10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED June 30, 2013

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM             TO             

Commission file number: 001-35187

The Active Network, Inc.

(Exact name of registrant as specified in its charter)

Delaware	33-0884962
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

10182 Telesis Court

San Diego, California 92121

(Address of Principal Executive Offices) (Zip Code)

(858) 964-3800

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  x    No  ¨

Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  ¨  Yes    x  No

As of July 30, 2013, the registrant had 62,363,680 shares of Common Stock ($0.001 par value) outstanding.

The Active Network, Inc.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)	3
Condensed Consolidated Balance Sheets as of June 30, 2013 and December 31, 2012	3
Condensed Consolidated Statements of Operations for the three and six months ended June  30, 2013 and 2012	4
Condensed Consolidated Statements of Comprehensive Loss for the three and six months ended June  30, 2013 and 2012	5
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2013 and 2012	6
Notes to Condensed Consolidated Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3. Quantitative and Qualitative Disclosures About Market Risk	30
Item 4. Controls and Procedures	31
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	31
Item 1A. Risk Factors	32
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	50
Item 3. Defaults Upon Senior Securities	51
Item 4. Mine Safety Disclosures	51
Item 5. Other Information	51
Item 6. Exhibits	51
SIGNATURES	52

PART I. FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THE ACTIVE NETWORK, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

	June 30, 2013			December 31, 2012
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	108,135		$	58,493
Restricted cash		624			1,145
Registrations receivable		31,281			16,260
Accounts receivable, net		52,980			51,363
Inventories		4,588			4,809
Prepaid expenses and other current assets		11,151			8,922
Total current assets		208,759			140,992
Property and equipment, net		44,527			41,236
Software development costs, net		49,869			51,151
Goodwill		242,369			243,716
Intangible assets, net		51,607			62,806
Other long-term assets		2,536			2,569
Total assets	$	599,667		$	542,470
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	6,383		$	8,174
Registration fees payable		117,242			61,272
Accrued expenses		42,826			38,865
Deferred revenue		73,207			66,846
Capital lease obligations, current portion		2,319			2,774
Other current liabilities		3,719			4,373
Total current liabilities		245,696			182,304
Capital lease obligations, net of current portion		1,793			2,462
Other long-term liabilities		6,039			6,192
Deferred tax liability		20,707			19,065
Total liabilities		274,235			210,023
Commitments and contingencies (Note 13)
Stockholders’ equity:
Preferred stock, $0.001 par value—authorized, 100,000 shares; no shares issued and outstanding		—			—
Common stock, $0.001 par value—authorized, 1,000,000; issued, 64,037 and 60,670; outstanding, 62,262 and 60,894		62			62
Treasury stock (at cost, 1,776 shares)		(11,959	)		(11,959	)
Additional paid-in capital		667,936			653,694
Accumulated other comprehensive income		7,377			8,934
Accumulated deficit		(337,984	)		(318,284	)
Total stockholders’ equity		325,432			332,447
Total liabilities and stockholders’ equity	$	599,667		$	542,470

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

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THE ACTIVE NETWORK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Net Revenue:
Technology revenue	$	119,473		$	108,155		$	214,463		$	192,275
Marketing services revenue		12,887			13,409			23,908			23,727
Total net revenue		132,360			121,564			238,371			216,002
Cost of net revenue:
Cost of technology revenue		56,413			50,812			105,459			96,467
Cost of marketing services revenue		1,024			2,115			2,215			3,431
Total cost of net revenue		57,437			52,927			107,674			99,898
Gross profit		74,923			68,637			130,697			116,104
Operating expenses:
Sales and marketing		27,148			24,284			53,974			49,308
Research and development		21,496			21,121			42,672			42,330
General and administrative		25,031			16,903			41,539			33,447
Amortization of intangibles		3,986			5,596			8,440			11,288
Total operating expenses		77,661			67,904			146,625			136,373
(Loss) income from operations		(2,738	)		733			(15,928	)		(20,269	)
Interest income		16			25			31			50
Interest expense		(153	)		(90	)		(335	)		(241	)
Other income (expense), net		(470	)		(524	)		(1,023	)		877
(Loss) income before provision for income taxes		(3,345	)		144			(17,255	)		(19,583	)
Provision for income taxes		1,127			2,469			2,445			3,080
Net loss attributable to common stockholders	$	(4,472	)	$	(2,325	)	$	(19,700	)	$	(22,663	)
Net loss per share attributable to common stockholders:
Basic	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)
Diluted	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)
Weighted-average shares used to compute net loss per share attributable to common stockholders:
Basic		61,611			58,322			61,190			57,655
Diluted		61,611			58,322			61,190			57,655

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

4

THE ACTIVE NETWORK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Net loss	$	(4,472	)	$	(2,325	)	$	(19,700	)	$	(22,663	)
Other comprehensive loss:
Foreign currency translation		(1,004	)		(923	)		(1,557	)		(37	)
Total other comprehensive loss		(1,004	)		(923	)		(1,557	)		(37	)
Comprehensive loss	$	(5,476	)	$	(3,248	)	$	(21,257	)	$	(22,700	)

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

5

THE ACTIVE NETWORK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended June 30,
	2013			2012
Operating activities
Net loss	$	(19,700	)	$	(22,663	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization of property and equipment		20,026			15,863
Amortization of intangible assets		10,833			14,231
Stock-based compensation expense		13,452			7,331
Allowance for doubtful accounts, net of write-offs		(131	)		10
Deferred tax liability		1,689			1,799
Amortization of acquisition-related costs		(521	)		(600	)
Gain on contingent consideration		—			(1,123	)
Change in operating assets and liabilities, net of effect of acquisitions:
Restricted cash		521			627
Registrations receivable		(15,030	)		(7,809	)
Accounts receivable		(1,747	)		(6,699	)
Inventories		220			(2,311	)
Prepaid expenses and other assets		(2,221	)		(1,318	)
Accounts payable		(2,360	)		(2,199	)
Registration fees payable		55,978			39,944
Accrued expenses		7,029			390
Deferred revenue		6,675			13,105
Other liabilities		(95	)		(359	)
Net cash provided by operating activities		74,618			48,219
Investing activities
Purchases of property and equipment		(13,909	)		(9,343	)
Capitalized software development		(11,123	)		(10,996	)
Cash paid for acquisitions, net of cash acquired		—			(38,037	)
Net cash used in investing activities		(25,032	)		(58,376	)
Financing activities
Proceeds from issuance of common stock		1,663			6,850
Payments on capital lease obligations		(1,124	)		(2,737	)
Payments of employee tax withholdings from equity transactions		(1,059	)		—
Proceeds from long-term debt		—			10,000
Repayment of long-term debt		—			(5,000	)
Net cash provided by (used in) financing activities		(520	)		9,113
Effect of exchange rates on cash		576			151
Net increase (decrease) in cash and cash equivalents		49,642			(893	)
Cash and cash equivalents at beginning of period		58,493			108,699
Cash and cash equivalents at end of period	$	108,135		$	107,806
Supplemental disclosures of cash flow information
Cash paid during the period for interest	$	277		$	155
Cash paid during the period for taxes	$	477		$	149
Supplemental disclosures of noncash financing and investing activities
Fixed asset purchases included in accounts payable	$	2,362		$	1,469

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

6

The Active Network, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Business

The Active Network, Inc., a Delaware corporation, and its subsidiaries (“Active” or the “Company”), provide cloud computing applications for Activity and Participant Management™ that form an online network connecting a fragmented and diverse group of activity and event organizers with a large base of potential participants. The Company’s technology platform transforms the way organizers manage their activities and events by automating online registrations and streamlining other critical management functions, while driving consumer participation to their activities and events.

2. Basis of Presentation and Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Active and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared by the Company, and reflect all adjustments, consisting only of normal recurring adjustments, that are, in the opinion of management, necessary for the fair presentation of the Company’s financial position, results of operations, comprehensive loss and cash flows for the interim periods presented. The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these statements do not include all information and footnotes required by GAAP for annual consolidated financial statements, and should be read in conjunction with our audited consolidated financial statements as of and for the fiscal year ended December 31, 2012 contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2013. The results of operations for the three and six months ended June 30, 2013 are not necessarily indicative of the operating results to be expected for the full fiscal year or future operating periods.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

3. Recent Accounting Pronouncements

In February 2013, the FASB issued an update to the reporting of reclassifications out of accumulated other comprehensive income. The guidance requires an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income (loss) if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income (loss). For other amounts that are not required under GAAP to be reclassified in their entirety from accumulated other comprehensive income to net income (loss) in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP that provide additional detail about those amounts. This accounting standard became effective for the Company beginning in the first quarter of fiscal 2013, and its adoption did not have an impact on the Company’s consolidated financial statements.

4. Business Combination

Acquisition of StarCite, Inc.

On December 30, 2011, the Company completed its acquisition of all of the outstanding shares of StarCite, Inc. (“StarCite”), a provider of a technology platform that delivers content and services for meetings and event planning to corporations, hotels, venues and meetings suppliers for total consideration of $57.4 million. The acquisition enables the Company to provide an integrated solution for the events space and broaden its customer base.

Total consideration comprised $38.1 million in cash, 1,350,000 shares of common stock with a fair value of approximately $18.4 million and 150,000 shares of contingently issuable common stock with an acquisition date fair value of approximately $1.1 million to be issued in the event that the Company’s shares of common stock did not close trading at or above $15.00 per share for at least three consecutive days at any time during the sixty day period following the effective date of a registration statement filed to register the shares issued, pursuant to the agreement and plan of merger.

7

The Company’s common stock traded at or above $15.00 per share for three consecutive days subsequent to April 11, 2012, the effective registration date of the shares; accordingly the contingently issuable shares were not issuable to the former StarCite security holders. Immediately prior to the effective date of the registration statement, the estimated fair value of the contingent consideration was approximately $38,000. The change in the estimated fair value of the contingent consideration was recorded in other income in the Company’s condensed consolidated statements of operations and the remaining fair value was transferred from other current liabilities to equity.

The acquisition agreement included an initial escrow of approximately $0.3 million in cash to cover potential expenses of the security holders’ agent and 300,000 common shares valued at approximately $4.1 million, based on the closing price of the Company’s common stock on the last trading day of fiscal 2011 to satisfy any claims under the indemnification provisions of the agreement for a period of 12 months following the acquisition date. During the year ended December 31, 2012, 20,320 escrow shares valued at approximately $0.3 million were cancelled in order to satisfy indemnification claims related to the acquisition, 34,197 escrow shares valued at $0.5 million were set aside by the Company as a share reserve to satisfy unresolved indemnification claims related to the acquisition and 245,483 shares were issued and released from escrow. The cancellation of the shares was recorded as a purchase price adjustment with a corresponding reduction to goodwill, as the estimated fair value of assets acquired and liabilities assumed was preliminary.

The estimated fair values of assets acquired and liabilities assumed for the StarCite acquisition, are as follows (in thousands):

Cash	$	572
Restricted cash		692
Accounts receivable		14,566
Prepaid and other assets		1,301
Fixed assets		1,912
Goodwill		21,690
Intangible assets		36,500
Accounts payable		(1,398	)
Accrued expenses		(5,459	)
Deferred revenue		(11,286	)
Capital lease obligations		(480	)
Other liabilities		(528	)
Unfavorable leases		(695	)
Total purchase price	$	57,387

The acquisition was accounted for as a purchase business combination. The following table summarizes the identifiable intangible assets acquired as of the date of the acquisition (dollars in thousands):

	Gross Amount at Acquisition Date		Amortization Period
Trademarks	$	5,100		9 years
Customer relationships		17,300		9 years
Customer contracts		6,800		3 years
Complete technology		6,500		9 years
Non-compete agreements		800		1 year
Total intangible assets	$	36,500

Goodwill of $21.7 million, none of which is deductible for tax purposes, represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed from StarCite. The carrying amount of goodwill is allocated to the technology operating segment of the Company.

8

5. Fair Value Measurements

FASB guidance for fair value measurements clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the guidance establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

The Company’s financial assets and liabilities that are measured at fair value on a recurring basis were insignificant at June 30, 2013 and December 31, 2012.

The Company did not have any transfers in or out of Level 1 or Level 2 during the six months ended June 30, 2013.

6. Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable, net, by category is as follows (in thousands):

	June, 30 2013			December 31, 2012
Accounts receivable	$	54,101		$	52,353
Less: Allowance for doubtful accounts		(1,121	)		(990	)
Accounts receivable, net	$	52,980		$	51,363

Allowances for doubtful accounts are established based on various factors including individual accounts receivable over a specific aging, historical payments, and current economic trends. The Company reviews its allowances by assessing individual accounts receivable over a specific aging and amount, and all other balances on a pooled basis based on historical collection experience. Accounts receivable are written off on a case-by-case basis, net of any amounts that may be collected.

7. Property and Equipment

Property and equipment by category is as follows (in thousands):

	June 30, 2013			December 31, 2012
Computer and software	$	90,931		$	80,521
Furniture and fixtures		10,570			10,307
Leasehold improvements		7,174			6,485
Property and equipment		108,675			97,313
Less: Accumulated depreciation		(64,148	)		(56,077	)
Property and equipment, net	$	44,527		$	41,236

Depreciation expense was $4.1 million and $3.9 million for the three months ended June 30, 2013 and 2012, respectively, and $8.2 million and $7.7 million for the six months ended June 30, 2013 and 2012, respectively.

Included in fixed assets are $14.5 million of equipment under capital leases at June 30, 2013 and December 31, 2012. Accumulated amortization of assets under capital leases totaled $9.1 million and $7.9 million at June 30, 2013 and December 31, 2012, respectively.

9

8. Software Development Costs

Capitalized software development costs are as follows (in thousands):

	June 30, 2013			December 31, 2012
Software development costs	$	99,437		$	89,221
Less: Accumulated amortization		(49,568	)		(38,070	)
Software development costs, net	$	49,869		$	51,151

Amortization expense was $6.1 million and $4.2 million for the three months ended June 30, 2013 and 2012, respectively, and $11.8 million and $8.2 million for the six months ended June 30, 2013 and 2012, respectively.

9. Goodwill

The change in the carrying amount of goodwill for the six months ended June 30, 2013 is as follows (in thousands):

	Technology			Marketing Services		Total
Balance at December 31, 2012	$	230,998		$	12,718	$	243,716
Effect of exchange rate changes		(1,347	)		—		(1,347	)
Balance at June 30, 2013	$	229,651		$	12,718	$	242,369

10. Intangible Assets

Intangible assets are amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the assets.

Certain of the Company’s intangible assets were recorded in foreign currencies and both the gross carrying amounts and accumulated amortization are subject to foreign exchange adjustments. The carrying values of amortized intangible assets are as follows (in thousands):

	June 30, 2013							December 31, 2012
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intellectual property	$	24,089	$	(15,873	)	$	8,216	$	24,800	$	(14,124	)	$	10,676
Non-compete agreements		2,098		(1,182	)		916		2,098		(832	)		1,266
Customer relationships		44,132		(14,468	)		29,664		44,132		(11,256	)		32,876
Trade names		13,042		(4,832	)		8,210		13,385		(4,113	)		9,272
Customer contracts		27,566		(22,965	)		4,601		46,888		(38,172	)		8,716
Intangible assets	$	110,927	$	(59,320	)	$	51,607	$	131,303	$	(68,497	)	$	62,806

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Amortization of intellectual property is recorded in cost of revenue, while the amortization of other acquired intangible assets is included in operating expenses. The following table summarizes the classification of amortization expense of acquired intangible assets for the periods indicated (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Cost of technology revenue	$	1,177	$	1,363	$	2,364	$	2,711
Cost of marketing services revenue		15		115		29		232
Operating expenses		3,986		5,596		8,440		11,288
Total amortization of acquired intangible assets	$	5,178	$	7,074	$	10,833	$	14,231

11. Accrued Expenses

The following table presents the detail of accrued expenses for the periods presented (in thousands):

	June 30, 2013		December 31, 2012
Accrued compensation	$	17,390	$	14,569
Sales and other foreign taxes		7,053		6,065
Accrued rebates		5,267		4,234
Other accrued expenses		13,116		13,997
Accrued expenses	$	42,826	$	38,865

12. Long-Term Debt

In December 2011, the Company entered into a five-year, senior secured revolving credit facility, with certain institutional lenders, for an initial aggregate principal amount of $50 million (the “Credit Facility”). The Company has the ability to issue up to $15 million for letters of credit and $5 million for swing line loans under the Credit Facility. The Credit Facility also includes an “accordion” feature which allows the Company, subject to certain terms and conditions, to increase the lending commitments by up to $25 million. The Credit Facility has a maturity date of December 16, 2016, but the outstanding amounts may be prepaid at any time without penalty or premium (except for certain customary break funding payments in connection with LIBOR loans) and is available to fund acquisitions and ongoing operations.

In July 2012, the Company amended the Credit Facility by increasing the aggregate principal amount to $100 million, increasing the ability to issue letters of credit up to $25 million and increasing the “accordion” feature up to $50 million.

Any advance under the Credit Facility will accrue interest at rates per annum that are equal to, based on certain conditions, either (a) 1.5% above the applicable LIBOR rate, or (b) 0.5% above (i) the greatest of (x) the prime rate, (y) the federal funds effective rate plus 0.5% or (z) a daily rate equal to one-month LIBOR plus 1.00%. The unused portion of the Credit Facility will also be subject to an unused fee that will be calculated at a per annum rate of 0.25%. The interest rate under the Credit Facility was 1.77% and 1.81% as of June 30, 2013 and December 31, 2012, respectively.

Under the Credit Facility, the Company is required to comply with certain financial covenants and ratios, including a quarterly consolidated leverage ratio of consolidated funded indebtedness to EBITDA of not more than 2.5 to 1.0 and a quarterly consolidated fixed charge coverage ratio of not less than 1.5 to 1.0. Substantially all of the Company’s tangible and intangible assets are considered collateral security under the secured Credit Facility. As of June 30, 2013 and December 31, 2012, the Company was in compliance with all specified financial covenants and ratios.

The Company had no amount outstanding under the Credit Facility as of June 30, 2013 and December 31, 2012. Amounts available under the Credit Facility were $94.9 million and $93.9 million as of June 30, 2013 and December 31, 2012, respectively, net of $5.1 million and $6.1 million in outstanding letters of credit, respectively.

13. Commitments and Contingencies

Operating Leases

The Company leases its office and datacenter facilities under non-cancelable leases that expire at various times through 2021. The Company is also responsible for certain real estate taxes, utilities and maintenance costs on its office facilities. Rent expense was approximately $3.5 million and $3.6 million for the three months ended June 30, 2013 and 2012, respectively, and $7.1 million and $7.0 million for the six months ended June 30, 2013 and 2012, respectively.

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Guarantees

The Company enters into arrangements with third-party customers to guarantee performance by the Company. The Company may provide a corporate guarantee, irrevocable letter of credit, surety bond or any other form of guarantee acceptable to the third-party customer. As of June 30, 2013 and December 31, 2012, the Company had guarantees of $5.4 million and $7.2 million, respectively.

Self-Insured Health Plan

The Company is generally self-insured for losses and liabilities related to health benefits. The Company’s self-insurance accruals are based on estimates, and while the Company believes that the amounts accrued are adequate, the ultimate claims may be in excess of the amounts provided. The Company’s accrued health benefits liability was $1.4 million and $1.2 million at June 30, 2013 and December 31, 2012, respectively.

Sales and Use Tax

In the normal course of business, the Company is subject to sales and use tax audits in certain states. As a result, the Company records a liability for sales and use taxes and evaluates the adequacy of such amounts each reporting period. At June 30, 2013 and December 31, 2012, the Company maintained a liability for sales and use taxes of approximately $5.5 million and $5.1 million, respectively.

In June 2013, the Company was notified by the Texas Comptroller of Public Accounts that it had concluded its sales and use tax audit for the periods of April 1, 2009 through June 30, 2012. Based on the results of their audit, the Company reduced its sales and use tax liability by approximately $599,000, which the Company recorded as a reduction to its operating expenses on its condensed consolidated financial statements during the quarter ended June 30, 2013.

Indemnification

The Company enters into indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to its technology. The term of these indemnification agreements is generally perpetual any time after the execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements.

The Company indemnifies its officers and directors under the terms of indemnity agreements entered into with them, as well as pursuant to the Company’s certificate of incorporation, bylaws and applicable Delaware law.

Penalty Accruals

The Company maintains a liability of $1.3 million and $1.5 million at June 30, 2013 and December 31, 2012, respectively, as a result of the potential exposure for penalties from its customers for various technical disruptions. The Company estimates the penalty accrual based on specific identification and the Company’s historical experience.

Separation Arrangements

On May 1, 2013, Matthew Landa resigned from his position as Chief Executive Officer of the Company effective April 30, 2013.

On May 1, 2013, David Alberga resigned from his position as Executive Chairman of the Company and Chairman of the Board of Directors of the Company effective April 30, 2013. Mr. Alberga will remain a member of the Board of Directors through the Company’s Annual Meeting of Stockholders in 2014.

In connection with their separations, Mr. Landa and Mr. Alberga are entitled to certain termination benefits including severance payments equal to twelve months of their base salaries, prorated annual target bonus payments, health coverage for twelve months from the date of termination, acceleration of certain unvested stock-based awards and an extension to exercise vested stock-based awards. The Company recorded severance charges of approximately $7.2 million during the quarter ended June 30, 2013. The Company will record an additional $665,000 of stock-based compensation expense for Mr. Alberga over his remaining one-year term as a member of the Company’s Board of Directors.

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14. Legal Proceedings

From time to time, the Company is involved in disputes, litigation and other legal actions. The Company records a charge equal to at least the minimum estimated liability for a loss contingency only when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements, and (ii) the range of loss can be reasonably estimated. The actual liability in any such matters may be materially different from the Company’s estimates, which could result in the need to adjust the liability and record additional expenses. The Company is not aware of any pending or threatened litigation that is reasonably likely to have a material adverse effect on our results of operations, financial position or liquidity.

Monster Litigation

On December 16, 2011, Monster Worldwide, Inc. (“Monster”) filed a complaint in the United States District Court for the Southern District of New York against a former Monster employee and current Active executive (the “Active Executive”). The complaint asserted various claims contending that the Active Executive violated the non-solicitation terms in certain of the Active Executive’s agreements with Monster by soliciting and hiring two former technology employees of Monster who are current employees of the Company.

On February 7, 2012, Monster filed an amended complaint to add additional allegations, and on June 7, 2012, Monster filed a second amended complaint to add allegations and claims against (1) Active; and (2) a second former Monster employee and current Active employee. The claims against this employee were similar to the claims alleged in the original complaint against the Active Executive and arose from alleged violations of this second employee’s non-solicitation agreement with Monster claiming the second employee solicited for hire a third former employee of Monster that is a current employee of the Company. The Company was added as a defendant to the complaint resulting from allegations by Monster that it interfered with the non-solicitation agreements by hiring the three former employees of Monster. Additionally, the second amended complaint included a new claim for breach of fiduciary duty against the Active Executive.

On February 27, 2013, the parties entered into a settlement and general release agreement, releasing all claims against Active and its employees in exchange for a cash settlement of $1.0 million. The Company’s insurer paid $0.8 million of the total settlement. As a result, the Company recorded the net settlement expense of $0.2 million in general and administrative expenses.

15. Stock-Based Compensation

The Company’s stock-based compensation is comprised of stock options, stock options with market conditions (“Market Stock Options”), restricted stock units with service conditions (“RSUs”), restricted stock units with market conditions (“MSUs”), and performance-based restricted stock units (“PRSUs”) which are issued under our 2002 and/or 2011 equity incentive plan, as well as common stock issued under the Employee Stock Purchase Plan (“ESPP”).

Stock Options and Market Stock Options

Stock option activity for the six months ended June 30, 2013 is as follows:

Stock Options	Number of Shares Underlying Options			Weighted-Average Exercise Price
Outstanding at December 31, 2012		8,369,021		$	5.78
Granted		100,000			5.03
Exercised		(423,113	)		2.36
Cancelled or expired		(714,748	)		10.91
Outstanding at June 30, 2013		7,331,160		$	5.47

On April 30, 2013, the Company granted 100,000 stock options to its interim chief executive officer which vest over eight months.

The fair value of stock options granted that contain only a service condition as a requirement for vesting, was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Volatility		58.0	%		52.6-52.8	%		58	%		51.8-52.8	%
Expected dividend yield		—			—			—			—
Risk-free rate		0.1	%		0.7-0.8	%		0.1	%		0.7-1.1	%
Expected term (in years)		0.7			5.0			0.7			5.0

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The fair value of Market Stock Options was estimated on the date of grant using the Monte Carlo Simulation valuation model, which estimates the potential outcome of reaching the market condition based on simulated future stock prices, with the following assumptions: contractual life of six years; expected volatility of 47% and risk free interest rate of 0.74%. These options vest over four years and are exercisable if specified stock prices are achieved. 513,208 Market Stock Options remain issued and outstanding at June 30, 2013.

Total unrecognized compensation cost, adjusted for estimated forfeitures, related to non-vested stock options and market stock options is approximately $7.6 million as of June 30, 2013 and is expected to be recognized over a weighted-average period of 2 years.

Restricted Stock Units

RSU and PRSU activity for the six months ended June 30, 2013 is as follows:

RSUs and PRSUs	Number of RSUs			Weighted- Average Grant Date Fair Value of RSUs		Number of PRSUs			Weighted- Average Grant Date Fair Value of PRSUs
Unvested at December 31, 2012		1,786,301		$	13.97		742,882		$	12.14
Granted		1,823,016			6.22		—			—
Released		(432,591	)		15.62		(69,642	)		13.06
Cancelled or expired		(190,883	)		12.95		(257,376	)		11.32
Unvested at June 30, 2013		2,985,843		$	9.35		415,864			12.49

The fair value of RSUs and PRSUs is based on the stock price on the date of grant. The RSUs vest over a four year period following the date of grant. The PRSUs vest over a two to four year period following the date of grant, subject to achievement of performance objectives and the participant’s continued service through the applicable vesting dates.

The number of PRSUs granted in the table above represents the maximum number of awards that could ultimately be issued if certain Company financial targets, as defined under the agreements, are achieved. The shares, if any, will be issued on a one-for-one basis following the end of the applicable performance and service periods. 232,510 PRSUs can be settled in cash or shares at the election of the Company. Compensation cost associated with the PRSUs is recognized when the performance metrics are determined to be probable of achievement over the requisite service periods.

At June 30, 2013, the remaining unrecognized compensation expense, adjusted for estimated forfeitures, related to RSUs is $24.3 million and is expected to be recognized over a weighted-average period of 3 years. The remaining unrecognized compensation expense associated with the maximum number of PRSUs that could ultimately be issued of $4.6 million will be recognized if and when the Company concludes that it is probable that the performance condition will be achieved, net of an estimate of pre-vesting forfeitures, over the requisite service period. The Company will reassess the probability of vesting at each reporting period for awards with performance conditions and adjust its stock-based compensation expense based on its probability assessment.

Market Stock Units

MSU activity for the six months ended June 30, 2013 is as follows:

MSUs	Number of MSUs			Weighted- Average Grant Date Fair Value of MSUs
Unvested at December 31, 2012		—		$	—
Granted		931,574			6.22
Released		—			—
Cancelled or expired		(50,000	)		5.60
Unvested at June 30, 2013		881,574		$	6.25

The fair value of MSUs is measured using the Monte Carlo simulation model which estimates the potential outcome of reaching the market condition based on simulated future stock prices and is recognized over the requisite service period. The MSUs vest over a one to four year period following the date of grant, subject to the achievement of certain market performance objectives and the participant’s continued service through the applicable vesting dates.

At June 30, 2013, the remaining unrecognized compensation cost, adjusted for estimated forfeitures, related to MSUs is $6.5 million and is expected to be recognized over a weighted-average period of 1.8 years.

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Employee Stock Purchase Plan

The Company issued 158,292 shares for approximately $0.7 million in employee contributions during the three and six months ended June 30, 2013 under the Company’s 2011 Employee Stock Purchase Plan (“2011 ESPP”).

The fair value of each purchase option under the 2011 ESPP is estimated at the beginning of each six-month offering period using the Black-Scholes model with the following weighted-average assumptions:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Volatility		43.1-55.1	%		44.5-57.9	%		43.1-55.1	%		44.5-57.9	%
Expected dividend yield		—			—			—			—
Risk-free rate		0.1	%		0.1	%		0.1	%		0.2	%
Expected term (in years)		0.5			0.5			0.5			0.5

As of June 30, 2012, total unrecognized compensation cost related to non-vested stock-based compensation arrangements granted under the 2011 ESPP was $0.2 million, which is expected to be recognized over a weighted-average period of six months. As of December 31, 2012, 244,947 shares were issued with a weighted average fair value of $7.80.

Stock-Based Compensation Expense

The following table presents the effects of stock-based compensation expense related to stock-based awards to employees in the Company’s condensed consolidated statements of operations during the periods presented (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Cost of revenue	$	118	$	192	$	283	$	252
Sales and marketing		841		1,006		1,591		1,702
Research and development		410		668		1,009		1,120
General and administrative		8,157		2,436		10,569		4,257
Total stock-based compensation	$	9,526	$	4,302	$	13,452	$	7,331

The components of stock-based compensation expense were as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Stock options	$	3,387	$	1,837	$	4,856	$	4,005
Restricted stock		1,963		2,179		4,221		2,834
Common stock		2,797		—		2,797		—
MSUs		323		—		441		—
PRSUs		953		87		931		123
ESPP		103		199		206		369
Total stock-based compensation	$	9,526	$	4,302	$	13,452	$	7,331

Stock-based compensation expense for the three and six months ended June 30, 2013 included $5.7 million related to separation payments for the acceleration of non-vested equity awards and the grant of 456,297 shares of the Company’s common stock, due to the departures of the Company’s former chief executive officer and executive chairman on April 30, 2013. (see note 13)

16. Net Loss Attributable to Common Stockholders

Basic net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. Under the two-class method, basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period.

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The following tables present the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except per share data):

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Net loss per share:
Net loss attributable to common stockholders	$	(4,472	)	$	(2,325	)	$	(19,700	)	$	(22,663	)
Weighted-average common shares outstanding:
Basic		61,611			58,322			61,190			57,655
Diluted		61,611			58,322			61,190			57,655
Net loss per share attributable to common stockholders:
Basic	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)
Diluted	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)

Potentially dilutive securities not included in the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Options to purchase common stock and common stock subject to repurchase		7,203,438		10,126,396		7,409,418		10,646,606
Restricted stock		2,152,848		1,603,734		2,133,019		1,167,338
Employee stock purchase plan shares		146,220		94,525		156,683		84,694
Market Stock Units		539,679		—		422,963		—
Common stock warrants		—		634		—		634
		10,042,185		11,825,289		10,122,083		11,899,272

17. Segment Information

The Company’s Chief Executive Officer who is considered to be the chief operating decision maker (“CODM”) reviews financial information presented on a consolidated basis, accompanied by information about operating segments for purposes of making operating decisions and assessing financial performance. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the CODM in deciding how to allocate resources and in assessing performance.

The Company determined its operating segments to be technology and marketing services. Technology derives substantially all of its revenue from technology fees, software licensing, installation, training, maintenance, and hosting subscriptions. Marketing services derives substantially all of its revenue from online services, field marketing services, and membership programs.

The Company evaluates the performance of its operating segments based on net revenues and operating income before interest, taxes, depreciation, amortization and stock-based compensation expense.

The Company does not allocate most of its assets, depreciation and amortization expense, stock-based compensation expense, interest income, interest expense or income tax expense by segment. Accordingly, the Company does not report such information.

Summarized information by segment is as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Net revenue by segment:
Technology	$	119,473	$	108,155	$	214,463	$	192,275
Marketing services		12,887		13,409		23,908		23,727
Total net revenue	$	132,360	$	121,564	$	238,371	$	216,002

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	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs:
Technology	$	33,044		$	25,956		$	49,355		$	32,008
Marketing services		3,532			4,493			4,941			6,802
Total segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs		36,576			30,449			54,296			38,810
Depreciation and amortization		(15,460	)		(15,118	)		(30,859	)		(30,094	)
Stock-based compensation expense		(9,526	)		(4,302	)		(13,452	)		(7,331	)
Unallocated corporate costs		(14,328	)		(10,296	)		(25,913	)		(21,654	)
(Loss) income from operations	$	(2,738	)	$	733		$	(15,928	)	$	(20,269	)

The Company allocates its net revenue to geographic regions based on the location at which each sale originates. The following tables set forth net revenue and long-lived assets by major geographic region (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Net revenue:
North America	$	128,930	$	118,762	$	231,695	$	209,984
Europe and other		3,430		2,802		6,676		6,018
Total net revenue	$	132,360	$	121,564	$	238,371	$	216,002

	June 30, 2013		December 31, 2012
Assets:
North America	$	593,015	$	537,220
Europe and other		6,652		5,250
Total assets	$	599,667	$	542,470
Property and equipment, net:
North America	$	41,819	$	39,460
Europe and other		2,708		1,776
Total property and equipment, net	$	44,527	$	41,236

18. Income Taxes

The effective tax rate of (14.2)% for the six months ended June 30, 2013 differs from the statutory rate primarily due to state taxes, foreign taxes, the increase in the deferred tax liability from the amortization of tax deductible goodwill, the increase in the valuation allowance and discrete items recorded in the period.

The Company has uncertain tax positions of $1.3 million as of June 30, 2013 and December 31, 2012, respectively. The Company’s policy for recording interest and penalties on uncertain tax positions is to record such items as a component of income tax expense. Accrued interest and penalties of $0 million and $0.9 million were recorded at June 30, 2013 and December 31, 2012, respectively.

The Company reduces its deferred tax asset resulting from future tax benefits by a valuation allowance if, based on the weight of the available evidence, it is more likely than not that some portion or all of these deferred taxes will not be realized. The timing of the reversal of deferred tax liabilities associated with tax deductible goodwill is not certain and thus not available to assure the

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realization of deferred tax assets. Similarly, state deferred tax liabilities in excess of state deferred tax assets are not available to ensure the realization of federal deferred tax assets. After consideration of these limitations associated with deferred tax liabilities, the Company has deferred tax assets in excess of deferred tax liabilities for the periods presented. As the Company has no history of generating book income, the ultimate future realization of these excess deferred tax assets is not more likely than not and thus subject to a valuation allowance. Accordingly, the Company has established a valuation allowance against its domestic deferred tax assets. A valuation allowance has not been recorded against the Company’s foreign deferred tax assets as there are sufficient future taxable temporary differences in foreign jurisdictions to assure the realization of foreign deferred tax assets. Deferred tax assets of $0.7 million are included in prepaid expenses and other current assets on the balance sheet at June 30, 2013 and December 31, 2012.

The Company conducts business globally, and as a result, is subject to taxation in the United States and various state jurisdictions and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities in many of the jurisdictions in which the Company operates. Effectively, all of the Company’s historical tax filings are subject to examination by the Internal Revenue Service and various state and foreign jurisdictions due to the generation of net operating loss carry forwards.

It is possible that new tax exams may commence and that other issues may be effectively settled. However, the Company is unable to make a reasonably reliable estimate as to when or if cash settlements with taxing authorities may occur. Although audit outcomes and the timing of potential audit payments are subject to uncertainty, the Company does not anticipate that the resolution of these tax matters or any events related thereto will result in a material adverse change to its consolidated financial position, results of operations or cash flows.

19. Related Party Transactions

ESPN Online Investments, Inc. (“ESPN”) is a significant common stockholder in the Company. The Company also sells its services to ESPN and its affiliates. The Company recorded net revenues from ESPN and its affiliates of less than $0.1 million for the three months ended June 30, 2013 and 2012, and less than $0.1 million for the six months ended June 30, 2013 and 2012.

ESPN is a wholly-owned subsidiary of The Walt Disney Company (“Disney”). The Company entered into an online services agreement with Disney to provide registration and advertising. The Company recorded net revenues from Disney of $0.8 million and $0.7 million for the three months ended June 30, 2013 and 2012, respectively, and $1.2 million and $0.9 million for the six months ended June 30, 2013 and 2012, respectively.

In August 2006, the Company entered into a Master Services Agreement and certain other related agreements with the United States Tennis Association (“USTA”) as amended in December 2010. Former members of the Company’s Board of Directors are the managing director for recreational tennis and chief financial officer at the USTA. Pursuant to the terms of these agreements, the USTA purchases certain software services from the Company. Net revenue from the USTA and its affiliates was approximately $1.4 million and $1.3 million for the three months ended June 30, 2013 and 2012, respectively, and $2.8 million and $2.7 million for the six months ended June 30, 2013 and 2012, respectively.

20. Employee Benefit Plans

Defined Contribution Plan

The Company has a defined contribution plan under Section 401(k) of the Internal Revenue Code (“401(k) Plan”) covering all full-time employees who meet certain eligibility requirements. Eligible employees may defer up to 4% of their pre-tax compensation, up to the annual maximum allowed by the Internal Revenue Service. Under the 401(k) Plan, the Company may, but is not obligated to, match a portion of the employee contributions up to a defined maximum. The Company made matching contributions $0.3 million and $0.2 million for the three months ended June 30, 2013 and 2012, respectively, and $0.6 million and $0.5 million for the six months ended June 30, 2013 and 2012, respectively.

Deferred Compensation Plan

In July 2012, the Company approved an unfunded, non-qualified Deferred Compensation Plan for certain employees. Under the Deferred Compensation Plan, participants may elect to defer up to 80% of their base salaries and up to 100% of performance-based compensation and commissions. The Company may also, at its discretion, match a portion of the employee contributions up to a defined maximum for each deferral election as prescribed in the Deferred Compensation Plan. The Company contributions vest annually over a four year period, subject to the employee’s continued service with the Company. The Company’s liability for the deferred compensation plan totaled less than $0.1 million as of June 30, 2013 and December 31, 2012, respectively, and is included in other liabilities in the consolidated balance sheets. Beginning in the first quarter of 2013, participant contributions are invested in Company-owned life insurance policies, which had a cash surrender value of less than $0.1 million and is included in prepaids and other current assets in the consolidated balance sheet at June 30, 2013.

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21. Subsequent Event

On August 1, 2013, the Company announced that Kory Vossoughi resigned from his position as Chief Legal Officer, General Counsel and Secretary of the Company on July 29, 2013. In connection with his resignation, Mr. Vossoughi is entitled to certain payments and benefits including a severance payment equal to twelve months of his base salary, prorated annual target bonus payment, health coverage for twelve months from the date of separation, acceleration of certain unvested stock-based awards and an extension to exercise vested stock-based awards.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and in our other public filings with the Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

This Quarterly Report on Form 10-Q contains “forward-looking statements” that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. The statements contained in this Quarterly Report on Form 10-Q that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are often identified by the use of words such as, but not limited to, “anticipate,” “believe,” “can,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “will,” “plan,” “project,” “seek,” “should,” “target,” “will,” “would,” and similar expressions or variations intended to identify forward-looking statements. These statements are based on the beliefs and assumptions of our management based on information currently available to management. Such forward-looking statements are subject to risks, uncertainties and other important factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified in “Part II — Item 1A. Risk Factors” below, and those discussed in our other public filings with the SEC. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

Overview

We are leaders in cloud-based Activity and Participant Management™ solutions serving a wide range of customer groups including business solutions, community activities, public sector and outdoors and sports. We provide applications that form an online network connecting a fragmented and diverse group of activity and event organizers with a large base of potential participants. Our proprietary technology platform transforms the way organizers manage their activities and events by automating online registrations and streamlining other critical management functions, while also driving consumer participation to their events.

We power a broad range of activities, such as reserving a campsite or tee time, signing up for a marathon or sports league, purchasing a fishing or hunting license, or participating in a community event or corporate conference. From the introduction of our platform in 1999, we have experienced significant growth and in 2012, we had over 55,000 customer organizations that drove approximately 89.9 million annual consumer registrations. Based on the results of a 2010 online survey we commissioned through Survey.com, we believe the organizations we target produce or organize activities and events for the majority of U.S. households. Our proprietary technology platform, ActiveWorks, provides cloud computing applications that reduce the cost and complexity of managing, organizing and promoting these activities and events.

Our business benefits from a powerful network effect. As more organizations use our platform, we increase the breadth and depth of activities and events offered through our platform. This more comprehensive offering of activities attracts more participants. As we attract more participants, we are able to drive increased demand for our customers’ activities, thus increasing registrations and revenue for both organizers and us. This revenue growth enables us to develop enhanced functionality and services through ActiveWorks and our websites, further increasing participant engagement and attracting new organizers. In this way, we build increasing value for both organizations and participants.

We serve a wide range of customers including community and sports organizations, large corporations, small and medium-sized businesses, educational institutions, federal and state government agencies, non-profit organizations and other similar entities. We primarily generate revenue from technology fees paid by participants who register for our customers’ activities through our cloud computing applications. During the six months ended June 30, 2013, we generated revenue of $238.4 million, as compared to $216.0 million in the six months ended June 30, 2012, an increase of 10%.

A large number of our customers are currently being served by our ActiveWorks architecture at varying levels of integration. We are in the process of transitioning to ActiveWorks certain customers who continue to use both our internally developed systems and acquired legacy systems. In addition, part of our growth strategy has included acquisitions, which resulted in the acquisition of additional legacy systems. In the future, we will evaluate acquired systems to determine, based on their sophistication and compatibility, whether to integrate them into ActiveWorks or to migrate the customers using these systems to ActiveWorks. This process is time consuming and requires the investment of significant technical and human resources. During this process, we expect to continue to incur costs associated with maintaining multiple legacy systems.

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In addition, our long-term strategic plan involves expanding our applications into new business areas within the activity and event registration and management market. A lack of market acceptance of such efforts or our inability to generate satisfactory revenue to offset the development costs could have a material adverse effect on our results of operations and future growth prospects. As we establish and expand our operational capabilities internationally, we will incur additional operating expenses and capital-related costs.

Technology Revenue. Our technology revenue was 90% of our total revenue for the six months ended June 30, 2013. Of our technology revenue recognized during the six months ended June 30, 2013, 76% related to registration revenue and 24% related to licensed software, maintenance, hosting, and implementation revenue. During the six months ended June 30, 2013, we processed 47.9 million consumer registrations.

Our technology fee is a percentage of the total registration amount that is paid by a participant at the time the participant registers. Participants typically use a credit card to register for an activity either online or offline, and in the case of some of our large contracts, by using a call center. Upon registration, the consumer is charged for the total event registration fee, including the technology fee, and the funds are remitted to bank accounts that we control. We record revenue for our technology fee and we remit the remaining funds to the organizer. The organizer has the option of absorbing our technology fee and presenting a total event registration fee to the participant, or adding the technology fee as a separate line item in the event registration fee. Pricing for our cloud offerings is based on a portion of the total dollars processed for a registration and typically has a fixed and variable component. A number of our offerings also include a fee for setup, support or hosting. Our technology platform serves the entire spectrum of organizations, from large to small. Our standard contract for our registration customers is three years. In some cases, we pre-purchase registrations and we retain the funds received upon registration. Approximately 2% of our total revenue represents pre-purchased registrations and the technology revenue associated with these registrations represents the sales price to the participant, in addition to the technology fee. The technology fee and the revenue from pre-purchased registrations represent net registration revenue, since they are the direct result of participant registrations.

Licensed software, maintenance, hosting and implementation revenue was 24% of our technology revenue for the six months ended June 30, 2013. In previous acquisitions, we acquired licensed software products which include licensed software, maintenance and services. As the market has become more receptive, we have begun transitioning these customers to our solutions. We anticipate that our licensed software, maintenance and services revenue will continue to decline as a percentage of our overall business. In the future, we anticipate sales in our technology segment will be primarily driven by technology fees from our cloud offerings.

Marketing Services Revenue. Our marketing services revenue was 10% of our total revenue for the six months ended June 30, 2013. The marketing services segment works to provide the organizations within our technology segment and their participants with marketing solutions, online communities, membership programs and hosted websites. We group these sales as online services, field marketing and commerce. Online services include online advertising, email marketing and targeted newsletter promotions. We provide field marketing services including event promotions and sponsorships. Our commerce revenue consists of membership programs, training programs and websites. Contracts within our marketing services segment vary in length but are generally less than one year. We obtain customers through direct sales, inside sales and self-setup.

Seasonality. Our total revenue experiences seasonality with the three months ended June 30 and September 30 having the higher revenues. This seasonality is mainly due to trends in net registration revenue, as many of our largest customers experience peak business activity during the warmer months of the year.

Key Business Metrics

Net Registration Revenue. We calculate our net registration revenue by summing the technology fees generated by our registrations and revenue from the sale of pre-purchased registrations in a given period. Technology fees are generally recognized as revenue at the time a transaction is processed, and are typically a percentage of the total registration price paid by a participant. Revenue from the sale of pre-purchased registrations is comprised of the registration price paid by a participant and the technology fee and is recognized at the time the event is held.

Registrations. We define a registration as when a participant registers one or more people for an event being held by an organization who is using our technology to register that participant. We determine that a registration has taken place when a participant registers one or more people for an activity or an event being held by one of our customers.

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	Three Months Ended June 30,							Six Months Ended June 30,
	2013		2012		% Change			2013		2012		% Change
	(Unaudited) (In thousands)							(Unaudited) (In thousands)
Net registration revenue	$	92,266	$	83,854		10	%	$	162,811	$	147,373		10	%
Registrations		29,738		28,036		6	%		47,876		46,259		3	%
Net registration revenue per registration	$	3.10	$	2.99		4	%	$	3.40	$	3.19		7	%

(1) Includes revenue of $2.8 million and $1.7 million related to pre-purchased registration with associated technology fees of $0.2 million and $0.2 million during the three months ended June 30, 2013 and 2012, respectively, and revenues of $5.4 million and $2.2 million related to pre-purchased registration with associated technology fees of $0.5 million and $0.3 million during the six months ended June 30, 2013 and 2012, respectively.

Registrations increased 1.7 million, or 6%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and 1.6 million, or 3%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. The increases were primarily due to higher registrations from new parks and recreation customers of the community activities primary group and higher registrations in certain large multi-event organizations in our sports customer group. In our outdoors customer group, we had higher registrations in the three months ended June 30, 2013, which partially offset the lower registrations we had during the three months ended March 31, 2013 which was primarily due to shifts in weather patterns impacting the seasonality of registrations. The average revenue per registration increased 4% for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and 7% for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. The increase was mainly due to an increase in our business solutions customer group which has higher revenue per registration than the rest of our customer groups, and an increase in net registration revenue related to pre-purchased registrations in our sports customer group.

Mobile Devices. During the three and six months ended June 30, 2013 and 2012, we do not believe a significant number of our registrations were made on a mobile or tablet device. We anticipate that revenue attributable to mobile usage will increase in future years due to users increasingly accessing the Internet through mobile devices.

Basis of Presentation

General

The condensed consolidated financial statements include the accounts of The Active Network, Inc. and its wholly-owned subsidiaries. All intercompany balances have been eliminated.

Revenue

We report our revenue in two segments:

• Technology

• Marketing services

The technology revenue segment is comprised of net registration revenue, which is primarily comprised of the technology fee we charge a participant when they register for one of our organization’s events. The types of events we offer on our platform can be categorized into the following four primary groups: business solutions, community activities, public sector and outdoors, and sports. We generate technology revenue for our services based on the technology fee we charge a consumer when they register for one of the events. Consumers generally pay us the registration fee at the time of booking, and we pay the event organizer at a later date. The technology fee is recognized as revenue net of the organization registration fee which is collected directly from our consumer and then we make payment to the event organizer typically on a two week basis. Net registration revenue is recognized when services are provided, net of estimated refunds and other chargebacks. The timing difference between when the cash is collected from our consumers and when payments are made to the event organizers improves our operating cash flow and represents a source of liquidity for us. Technology revenue also includes software licensing, installation, training, maintenance, hosting subscriptions, and the sale of pre-purchased registrations. In certain circumstances we pre-purchase registrations from event organizers and bear the risk and rewards of ownership. Net registration revenue associated with these transactions is recognized when the event occurs and includes the total registration price paid by a customer and the technology fee.

The marketing services revenue segment includes online services, field marketing services and membership programs. Registrations lead participants to our network of websites and create opportunities for us to sell our online commerce and other marketing services to participants. Our network of websites enables like-minded consumers to engage in our online communities.

Costs and Expenses

Cost of Revenue. Our cost of revenue consists of credit card processing fees for registrations, payroll and related costs including allocated facilities costs, stock-based compensation for employees associated with registration, subscription or software

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implementation, customer support and onsite event support including travel costs. Costs also include expenses related to our call center operations, amortization of capitalized software development costs and certain acquired intangibles including acquired technology, customer supply costs, inventory costs and internet hosting costs.

Sales and Marketing. Our sales and marketing costs are primarily salaries, benefits, incentive compensation, stock-based compensation and allocated facilities costs for our sales and marketing employees. Costs also include expenses for travel, trade shows and other promotional and marketing activities including direct and online marketing.

Research and Development. Our research and development costs are primarily salaries, benefits, incentive compensation, stock-based compensation and allocated facilities costs for employees and contractors engaged in the development and ongoing maintenance of our products and services.

General and Administrative. Our general and administrative costs are primarily salaries, benefits, incentive compensation, stock-based compensation and allocated facilities costs for employees engaged in support activities including executive, finance, accounting, human resources, legal and internal information technology support. Also included are professional fees and contractor costs for legal and accounting services. Software expenses and travel costs for support employees, taxes, fees and licenses are also included.

Amortization of Intangibles. Intangible assets with finite lives are amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the asset over their estimated useful lives. This includes assets recorded in conjunction with certain acquisitions.

Other Income (Expense), Net. Other income (expense), net consists primarily of the interest income earned on our cash and cash equivalents, interest paid on our debt, foreign exchange gains and losses and other one-time gains and losses.

Provision for Income Taxes. Provision for income taxes consists of federal and state income taxes in the United States and income taxes in certain foreign jurisdictions.

Adjusted EBITDA

To provide investors with additional information regarding our financial results, we have disclosed within this Quarterly Report on Form 10-Q Adjusted EBITDA, a non-GAAP financial measure. We have provided a reconciliation below of Adjusted EBITDA to net loss, the most directly comparable GAAP financial measure.

We have included Adjusted EBITDA in this Quarterly Report on Form 10-Q because it is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short—and long-term operational plans. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. Additionally, Adjusted EBITDA is a key financial measure used by the compensation committee of our board of directors in connection with the payment of bonuses to our executive officers. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.

Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these limitations are:

• Adjusted EBITDA does not reflect our cash expenditures for capital equipment, internally developed software costs or certain other contractual commitments;

• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may need to be replaced in the future, and Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements;

• Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

• Adjusted EBITDA does not consider the potentially dilutive impact of equity-based compensation to our management team or employees;

• Adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to us; and

• other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including various cash flow metrics, net loss and our other GAAP financial results.

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The following table presents a reconciliation of Adjusted EBITDA for each of the three and six month periods ended June 30, 2013 and June 30, 2012:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Reconciliation of Adjusted EBITDA to Net Loss:
Net loss		(4,472	)		(2,325	)		(19,700	)		(22,663	)
Interest expense, net		137			65			304			191
Provision for income taxes		1,127			2,469			2,445			3,080
Depreciation and amortization		15,460			15,118			30,859			30,094
Stock-based compensation		9,526			4,302			13,452			7,331
Other (income) expense, net		470			524			1,023			(877	)
Adjusted EBITDA		22,248			20,153			28,383			17,156

Critical Accounting Policies

In presenting our condensed consolidated financial statements in conformity with U.S. generally accepting accounting principles, or GAAP, we are required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures.

Some of the estimates and assumptions we are required to make relate to matters that are inherently uncertain as they pertain to future events. We base these estimates and assumptions on historical experience or on various other factors that we believe to be reasonable and appropriate under the circumstances. On an ongoing basis, we reconsider and evaluate our estimates and assumptions. Our future estimates may change if the underlying assumptions change. Actual results may differ significantly from these estimates.

We believe that the critical accounting policies listed below involve our more significant judgments, assumptions and estimates and, therefore, could have the greatest potential impact on our condensed consolidated financial statements.

• Revenue recognition

• Software development costs

• Business combinations

• Impairment of goodwill, indefinite-lived intangible assets and long-lived assets

• Income taxes

• Stock-based compensation

As of June 30, 2013, there have been no material changes to the items disclosed as critical accounting policies and estimates in “Management Discussion and Analysis of Financial Condition and Results of Operations” in Part II—Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2012.

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Results of Operations

The following tables set forth our results of operations for the periods presented and those results as a percentage of our revenue. The period-to-period comparison of financial results is not necessarily indicative of future results.

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Net revenue:
Technology revenue	$	119,473		$	108,155		$	214,463		$	192,275
Marketing services revenue		12,887			13,409			23,908			23,727
Total net revenue		132,360			121,564			238,371			216,002
Cost of net revenue:
Cost of technology revenue		56,413			50,812			105,459			96,467
Cost of marketing services revenue		1,024			2,115			2,215			3,431
Cost of net revenue		57,437			52,927			107,674			99,898
Gross profit		74,923			68,637			130,697			116,104
Operating expenses:
Sales and marketing		27,148			24,284			53,974			49,308
Research and development		21,496			21,121			42,672			42,330
General and administrative		25,031			16,903			41,539			33,447
Amortization of intangibles		3,986			5,596			8,440			11,288
Total operating expenses		77,661			67,904			146,625			136,373
(Loss) income from operations		(2,738	)		733			(15,928	)		(20,269	)
Interest income		16			25			31			50
Interest expense		(153	)		(90	)		(335	)		(241	)
Other income (expense), net		(470	)		(524	)		(1,023	)		877
(Loss) income before provision for income taxes		(3,345	)		144			(17,255	)		(19,583	)
Income tax provision		1,127			2,469			2,445			3,080
Net loss attributable to common stockholders	$	(4,472	)	$	(2,325	)	$	(19,700	)	$	(22,663	)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(As of percentage of net revenue)
Net Revenue		100	%		100	%		100	%		100	%
Cost of net revenue		43			44			45			46
Gross profit		57			56			55			54
Operating expenses:
Sales and marketing		21			20			23			23
Research and development		16			17			18			20
General and administrative		19			14			17			15
Amortization of intangibles		3			5			4			5
Total operating expenses		59			56			62			63
(Loss) income from operations		(2	)		1			(7	)		(9	)
Interest income		—			—			—			—
Interest expense		—			—			—			—
Other (expense) income, net		—			—			—			—
(Loss) income before provision for income taxes		(2	)		—			(7	)		(9	)
Provision for income taxes		1			2			1			1
Net loss		(3	)%		(2	)%		(8	)%		(10	)%

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Three and Six Months ended June 30, 2013 and 2012

Net Revenue

	Three Months Ended June 30,							Six Months Ended June 30,
	2013		2012		% Change			2013		2012		% Change
	(Unaudited) (In thousands)							(Unaudited) (In thousands)
Net revenue:
Technology revenue	$	119,473	$	108,155		10	%	$	214,463	$	192,275		12	%
Marketing services revenue		12,887		13,409		(4	)%		23,908		23,727		1	%
Net revenue	$	132,360	$	121,564		9	%	$	238,371	$	216,002		10	%

Total revenue increased $10.8 million, or 9%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $22.4 million, or 10%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012 as discussed below.

Technology revenue. Net registration revenue increased $8.4 million, or 10%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $15.4 million, or 10%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. The increase was driven by higher revenue in our business solutions, communities and sports customer groups, as well as an increase in net registration revenue related to pre-purchased registrations. Software revenue increased $2.9 million, or 12%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $6.8 million, or 15%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012, due to an increase in revenue from business solutions, ski attractions and from our faith offerings. In total, technology revenue increased $11.3 million, or 10%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $22.2 million, or 12%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012.

Marketing services revenue. Revenue decreased $0.5 million, or 4%, for the three months ended June 30, 2013 and increased $0.2 million, or 1%, for the six months ended June 30, 2013. The decrease for the three months was primarily attributable to a decline in revenue related to our field marketing services as well as online advertising as a result of refocusing our marketing services offerings towards our organizers. These decreases were partially offset by an increase in revenue related to our membership programs as membership increased. The increase for the six months was primarily attributable to higher revenue from our membership programs, partially offset by lower revenue from our field marketing services and online advertising.

Costs and Expenses

Employee related expenses. Headcount and its related expenses make up a significant portion of our total expenses. We define employee related expenses as salaries, fringe benefits, facilities costs, employee travel, commissions, bonuses, stock-based compensation and other employee expenses.

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Cost of Net Revenue

	Three Months Ended June  30,							Six Months Ended June  30,
	2013		2012		% Change			2013		2012		% Change
					(Unaudited) (Dollars in thousands)
Cost of net revenue	$	57,437	$	52,927		9	%	$	107,674	$	99,898		8	%
Headcount (at period end)									1,634		1,740		(6	)%

Cost of net revenue increased $4.5 million, or 9%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $7.8 million, or 8%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. Employee related costs increased $0.1 million, or 1%, for the three months ended June 30, 2013 and decreased $1.2 million, or 3%, for the six months ended June 30, 2013, related mainly to a 6% decrease in headcount, which was due to a decline in seasonal and other call center employees due to efficiencies in operations as well as a reduction in relocation costs in 2012 which did not reoccur in 2013. Depreciation of fixed assets and amortization of intangibles and software that was capitalized in earlier periods increased $2.2 million, or 27%, for the three months ended June 30, 2013 and $4.0 million, or 25%, for the six months ended June 30, 2013. Inventory costs also increased $1.4 million, or 152%, for the three months ended June 30, 2013 and $3.1 million, or 235%, for the six months ended June 30, 2013 resulting from increased pre-purchased registrations in our sports customer group. Credit card processing fees increased $1.5 million, or 11%, for the three months ended June 30, 2013 and $3.0 million, or 12%, for the six months ended June 30, 2013, related to growth in registration revenue. All other costs, including contractors, web hosting, and marketing declined $0.7 million, or 7%, for the three months, and $1.1 million, or 6%, for the six months, primarily due to benefits realized through data center consolidations and through efficiencies in operations.

Sales and Marketing

	Three Months Ended June  30,							Six Months Ended June  30,
	2013		2012		% Change			2013		2012		% Change
					(Unaudited) (Dollars in thousands)
Sales and marketing	$	27,148	$	24,284		12	%	$	53,974	$	49,308		9	%
Headcount (at period end)									682		631		8	%

Sales and marketing expense increased $2.9 million, or 12%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $4.7 million, or 9%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. The increase was primarily due to higher employee related expenses of $2.9 million, or 14% for the three months ended June 30, 2013, and $4.9 million or 12% for the six months ended June 30, 2013 primarily due to an increase in headcount. For the six month period ended June 30, 2013 compared to the June 30, 2012, the headcount increase was 8% as we invested in our sales and marketing staff to support future revenue growth. The employee related costs included higher commissions and salaries expenses, as well as costs for a sales team meeting held in January. Software expenses increased $0.5 million related to our licensing of CRM software, and this was offset by lower contractor expenses of $0.8 million mainly related to costs for the implementation of our CRM software in 2012 that are not reoccurring in 2013.

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Research and Development

	Three Months Ended June  30,							Six Months Ended June  30,
	2013		2012		% Change			2013		2012		% Change
					(Unaudited) (Dollars in thousands)
Research and development	$	21,496	$	21,121		2	%	$	42,672	$	42,330		1	%
Headcount (at period end)									1,005		1,069		(6	)%

Research and development expense increased $0.4 million, or 2%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $0.3 million, or 1%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. Employee related expenses increased $0.8 million for the three months ended June 30, 2013 and $1.6 million for the six months ended June 30, 2013, as average salary increased which was partially offset by a decline in headcount of 6% compared to the prior year. The decrease in headcount was due in part to a lower number of employees in our China locations, whose average salary is lower than the Company average. Contractor costs declined $0.2 million for the three months ended June 30, 2013 and $0.9 million for the six months ended June 30, 2013 as we completed certain implementations in 2012, mainly related to our outdoors customer group.

General and Administrative

	Three Months Ended June  30,							Six Months Ended June  30,
	2013		2012		% Change			2013		2012		% Change
					(Unaudited)
					(Dollars in thousands)
General and administrative	$	25,031	$	16,903		48	%	$	41,539	$	33,447		24	%
Headcount (at period end)									361		347		4	%

General and administrative expense increased $8.1 million, or 48%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $8.1 million, or 24%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. General and administrative expense for the three and six months ended June 30, 2013 included $5.7 million related to the acceleration of unvested equity awards and the grant of common shares and $1.5 million in separation payments and legal costs resulting from the departure of the Company’s former chief executive officer and executive chairman on April 30, 2013. Employee related expenses also increased $2.9 million for the three and six months ended June 30, 2013 due to higher salaries due to an increase in headcount. This was partially offset by lower expenses for contractors.

Amortization of Intangibles

	Three Months Ended June  30,							Six Months Ended June  30,
	2013		2012		% Change			2013		2012		% Change
	(Unaudited) (In thousands)							(Unaudited) (In thousands)
Amortization of intangibles	$	3,986	$	5,596		(29	)%	$	8,440	$	11,288		(25	)%

Amortization of intangibles decreased $1.6 million, or 29%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $2.8 million, or 25%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. The decrease was due to a decline in amortization expense as a result of certain intangibles being fully amortized.

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Interest and Other Income (Expense), Net

	Three Months Ended June  30,									Six Months Ended June  30,
	2013			2012			% Change			2013			2012			% Change
	(Unaudited) (In thousands)									(Unaudited) (In thousands)
Interest income	$	16		$	25			(36	)%	$	31		$	50			(38	)%
Interest expense		(153	)		(90	)		70	%		(335	)		(241	)		39	%
Other income (expense), net		(470	)		(524	)		(10	)%		(1,023	)		877			(217	)%
Interest and other income (expense), net	$	(607	)	$	(589	)		3	%	$	(1,327	)	$	686			(293	)%

Interest income decreased by less than $0.1 million, or 36%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $0.1 million, or 38%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012 due to a decrease in exchange rates on our foreign currency cash accounts.

Interest expense increased by less than $0.1 million, or 70%, for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $0.1 million, or 39%, for the six months ended June 30, 2013 compared to the six months ended June 30, 2012 primarily due to an increase in loan fee amortization offset by a decrease in interest paid on capital leases.

Other income (expense), net was $0.5 million expense for the three months ended June 30, 2013 and $1.0 million expense for the six months ended June 30, 2013, and was primarily related to losses on foreign exchange due to fluctuations in exchange rates. Other income (expense), net was $0.5 million expense for the three months ended June 30, 2012 primarily related to losses on foreign exchange due to fluctuations in exchange rate. Other income (expense) was $0.9 million income for the six months ended June 30, 2012 and included a gain resulting from the change in the fair value of contingent consideration related to an acquisition of $1.1 million, which settled in the second quarter of 2012, partially offset by losses on foreign exchange due to fluctuations in exchange rates.

Income Taxes

	Three Months Ended June  30,							Six Months Ended June  30,
	2013		2012		% Change			2013		2012		% Change
					(Unaudited) (In thousands)
Provision for income taxes	$	1,127	$	2,469		(54	)%	$	2,445	$	3,080		(21	)%

Provision for income taxes decreased $1.3 million for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 and $0.6 million for the six months ended June 30, 2013 compared to the six months ended June 30, 2012. During the six months ended June 30, 2012, the Company recorded an expense of $1.3 million related to a tax assessment from the Canadian Revenue Agency. The provision for each period is primarily the result of increases in our deferred tax liabilities from the amortization of tax deductible goodwill. During the three and six months ended June 30, 2013, we recorded an additional expense of $0.2 million related to uncertain tax positions principally related to the denial of amortization deductions and withholding taxes asserted in connection with a tax audit examination of one of the Company’s foreign subsidiaries.

The effective tax rate of (14.2)% for the six months ended June 30, 2013 differs from the statutory rate primarily due to state taxes, foreign taxes, the increase in the deferred tax liability from the amortization of tax deductible goodwill, the increase in the valuation allowance and discrete items recorded in the period.

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Liquidity and Capital Resources

Condensed Consolidated Statements of Cash Flows Data:

	Six Months Ended June 30,
	2013			2012
	(In thousands)
Net cash provided by operating activities		74,618			48,219
Net cash used in investing activities		(25,032	)		(58,376	)
Net cash provided by financing activities		(520	)		9,113
Effect of exchange rates on cash		576			151
Net increase (decrease) in cash and cash equivalents		49,642			(893	)

As of June 30, 2013, we had cash and cash equivalents of $108.1 million and restricted cash of $0.6 million. We did not have any short-term or long-term investments. Cash and cash equivalents consist of cash and non-interest and interest bearing accounts. Restricted cash consists of cash restricted from withdrawal primarily attributable to a customer contract. We believe that our existing cash and cash equivalents together with cash flows from our operating activities and cash available under our Credit Facility will be sufficient to fund our operations for at least the next 12 months.

Operating Activities

For the six months ended June 30, 2013, cash provided by operating activities was $74.6 million, which included a net loss of $19.7 million, an increase of $45.3 million to exclude non-cash items, and a net increase of $49.0 million in operating assets and liabilities. Significant non-cash items include $20.0 million in depreciation and amortization of property and equipment, $10.8 million in amortization of intangibles, and $13.5 million in stock-based compensation. Net change in operating assets and liabilities was primarily driven by an increase of $56.0 million in registration fees payable due to increased registrations related to growth in the business and seasonality particularly in our sports and communities customer group and $6.7 million increase in deferred revenue related to timing differences between cash receipts and revenue recognition, offset by an increase of $15.0 million in registrations receivable resulting from an increase in registrations due to growth in the business and seasonality.

Investing Activities

Net cash used in investing activities for the six months ended June 30, 2013 was $25.0 million, resulting primarily from $13.9 million cash used for capital expenditures and $11.1 million for capitalized software development costs to support the increase in headcount.

Financing Activities

Net cash used in financing activities for the six months ended June 30, 2013 was $0.5 million, resulting primarily from $1.7 million cash received from the exercise of stock options, offset by $1.1 million in payment of employee tax withholdings and $1.1 million for payments on capital lease obligations.

In December 2011, we entered into a five-year, senior secured revolving credit facility, with certain institutional lenders, for an initial aggregate principal amount of $50 million. On July 2, 2012, we amended the Credit Agreement to, among other things, add J.P. Morgan Securities LLC, as a Joint Lead Arranger. The Credit Agreement, as amended, provides for a five-year, senior secured revolving credit facility in an initial aggregate principal amount of $100.0 million (the “Credit Facility”). The Credit Facility includes a $25.0 million sublimit for the issuance of standby letters of credit and a $5.0 million sublimit for swing line loans, which will be available on a same-day basis. The credit amendment also contains an “accordion” feature which allows us, subject to certain terms and conditions, to increase the lending commitments by up to $50.0 million.

The Credit Facility has a maturity date of December 16, 2016, but the outstanding amounts may be prepaid at any time without penalty or premium (except for certain customary break funding payments in connection with LIBOR loans) and is available to fund acquisitions and ongoing operations.

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Any advance under the Credit Facility will accrue interest at rates per annum that are equal to, based on certain conditions, either (a) 1.5% above the applicable LIBOR rate, or (b) 0.5% above (i) the greatest of (x) the prime rate, (y) the federal funds effective rate plus 0.5% or (z) a daily rate equal to one-month LIBOR plus 1.00%. The unused portion of the Credit Facility will also be subject to an unused fee that will be calculated at a per annum rate of 0.25%. The interest rate under the Credit Facility was 1.81% as of December 31, 2012.

Under the Credit Facility, we are required to comply with certain financial covenants and ratios, including a quarterly consolidated leverage ratio of consolidated funded indebtedness to EBITDA of not more than 2.5 to 1.0 and a quarterly consolidated fixed charge coverage ratio of not less than 1.5 to 1.0. Substantially all of our tangible and intangible assets are considered collateral security under the secured Credit Facility. As of June 30, 2013, we were in compliance with all specified financial covenants and ratios.

Payment of the amounts owed under the Credit Facility may be accelerated, and the lenders’ commitments under the Credit Agreement may be terminated, upon an “event of default,” as defined in the Credit Agreement, such as failure to pay amounts owed when due, breach of a covenant, material inaccuracy of a representation or occurrence of bankruptcy, subject in some cases to cure periods.

At December 31, 2011 outstanding swing line loans were $5.0 million. In January 2012, we fully repaid the $5.0 million swing line loan and immediately borrowed $10.0 million under the revolving Credit Facility, which was fully repaid in August 2012. As of June 30, 2013 and 2012, we had $94.9 million and $93.9 million, respectively, available under the Credit Facility, net of $5.1 million and $6.1 million in outstanding letters of credit, respectively.

Letters of Credit

At June 30, 2013 and 2012, we had no amounts of cash restricted from withdrawal and held by banks as collateral for letters of credit.

Off Balance Sheet Arrangements

As of June 30, 2013, we did not have any off balance sheet arrangements.

Contractual Obligations

Our contractual obligations relate primarily to borrowings under our credit facility, operating leases, capital leases and purchase obligations. As of June 30, 2013, there have been no significant changes to our contractual obligations from the information provided in Part II—Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in our Annual Report on Form 10-K for the year ended December 31, 2012.

Recently Issued Accounting Standards

Accounting standards that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our condensed consolidated financial statements upon adoption.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risks in the ordinary course of our business. These risks primarily include interest rate fluctuations, foreign exchange risk and inflation.

Interest Rate Fluctuations

Our investments include cash and cash equivalents, which consists of cash and money market accounts. The primary objective of our investment activities is to preserve principal while maximizing income without significantly increasing risk. We do not enter into investments for trading or speculative purposes. Our investments are exposed to market risk due to a fluctuation in interest rates, which may affect our interest income and the fair market value of our investments. Due to the short-term nature of our investment portfolio, we do not believe an immediate 10% increase in interest rates would have a material effect on the fair market value of our portfolio, and therefore we do not expect our operating results or cash flows to be materially affected to any degree by a sudden change in market interest rates.

On December 16, 2011, we entered into a Credit Agreement, as amended on July 2, 2012, that provides for a credit facility bearing interest at floating rates based upon either (a) 1.5% above the applicable LIBOR rate, or (b) 0.5% above (i) the greatest of (x) the prime rate, (y) the federal funds effective rate plus 0.5% or (z) a daily rate equal to one-month LIBOR plus 1.00%. Our exposure to market risk for changes in interest rates relates primarily to the floating interest rate. Accordingly, interest rate increases would increase our interest expense on outstanding credit facility balances. As of June 30, 2013, no amount was drawn under the

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credit facility. Based on a sensitivity analysis, an increase of 1% in the floating interest rate would increase our borrowing costs by less than $0.1 million for each $1.0 million of borrowings under the credit facility, assuming such borrowings were outstanding for the entire quarter, or a maximum of $0.7 million if we utilized our entire line of credit.

Foreign Currency Exchange Risk

We have foreign currency risks related to our revenue and operating expenses denominated in currencies other than the U.S. dollar, principally the Canadian dollar, the British pound sterling and the Chinese yuan. We do not believe movements in the foreign currencies in which we transact will significantly affect future net earnings. Foreign currency risk can be quantified by estimating the change in cash flows resulting from a hypothetical 1% adverse change in foreign exchange rates. We believe such a change would not have a material impact on our results of operations.

Inflation

We do not believe that inflation has had a material effect on our business, financial condition or results of operations. If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could harm our business, financial condition and results of operations.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our “disclosure controls and procedures,” as such term is defined in Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were effective at the reasonable assurance level to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives as specified above. In designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Additionally, the design of a control system must reflect that there are resource constraints, thus, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the probability of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Changes in Internal Control over Financial Reporting

We are involved in ongoing evaluations of internal controls. In anticipation of the filing of this Form 10-Q, our Chief Executive Officer and Chief Financial Officer, with the assistance of other members of our management, performed an evaluation of any change in internal control over financial reporting that occurred during our last fiscal quarter that has materially affected, or is likely to materially affect, our internal controls over financial reporting. There has been no change to our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is likely to materially affect, our internal controls over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are from time to time subject to various claims and legal actions during the ordinary course of business, including potential liabilities under government regulations and various claims and legal actions that are pending or may be asserted by third parties. These matters arise in the ordinary course and conduct of our business, and, at times, as a result of our acquisitions. They include, for example, commercial, intellectual property and employment matters. Some are expected to be covered, at least partly, by insurance. We intend to continue to defend ourselves vigorously in such matters. We believe that there are currently no claims or legal actions that would reasonably be expected to have a material adverse effect on our results of operations or financial condition.

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ITEM 1A. RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the following risks and all other information contained in this Quarterly Report on Form 10-Q, as well as our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, which we filed with the SEC on February 26, 2013, including our condensed consolidated financial statements and the related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, before investing in our common stock. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, also may become important factors that affect us. If any of the following risks materialize, our business, financial condition and results of operations could be materially harmed. In that case, the trading price of our common stock could decline, and you may lose some or all of your investment.

Risks Related To Our Business

We have a history of significant net losses, and we may not be able to achieve or maintain consistent profitability on an annual basis.

We have incurred fiscal year net losses since our inception in 1998. Our net losses were approximately $19.7 million for the six months ended June 30, 2013, $43.0 million for the year ended December 31, 2012, $15.3 million for the year ended December 31, 2011, and $27.3 million for the year ended December 31, 2010. At June 30, 2013, we had an accumulated deficit of approximately $0.3 million. We anticipate our operating expenses will continue to increase during the next few years as we complete the transition of our customers to ActiveWorks, make additional acquisitions, increase our sales and marketing activities, expand outside of North America and enhance our customer service and call center capabilities. If our revenue grows at a slower rate than we anticipate, or if our operating expenses increase unexpectedly, we may not be able to achieve or maintain consistent profitability.

Our limited operating history, new and unproven business model and rapidly evolving market make it difficult to evaluate our future prospects and increase the risk that we will not be successful.

We launched our application services in 1999, and we have made a number of changes to our operations, technology platform and online communities since that time. As a result, we have a limited operating history with our current business upon which to predict our future operating results. In addition, the business of providing cloud computing applications to activity and event organizers and building and supporting online communities for activity and event participants is relatively new and subject to rapid change. You must consider our business and prospects in light of the risks and difficulties we will continue to encounter as a company with a new and unproven business model and operating in a new and rapidly evolving market. These risks and difficulties include our ability to, among other things:

• attract new customers;

• deepen our relationships with our existing customers;

• continue to transition our existing customers to ActiveWorks;

• continue to earn the trust of organizers and participants with respect to the processing, storage and use of their confidential information and personal data in compliance with our own high standards of care and applicable governmental and other legal obligations related to privacy and data protection;

• develop a scalable, high performance technology infrastructure that can securely, efficiently and reliably handle increased usage globally;

• continue to manage and successfully integrate acquired businesses, applications and technologies;

• successfully compete with other companies that engage in the activity and event registration and management market;

• continue to build and support online communities and applications for activity and event participants;

• successfully introduce and deploy new features and functionality for our technology platform;

• increase revenue from our applications, websites and online communities;

• avoid interruptions or disruptions in our service;

• avoid problems with the functionality of our applications;

• continue to hire, integrate and retain highly skilled team members who embrace our values and culture; and

• successfully expand our business outside of North America.

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We may not be able to address these risks and difficulties or others that we may encounter, including those described elsewhere in this risk factors section. Our failure to adequately address risks and difficulties as we encounter them could cause our reputation to suffer and harm our business. We base our current and future expense levels on our management’s estimates of the size of our market and the number of potential customers and registrations, operating forecasts and estimates of future revenue. However, our revenue and operating results are difficult to forecast due to the uncertainty of our market and our ability to increase our customer base and the number of participants who elect to register for activities using our applications. In addition, certain of our expenses are fixed, and we may be unable to adjust our spending in a timely manner to compensate for any unexpected shortfall in revenue. As a result, we may make errors in predicting our revenue and expenses, which would harm our business and financial condition.

Our growth rate over the past few years may not be sustainable. If we fail to maintain an adequate growth rate, our business will be adversely affected and we may not achieve or maintain profitability.

Our revenue has grown rapidly over the past few years, increasing to $418.9 million in 2012 from $337.4 million in 2011 and $279.6 million in 2010, representing a compound annual growth rate over this period of 22.4%. We may not be able to sustain this level of growth in future periods, and you should not rely on the revenue growth of any prior quarterly or annual period as an indication of our future performance. Further, a portion of our revenue growth in each year resulted from acquisitions. We may not complete acquisitions in the future that increase our revenue at the same rate as in prior periods. The identification of suitable acquisition candidates can be difficult, time-consuming and costly, and we may not be able to successfully complete the acquisitions we do identify. If we are unable to maintain an adequate rate of growth, our business will be adversely affected and we may not achieve or maintain profitability.

If we fail to effectively manage our growth, our business and operating results could be harmed.

The substantial growth in our business over the past few years has placed, and may continue to place, significant demands on our management, our operating infrastructure and our internal controls and procedures. As our operations grow in size and complexity, we will need to improve and upgrade our operating systems and infrastructure to offer an increasing number of organizers and participants enhanced applications, features, functionality and support. In addition, we will be required to strengthen our internal controls and our risk management policies and procedures. The expansion of our operating systems and infrastructure and the strengthening of our controls, policies and procedures will require us to commit substantial financial, operational and technical resources in advance of an increase in the volume of our business, with no assurance that our business will actually increase. Continued growth could also strain our ability to maintain reliable service levels for organizers and participants, as well as to recruit, train and retain highly skilled personnel. If we fail to effectively manage our growth, our business and operating results could be harmed.

Acquisitions could prove difficult to integrate, disrupt our business, dilute stockholder value, strain our resources and impair our operating results, financial conditions and prospects.

Acquisitions have been an important part of our growth to date. We have completed a significant number of acquisitions over the past few years. We may continue to seek to acquire and invest in businesses, applications and technologies that we believe could complement or expand our business, augment our market coverage, enhance our technology platform, provide us with valuable customer contacts or otherwise offer growth opportunities.

Acquisitions and investments involve numerous risks and difficulties, including:

• difficulties in integrating operations, technologies, accounting functions and personnel;

• difficulties in supporting and transitioning customers of our acquired companies to our technology platform;

• difficulties in maintaining the security and reliability of acquired applications;

• delays in strengthening internal controls and risk management policies and procedures;

• diversion of financial and management resources from existing operations;

• potential loss of key employees;

• inability to generate sufficient revenue to offset acquisition or investment costs;

• assumption of unknown liabilities and claims;

• potential disputes and litigation;

• potential diminishment in the value of any acquired brands; and

• potential write-offs of acquired assets.

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Acquisitions also frequently result in recording of goodwill and other intangible assets, which are subject to potential impairments in the future that could harm our operating results. In addition, if we finance acquisitions by issuing convertible debt or equity securities, our existing stockholders may be diluted. Such dilution could adversely affect the market price of our stock. Moreover, if we are unable to identify suitable future acquisition candidates, reach agreement with these parties or obtain the financing needed to complete such acquisitions, we could lose market share to competitors who are able to complete such acquisitions. This loss of market share could negatively impact our business, revenue and future growth. If we fail to achieve the anticipated benefits of any acquisitions we have completed or may complete in the future, our business, operating results, financial condition and prospects may be impaired.

Any failure to compete successfully against current or future competitors would materially adversely affect our business and prospects.

The market for technology applications for activity and event organizers is fragmented, competitive and rapidly evolving. Our primary competition comes from traditional registration processing methods used by activity and event organizers, such as paper-based registrations submitted by mail or in person or reservations submitted by telephone. We also face competition from:

• custom-developed applications created by an organizer’s technical staff or an outside custom service provider;

• companies that offer generalized functional software that have features and functionality that organizers can use to register participants and manage their activities, such as content or contact management software programs, e-commerce solutions, enterprise resource planning software and other products having separate software modules; and

• companies that offer organizers integrated hosted software solutions in one or more verticals within the activities and events market.

Our competitors may announce new products, services or enhancements that better address changing industry standards or the needs of organizers and participants. In addition, competitors and potential competitors may enter into business combinations or alliances that strengthen their competitive positions. For example, companies who we do not consider to be significant competitors could acquire one or more of the various companies in our fragmented industry and, over a short period of time, become a significant competitor in the markets we service. If any of these competitors were to aggressively price their competing services in our market, we may be required to reduce our prices, which could adversely affect our operating results and financial condition. In addition, it may be difficult to displace a competitor once they have established a relationship with an organizer.

We expect to encounter new and evolving competition as the market becomes aware of the advantages of cloud computing applications for activity and event organizers. For example, social networking companies with a large number of online users could develop competing applications or partner with third parties to do so. Future or existing competitors may introduce different pricing models, and offer users applications at minimal or no cost. In addition, larger, better capitalized companies with greater operational, strategic, financial, personnel, customer or user bases and other resources than we have could also enter our market and attempt to compete with us. If we do not successfully compete with existing and future competitors, our business and prospects will be adversely affected.

Our business may be harmed if we fail to successfully transition certain of our existing customers to ActiveWorks.

We have made a significant investment in developing ActiveWorks, and a large number of our customers are currently being served by our ActiveWorks architecture at varying levels of integration. We are in the process of transitioning to ActiveWorks certain customers who continue to use both our internally developed systems and acquired legacy systems. We are developing the additional features required to complete this transition. As legacy systems are transitioned to ActiveWorks, we will end any further development on those products and retire the applications. In addition, as part of our growth strategy, we expect to continue to inherit legacy systems through acquisitions. We will evaluate these systems to determine, based on their sophistication and compatibility, whether to integrate them into ActiveWorks or to migrate the customers using them to ActiveWorks. This process is time consuming and requires the investment of significant technical and human resources. During this process, we will continue to incur the costs and face the risks and difficulties associated with maintaining multiple legacy systems. During that transition period, we may also experience service interruptions, system failures and security breaches due to the shortcomings of certain of the legacy systems. Further, as we transition legacy systems to ActiveWorks, we may discontinue certain brands associated with those legacy systems and we may encounter resistance from customers who have affinity for these brands. If we fail to complete the transition to ActiveWorks in a cost-effective and timely manner and without service interruptions, system failures, security breaches or resistance from customers, our business may be harmed.

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If our computer systems are compromised, we could be subject to fines, damages, litigation and enforcement actions and organizers and participants could curtail or cease using our applications, the occurrence of which would harm our business.

Our computer systems involve the storage and transmission of non-public personal and credit card information provided by our customers and participants. Despite our security measures, our computer systems are vulnerable to computer viruses, break-ins and other attacks that could lead to the unauthorized access, disclosure and use of non-public personal information, including credit card data. The techniques used by criminal elements to attack our computer systems are sophisticated, change frequently and may originate from less regulated and remote areas of the world. As a result, we may not be able to address these techniques proactively or implement adequate preventative measures. In one instance, we became aware of a security breach in one of the legacy computer systems we inherited through one of our acquisitions. This type of breach could potentially result in the unauthorized acquisition and use of credit card data of a number of participants. We promptly isolated the affected computer system, conducted a forensic analysis of this breach, took steps to clean the affected computer system and implemented a remediation plan to prevent any further breach. We cooperated with the federal authorities investigating the criminals who perpetrated the attack. We cannot guarantee that we will be able to prevent a breach of our computer systems in the future.

If our security measures are breached because of third-party action, employee error, malfeasance or otherwise, or if design flaws in our software are exposed and exploited, and, as a result, a third party obtains unauthorized access to any of our customers’ data, our relationships with our customers may be severely damaged, and we could incur significant liability. There can be no assurance that the limitations of liability in our contracts would be enforceable or adequate or would otherwise protect us from any such liabilities or damages with respect to any particular claim. We also cannot provide assurances that our existing general liability insurance coverage and coverage for errors and omissions will continue to be available on acceptable terms or will be available in sufficient amounts to cover one or more large claims or that the insurer will not deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceeds available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, financial condition and results of operations.

The breach of our computer systems may also subject us to fines, damages from claims asserted by payment processors, merchant banks, organizers and participants, litigation and enforcement actions. In addition, if we experience compromises of our computer systems, payment processors, merchant banks, organizers and participants may lose confidence and cease using our applications, which would harm our business.

In addition, many jurisdictions have enacted laws requiring companies to notify individuals of data security breaches involving certain types of personal data, and our agreements with certain partners require us to notify them in the event of a security incident. These mandatory disclosures regarding a security breach could lead to widespread negative publicity and may cause our customers to lose confidence in the effectiveness of our data security measures.

We are subject to data privacy laws and regulations as well as contractual privacy obligations, and our failure to comply could subject us to fines and damages and would harm our reputation and business.

We are subject to the data privacy laws and regulations adopted by federal, state and foreign governmental agencies. Data privacy is highly regulated, and may become the subject of additional regulation in the future. Privacy laws restrict our storage, use, processing, disclosure, transfer and protection of non-public personal information, including credit card data, provided to us by our customers and participants. In addition, we are subject to the privacy-related obligations in our contracts with our customers and other third parties (including voluntary third-party certification bodies such as TRUSTe). Any failure by us to comply with applicable privacy laws or regulations, our contractual privacy obligations or our own privacy policies, may result in fines, statutory or contractual damages or litigation or governmental enforcement actions. These proceedings or violations could force us to spend significant amounts in defense or settlement of these proceedings, result in the imposition of monetary liability, distract our management, increase our costs of doing business, and adversely affect our reputation and the demand for our solutions. Additionally, violations of our legal or contractual privacy obligations could cause organizers and participants to lose trust in us, which would harm our reputation and business.

The regulatory framework for privacy and data protection issues worldwide is evolving, and as we expand our operations globally, compliance with regulations that differ from country to country may also impose substantial burdens on our business. In particular, the European Union, or EU, has traditionally taken a broader view as to what is considered personal information and has imposed greater obligations under data privacy regulations. In addition, individual EU member countries have had discretion with respect to their interpretation and implementation of the regulations, which has resulted in variation of privacy standards from country to country. Complying with any additional or new regulatory requirements could force us to incur substantial costs or require us to change our business practices in a manner that could compromise our ability to effectively pursue our growth strategy.

We are also subject to the privacy and data protection-related obligations in our contracts with our customers and other third parties. We may also be contractually liable to indemnify and hold harmless our clients from the costs or consequences of inadvertent or unauthorized disclosure of data that we store or handle as part of providing our services. Finally, we are also subject to contractual obligations and other legal restrictions with respect to our collection and use of data, and we may be liable to third parties in the event we are deemed to have wrongfully used or gathered data.

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Our technology systems are vulnerable to damage, interruptions or failures, any of which could harm our reputation and business.

Our technology systems rely on computer hardware and communications systems located either in our facilities or at third-party facilities, including our main web-hosting facilities in Las Vegas, Nevada, Ashburn, Virginia, Toronto, Ontario, and Kelowna, British Columbia. We do not control the operation of the third-party facilities and must rely on third parties to provide the physical security, facilities management and communications infrastructure services to ensure the reliable and consistent delivery of our solutions to our customers. Our web-hosting technology systems located at our facilities and at third-party facilities are vulnerable to damage or interruption from catastrophic occurrences such as earthquakes, floods, fires, power loss, telecommunications failures, terrorist attacks and similar unforeseen events. Despite any precautions we may take, the occurrence of a natural disaster or other unexpected problems at one of our facilities or the facilities operated by third parties who house our equipment could result in lengthy interruptions in our services.

We are in the process of implementing procedures designed to allow us to move our production operations over to a backup datacenter in the event of a catastrophe. Although this program is functional, it does not provide a real-time failover in all instances, so if one of our websites shuts down it would remain shut down for a period of time while the transition takes place, and during that time, the website would not be accessible. In addition, the prolonged interruption of service of one or more of our websites that process transactions could result in potentially significant losses.

We carry business interruption insurance but our coverage may not be sufficient to compensate us for the potentially significant losses that may result from prolonged interruptions in our services as a result of system failures. We have experienced limited interruptions in the past, including server failures that temporarily slowed down the performance of our websites and mobile applications, but we may experience more significant interruptions in the future. Interruptions in these systems, whether due to system failures, computer viruses, physical or electronic break-ins or other catastrophic events, could affect the security or availability of our services on our websites and mobile applications and prevent or inhibit the ability of our customers and event and meeting registrants to access our services. Problems with the reliability or security of our systems could harm our reputation or result in substantial costs to remedy these problems, including but not limited to costs associated with contractual obligations to compensate customers should an interruption affect their use of our services. Any of these issues could negatively affect our business, results of operations and financial condition and harm our reputation.

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If credit card payment processors and service providers fail or no longer agree to provide their services, change their services or terms of service or increase processing fees, our customer relationships could be adversely affected and we could lose business and revenue.

We rely on agreements with large payment processing organizations to enable us to provide credit card authorization, data capture, settlement and merchant accounting services, and access to various reporting tools for the customers we serve. Our credit card processors and service providers could terminate their arrangements with us or fail to perform their services efficiently, become unwilling or unable to provide payment processing services to us or change the services or terms of service provided to us, each of which would adversely affect our relationships with customers and could cause customers to discontinue using our applications and adversely affect our operating results. In addition, we cannot guarantee that credit card companies will not increase the transaction fees we incur for each registration we process. Any increase in transaction fees would require us to increase the prices we charge for our products and services or negatively impact our profitability, either of which could adversely affect our business, financial condition and results of operations. In addition, if credit card payment processors and service providers fail or no longer agree to provide their services, our customer relationships could be adversely affected and we could lose business and revenue.

We are subject to the rules and regulations adopted by the card networks, such as Visa, MasterCard and American Express, and if we fail to adhere to their rules and regulations, we would be in breach of our contractual obligations to payment processors and merchant banks, which could subject us to damages and liability and could eventually prevent us from processing or accepting credit cards.

The card networks, such as Visa, MasterCard and American Express, have adopted rules and regulations that apply to all merchants who process and accept credit cards for payment of goods and services. We are obligated to comply with these rules and regulations as part of the contracts we enter into with payment processors and merchant banks. The rules and regulations adopted by the card networks include the Payment Card Industry Data Security Standards, or the PCI DSS. Under the PCI DSS, we are required to adopt and implement internal controls over the use, storage and security of card data to help prevent credit card fraud. We assess our compliance with the PCI DSS on a periodic basis, and make necessary improvements to our internal controls. If we fail to comply with the rules and regulations adopted by the card networks, including the PCI DSS, we would be in breach our contractual obligations to payment processors and merchant banks. Such failure to comply may subject us to fines, penalties, damages and civil liability, and could eventually prevent us from processing or accepting credit cards and reduce our working capital. Further, there is no guarantee that even if we comply with the rules and regulations adopted by the card networks, we will be able to maintain our compliance. We also cannot guarantee that such compliance will prevent illegal or improper use of our payments systems or the theft, loss or misuse of the credit card data of customers or participants. Any such event would harm our reputation and business.

We face potential liability for the fraudulent activities of organizers and their employees, participants and our employees.

We have potential liability for losses caused by the fraudulent activities of our organizers or their employees. An organizer, or one of an organizer’s employees, could use a stolen or counterfeit credit card or credit card number to record a false sales transaction, or intentionally fail to deliver merchandise, events, activities or services sold in an otherwise valid transaction. We may also face potential liability for credit card fraud by participants who register for an activity or complete a transaction through our applications. A participant could use a stolen credit card or a stolen credit card number in a credit card-not-present transaction, to register for an activity or event or purchase merchandise or services. In a traditional credit card-present transaction, if the merchant uses the credit card, receives authorization for the transaction from the credit card issuing bank and verifies the signature on the back of the credit card against the paper receipt signed by the individual using the credit card, the credit card issuing bank remains liable for any loss. In a fraudulent credit card-not-present transaction, we could be liable to the credit card issuing bank for any loss arising from the transaction, even if we receive authorization for the transaction from the same credit card issuing bank. In addition, we face potential fraud if our employees misappropriate or disclose to others who misappropriate the credit card or other sensitive information of organizers or participants. We have implemented systems and procedures designed to detect and reduce the impact of organizer, participant and employee fraud, but we cannot guarantee that these measures are or will be effective. It is possible that incidents of fraud could increase in the future, and they may remain undetected for extended periods of time if our systems and procedures are not effective. Significant or recurring credit card fraud could adversely affect our business, financial condition and operating results.

We may face significant chargeback liability if our customers refuse or cannot reimburse chargebacks resolved in favor of participants who register through our applications.

We may have potential liability for chargebacks associated with the transactions we process for certain of our organizer customers. If a billing dispute relating to a transaction is not ultimately resolved in favor of the organizer, the disputed transaction is charged back to our bank and credited to the credit card account of the participant. If we or our processing banks are unable to collect the chargeback from the organizer’s account, or if the organizer refuses or is financially unable to reimburse us for the chargeback amount, we bear the risk of loss for the amount of the refund paid to the participant’s credit card account. We have in the past experienced chargebacks related to cancelled and fraudulent events and transactions. Significant or recurring chargeback amounts could adversely affect our business, operating results and financial condition.

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Our business is subject to a variety of U.S. and foreign laws, many of which are unsettled and still developing, and which could subject us to claims or otherwise harm our business.

We are subject to a variety of laws in the United States and abroad that are continuously evolving and developing, and that are costly to comply with, can require significant management time and effort and can subject us to claims or other remedies. Existing and future laws and regulations may be adopted, interpreted or implemented in a manner that is inconsistent with our current business practices or that require changes to such practices, our privacy policy, the features and functionality of our applications or the design of our websites. These regulations and laws may cover employment, immigration, taxation, tariffs, user privacy, data protection, pricing, content, copyrights, distribution, electronic contracts and other communications, consumer protection, broadband residential Internet access and the characteristics and quality of services. It is not clear how existing laws governing issues such as property ownership, sales and other taxes, libel and personal privacy apply to the Internet. If we are not able to comply with these laws and regulations or if we become liable under them, we could be directly harmed, and we may be forced to implement new measures to reduce our exposure to this liability. This may require us to expend substantial resources or to discontinue certain practices, which could negatively affect our business, financial condition and results of operations. In addition, the increased attention focused on liability as a result of lawsuits and legislative proposals could harm our reputation or otherwise harm our business.

Our quarterly operating results are volatile, subject to seasonal fluctuations and difficult to predict, all of which may adversely affect our stock price.

Our quarterly operating results have fluctuated in the past and may fluctuate significantly in the future due to a variety of factors, many of which are outside of our control. For example, we generally experience seasonality due to the greater number of activities and events during the spring and summer months in North America. Other factors that may contribute to the variability of our quarterly and annual results include:

• our ability to accurately forecast revenue and appropriately plan our operating expenses;

• our ability to attract new, and increase the engagement and penetration of our existing, activity and event organizers;

• our ability to increase the number of participants who register for the activities and events offered by our customers using our applications;

• our ability to control the cost and time required to transition certain customers to ActiveWorks;

• our ability to maintain and effectively manage an adequate rate of growth;

• our ability to successfully enter new markets and manage our planned global expansion;

• our ability to successfully manage and integrate our past and any future acquisitions of businesses, applications or technologies;

• our ability to limit interruptions in service and prevent the compromise of customer or participant data;

• the effects of natural or man-made catastrophic events;

• changes in the laws, regulations and legal standards affecting our business;

• our ability to keep pace with changes in technology and the offerings by our competitors;

• our ability to provide a high-quality participant experience through our applications and online communities;

• our ability to design and implement effective internal controls and processes;

• our ability to attract and retain qualified employees and key personnel;

• our ability to protect our intellectual property, including our technology platform and our key brands;

• our ability to control the costs associated with defending intellectual property infringement and other claims by third parties; and

• the impact of worldwide economic conditions, including the resulting effect on consumer spending.

As a result, we believe that quarterly comparisons of our operating results are not necessarily meaningful and that you should not rely on the results of one quarter as an indication of our future performance. In addition, our operating results may continue to vary significantly from one quarter to the next as part of our normal business cycle, which may adversely affect our stock price.

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If we do not continue to enhance and improve our existing applications and successfully introduce new applications, our ability to maintain the pricing of our applications and to attract and retain organizer customers will be harmed.

In the past we have grown our business in part through improving the functionality and features of our existing applications and introducing new applications to our customers, such as fundraising, real-time event tracking and merchandising for activities and events. If we fail to continue to offer new applications that increase the number of participants who register online for our customers’ activities and events, and improve the ability of our customers to manage their activities and events, we may be unable to maintain the pricing of our applications. We cannot assure you that we will be able to timely and adequately develop additional functions and features or introduce new applications to satisfy the demands of our customers. Further, developing new technologies and applications entails significant technical and business risks. We cannot assure you that any new functions, features or applications will achieve the level of acceptance required for us to generate sufficient revenue to offset our development costs. If we do not continue to enhance and improve the functions and features of our existing applications and successfully introduce new applications, our ability to maintain the pricing of our applications and to attract and retain organizer customers will be harmed.

Defects or disruptions in the rollout of our new products and product enhancements could diminish demand for our service, adversely affect our reputation and subject us to substantial liability.

Like many internet-based cloud companies, we provide incremental releases of product updates and functional enhancements. Such new versions may contain undetected errors when first introduced or released. We have, from time to time, found defects in our service, and new errors in our existing service may be detected in the future. In addition, our customers may use our service in unanticipated ways that may cause a disruption in service for other customers or for event registrants. Since our customers use our service for important aspects of their business, any errors, defects, disruptions in service or other performance problems with our service could hurt our reputation and may damage our customers’ businesses. If that occurs, our customers may delay or withhold payment to us, elect not to renew, make service credit claims, warranty claims or other claims against us, and we could lose future sales. Further, if we are unable to meet the stated service level commitments we have guaranteed to our customers or suffer extended periods of unavailability for our service, we may be contractually obligated to provide these customers with credits for future service, and there would be a negative impact on our reputation.

Activity and event organizers may not widely adopt our applications to manage the important aspects of their activities and events, which would limit our ability to grow our business.

Our ability to grow our business and increase revenue depends on our success in educating activity and event organizers about the potential benefits of our cloud computing applications. Cloud computing applications for organizing and managing important aspects of activities and events are relatively new, and have not been widely adopted by activity and event organizers. Concerns about cost, fraud, privacy, security, reliability and other issues may cause activity and event organizers not to adopt our applications. Moreover, activity and event organizers who have already invested substantial resources in other registration and management systems or methods may be reluctant to adopt a new approach like ours to supplement or replace existing systems or methods. If activity and event organizers do not widely adopt applications such as ours, our ability to grow our business will be limited.

If we fail to expand our customers’ use of our applications, our ability to execute our growth strategy and increase our revenue will be limited.

Many of our organizer customers initially make a purchase of only one or a limited number of our available applications or use our applications for only one or a limited number of their activities or events. Our ability to grow our business and increase revenue is dependent on our ability to further penetrate our existing customers by selling additional applications to them, and by increasing the number of activities and events for which they deploy our applications. If we fail to expand the usage of our applications by our existing customers, our ability to execute our growth strategy and increase our revenue will be limited.

Many individuals are using devices other than personal computers to access the Internet. If users of these devices do not widely adopt solutions we develop for these devices, our business could be adversely affected.

The number of people who access the Internet through devices other than personal computers, including mobile telephones, personal digital assistants, smart phones and handheld tablets or computers, has increased dramatically in the past few years and is projected to continue to increase. If we are unable to develop mobile solutions to meet the needs of our users, our business could suffer. Additionally, as new devices and new platforms are continually being released, it is difficult to predict the problems we may encounter in developing versions of our solutions for use on these alternative devices, and we may need to devote significant resources to the creation, support, and maintenance of such devices.

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If we are unable to increase the percentage of participants who register through our websites, our ability to grow our business will be impaired.

In addition to expanding and increasing penetration within our organizer customer base, the growth of our business depends on our ability to increase the percentage of participants who elect to register for activities and events through our websites. Our ability to increase the percentage of participants who register through our websites depends on our ability to make our online registration and reservation processes simple, efficient, secure and cost-effective, as well as on our ability to develop applications, such as our online communities, activity and event information and searchable database of events, that encourage participants to use our websites. Our ability to increase participant use of our websites also depends on the ability and willingness of our organizer customers to increase the awareness of our websites to their participants. We cannot control the level of effort that organizers expend or the extent to which any of them will be successful in increasing awareness of our websites among their participants. We may not be able to prevent organizers from devoting greater resources to support other registration methods developed by them or other third parties. If we are unable to increase the percentage of participants who register for activities and events through our websites, our ability to grow our business will be impaired.

We may not be successful in expanding into new business areas within the activity and event registration and management market, which could harm our business and future prospects.

Our long-term strategic plan involves expanding our applications into new business areas within the activity and event registration and management market. We cannot assure you that our efforts to expand our business in this manner will succeed. We also cannot assure you that we will develop any new applications required to successfully compete in these new business areas in a cost-effective or timely manner. The lack of market acceptance of such efforts or our inability to generate satisfactory revenue to offset the development costs could harm our business and limit our future prospects.

The sales cycle for certain of our applications can be long, and we may not recognize revenue until completion of the entire sale, which makes it difficult for us to forecast our operating results.

It can take us between three and nine months to complete a sale to an activity or event organizer, and at times it may take up to one year or longer. The period between our initial contact with a potential customer and the completion of a sale may be relatively long due to several factors, including:

• many activities and events occur only annually;

• our need to educate potential customers about the uses, benefits, safety and reliability of our applications;

• activity and event organizers have budget cycles which can affect the timing of purchases; and

• some organizers, such as park and recreation department administrators, have lengthy internal approval processes before having the required authority to purchase our applications.

In addition, our customers may demand customization of the applications we provide them. As a result, these sales opportunities may require us to devote greater sales and technical resources, increasing the cost and time required to complete sales. As a result, it is difficult to predict when particular sales will occur or be completed, which adversely impacts our ability to accurately forecast our operating results.

Negative factors affecting the activities and events market have an adverse effect on our business and revenue.

We primarily generate revenue from the registration and reservation fees paid by the participants in the activities and events offered by our organizer customers. As a result, our business is directly affected by factors affecting the activities and events market, including global, national or local consumer trends, adverse weather, security concerns or environmental disasters. Our performance is also subject to economic conditions and their impact on levels of consumer spending, which may remain depressed, or be subject to further deterioration, for the foreseeable future. Some of the factors that have had and may continue to have an adverse impact on discretionary consumer spending include general economic conditions, unemployment, consumer debt, reductions in net worth, disruptions in the residential real estate or mortgage markets, higher taxation, energy prices or interest rates and decreases in consumer confidence and other macroeconomic factors. Because spending for activities is generally considered to be discretionary, declines in consumer spending may have a more negative effect on our business than on those businesses that sell products or services considered to be necessities. Unfavorable changes in the above factors or in other business and economic conditions affecting our activity and event customers and their participants could cause organizers to cancel activities, result in fewer participants using our applications to register for activities, lower our profit margins, cause our activity and event customers to terminate their relationship with us or default on their payment obligations to us, any of which would have a material adverse effect on our financial condition and operating results.

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If our customers do not renew their agreements for our applications, our business and operating results will suffer.

We currently generate a majority of our revenue from customers who have entered into contracts with us with terms ranging from three to seven years. However, we have a number of customers with contract terms under three years. Our customers are not obligated to renew their contracts with us. Even if our customers perceive our applications to be of value, budgetary, economic or other competitive pressures may prevent some customers from renewing their contracts. If we are not successful in continuing to renew or extend the terms of our contracts with our existing customers, our business and operating results will suffer.

Our ability to grow our business will be impaired if we do not provide high quality customer support in a timely and cost-effective manner.

Our ability to maintain and increase our customer base and the number of participants who use our applications depends significantly on our ability to provide high quality levels of service and support. Complaints or negative publicity about our service or support could severely diminish confidence in or use of our applications. We spend significant time and resources to hire, train and retain our service and support personnel. In addition, we are required to hire temporary employees each year to provide customer service and support during peak registration seasons. These temporary employees require training and education and take time to reach full productivity. The market for our applications is still evolving, and competitive dynamics may cause pricing levels to change as the market matures and as existing and new market participants introduce new types of solutions. As a result, we may be forced to reduce the prices we charge for our solutions and may be unable to renew existing customer agreements or enter into new customer agreements at the same prices and upon the same terms that we have historically. If we are not successful in timely hiring, training and retaining our service and support personnel or otherwise fail to provide high quality service and support to organizers and participants, our ability to grow our business will be impaired.

Our ability to improve our operating margins may be limited by the requirements imposed by our government agency customers.

We acquired the state hunting and fishing business of Automated License Systems and Central Trust Bank in October 2008 and the campground registration business of ReserveAmerica in January 2009. As of June 30, 2013, we had approximately 0 state or provincial customers in North America that are utilizing our technology for registration and management services related to hunting, fishing, and campgrounds. Our government agency customers often require us to customize our applications and provide additional services to their participants to qualify for these contracts. For example, we are typically required to maintain call centers for these customers to allow participants to register telephonically and receive telephonic customer service and support. We continue to focus on ways to encourage participants to use the self-service features available through our websites, however, each year we are required to hire temporary employees and independent contractors to staff our call centers during peak registration periods. A number of our state customers require us to maintain a physical call center located in their particular state. Additionally, our state customers typically require us to provide third-party audits of our operations. These additional requirements are costly to comply with and add to the complexity of our business. If we are unable to properly manage and control the cost of the additional services required by our government agency customers, our operating margins will suffer and our business and results would be harmed.

We may be unsuccessful in expanding our operations outside of North America, which could negatively impact our growth strategy, revenue and future growth.

Our headquarters are located in the United States. To date, we have operated primarily in North America. We do however maintain offices and have personnel in international offices around the world, and in particular, have a significant number of research and development employees in China. Continued expansion outside of North America is an important aspect of our future growth strategy. Our ability to expand outside of North America involves various risks and difficulties, including:

• incurring significant expenses in advance of generating material revenue as we attempt to establish our presence in international markets;

• operating in unfamiliar competitive environments;

• distraction of management and company resources;

• different participant preferences and participation patterns than those in North America;

• varied, unfamiliar and unclear legal and regulatory requirements and restrictions;

• potentially greater susceptibility to fraud and security breaches;

• pricing controls, legal, political or systemic restrictions on the ability of U.S. companies to compete with foreign competitors or otherwise do business in foreign countries;

• less extensive adoption of the Internet as a commerce medium or information source and increased restrictions on privacy or the use of customer and participant data;

• lack of infrastructure to adequately conduct electronic commerce transactions and data storage and management;

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• difficulties in staffing and managing foreign operations;

• greater difficulty in accounts receivable collection;

• currency fluctuations or other restrictions on foreign currency;

• potential adverse tax consequences; and

• uncertain political and economic climates in foreign countries.

Operating in international markets including China also requires significant management attention and financial resources and subjects us to economic, political and operational risks that are different from those in the United States. As a result of these obstacles, we may find it difficult to expand outside of North America or we may be unsuccessful in our attempt to do so, which would negatively impact our growth strategy, revenue and future growth.

We may not timely and effectively scale and adapt our existing technology and network infrastructure to ensure that our websites are accessible with little or no perceptible load times.

A key element in our continued growth is the ability of organizers and participants to access our websites at all times with little or no perceptible load times. This has become increasingly difficult to achieve as our applications have become more complex and our user traffic has increased. Strains on the capacity of our technology infrastructure caused by growth in the numbers of organizers and participants accessing our websites, new applications and features and overall engagement on our websites, especially at the opening of the registration period for a popular activity, have in the past resulted, and may in the future result in, slower load times or system failures. We have experienced website disruptions, outages and other performance problems due to a variety of factors, including maintaining multiple legacy systems, infrastructure changes, power failure, telecommunication outages, human or software errors and capacity constraints caused by overwhelming numbers of users accessing our websites simultaneously. If our websites are not available when users attempt to access them or do not function as expected, our customers may select another option to organize and manage their activities and events and participants may select alternative means of researching and registering for activities and events, each of which would negatively impact our business.

We expect to continue to make significant investments to upgrade our technology and network infrastructure to handle increased usage and to enable the timely and effective release of new applications. These upgrades and expansions are complex and in the past have resulted, and in the future could result, in website outages or inefficiencies or operational failures. To the extent that we do not effectively address infrastructure challenges, upgrade our systems as needed and continually develop our technology and network architecture, our business and operating results may be harmed.

If Internet search engines’ methodologies are modified or our search result page rankings decline for other reasons, participant engagement in our websites and online communities could decline.

We depend in part on various Internet search engines to direct a significant amount of traffic to our websites. Our ability to maintain the number of potential participants directed to our websites is not entirely within our control. Our competitors’ search engine optimization, or SEO, efforts may result in their websites receiving a higher search result page ranking than ours, or Internet search engines could revise their methodologies in an attempt to improve search results, which could adversely affect placement of our search result page rankings. If search engine companies revise their search algorithms in ways that are detrimental to new participant growth on our websites or in ways that make it more difficult for organizers or participants to use our websites, or if competitors’ SEO efforts are more successful than ours, the overall growth in the numbers of organizers and participants using our websites could slow, participant engagement could decrease, and we could lose existing participants and become less attractive to existing and prospective organizer customers. Our websites have experienced fluctuations in search result rankings in the past, and we anticipate similar fluctuations in the future. Any reduction in the number of participants directed to our website would harm our business and operating results.

Our ability to establish, maintain and strengthen our brands in the activities and events market is critical to our growth strategy.

Promoting and maintaining our brands is critical to our efforts to attract and retain our organizer customers and to increase the number of participants who use our applications. We also believe brand recognition is critical to allow us to effectively compete against the growing number of Internet sites and relatively low initial barriers to entry in certain of our markets. Maintaining, protecting and enhancing our brands is also critical to expanding our base of organizers, end users, advertisers, and other strategic partners, and increasing their engagement with our websites, and will depend largely on our ability to be a technology leader and continue to provide high-quality applications, which we may not do successfully. If we are unable to establish and maintain our brands, including THE ACTIVE NETWORK, ACTIVE, ACTIVE.COM, ACTIVENET, ACTIVEWORKS, REGONLINE, RESERVEAMERICA and STARCITE, as leaders for online registration and management applications in the activities and events market, our business and prospects would be materially and adversely affected.

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We may experience difficulty in developing marketing services that are attractive to advertisers and promoters.

The market for marketing services such as ours is relatively new and rapidly evolving. We cannot be certain this market will continue to grow. Our marketing services customers may determine that it is in their best interest to spend their marketing budgets through other forms of promotional or advertising activities. As a result, if we fail to develop compelling marketing services for advertisers and promoters, our ability to sustain and grow our marketing services business would be adversely affected.

If we fail to maintain and grow our user base of participants and the data we gain access to from such participants, potential advertisers may not utilize our marketing services, which may result in reduced revenue.

We use a wide range of data to expand, refine and target our marketing services on behalf of our customers. We gain access to most of this data from participants as they “opt-in” to receive special offers and other direct marketing opportunities from our marketing services customers and us and the registration process for activities and events using our application services. If we are unable to maintain and grow our user base of participants and the data we gain access to from such participants, potential advertisers may not utilize our marketing services and we may lose significant marketing services revenue.

Federal, state and foreign laws impose certain obligations on the senders of commercial emails, which could minimize the effectiveness of our ability to market to prospective customers and impose financial penalties for noncompliance.

The U.S.’s CAN-SPAM Act establishes certain requirements for commercial email messages and specifies penalties for the transmission of commercial email messages that are intended to deceive the recipient as to source or content. The CAN-SPAM Act, among other things, obligates the sender of commercial emails to provide recipients with the ability to opt out of receiving future emails from the sender. In addition, some states have passed laws regulating commercial email practices that are significantly more punitive and difficult to comply with than the CAN-SPAM Act. The ability of recipients of emails from our customers using our applications to opt out of receiving commercial emails may minimize the effectiveness of our solutions for our customers. In addition, noncompliance with the CAN-SPAM Act carries significant litigation, regulatory investigation and related risks. If we were found to be in violation of the CAN-SPAM Act or similar state or international laws regulating the distribution of commercial email, whether as a result of violations by our customers or if we were deemed to be directly subject to and in violation of these requirements, we could incur penalties, and significant litigation and investigation-related expenses, and any inquiries might impact the deliverability of our commercial email regardless of outcome. This would adversely affect our operating results and financial condition and significantly harm our business, and our reputation would suffer. We also may be required to change one or more aspects of the way we operate our business, which could impair our ability to attract and retain customers or could increase our operating costs.

We might not be able to attract and retain employees, which could impede our ability to grow and successfully generate our business.

Any failure to attract and retain qualified, experienced employees could adversely affect our ability to grow our business. To execute our continuing growth plans, we need to increase the size and maintain the quality of our staff of direct sales and business development representatives and technology development staff. To be successful, we must attract and retain highly qualified sales and other personnel with specialized skill sets focused on the activities and events industry. Competition for qualified and experienced sales and other personnel can be intense, and we might not be successful in attracting and retaining such individuals. We have from time to time experienced, and we expect to continue to experience in the future, difficulty in hiring and retaining a sufficient number of highly skilled employees with appropriate qualifications for our business.

Our business and prospects could be harmed if we lose members of our senior management team.

On April 30, 2013, we announced that our Board of Directors appointed Jon Belmonte as our Interim Chief Executive Officer, and initiated an executive search process to identify a permanent Chief Executive Officer. Our business and prospects depends on our ability to identify and retain a permanent Chief Executive Officer who can assist us in improving our operations and executing on our business plan. Our performance also depends on our ability to retain and motivate our existing executive officers and key employees, including Mr. Belmonte, Darko Dejanovic, our President, and Scott Mendel, our Chief Financial Officer. We do not have long-term employment agreements with any of our executive officers or other key personnel. In addition, we do not maintain key-man insurance on these individuals. The failure to identify and retain a permanent Chief Executive Officer or the loss of the services of any of our executive officers or other key employee for any reason could harm our business.

If we cannot maintain our corporate culture as we grow and evolve, we could lose the innovation, creativity and teamwork that this culture has fostered.

We believe that a critical contributor to our success has been our corporate culture, which we believe fosters innovation, creativity and teamwork. Maintaining this corporate culture will become increasingly difficult as we grow and implement the more complex organizational management structures necessary to support our growth and to comply with the requirements imposed on public companies. Failure to maintain and further develop our culture could negatively impact our future success.

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If the protection of our technology platform, domain name, trademarks and other proprietary rights is inadequate, our business would be harmed.

Our commercial success is dependent in part on obtaining, maintaining and enforcing our intellectual property rights. We rely on a combination of trade secret, trademark, copyright, trade dress, domain name and patent laws in the United States and in the other jurisdictions in which we operate, together with confidentiality agreements and technical measures, to protect our intellectual property. We pursue the registration of our trademarks, service marks and domain names in the United States. Our registered trademarks in the United States include THE ACTIVE NETWORK, ACTIVE, ACTIVE.COM, ACTIVENET, ACTIVEWORKS, REGONLINE, RESERVEAMERICA and STARCITE. As of June 30, 2013, we have been granted six patents by the United States Patent and Trademark Office and have five patent applications pending in the United States. Our issued patents begin to expire in February 2019. We rely more heavily on trade secret protection than patents to protect our proprietary technology. To protect our trade secrets, we control access to our proprietary systems and technology and enter into confidentiality and invention assignment agreements with our employees and consultants and confidentiality agreements with other third parties. In addition, due to the relatively high cost associated with registering all of our copyrights, we generally rely on common-law copyright laws to protect these rights.

The steps we have taken and take in the future to protect our proprietary rights may be inadequate. For example, confidentiality agreements with our employees, licenses, independent contractors and other advisors may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. In addition, third parties may independently discover trade secrets and proprietary information, and in such cases, we may not be able to successfully assert trade secret rights against such parties. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights. If we are unable to obtain, maintain and enforce intellectual property protection covering our technology platform, brands and domain names, others may be able to make, use or sell products that are substantially similar to ours without incurring the sizeable development costs that we have incurred, which would adversely affect our ability to compete.

In addition, the domain names for the websites that we maintain are important to our business. The regulation of domain names in the United States and in foreign countries is unclear and subject to change. Governing bodies may establish additional top-level domains, appoint additional domain name registrars or modify the requirements for holding domain names. As a result, we cannot assure you that we will be able to acquire or maintain relevant domain names. The relationship between regulations governing domain names and laws protecting trademarks and similar proprietary rights is also unclear. As a result, we may be unable to prevent third parties from acquiring domain names that are similar to, infringe upon or otherwise decrease the value of our domain names, and trademarks and other proprietary rights. Any such inability could have a material adverse effect on our business, results of operations, financial condition and prospects.

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Intellectual property claims against us could be costly and could hurt our business, operating results, financial condition and prospects.

We cannot predict whether third parties will assert claims of infringement or other intellectual property claims against us. If we are forced to defend against third party claims, whether they are with or without merit or are determined in our favor, we could face expensive and time consuming litigation, which could distract our technical and management personnel. For example, we have faced and currently face infringement threats from non-practicing organizations (sometimes referred to as “patent trolls”) filing lawsuits for patent infringement. In the future, we may receive other notices from, or have lawsuits filed against us by, third parties alleging infringement. If an infringement claim is determined against us, we may be required, or deem it advisable, to develop non-infringing intellectual property or enter into costly royalty or licensing agreements. Such royalty or licensing agreements, if required, may be unavailable on terms that are acceptable to us, or at all. If a third party successfully asserts an infringement claim against us and we are required to pay monetary damages or royalties or we are unable to develop suitable non-infringing alternatives or license the infringed or similar intellectual property on reasonable terms and on a timely basis, it could significantly harm our business. In addition, third parties may seek to invalidate our intellectual property.

As a result of becoming a public company, we are obligated to develop and maintain proper and effective internal controls over financial reporting.

We maintain a documented system of internal controls, which is reviewed and monitored by the Audit Committee and tested by the Company’s internal audit department. The internal audit department reports the results of testing to the Audit Committee who in turn report the results to the Board of Directors. We believe we have a well-designed system to maintain adequate internal controls over the business; however, we cannot be certain that our controls will be adequate in the future or that adequate controls will be effective in preventing or detecting all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of any system of control is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Our reserves for state sales taxes may not be sufficient.

Certain states in which we operate impose sales, purchase and use taxes on transactions completed through our applications. At this time, many of our systems do not automatically capture the sales, purchase and use taxes we are required to remit to these states.

As a result, we are required to analyze our transactions, and reserve an appropriate amount for the payment of state sales, purchase and use taxes. We regularly review the procedures we use to calculate our sales tax obligations as well as our sales tax reserves, and make adjustments when appropriate. Although we believe that our sales tax reserves are adequate, we may not be fully reserved and it is possible that we may be obligated to pay amounts in excess of our reserves.

We may not be able to realize the tax benefits associated with the net operating losses we have recorded to date.

As of December 31, 2012, we had federal tax net operating loss carry forwards of approximately $182 million which will begin to expire in 2019 and continue to expire through 2032 and state tax net operating loss carry forwards of approximately $142 million which began to expire between 2013 and 2032 and foreign NOL carryforwards of approximately $11 million as of December 31, 2012 which expire between 2029 and 2032. If we do not maintain sufficient profitability prior to the expiration of these net operating loss carry forwards, then we will not be able to fully use such tax attributes to our benefit. Additional limitations on the annual use of these net operating loss carry forwards may also apply due to subsequent issuances of our stock.

Covenants in our Credit Agreement may restrict our operations, and if we do not effectively manage our business to comply with these covenants, our financial condition and liquidity could be adversely affected.

In December 2011, we entered into a Credit Agreement (the “Credit Agreement”), which was subsequently amended in July 2012, with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPFS”) and J.P Morgan Securities LLC (upon the amendment of the Credit Agreement), as Joint Lead Arrangers, MLPFS as Sole Book Manager, and the lenders from time to time party thereto. We must comply with various covenants under our Credit Agreement that limit our ability to, among other things:

• incur or assume liens or additional debt or provide guarantees in respect of obligations of other persons;

• pay cash dividends or distributions or redeem or repurchase capital stock;

• prepay, redeem or repurchase debt;

• make loans and investments;

• enter into agreements that restrict distributions from our subsidiaries;

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• sell assets and capital stock of our subsidiaries;

• enter into certain transactions with affiliates; and

• consolidate or merge with or into, or sell substantially all of our assets to, another person.

In addition, under our Credit Agreement, we are required to maintain specified financial ratios. Our ability to meet these financial covenants can be affected by events beyond our control, and we may be unable to meet these tests. In addition, our failure to maintain effective internal controls to measure compliance with these financial covenants could affect our ability to take corrective actions on a timely basis, and could result in us being in breach of this covenant. Our Credit Agreement provides that our breach or failure to satisfy certain covenants constitute an event of default. Upon the occurrence of an event of default, the lenders could elect to terminate any commitment under our Credit Agreement and declare all amounts outstanding to be immediately due and payable. If we are unable to repay those amounts, our financial condition could be adversely affected. In addition, termination of our Credit Agreement could also adversely impact our liquidity.

Our cash, cash equivalents and short-term investments are subject to a risk of loss based upon the solvency of the financial institutions in which they are maintained.

We maintain the majority of our cash and cash equivalents in accounts with major financial institutions within the United States, in the form of demand deposits and money market accounts. Our deposits in these institutions may generally exceed the amounts of insurance provided, or deposits may not at all be covered by insurance. If any of these institutions become insolvent, it could substantially harm our financial condition and we may lose some, or all, of such deposits.

If our goodwill, amortizable intangible assets or property, plant and equipment become impaired, we may be required to record a significant charge to earnings.

We review our goodwill, intangible and long-lived assets for impairment annually in the fourth quarter or whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. Significant negative industry or economic trends, a decline in the market price of our common stock, reduced estimates of future cash flows or disruptions to our business could indicate that goodwill, intangible or long-lived assets might be impaired. If, in any period, our stock price decreases to the point where our market capitalization is less than our book value, this could also indicate a potential impairment and we may be required to record an impairment charge in that period. Our valuation methodology for assessing impairment requires management to make judgments and assumptions based on historical experience and to rely on projections of future operating performance. Changes in the our estimates, such as forecasted cash flows and discount rates, would affect the estimated fair value of the reporting units which could result in a material goodwill impairment charge, particularly in the technology reporting unit, as the fair value of the Company’s technology reporting exceeded its respective carrying value by a narrower margin than the marketing reporting unit. We operate in highly competitive environments and projections of future operating results and cash flows may vary significantly from actual results. Additionally, if our analysis results in impairment to our goodwill, intangibles or long-lived assets, we would be required to record a non-cash charge to earnings in our financial statements during a period in which such impairment is determined to exist. Any of these factors could have a negative impact on our operating results.

Changes in accounting standards and subjective assumptions, estimates and judgments by management related to complex accounting matters could significantly change our reported or expected financial results.

Generally accepted accounting principles and related accounting pronouncements, implementation guidelines and interpretations with regard to a wide range of matters that are relevant to our business, including but not limited to, revenue recognition, allowances for doubtful accounts, software development costs, stock-based compensation, business combinations, impairment of goodwill, intangible assets and long-lived assets, and accounting for income taxes are highly complex and involve many subjective assumptions, estimates and judgments by our management. Changes in these rules or their interpretation or changes in underlying assumptions, estimates or judgments by our management could significantly change our reported or expected financial performance.

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We are currently in the process of transitioning certain of our customers who are using the legacy systems we inherited in our acquisitions to ActiveWorks. Until we complete this transition, we may not be able to compare our key business metrics on a period-to-period basis in a manner consistent with the rest of our business, and as a result, our ability to manage our business could be adversely affected.

We manage our business based in part on key business metrics regarding the total number of customer organizations we serve and the total number of registrations we process during a specific financial period. We are currently in the process of transitioning our customers who are currently using the legacy systems we inherited in our acquisitions to ActiveWorks. Until we complete this transition, participants for certain activities and events will continue registering through these legacy systems. Certain of these legacy systems do not track customers and registrations in a manner consistent with the rest of our business. As a result, we need to use manual processes to accumulate these metrics, which could lead to errors. If we are unable to accurately compare our key business metrics on a period-to-period basis, our ability to manage our business could be adversely affected.

If the estimates and assumptions we use to determine the size of our target market, customer groups or the verticals within customer groups are inaccurate, our future growth rate may be limited and our business would be harmed.

We calculate the size of our target market, customers groups and verticals within customer groups, based on data published by third parties and on assumptions that we have made based on that data. We have not independently verified any third-party information and cannot assure you of its accuracy or completeness. While we believe our market size information is generally reliable, such information is inherently imprecise. In addition, our projections, assumptions and estimates of future opportunities within our target market are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in this risk factors section. If third-party data proves to be inaccurate or we make errors in our assumptions based on that data, our future growth rate may be limited. In addition, these inaccuracies or errors may cause us to misallocate capital and other business resources, which could harm our business. For example, in the third quarter of 2011, we identified previously unreported registration data during the first and second quarters of 2011. As a result, we underreported the number of registrations for these prior periods. We identified that the underreporting resulted primarily from the prior lack of the reporting systems of two new state customers. The underreporting had no impact on our prior financial statements, nor do we believe the underreporting had a material adverse effect on our business.

Risks Relating To Ownership Of Our Common Stock

Our stock price may be volatile.

The market price of our common stock may be subject to significant fluctuations. Factors that could affect our stock price include the following:

• fluctuations in our operating results or the operating results of our competitors;

• changes in estimates of our financial results or recommendations by securities analysts;

• changes in the estimates of the future size and growth rate of our markets;

• changes in accounting principles or changes in interpretations of existing principles, which could affect our financial results;

• conditions and trends in the markets we serve;

• changes in general economic, industry and market conditions;

• success of competitive applications and services;

• changes in market valuations or earnings of our competitors;

• changes in our pricing policies or the pricing policies of our competitors;

• announcements of significant new applications, contracts, acquisitions or strategic alliances by us or our competitors;

• changes in legislation or regulatory policies, practices or actions;

• the commencement or outcome of litigation involving our company, our general industry or both;

• recruitment or departure of key personnel;

• changes in our capital structure, such as future issuances of securities or the incurrence of debt;

• actual or expected sales of our common stock by the holders of our common stock; and

• the trading volume of our common stock.

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In addition, the U.S. and worldwide stock markets in general have experienced significant price and trading volume fluctuations, and the market prices of technology and Internet companies have generally been extremely volatile and have experienced sharp share price and trading volume changes. These broad market fluctuations may adversely affect the trading price of our common stock.

The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain qualified board members.

As a public company, we are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Act, the listing requirements of the New York Stock Exchange and other applicable securities rules and regulations. The Exchange Act requires, among other things, that we file annual, quarterly and current reports with respect to our business and operating results. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal controls over financial reporting. In order to maintain and, if required, improve our disclosure controls and procedures and internal controls over financial reporting to meet this standard, significant resources and management oversight may be required. As a result, management’s attention may be diverted from other business concerns, which could harm our business and operating results.

In addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time-consuming. These laws, regulations and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. We intend to invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. If our efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to practice, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

Any new rules and regulations may increase the cost for us to obtain director and officer liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These factors could also make it more difficult for us to attract and retain qualified executive officers and members of our board of directors, particularly to serve on our Board committees. We currently have one vacancy on our board of directors. While we intend to seek a qualified candidate that meets the independence standards of the NYSE to fill the board vacancy, there can be no assurance that we will be able to fill this vacancy with a new director, independent or otherwise.

As a result of our public disclosure requirements, our business and financial condition has become more visible, which we believe may result in threatened or actual litigation, including by competitors and other third parties. If such claims are successful, our business and operating results could be harmed, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources of our management and harm our business and operating results.

We do not expect to declare any dividends on our common stock in the foreseeable future.

We currently intend to invest our future earnings, if any, to fund the development and growth of our business. The payment of dividends will be at the discretion of our Board of Directors and will depend on our results of operations, capital requirements, financial condition, future prospects, restrictions imposed by applicable law, any limitations on payments of dividends present in any debt agreements we may enter into and other factors our Board of Directors may deem relevant. Consequently, stockholders may need to rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investment. Investors seeking cash dividends should not purchase our common stock.

Our directors, executive officers and significant stockholders hold a substantial portion of our stock, which may lead to conflicts of interest with other stockholders over corporate transactions and other corporate matters.

As of June 30, 2013, our directors, executive officers and beneficial holders of 10% or more of our outstanding common stock beneficially owned approximately 25% of our outstanding common stock, including restricted stock units awards vested and stock options exercisable within 60 days after June 30, 2013. We are not aware of any stockholder or voting agreements or understandings between or among our current directors, officers or beneficial holders of 10% or more of our outstanding common stock. However, these stockholders, acting together, would be able to influence significantly all matters requiring stockholder approval, including the election of directors and significant corporate transactions such as mergers or other business combinations. This control could delay, deter or prevent a third party from acquiring or merging with us, which could adversely affect the market price of our common stock.

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A large number of shares eligible for public sale or subject to rights requiring us to register them for public sale could depress the market price of our common stock.

The market price of our common stock could decline as a result of sales of a large number of shares of our common stock in the market in the future, and the perception that these sales could occur may also depress the market price of our common stock. From time to time, we may raise additional capital through issuances of equity or convertible debt securities, or issue additional equity for future acquisitions and may be required to register these securities with the SEC. Sales of our common stock pursuant to registration rights could cause our stock price to fall and make it more difficult for you to sell shares of our common stock.

If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our stock adversely or publish negative reports about our company or business, our stock price and trading volume could decline.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts may publish about us, our business, our market or our competitors. If any of the analysts who may cover us change their recommendation regarding our stock adversely, publish negative reports about our company or business, or provide more favorable relative recommendations about our competitors, our stock price would likely decline. If any analyst who may cover us were to cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

Our future capital needs are uncertain, and we may need to raise additional funds in the future, which may not be available on acceptable terms or at all.

Our capital requirements will depend on many factors, including:

• acceptance of, and demand for, our applications;

• the costs of developing new applications or technology;

• the timing of transitioning our customers to ActiveWorks;

• the number and timing of acquisitions and other strategic transactions; and

• the costs associated with the growth of our business.

Our existing sources of cash and cash flows may not be sufficient to fund all of our activities. While we believe we have sufficient capital available through our credit facility and cash flow from operations to conduct our plan of business for at least the next 12 months, we may need to raise additional funds following such time, and such funds may not be available on reasonable terms, or at all. Further, if we incur additional debt, it may increase our leverage relative to our earnings or to our equity capitalization. If we cannot raise funds on acceptable terms, we may not be able to develop or enhance our applications, execute our business plan, take advantage of future opportunities or respond to competitive pressures or unanticipated customer requirements.

If we issue additional shares of common stock to raise capital or for future acquisition purposes, it may have a dilutive effect on your investment.

If we raise additional capital through further issuances of equity or convertible debt securities, or issue additional equity for future acquisitions, our existing stockholders could suffer significant dilution in their percentage ownership of us. Moreover, any new equity securities we issue could have rights, preferences and privileges senior to those of holders of our common stock.

A further tightening of the credit markets may have an adverse effect on our ability to obtain short-term debt financing.

The recent deterioration of the global economy threatens to cause further tightening of the credit markets, more stringent lending standards and terms and higher volatility in interest rates. Persistence of these conditions could have a material adverse effect on our access to short-term debt and the terms and cost of that debt. As a result, we may not be able to secure additional financing in a timely manner, or at all, to meet our future capital needs which may have an adverse effect on our business, operating results and financial condition.

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Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current directors and management team and limit the market price of our common stock.

Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may delay or prevent a change in control, discourage bids at a premium over the market price of our common stock and adversely affect the market price of our common stock and the voting and other rights of the holders of our common stock. These provisions include:

• dividing our board into three classes, with each class serving a staggered three-year term;

• prohibiting our stockholders from calling a special meeting of stockholders or acting by written consent;

• permitting our board to issue additional shares of our preferred stock, with such rights, preferences and privileges as they may designate, including the right to approve an acquisition or other changes in control;

• establishing an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors;

• providing that our directors may be removed only for cause;

• providing that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum; and

• requiring the approval of our board of directors or the holders of a supermajority of our outstanding shares of capital stock to amend our bylaws and certain provisions of our certificate of incorporation.

Although we believe these provisions collectively provide for an opportunity to receive higher bids by requiring potential acquirers to negotiate with our board, they would apply even if the offer may be considered beneficial by some stockholders. In addition, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management team by making it more difficult for stockholders to replace members of our board, which is responsible for appointing the members of our management.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Unregistered Sales of Equity Securities

Period	Total Number of Shares Purchased (1)		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs
April 1 - 30, 2013		—	$	—		—		—
May 1 - 31, 2013		160,730	$	6.16		—		—
June 1 - 30, 2013		6,255	$	7.57		—		—

(1) Through our stock incentive plans, 166,985 shares were delivered to us by our employees to satisfy their tax withholding requirements upon vesting of restricted stock during the three months ended June 30, 2013.

Use of Proceeds from Registered Securities

Our initial public offering of common stock was effected through a Registration Statement on Form S-1 (File No. 333-172254) that was declared effective by the Securities and Exchange Commission on May 24, 2011, which registered an aggregate of 12,650,000 shares of our common stock, including 1,650,000 shares that the underwriters had the option to purchase. On May 31, 2011, 8,222,222 shares of common stock were sold on our behalf and 4,427,778 shares of common stock were sold on behalf of the selling stockholders, including 1,650,000 shares sold by the selling stockholders upon exercise in full of the underwriters’ option to purchase additional shares, at an initial public offering price of $15.00 per share, for an aggregate gross offering price of $123,333,330 to us, and $66,416,670 to the selling stockholders. Merrill Lynch, Pierce, Fenner & Smith and Citigroup Global Markets Inc. served as the managing underwriters of the initial public offering. Following the sale of the shares in connection with the closing of the initial public offering, the offering terminated.

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As a result of the offering, we received net proceeds of approximately $112.6 million, after deducting underwriting discounts and commissions of approximately $8.6 million and additional offering-related expenses, net of reimbursements, of approximately $2.1 million. We did not receive any proceeds from the sale of shares by the selling shareholders. No offering expenses were paid directly or indirectly to (i) any of our officers or directors or their associates, (ii) any persons owning 10% or more of any class of our equity securities, or (iii) any of our affiliates.

There was no material change in the use of proceeds from our initial public offering as described in our final prospectus filed with the SEC pursuant to Rule 424(b). From the effective date of the registration statement through June 30, 2013, we have used the net proceeds of the offering for repayment of debt, funding for our recent acquisitions and for general corporate purposes, including expenditures for financing our growth, developing additional application services functionality and features, acquiring new customers and funding capital expenditures. We invested the funds received in short-term, interest bearing, investment-grade securities.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

On July 29, 2013, Kory Vossoughi, the Company’s Chief Legal Officer and a named executive officer resigned from the Company, effective July 30, 2013 (the “Effective Date”). Mr. Vossoughi will be entitled to the following payments and benefits in accordance with terms of his retention agreement previously entered into with the Company, a copy of which was filed as an exhibit to Form S-1 on May 24, 2011:

• A lump sum cash payment equal to twelve (12) months of his base salary payable within ten days following the Effective Date, less applicable tax withholdings.

• If Mr. Vossoughi elects continuation coverage under the Company’s medical plan under COBRA, reimbursement for his COBRA payments until the earlier of (1) his eligibility for any such coverage under another employer’s or any other medical plan or (2) the date that is twelve (12) months following the Effective Date.

• Accelerated vesting and exercisability of each his outstanding stock awards to be automatically accelerated on the Effective Date as to the number of stock awards that would vest over the twelve (12) month period following the Effective Date had Mr. Vossoughi remained continuously employed by Company during such period except as otherwise specified in the applicable grant notice.

• All of Mr. Vossoughi’s vested stock awards shall remain exercisable for a period of twelve (12) months following the Effective Date.

ITEM 6. EXHIBITS

The exhibits listed in the accompanying Exhibit Index are filed or incorporated by reference as part of this Quarterly Report on Form 10-Q.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	The Active Network, Inc.
Date: August 2, 2013	By:	/S/    SCOTT MENDEL
		Scott Mendel
		Chief Financial Officer (Principal Financial and Accounting Officer)

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INDEX TO EXHIBITS

Exhibit Number	Description
10.53	Second Amendment to Credit Agreement, dated as of July 23, 2013, by and among the Registrant, as Borrower, the subsidiaries of Borrower named therein, as Guarantors, the lenders named therein, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and JP Morgan Securities LLC, as Joint Lead Arrangers and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Sole Book Manager.
31.1	Certification of Chief Executive Officer pursuant to Rules 13a-14 and 15d-14 promulgated pursuant to the Securities Exchange Act of 1934, as amended.
31.2	Certification of Chief Financial Officer pursuant to Rules 13a-14 and 15d-14 promulgated pursuant to the Securities Exchange Act of 1934, as amended.
32.1*	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance Document.
101.SCH**	XBRL Taxonomy Extension Schema Document.
101.CAL**	XBRL Taxonomy Calculation Linkbase Document.
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB**	XBRL Taxonomy Label Linkbase Document.
101.PRE**	XBRL Taxonomy Presentation Linkbase Document.

* These certifications are being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934 and are not to be incorporated by reference into any filing of The Active Network, Inc., whether made before or after the date hereof, regardless of any general incorporation language in such filing.

** Pursuant to applicable securities laws and regulations, we are deemed to have complied with the reporting obligation relating to the submission of interactive data files in such exhibits and are not subject to liability under any anti-fraud provisions of the federal securities laws as long as we have made a good faith attempt to comply with the submission requirements and promptly amend the interactive data files after becoming aware that the interactive data files fail to comply with the submission requirements. Users of this data are advised that, pursuant to Rule 406T, these interactive data files are deemed not filed and otherwise are not subject to liability.

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EX-10.53

Exhibit 10.53

SECOND AMENDMENT TO CREDIT AGREEMENT

SECOND AMENDMENT TO CREDIT AGREEMENT dated as of July 23, 2013 (the “Agreement”) is entered into among The Active Network, Inc., a Delaware corporation (the “Borrower”), the Guarantors, the Lenders and Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer. All capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement (as defined below).

RECITALS

WHEREAS, the Borrower, the Guarantors, the Lenders and the Administrative Agent, Swing Line Lender and L/C Issuer entered into that certain Credit Agreement dated as of December 16, 2011 (as amended and modified from time to time, the “Credit Agreement”);

WHEREAS, the Borrower has requested that the Lenders amend the Credit Agreement as set forth below;

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Amendments. The Credit Agreement is hereby amended as follows:

(a) The following definitions are hereby added to Section 1.01 of the Credit Agreement in appropriate alphabetical order to read as follows:

“Alternative Currency” means each of Sterling, Canadian Dollars and each other currency (other than Dollars) that is approved in accordance with Section 1.08.

“Alternative Currency Equivalent” means, at any time, with respect to any amount denominated in Dollars, the equivalent amount thereof in the applicable Alternative Currency as determined by the Administrative Agent or the L/C Issuer, as the case may be, at such time on the basis of the Spot Rate (determined in respect of the most recent Revaluation Date) for the purchase of such Alternative Currency with Dollars.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.).

“Dollar Equivalent” means, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in any Alternative Currency, the equivalent amount thereof in Dollars as determined by the Administrative Agent or the L/C Issuer, as the case may be, at such time on the basis of the Spot Rate (determined in respect of the most recent Revaluation Date) for the purchase of Dollars with such Alternative Currency.

“EMU” means the economic and monetary union in accordance with the Treaty of Rome 1957, as amended by the Single European Act 1986, the Maastricht Treaty of 1992 and the Amsterdam Treaty of 1998.

“EMU Legislation” means the legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified European currency.

“Euro” and “EUR” mean the lawful currency of the Participating Member States introduced in accordance with the EMU legislation.

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guaranty of such Guarantor of, or the grant under a Loan Document by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act (or the application or official interpretation thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to Section 4.08 hereof and any and all guarantees of such Guarantor’s Swap Obligations by other Loan Parties) at the time the Guaranty of such Guarantor, or grant by such Guarantor of a security interest, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a Master Agreement governing more than one Swap Contract, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to Swap Contracts for which such Guaranty or security interest becomes illegal.

“Master Agreement” has the meaning set forth in the definition of “Swap Contract”.

“Participating Member State” means each state so described in any EMU Legislation.

“Qualified ECP Guarantor” means, at any time, each Loan Party with total assets exceeding $10,000,000 or that qualified at such time as an “eligible contract participant” under the Commodity Exchange Act and can cause another Person to qualify as an “eligible contract participant” at such time under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Revaluation Date” means, with respect to any Letter of Credit, each of the following: (a) each date of issuance of a Letter of Credit denominated in an Alternative Currency, (b) each date of an amendment of any such Letter of Credit having the effect of increasing the amount thereof (solely with respect to the increased amount), (c) each date of any payment by the L/C Issuer under any Letter of Credit denominated in an Alternative Currency, and (d) such additional dates as the Administrative Agent or the L/C Issuer shall determine or the Required Lenders shall require.

“Second Amendment Effective Date” means July 23, 2013.

“Spot Rate” for a currency means the rate determined by the Administrative Agent or the L/C Issuer, as applicable, to be the rate quoted by the Person acting in such capacity as the spot rate for the purchase by such Person of such currency with another currency through its principal foreign exchange trading office at approximately 11:00 a.m. on the date two Business Days prior to the date as of which the foreign exchange computation is made; provided that the Administrative Agent or the L/C Issuer may obtain such spot rate from another financial institution designated by the Administrative Agent or the L/C Issuer if the Person acting in such capacity does not have as of the date

of determination a spot buying rate for any such currency; and provided further that the L/C Issuer may use such spot rate quoted on the date as of which the foreign exchange computation is made in the case of any Letter of Credit denominated in an Alternative Currency.

“Sterling” means the lawful currency of the United Kingdom.

“Swap Obligation” means with respect to any Guarantor any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

(b) The definition of “Eurodollar Base Rate” in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

“Eurodollar Base Rate” means:

(a) for any Interest Period with respect to a Eurodollar Rate Loan, the rate per annum equal to (i) the British Bankers Association LIBOR Rate or the successor thereto if the British Bankers Association is no longer making a LIBOR Rate available (“LIBOR”), as published by Reuters (or such other commercially available source providing quotations of LIBOR as may be designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two London Banking Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or (ii) if such rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or converted and with a term equivalent to such Interest Period would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London time) two London Banking Days prior to the commencement of such Interest Period; and

(b) for any interest rate calculation with respect to a Base Rate Loan on any date, the rate per annum equal to (i) LIBOR, at approximately 11:00 a.m. London time determined two London Banking Days prior to such date for Dollar deposits being delivered in the London interbank market for a term of one month commencing that day or (ii) if such published rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the date of determination in same day funds in the approximate amount of the Base Rate Loan being made or maintained with a term equal to one month would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at the date and time of determination.

(c) The definition of “Existing Letters of Credit” in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

“Existing Letters of Credit” means (a) the letters of credit described by date of issuance, letter of credit number, undrawn amount, name of beneficiary and date of expiry on Schedule 1.01 and (b) that certain letter of credit number 3127733 in the initial amount of Sterling 238,780.00 issued on April 18, 2013, for applicant The Active Network (EU) Ltd. (the “Sterling Letter of Credit”).

(d) The definition of “Obligations” in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. The foregoing shall also include (a) all obligations under any Swap Contract between any Loan Party and any Swap Bank that is permitted to be incurred pursuant to Section 8.03(d) and (b) all obligations under any Treasury Management Agreement between any Loan Party and any Treasury Management Bank; provided, that the “Obligations” of a Guarantor shall exclude any Excluded Swap Obligations with respect to such Guarantor.

(e) Section 1.06 of the Credit Agreement is hereby amended to read as follows:

1.06 Letter of Credit Amounts.

Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the Dollar Equivalent of the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the Dollar Equivalent of maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

(f) A new Section 1.07 is hereby added to the Credit Agreement to read as follows:

1.07 Exchange Rates; Currency Equivalents.

(a) The L/C Issuer shall determine the Spot Rates as of each Revaluation Date to be used for calculating Dollar Equivalent amounts of Outstanding Amounts denominated in Alternative Currencies. Such Spot Rates shall become effective as of such Revaluation Date and shall be the Spot Rates employed in converting any amounts between the applicable currencies until the next Revaluation Date to occur. Except for purposes of financial statements delivered by Loan Parties hereunder, calculating financial covenants hereunder or as otherwise provided herein (including clause (b) below), the applicable amount of any currency (other than Dollars) for purposes of the Loan Documents shall be such Dollar Equivalent amount as so determined by the L/C Issuer.

(b) Wherever in this Agreement in connection with the issuance, amendment or extension of a Letter of Credit, an amount, such as a required minimum or multiple

amount, is expressed in Dollars, but such Letter of Credit is denominated in an Alternative Currency, such amount shall be the relevant Alternative Currency Equivalent of such Dollar amount (rounded to the nearest unit of such Alternative Currency, with 0.5 of a unit being rounded upward), as determined by the L/C Issuer.

(g) A new Section 1.08 is hereby added to the Credit Agreement to read as follows:

1.08 Additional Alternative Currencies.

(a) The Borrower may from time to time request that Letters of Credit be issued in a currency other than those specifically listed in the definition of “Alternative Currency”; provided that such requested currency is a lawful currency (other than Dollars) that is readily available and freely transferable and convertible into Dollars. Such request shall be subject to the approval of the Administrative Agent and the L/C Issuer.

(b) Any such request shall be made to the Administrative Agent not later than 11:00 a.m., twenty (20) Business Days prior to the date of the desired Credit Extension (or such other time or date as may be agreed by the Administrative Agent and the L/C Issuer, in their sole discretion). The Administrative Agent shall promptly notify the L/C Issuer of such request. The L/C Issuer shall notify the Administrative Agent, not later than 11:00 a.m., ten (10) Business Days after receipt of such request whether it consents, in its sole discretion, to the issuance of Letters of Credit in such requested currency.

(c) Any failure by the L/C Issuer to respond to such request within the time period specified in the preceding sentence shall be deemed to be a refusal by the L/C Issuer to permit Letters of Credit to be issued in such requested currency. If the Administrative Agent and the L/C Issuer consent to the issuance of Letters of Credit in such requested currency, the Administrative Agent shall so notify the Borrower and such currency shall thereupon be deemed for all purposes to be an Alternative Currency hereunder for purposes of any Letter of Credit issuances. If the Administrative Agent shall fail to obtain consent to any request for an additional currency under this Section 1.08, the Administrative Agent shall promptly so notify the Borrower.

(h) A new Section 1.09 is hereby added to the Credit Agreement to read as follows:

1.09 Change of Currency.

(a) Each obligation of the Borrower to make a payment denominated in the national currency unit of any member state of the European Union that adopts the Euro as its lawful currency after the date hereof shall be redenominated into Euro at the time of such adoption (in accordance with the EMU Legislation); provided that if and to the extent that such legislation or member state provides that any such obligation may be paid by the debtor in either the Euro or such other currency, then the Borrower shall be permitted to repay such amount either in the Euro or such other currency. If, in relation to the currency of any such member state, the basis of accrual of interest expressed in this Agreement in respect of that currency shall be inconsistent with any convention or practice in the London interbank market for the basis of accrual of interest in respect of the Euro, such expressed basis shall be replaced by such convention or practice with effect from the date on which such member state adopts the Euro as its lawful currency.

(b) Each provision of this Agreement shall be subject to such reasonable changes of construction as the Administrative Agent may from time to time specify to be appropriate to reflect the adoption of the Euro by any member state of the European Union and any relevant market conventions or practices relating to the Euro.

(c) Each provision of this Agreement also shall be subject to such reasonable changes of construction as the Administrative Agent may from time to time specify to be appropriate to reflect a change in currency of any other country and any relevant market conventions or practices relating to the change in currency.

(i) Clause (i)(A)(1) of Section 2.03(a) of the Credit Agreement is hereby amended to read as follows:

(1) from time to time on any Business Day during the Availability Period, to issue Letters of Credit denominated in Dollars or an Alternative Currency for the account of the Borrower or any of its Subsidiaries, and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (b) below, and

(j) The penultimate sentence in Section 2.03(a)(i) of the Credit Agreement is hereby amended to read as follows:

Furthermore, each Lender acknowledges and confirms that it has a participation interest in the liability of the L/C Issuer under the Existing Letters of Credit (including, for the avoidance of doubt, the Sterling Letter of Credit) in a percentage equal to its Applicable Percentage of the Revolving Loans.

(k) Clause (iii)(D) of Section 2.03(a) of the Credit Agreement is hereby amended to read as follows:

(D) such Letter of Credit is to be denominated in a currency other than Dollars or an Alternative Currency; or

(l) Clause (i)(B) of Section 2.03(b) of the Credit Agreement is hereby amended to read as follows:

(B) the amount and currency thereof;

(m) Clauses (i) and (ii) of Section 2.03(c) of the Credit Agreement are hereby amended to read as follows:

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of drawing under such Letter of Credit, the L/C Issuer shall notify the Borrower and the Administrative Agent thereof. In the case of a Letter of Credit denominated in an Alternative Currency, the Borrower shall reimburse the L/C Issuer in such Alternative Currency, unless (A) the L/C Issuer (at its option) shall have specified in such notice that it will require reimbursement in Dollars, or (B) in the absence of any such requirement for reimbursement in Dollars, the Borrower shall have notified the L/C Issuer promptly

following receipt of the notice of drawing that the Borrower will reimburse the L/C Issuer in Dollars. In the case of any such reimbursement in Dollars of a drawing under a Letter of Credit denominated in an Alternative Currency, the L/C Issuer shall notify the Borrower of the Dollar Equivalent of the amount of the drawing promptly following the determination thereof. Not later than 11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of Credit to be reimbursed in Dollars or the applicable Alternative Currency (each such date, an “Honor Date”), the Borrower shall reimburse the L/C Issuer through the Administrative Agent in an amount equal to the amount of such drawing and in the applicable currency of such drawing; provided, that, the Borrower has received notice of such payment by 10:00 a.m. on such Honor Date, otherwise the Borrower shall make such payment not later than 11:00 a.m. on the following Business Day (together with interest thereon). In the event that (A) a drawing denominated in an Alternative Currency is to be reimbursed in Dollars pursuant to the second sentence in this Section 2.03(c)(i) and (B) the Dollar amount paid by the Borrower whether on or after the Honor Date, shall not be adequate on the date of that payment to purchase in accordance with normal banking procedures a sum denominated in the Alternative Currency equal to the drawing, the Borrower agrees, as a separate and independent obligation, to indemnify the L/C Issuer for the loss resulting from its inability on that date to purchase the Alternative Currency in the full amount of the drawing. If the Borrower fails to so reimburse the L/C Issuer by such time, the Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (expressed in Dollars in the amount of the Dollar Equivalent thereof in the case of a Letter of Credit denominated in an Alternative Currency) (the “Unreimbursed Amount”), and the amount of such Lender’s Applicable Percentage thereof. In such event, the Borrower shall be deemed to have requested a Borrowing of Base Rate Loans in Dollars to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of Base Rate Loans, but subject to the conditions set forth in Section 5.02 (other than the delivery of a Loan Notice) and provided that, after giving effect to such Borrowing, the Total Revolving Outstandings shall not exceed the Aggregate Revolving Commitments (it being understood and agreed that no Default or Event of Default caused solely by the Borrower’s failure to reimburse the L/C Issuer for any Unreimbursed Amount in accordance with the first sentence of this Section 2.03(c)(i) shall exist to the extent such Unreimbursed Amount is refinanced by a borrowing of Revolving Loans in the amount of such Unreimbursed Amount pursuant to this Section 2.03(c)(i)). Any notice given by the L/C Issuer or the Administrative Agent pursuant to this Section 2.03(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

(ii) Each Lender shall upon any notice pursuant to Section 2.03(c)(i) make funds available (and the Administrative Agent may apply Cash Collateral provided for this purpose) to the Administrative Agent for the account of the L/C Issuer, in Dollars, at the Administrative Agent’s Office for Dollar-denominated payments in an amount equal to its Applicable Percentage of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Administrative Agent, whereupon, subject to the provisions of Section 2.03(c)(iii), each Lender that so makes funds available shall be deemed to have made a Base Rate Loan to the Borrower in such amount. The Administrative Agent shall remit the funds so received to the L/C Issuer in Dollars.

(n) The “or” at the end of clause (iv) of Section 2.03(e) of the Credit Agreement is hereby deleted; clause (v) of Section 2.03(e) is hereby renumbered to be clause (vi), and a new clause (v) is added to Section 2.03(e) of the Credit Agreement to read as follows:

(v) any adverse change in the relevant exchange rates or in the availability of the relevant Alternative Currency to the Borrower or any Subsidiary or in the relevant currency markets generally; or

(o) The text of Section 2.03(h) of the Credit Agreement that precedes the first proviso in Section 2.03(h) of the Credit Agreement is hereby amended to read as follows:

(h) Letter of Credit Fees. The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage, in Dollars, a Letter of Credit fee (the “Letter of Credit Fee”) for each Letter of Credit equal to the Applicable Rate times the Dollar Equivalent of the daily maximum amount available to be drawn under such Letter of Credit;

(p) Section 2.03(i) of the Credit Agreement is hereby amended to read as follows:

(i) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer. The Borrower shall pay directly to the L/C Issuer for its own account, in Dollars, a fronting fee with respect to each Letter of Credit, at the rate per annum specified in the Fee Letter, computed on the Dollar Equivalent of the actual daily maximum amount available to be drawn under such Letter of Credit (whether or not such maximum amount is then in effect under such Letter of Credit) and on a quarterly basis in arrears. Such fronting fee shall be due and payable on the tenth Business Day after the end of each March, June, September and December in respect of the most recently-ended quarterly period (or portion thereof, in the case of the first payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on the Maturity Date and thereafter on demand. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06. In addition, the Borrower shall pay directly to the L/C Issuer for its own account in Dollars the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the L/C Issuer relating to letters of credit as from time to time in effect. Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

(q) Section 2.12(a) of the Credit Agreement is hereby amended to read as follows:

(a) General. All payments to be made by the Borrower shall be made free and clear of and without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date specified herein. If for any reason, the Borrower is prohibited by any Law from making any payment required hereunder in an Alternative Currency, the Borrower shall make such payment in Dollars in the Dollar Equivalent of the Alternative Currency payment amount. The Administrative Agent will promptly distribute to each Lender its Applicable Percentage (or other applicable share as provided herein) of such payment in

like funds as received by wire transfer to such Lender’s Lending Office. All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. Subject to the definition of “Interest Period”, if any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

(r) The “;” at the end of Section 3.05(c) of the Credit Agreement is hereby deleted and replaced with the text “; or” and a new Section 3.05(d) is hereby added to the Credit Agreement to read as follows:

(d) any failure by the Borrower to make payment of any drawing under any Letter of Credit denominated in an Alternative Currency on its scheduled due date or any payment thereof in a different currency;

(s) A new Section 4.08 is hereby added to the Credit Agreement to read as follows:

4.08 Keepwell.

Each Loan Party that is a Qualified ECP Guarantor at the time the Guaranty in this Article IV by any Guarantor that is not then an “eligible contract participant” under the Commodity Exchange Act (a “Specified Guarantor”) or the grant of a security interest under the Loan Documents by any such Specified Guarantor, in either case, becomes effective with respect to any Swap Obligation, hereby jointly and severally, absolutely, unconditionally and irrevocably undertakes to provide such funds or other support to each Specified Guarantor with respect to such Swap Obligation as may be needed by such Specified Guarantor from time to time to honor all of its obligations under the Loan Documents in respect of such Swap Obligation (but, in each case, only up to the maximum amount of such liability that can be hereby incurred without rendering such Qualified ECP Guarantor’s obligations and undertakings under this Article IV voidable under applicable Debtor Relief Laws, and not for any greater amount). The obligations and undertakings of each applicable Loan Party under this Section shall remain in full force and effect until such time as the Obligations (other than contingent indemnification obligations that survive the termination of this Agreement) have been paid in full and the Revolving Commitment has expired or terminated. Each Loan Party intends this Section to constitute, and this Section shall be deemed to constitute, a guarantee of the obligations of, and a “keepwell, support, or other agreement” for the benefit of, each Specified Guarantor for all purposes of the Commodity Exchange Act.

(t) A new clause (d) is added to Section 5.02 of the Credit Agreement to read as follows:

(d) In the case of a Credit Extension to be denominated in an Alternative Currency, there shall not have occurred any change in national or international financial, political or economic conditions or currency exchange rates or exchange controls which in the reasonable opinion of the L/C Issuer would make it impracticable for such Credit Extension to be denominated in the relevant Alternative Currency.

(u) The following sentence is hereby added at the end of the last paragraph of Section 9.03 of the Credit Agreement to read as follows:

Excluded Swap Obligations with respect to any Guarantor shall not be paid with amounts received from such Guarantor, but appropriate adjustments shall be made with respect to payments from other Loan Parties to preserve the allocation to Obligations set forth above in this Section.

2. Conditions Precedent. This Agreement shall be effective upon satisfaction of the following conditions precedent:

(a) receipt by the Administrative Agent of counterparts of this Agreement duly executed by the Administrative Agent, the L/C Issuer, the Required Lenders and the Loan Parties; and

(b) receipt by the Administrative Agent of all legal fees and expenses of its counsel in connection with this Agreement.

3. Miscellaneous.

(a) The Credit Agreement and the obligations of the Loan Parties thereunder and under the other Loan Documents, are hereby ratified and confirmed and shall remain in full force and effect according to their terms.

(b) Each Guarantor (i) acknowledges and consents to all of the terms and conditions of this Agreement, (ii) affirms all of its obligations under the Loan Documents and (iii) agrees that this Agreement and all documents executed in connection herewith do not operate to reduce or discharge its obligations under the Credit Agreement or the other Loan Documents.

(c) The Borrower and the Guarantors hereby represent and warrant as follows:

(i) Each Loan Party has taken all necessary action to authorize the execution, delivery and performance of this Agreement.

(ii) This Agreement has been duly executed and delivered by the Loan Parties and constitutes each of the Loan Parties’ legal, valid and binding obligations, enforceable in accordance with its terms, except as such enforceability may be subject to (A) bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or similar laws affecting creditors’ rights generally and (B) general principles of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity).

(iii) No consent, approval, authorization or order of, or filing, registration or qualification with, any court or governmental authority or third party is required in connection with the execution, delivery or performance by any Loan Party of this Agreement.

(d) The Loan Parties represent and warrant to the Lenders that (i) the representations and warranties of the Loan Parties set forth in Article VI of the Credit Agreement and in each other Loan Document are true and correct in all material respects on and as of the date hereof,

except (x) that any such representation and warranty that is qualified by materiality or a reference to Material Adverse Effect is true and correct in all respects on and as of the date hereof and (y) to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date (except that any such representation and warranty that is qualified by materiality or reference to Material Adverse Effect is true and correct in all respects as of such earlier date) and (ii) no event has occurred and is continuing which constitutes a Default or an Event of Default.

(e) This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. Delivery of an executed counterpart of this Agreement by telecopy shall be effective as an original and shall constitute a representation that an executed original shall be delivered.

(f) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

[Signature pages follow]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

BORROWER:	THE ACTIVE NETWORK, INC., a Delaware corporation
	By:	Scott Mendel
	Name:	Scott Mendel
	Title:	Chief Financial Officer
GUARANTORS:	STARCITE, INC., a Delaware corporation
	By:	Michael Skelly
	Name:	Michael Skelly
	Title:	Chief Financial Officer

ADMINISTRATIVE AGENT:	BANK OF AMERICA, N.A., as Administrative Agent
	By:	Erik M. Truette
	Name:	Erik M. Truette
	Title:	Assistant Vice President
LENDERS:	BANK OF AMERICA, N.A., as a Lender, Swing Line Lender and L/C Issuer
	By:	Sophia T. Chen
	Name:	Sophia T. Chen
	Title:	Vice President
	JPMORGAN CHASE BANK, N.A., as a Lender
	By:	Ling Li
	Name:	Ling Li
	Title:	Vice President
	UNION BANK, N.A., as a Lender
	By:	Glenn Fortin
	Name:	Glenn Fortin
	Title:	Vice President
	WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender
	By:	Dennis Kim
	Name:	Dennis Kim
	Title:	Vice President

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jon Belmonte, certify that:

1. I have reviewed this quarterly report on Form 10-Q of The Active Network, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 2, 2013

By:	/s/ Jon Belmonte
	Jon Belmonte Interim Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Scott Mendel, certify that:

1. I have reviewed this quarterly report on Form 10-Q of The Active Network, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 2, 2013

By:	/s/ Scott Mendel
	Scott Mendel Chief Financial Officer (Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of The Active Network, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2013 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jon Belmonte, Interim Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 2, 2013

By:	/s/ Jon Belmonte
	Jon Belmonte Interim Chief Executive Officer (Principal Executive Officer)

The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of The Active Network, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Scott Mendel, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 2, 2013

By:	/s/ Scott Mendel
	Scott Mendel Chief Financial Officer (Principal Financial and Accounting Officer)

The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

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Accrued Expenses

6 Months Ended

Jun. 30, 2013

Accrued Expenses

11. Accrued Expenses

The following table presents the detail of accrued expenses for the periods presented (in thousands):

	June 30, 2013		December 31, 2012
Accrued compensation	$	17,390	$	14,569
Sales and other foreign taxes		7,053		6,065
Accrued rebates		5,267		4,234
Other accrued expenses		13,116		13,997
Accrued expenses	$	42,826	$	38,865

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Legal Proceedings - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	1 Months Ended	6 Months Ended
	Feb. 27, 2013	Jun. 30, 2013 Employee
Legal Proceedings [Line Items]
Number of employees with non solicitation agreements		2
Claim settlement amount	$ 1.0
Cash settlement by insurer	0.8
Net settlement expense	$ 0.2

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Condensed Consolidated Statements of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Net Revenue:
Technology revenue	$ 119,473	$ 108,155	$ 214,463	$ 192,275
Marketing services revenue	12,887	13,409	23,908	23,727
Total net revenue	132,360	121,564	238,371	216,002
Cost of net revenue:
Cost of technology revenue	56,413	50,812	105,459	96,467
Cost of marketing services revenue	1,024	2,115	2,215	3,431
Total cost of net revenue	57,437	52,927	107,674	99,898
Gross profit	74,923	68,637	130,697	116,104
Operating expenses:
Sales and marketing	27,148	24,284	53,974	49,308
Research and development	21,496	21,121	42,672	42,330
General and administrative	25,031	16,903	41,539	33,447
Amortization of intangibles	3,986	5,596	8,440	11,288
Total operating expenses	77,661	67,904	146,625	136,373
(Loss) income from operations	(2,738)	733	(15,928)	(20,269)
Interest income	16	25	31	50
Interest expense	(153)	(90)	(335)	(241)
Other income (expense), net	(470)	(524)	(1,023)	877
(Loss) income before provision for income taxes	(3,345)	144	(17,255)	(19,583)
Provision for income taxes	1,127	2,469	2,445	3,080
Net loss attributable to common stockholders	$ (4,472)	$ (2,325)	$ (19,700)	$ (22,663)
Net loss per share attributable to common stockholders:
Basic	$ (0.07)	$ (0.04)	$ (0.32)	$ (0.39)
Diluted	$ (0.07)	$ (0.04)	$ (0.32)	$ (0.39)
Weighted-average shares used to compute net loss per share attributable to common stockholders:
Basic	61,611	58,322	61,190	57,655
Diluted	61,611	58,322	61,190	57,655

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Business Combination

6 Months Ended

Jun. 30, 2013

Business Combination

4. Business Combination

Acquisition of StarCite, Inc.

On December 30, 2011, the Company completed its acquisition of all of the outstanding shares of StarCite, Inc. (“StarCite”), a provider of a technology platform that delivers content and services for meetings and event planning to corporations, hotels, venues and meetings suppliers for total consideration of $57.4 million. The acquisition enables the Company to provide an integrated solution for the events space and broaden its customer base.

Total consideration comprised $38.1 million in cash, 1,350,000 shares of common stock with a fair value of approximately $18.4 million and 150,000 shares of contingently issuable common stock with an acquisition date fair value of approximately $1.1 million to be issued in the event that the Company’s shares of common stock did not close trading at or above $15.00 per share for at least three consecutive days at any time during the sixty day period following the effective date of a registration statement filed to register the shares issued, pursuant to the agreement and plan of merger.

The Company’s common stock traded at or above $15.00 per share for three consecutive days subsequent to April 11, 2012, the effective registration date of the shares; accordingly the contingently issuable shares were not issuable to the former StarCite security holders. Immediately prior to the effective date of the registration statement, the estimated fair value of the contingent consideration was approximately $38,000. The change in the estimated fair value of the contingent consideration was recorded in other income in the Company’s condensed consolidated statements of operations and the remaining fair value was transferred from other current liabilities to equity.

The acquisition agreement included an initial escrow of approximately $0.3 million in cash to cover potential expenses of the security holders’ agent and 300,000 common shares valued at approximately $4.1 million, based on the closing price of the Company’s common stock on the last trading day of fiscal 2011 to satisfy any claims under the indemnification provisions of the agreement for a period of 12 months following the acquisition date. During the year ended December 31, 2012, 20,320 escrow shares valued at approximately $0.3 million were cancelled in order to satisfy indemnification claims related to the acquisition, 34,197 escrow shares valued at $0.5 million were set aside by the Company as a share reserve to satisfy unresolved indemnification claims related to the acquisition and 245,483 shares were issued and released from escrow. The cancellation of the shares was recorded as a purchase price adjustment with a corresponding reduction to goodwill, as the estimated fair value of assets acquired and liabilities assumed was preliminary.

The estimated fair values of assets acquired and liabilities assumed for the StarCite acquisition, are as follows (in thousands):

Cash	$	572
Restricted cash		692
Accounts receivable		14,566
Prepaid and other assets		1,301
Fixed assets		1,912
Goodwill		21,690
Intangible assets		36,500
Accounts payable		(1,398	)
Accrued expenses		(5,459	)
Deferred revenue		(11,286	)
Capital lease obligations		(480	)
Other liabilities		(528	)
Unfavorable leases		(695	)
Total purchase price	$	57,387

The acquisition was accounted for as a purchase business combination. The following table summarizes the identifiable intangible assets acquired as of the date of the acquisition (dollars in thousands):

	Gross Amount at Acquisition Date		Amortization Period
Trademarks	$	5,100		9 years
Customer relationships		17,300		9 years
Customer contracts		6,800		3 years
Complete technology		6,500		9 years
Non-compete agreements		800		1 year
Total intangible assets	$	36,500

Goodwill of $21.7 million, none of which is deductible for tax purposes, represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed from StarCite. The carrying amount of goodwill is allocated to the technology operating segment of the Company.

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Income Taxes

6 Months Ended

Jun. 30, 2013

Income Taxes

18. Income Taxes

The effective tax rate of (14.2)% for the six months ended June 30, 2013 differs from the statutory rate primarily due to state taxes, foreign taxes, the increase in the deferred tax liability from the amortization of tax deductible goodwill, the increase in the valuation allowance and discrete items recorded in the period.

The Company has uncertain tax positions of $1.3 million as of June 30, 2013 and December 31, 2012, respectively. The Company’s policy for recording interest and penalties on uncertain tax positions is to record such items as a component of income tax expense. Accrued interest and penalties of $0 million and $0.9 million were recorded at June 30, 2013 and December 31, 2012, respectively.

The Company reduces its deferred tax asset resulting from future tax benefits by a valuation allowance if, based on the weight of the available evidence, it is more likely than not that some portion or all of these deferred taxes will not be realized. The timing of the reversal of deferred tax liabilities associated with tax deductible goodwill is not certain and thus not available to assure the realization of deferred tax assets. Similarly, state deferred tax liabilities in excess of state deferred tax assets are not available to ensure the realization of federal deferred tax assets. After consideration of these limitations associated with deferred tax liabilities, the Company has deferred tax assets in excess of deferred tax liabilities for the periods presented. As the Company has no history of generating book income, the ultimate future realization of these excess deferred tax assets is not more likely than not and thus subject to a valuation allowance. Accordingly, the Company has established a valuation allowance against its domestic deferred tax assets. A valuation allowance has not been recorded against the Company’s foreign deferred tax assets as there are sufficient future taxable temporary differences in foreign jurisdictions to assure the realization of foreign deferred tax assets. Deferred tax assets of $0.7 million are included in prepaid expenses and other current assets on the balance sheet at June 30, 2013 and December 31, 2012.

The Company conducts business globally, and as a result, is subject to taxation in the United States and various state jurisdictions and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities in many of the jurisdictions in which the Company operates. Effectively, all of the Company’s historical tax filings are subject to examination by the Internal Revenue Service and various state and foreign jurisdictions due to the generation of net operating loss carry forwards.

It is possible that new tax exams may commence and that other issues may be effectively settled. However, the Company is unable to make a reasonably reliable estimate as to when or if cash settlements with taxing authorities may occur. Although audit outcomes and the timing of potential audit payments are subject to uncertainty, the Company does not anticipate that the resolution of these tax matters or any events related thereto will result in a material adverse change to its consolidated financial position, results of operations or cash flows.

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Related Party Transactions - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
ESPN | Maximum
Related Party Transaction [Line Items]
Net revenue from related parties	$ 0.1	$ 0.1	$ 0.1	$ 0.1
DISNEY
Related Party Transaction [Line Items]
Net revenue from related parties	0.8	0.7	1.2	0.9
USTA
Related Party Transaction [Line Items]
Net revenue from related parties	$ 1.4	$ 1.3	$ 2.8	$ 2.7

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Weighted-Average Assumptions Used to Estimate Fair Value of Stock Options Granted (Detail)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	58.00%		58.00%
Expected dividend yield
Risk-free rate	0.10%		0.10%
Expected term (in years)	8 months 12 days	5 years	8 months 12 days	5 years
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility		52.60%		51.80%
Risk-free rate		0.70%		0.70%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility		52.80%		52.80%
Risk-free rate		0.80%		1.10%

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Long-Term Debt

6 Months Ended

Jun. 30, 2013

Long-Term Debt

12. Long-Term Debt

In December 2011, the Company entered into a five-year, senior secured revolving credit facility, with certain institutional lenders, for an initial aggregate principal amount of $50 million (the “Credit Facility”). The Company has the ability to issue up to $15 million for letters of credit and $5 million for swing line loans under the Credit Facility. The Credit Facility also includes an “accordion” feature which allows the Company, subject to certain terms and conditions, to increase the lending commitments by up to $25 million. The Credit Facility has a maturity date of December 16, 2016, but the outstanding amounts may be prepaid at any time without penalty or premium (except for certain customary break funding payments in connection with LIBOR loans) and is available to fund acquisitions and ongoing operations.

In July 2012, the Company amended the Credit Facility by increasing the aggregate principal amount to $100 million, increasing the ability to issue letters of credit up to $25 million and increasing the “accordion” feature up to $50 million.

Any advance under the Credit Facility will accrue interest at rates per annum that are equal to, based on certain conditions, either (a) 1.5% above the applicable LIBOR rate, or (b) 0.5% above (i) the greatest of (x) the prime rate, (y) the federal funds effective rate plus 0.5% or (z) a daily rate equal to one-month LIBOR plus 1.00%. The unused portion of the Credit Facility will also be subject to an unused fee that will be calculated at a per annum rate of 0.25%. The interest rate under the Credit Facility was 1.77% and 1.81% as of June 30, 2013 and December 31, 2012, respectively.

Under the Credit Facility, the Company is required to comply with certain financial covenants and ratios, including a quarterly consolidated leverage ratio of consolidated funded indebtedness to EBITDA of not more than 2.5 to 1.0 and a quarterly consolidated fixed charge coverage ratio of not less than 1.5 to 1.0. Substantially all of the Company’s tangible and intangible assets are considered collateral security under the secured Credit Facility. As of June 30, 2013 and December 31, 2012, the Company was in compliance with all specified financial covenants and ratios.

The Company had no amount outstanding under the Credit Facility as of June 30, 2013 and December 31, 2012. Amounts available under the Credit Facility were $94.9 million and $93.9 million as of June 30, 2013 and December 31, 2012, respectively, net of $5.1 million and $6.1 million in outstanding letters of credit, respectively.

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Carrying Values of Acquired Amortized Intangible Assets (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 110,927	$ 131,303
Accumulated Amortization	(59,320)	(68,497)
Net Carrying Amount	51,607	62,806
Intellectual Property
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	24,089	24,800
Accumulated Amortization	(15,873)	(14,124)
Net Carrying Amount	8,216	10,676
Noncompete Agreements
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	2,098	2,098
Accumulated Amortization	(1,182)	(832)
Net Carrying Amount	916	1,266
Customer Relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	44,132	44,132
Accumulated Amortization	(14,468)	(11,256)
Net Carrying Amount	29,664	32,876
Trade Names
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	13,042	13,385
Accumulated Amortization	(4,832)	(4,113)
Net Carrying Amount	8,210	9,272
Customer Contracts
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	27,566	46,888
Accumulated Amortization	(22,965)	(38,172)
Net Carrying Amount	$ 4,601	$ 8,716

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Summary of Restricted Stock Activity (Detail) (USD $)	6 Months Ended
	Jun. 30, 2013
Restricted Stock Units (RSUs)
Number
Unvested at December 31, 2012	1,786,301
Granted	1,823,016
Released	(432,591)
Cancelled or expired	(190,883)
Unvested at June 30, 2013	2,985,843
Weighted-Average Grant Date Fair Value
Unvested at December 31, 2012	$ 13.97
Granted	$ 6.22
Released	$ 15.62
Cancelled or expired	$ 12.95
Unvested at June 30, 2013	$ 9.35
Performance Restricted Stock Units (PRSUs)
Number
Unvested at December 31, 2012	742,882
Released	(69,642)
Cancelled or expired	(257,376)
Unvested at June 30, 2013	415,864
Weighted-Average Grant Date Fair Value
Unvested at December 31, 2012	$ 12.14
Released	$ 13.06
Cancelled or expired	$ 11.32
Unvested at June 30, 2013	$ 12.49

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2013

Summarized Information by Segment

Summarized information by segment is as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Net revenue by segment:
Technology	$	119,473	$	108,155	$	214,463	$	192,275
Marketing services		12,887		13,409		23,908		23,727
Total net revenue	$	132,360	$	121,564	$	238,371	$	216,002

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs:
Technology	$	33,044		$	25,956		$	49,355		$	32,008
Marketing services		3,532			4,493			4,941			6,802
Total segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs		36,576			30,449			54,296			38,810
Depreciation and amortization		(15,460	)		(15,118	)		(30,859	)		(30,094	)
Stock-based compensation expense		(9,526	)		(4,302	)		(13,452	)		(7,331	)
Unallocated corporate costs		(14,328	)		(10,296	)		(25,913	)		(21,654	)
(Loss) income from operations	$	(2,738	)	$	733		$	(15,928	)	$	(20,269	)

Net Revenue and Long-Lived Assets by Major Geographic Region

The following tables set forth net revenue and long-lived assets by major geographic region (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Net revenue:
North America	$	128,930	$	118,762	$	231,695	$	209,984
Europe and other		3,430		2,802		6,676		6,018
Total net revenue	$	132,360	$	121,564	$	238,371	$	216,002

	June 30, 2013		December 31, 2012
Assets:
North America	$	593,015	$	537,220
Europe and other		6,652		5,250
Total assets	$	599,667	$	542,470
Property and equipment, net:
North America	$	41,819	$	39,460
Europe and other		2,708		1,776
Total property and equipment, net	$	44,527	$	41,236

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Subsequent Event

6 Months Ended

Jun. 30, 2013

Subsequent Event

21. Subsequent Event

On August 1, 2013, the Company announced that Kory Vossoughi resigned from his position as Chief Legal Officer, General Counsel and Secretary of the Company on July 29, 2013. In connection with his resignation, Mr. Vossoughi is entitled to certain payments and benefits including a severance payment equal to twelve months of his base salary, prorated annual target bonus payment, health coverage for twelve months from the date of separation, acceleration of certain unvested stock-based awards and an extension to exercise vested stock-based awards.

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Employee Benefit Plans

6 Months Ended

Jun. 30, 2013

Employee Benefit Plans

20. Employee Benefit Plans

Defined Contribution Plan

The Company has a defined contribution plan under Section 401(k) of the Internal Revenue Code (“401(k) Plan”) covering all full-time employees who meet certain eligibility requirements. Eligible employees may defer up to 4% of their pre-tax compensation, up to the annual maximum allowed by the Internal Revenue Service. Under the 401(k) Plan, the Company may, but is not obligated to, match a portion of the employee contributions up to a defined maximum. The Company made matching contributions $0.3 million and $0.2 million for the three months ended June 30, 2013 and 2012, respectively, and $0.6 million and $0.5 million for the six months ended June 30, 2013 and 2012, respectively.

Deferred Compensation Plan

In July 2012, the Company approved an unfunded, non-qualified Deferred Compensation Plan for certain employees. Under the Deferred Compensation Plan, participants may elect to defer up to 80% of their base salaries and up to 100% of performance-based compensation and commissions. The Company may also, at its discretion, match a portion of the employee contributions up to a defined maximum for each deferral election as prescribed in the Deferred Compensation Plan. The Company contributions vest annually over a four year period, subject to the employee’s continued service with the Company. The Company’s liability for the deferred compensation plan totaled less than $0.1 million as of June 30, 2013 and December 31, 2012, respectively, and is included in other liabilities in the consolidated balance sheets. Beginning in the first quarter of 2013, participant contributions are invested in Company-owned life insurance policies, which had a cash surrender value of less than $0.1 million and is included in prepaids and other current assets in the consolidated balance sheet at June 30, 2013.

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Software Development Costs - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Schedule Of Research And Development [Line Items]
Amortization of software development costs	$ 6.1	$ 4.2	$ 11.8	$ 8.2

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Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2013

Carrying Values of Acquired Amortized Intangible Assets

The carrying values of amortized intangible assets are as follows (in thousands):

	June 30, 2013							December 31, 2012
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intellectual property	$	24,089	$	(15,873	)	$	8,216	$	24,800	$	(14,124	)	$	10,676
Non-compete agreements		2,098		(1,182	)		916		2,098		(832	)		1,266
Customer relationships		44,132		(14,468	)		29,664		44,132		(11,256	)		32,876
Trade names		13,042		(4,832	)		8,210		13,385		(4,113	)		9,272
Customer contracts		27,566		(22,965	)		4,601		46,888		(38,172	)		8,716
Intangible assets	$	110,927	$	(59,320	)	$	51,607	$	131,303	$	(68,497	)	$	62,806

Amortization Expense of Acquired Intangible Assets

The following table summarizes the classification of amortization expense of acquired intangible assets for the periods indicated (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Cost of technology revenue	$	1,177	$	1,363	$	2,364	$	2,711
Cost of marketing services revenue		15		115		29		232
Operating expenses		3,986		5,596		8,440		11,288
Total amortization of acquired intangible assets	$	5,178	$	7,074	$	10,833	$	14,231

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Fair Value of Assets Acquired and Liabilities Assumed (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012	Dec. 30, 2011 Acquisition of StarCite, Inc.
Business Acquisition [Line Items]
Cash			$ 572
Restricted cash			692
Accounts receivable			14,566
Prepaid and other assets			1,301
Fixed assets			1,912
Goodwill	242,369	243,716	21,690
Intangible assets			36,500
Accounts payable			(1,398)
Accrued expenses			(5,459)
Deferred revenue			(11,286)
Capital lease obligations			(480)
Other liabilities			(528)
Unfavorable leases			(695)
Total purchase price			$ 57,387

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Amortization Expense of Acquired Intangible Assets (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Finite-Lived Intangible Assets [Line Items]
Cost of technology revenue	$ 1,177	$ 1,363	$ 2,364	$ 2,711
Cost of marketing services revenue	15	115	29	232
Operating expenses	3,986	5,596	8,440	11,288
Total amortization of acquired intangible assets	$ 5,178	$ 7,074	$ 10,833	$ 14,231

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Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2013

Summary of Property and Equipment

Property and equipment by category is as follows (in thousands):

	June 30, 2013			December 31, 2012
Computer and software	$	90,931		$	80,521
Furniture and fixtures		10,570			10,307
Leasehold improvements		7,174			6,485
Property and equipment		108,675			97,313
Less: Accumulated depreciation		(64,148	)		(56,077	)
Property and equipment, net	$	44,527		$	41,236

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Summarized Information by Segment (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Segment Reporting Information [Line Items]
Technology	$ 119,473	$ 108,155	$ 214,463	$ 192,275
Marketing services	12,887	13,409	23,908	23,727
Total net revenue	132,360	121,564	238,371	216,002
Segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs:
Total segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs	36,576	30,449	54,296	38,810
Depreciation and amortization	(15,460)	(15,118)	(30,859)	(30,094)
Stock-based compensation expense	(9,526)	(4,302)	(13,452)	(7,331)
Unallocated corporate costs	(14,328)	(10,296)	(25,913)	(21,654)
(Loss) income from operations	(2,738)	733	(15,928)	(20,269)
Technology
Segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs:
Total segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs	33,044	25,956	49,355	32,008
Marketing Services
Segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs:
Total segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs	$ 3,532	$ 4,493	$ 4,941	$ 6,802

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Presentation of Potentially Dilutive Securities Not Included in Calculation of Diluted Net Loss Per Share (Detail)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, amount	10,042,185	11,825,289	10,122,083	11,899,272
Stock Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, amount	7,203,438	10,126,396	7,409,418	10,646,606
Restricted Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, amount	2,152,848	1,603,734	2,133,019	1,167,338
Stock Compensation Plan
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, amount	146,220	94,525	156,683	84,694
MSU
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, amount	539,679		422,963
Warrant
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, amount		634		634

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Summary of Property and Equipment (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Property, Plant and Equipment [Line Items]
Property and equipment	$ 108,675	$ 97,313
Less: Accumulated depreciation	(64,148)	(56,077)
Property and equipment, net	44,527	41,236
Computer and software
Property, Plant and Equipment [Line Items]
Property and equipment	90,931	80,521
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment	10,570	10,307
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment	$ 7,174	$ 6,485

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Related Party Transactions

6 Months Ended

Jun. 30, 2013

Related Party Transactions

19. Related Party Transactions

ESPN Online Investments, Inc. (“ESPN”) is a significant common stockholder in the Company. The Company also sells its services to ESPN and its affiliates. The Company recorded net revenues from ESPN and its affiliates of less than $0.1 million for the three months ended June 30, 2013 and 2012, and less than $0.1 million for the six months ended June 30, 2013 and 2012.

ESPN is a wholly-owned subsidiary of The Walt Disney Company (“Disney”). The Company entered into an online services agreement with Disney to provide registration and advertising. The Company recorded net revenues from Disney of $0.8 million and $0.7 million for the three months ended June 30, 2013 and 2012, respectively, and $1.2 million and $0.9 million for the six months ended June 30, 2013 and 2012, respectively.

In August 2006, the Company entered into a Master Services Agreement and certain other related agreements with the United States Tennis Association (“USTA”) as amended in December 2010. Former members of the Company’s Board of Directors are the managing director for recreational tennis and chief financial officer at the USTA. Pursuant to the terms of these agreements, the USTA purchases certain software services from the Company. Net revenue from the USTA and its affiliates was approximately $1.4 million and $1.3 million for the three months ended June 30, 2013 and 2012, respectively, and $2.8 million and $2.7 million for the six months ended June 30, 2013 and 2012, respectively.

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Condensed Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Operating activities
Net loss	$ (19,700)	$ (22,663)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization of property and equipment	20,026	15,863
Amortization of intangible assets	10,833	14,231
Stock-based compensation expense	13,452	7,331
Allowance for doubtful accounts, net of write-offs	(131)	10
Deferred tax liability	1,689	1,799
Amortization of acquisition-related costs	(521)	(600)
Gain on contingent consideration		(1,123)
Change in operating assets and liabilities, net of effect of acquisitions:
Restricted cash	521	627
Registrations receivable	(15,030)	(7,809)
Accounts receivable	(1,747)	(6,699)
Inventories	220	(2,311)
Prepaid expenses and other assets	(2,221)	(1,318)
Accounts payable	(2,360)	(2,199)
Registration fees payable	55,978	39,944
Accrued expenses	7,029	390
Deferred revenue	6,675	13,105
Other liabilities	(95)	(359)
Net cash provided by operating activities	74,618	48,219
Investing activities
Purchases of property and equipment	(13,909)	(9,343)
Capitalized software development	(11,123)	(10,996)
Cash paid for acquisitions, net of cash acquired		(38,037)
Net cash used in investing activities	(25,032)	(58,376)
Financing activities
Proceeds from issuance of common stock	1,663	6,850
Payments on capital lease obligations	(1,124)	(2,737)
Payments of employee tax withholdings from equity transactions	(1,059)
Proceeds from long-term debt		10,000
Repayment of long-term debt		(5,000)
Net cash provided by (used in) financing activities	(520)	9,113
Effect of exchange rates on cash	576	151
Net increase (decrease) in cash and cash equivalents	49,642	(893)
Cash and cash equivalents at beginning of period	58,493	108,699
Cash and cash equivalents at end of period	108,135	107,806
Supplemental disclosures of cash flow information
Cash paid during the period for interest	277	155
Cash paid during the period for taxes	477	149
Supplemental disclosures of noncash financing and investing activities
Fixed asset purchases included in accounts payable	$ 2,362	$ 1,469

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Basis of Presentation and Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2013

Basis of Presentation and Summary of Significant Accounting Policies

2. Basis of Presentation and Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Active and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared by the Company, and reflect all adjustments, consisting only of normal recurring adjustments, that are, in the opinion of management, necessary for the fair presentation of the Company’s financial position, results of operations, comprehensive loss and cash flows for the interim periods presented. The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these statements do not include all information and footnotes required by GAAP for annual consolidated financial statements, and should be read in conjunction with our audited consolidated financial statements as of and for the fiscal year ended December 31, 2012 contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2013. The results of operations for the three and six months ended June 30, 2013 are not necessarily indicative of the operating results to be expected for the full fiscal year or future operating periods.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2013

Fair Value Measurements

5. Fair Value Measurements

FASB guidance for fair value measurements clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the guidance establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

The Company’s financial assets and liabilities that are measured at fair value on a recurring basis were insignificant at June 30, 2013 and December 31, 2012.

The Company did not have any transfers in or out of Level 1 or Level 2 during the six months ended June 30, 2013.

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Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2013

Recent Accounting Pronouncements

3. Recent Accounting Pronouncements

In February 2013, the FASB issued an update to the reporting of reclassifications out of accumulated other comprehensive income. The guidance requires an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income (loss) if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income (loss). For other amounts that are not required under GAAP to be reclassified in their entirety from accumulated other comprehensive income to net income (loss) in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP that provide additional detail about those amounts. This accounting standard became effective for the Company beginning in the first quarter of fiscal 2013, and its adoption did not have an impact on the Company’s consolidated financial statements.

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Identifiable Intangible Assets Acquired (Detail) (Acquisition of StarCite, Inc., USD $) In Thousands, unless otherwise specified	1 Months Ended
	Dec. 30, 2011
Business Acquisition [Line Items]
Gross Amount at Acquisition Date	$ 36,500
Trademarks
Business Acquisition [Line Items]
Gross Amount at Acquisition Date	5,100
Amortization Period	9 years
Customer Relationships
Business Acquisition [Line Items]
Gross Amount at Acquisition Date	17,300
Amortization Period	9 years
Customer Contracts
Business Acquisition [Line Items]
Gross Amount at Acquisition Date	6,800
Amortization Period	3 years
Complete Technology
Business Acquisition [Line Items]
Gross Amount at Acquisition Date	6,500
Amortization Period	9 years
Noncompete Agreements
Business Acquisition [Line Items]
Gross Amount at Acquisition Date	$ 800
Amortization Period	1 year

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Basis of Presentation and Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2013

Principles of Consolidation

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Active and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

Unaudited Interim Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared by the Company, and reflect all adjustments, consisting only of normal recurring adjustments, that are, in the opinion of management, necessary for the fair presentation of the Company’s financial position, results of operations, comprehensive loss and cash flows for the interim periods presented. The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these statements do not include all information and footnotes required by GAAP for annual consolidated financial statements, and should be read in conjunction with our audited consolidated financial statements as of and for the fiscal year ended December 31, 2012 contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2013. The results of operations for the three and six months ended June 30, 2013 are not necessarily indicative of the operating results to be expected for the full fiscal year or future operating periods.

Use of Estimates

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

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Software Development Costs (Tables)

6 Months Ended

Jun. 30, 2013

Summary of Capitalized Software Development Costs

Capitalized software development costs are as follows (in thousands):

	June 30, 2013			December 31, 2012
Software development costs	$	99,437		$	89,221
Less: Accumulated amortization		(49,568	)		(38,070	)
Software development costs, net	$	49,869		$	51,151

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Net Loss Attributable to Common Stockholders (Tables)

6 Months Ended

Jun. 30, 2013

Calculation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders

The following tables present the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except per share data):

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Net loss per share:
Net loss attributable to common stockholders	$	(4,472	)	$	(2,325	)	$	(19,700	)	$	(22,663	)
Weighted-average common shares outstanding:
Basic		61,611			58,322			61,190			57,655
Diluted		61,611			58,322			61,190			57,655
Net loss per share attributable to common stockholders:
Basic	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)
Diluted	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)

Presentation of Potentially Dilutive Securities Not Included In Calculation of Diluted Net Loss Per Share

Potentially dilutive securities not included in the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Options to purchase common stock and common stock subject to repurchase		7,203,438		10,126,396		7,409,418		10,646,606
Restricted stock		2,152,848		1,603,734		2,133,019		1,167,338
Employee stock purchase plan shares		146,220		94,525		156,683		84,694
Market Stock Units		539,679		—		422,963		—
Common stock warrants		—		634		—		634
		10,042,185		11,825,289		10,122,083		11,899,272

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Stock-Based Compensation - Additional Information (Detail) (USD $)	3 Months Ended		6 Months Ended		12 Months Ended	3 Months Ended	6 Months Ended	3 Months Ended	6 Months Ended										1 Months Ended	3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012	Jun. 30, 2012 Minimum	Jun. 30, 2012 Minimum	Jun. 30, 2012 Maximum	Jun. 30, 2012 Maximum	Jun. 30, 2013 Restricted Stock Units (RSUs)	Jun. 30, 2013 Performance Restricted Stock Units (PRSUs)	Jun. 30, 2013 Performance Restricted Stock Units (PRSUs) Minimum	Jun. 30, 2013 Performance Restricted Stock Units (PRSUs) Maximum	Jun. 30, 2013 MSU	Jun. 30, 2013 MSU Minimum	Jun. 30, 2013 MSU Maximum	Jun. 30, 2013 Stock Options Containing a Market Condition	Jun. 30, 2013 Stock Option Activity	Apr. 30, 2013 Stock Option Activity Chief Executive Officer	Jun. 30, 2013 2011 ESPP	Jun. 30, 2012 2011 ESPP	Jun. 30, 2013 2011 ESPP	Jun. 30, 2012 2011 ESPP	Jun. 30, 2013 2011 ESPP Minimum	Jun. 30, 2012 2011 ESPP Minimum	Jun. 30, 2013 2011 ESPP Minimum	Jun. 30, 2012 2011 ESPP Minimum	Jun. 30, 2013 2011 ESPP Maximum	Jun. 30, 2012 2011 ESPP Maximum	Jun. 30, 2013 2011 ESPP Maximum	Jun. 30, 2012 2011 ESPP Maximum
Common Stock, Preferred Stock, Treasury Stock, Stock-Based Compensation And Other Benefits [Line Items]
Stock option granted			100,000																100,000
Award vesting period										4 years		2 years	4 years		1 year	4 years	4 years		8 months
Expected Volatility	58.00%		58.00%			52.60%	51.80%	52.80%	52.80%								47.00%							43.10%	44.50%	43.10%	44.50%	55.10%	57.90%	55.10%	57.90%
Risk-free rate	0.10%		0.10%			0.70%	0.70%	0.80%	1.10%								0.74%			0.10%	0.10%	0.10%	0.20%
Contractual life	8 months 12 days	5 years	8 months 12 days	5 years													6 years			6 months	6 months	6 months	6 months
Market stock options outstanding	7,331,160		7,331,160		8,369,021												513,208
Unrecognized compensation cost, nonvested stock options																		$ 7,600,000
Weighted average period for which unrecognized compensation is expected to be recognized			1 year							3 years				1 year 9 months 18 days				2 years					6 months
PRSUs that can be settled in cash or stock											232,510
Unrecognized compensation cost										24,300,000	4,600,000			6,500,000
Shares issued under ESPP	158,292		158,292		244,947
Value of shares issued under ESPP	700,000		700,000
Unrecognized stock-based compensation expense	665,000		665,000																		200,000		200,000
Weighted average fair value of shares issued under ESPP					$ 7.80
Severance costs	$ 5,700,000		$ 5,700,000
Common stock,issued to the Company's former chief executive officer and executive chairman	456,297		456,297

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Accrued Expenses (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Accrued Expenses and Other Current Liabilities [Line Items]
Accrued compensation	$ 17,390	$ 14,569
Sales and other foreign taxes	7,053	6,065
Accrued rebates	5,267	4,234
Other accrued expenses	13,116	13,997
Accrued expenses	$ 42,826	$ 38,865

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Summary of Capitalized Software Development Costs (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Schedule Of Research And Development [Line Items]
Software development costs	$ 99,437	$ 89,221
Less: Accumulated amortization	(49,568)	(38,070)
Software development costs, net	$ 49,869	$ 51,151

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	100,000	100,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par share	$ 0.001	$ 0.001
Common stock, shares authorized	1,000,000	1,000,000
Common stock, shares issued	64,037	60,670
Common stock, shares outstanding	62,262	60,894
Treasury stock, at cost	1,776	1,776

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Software Development Costs

6 Months Ended

Jun. 30, 2013

Software Development Costs

8. Software Development Costs

Capitalized software development costs are as follows (in thousands):

	June 30, 2013			December 31, 2012
Software development costs	$	99,437		$	89,221
Less: Accumulated amortization		(49,568	)		(38,070	)
Software development costs, net	$	49,869		$	51,151

Amortization expense was $6.1 million and $4.2 million for the three months ended June 30, 2013 and 2012, respectively, and $11.8 million and $8.2 million for the six months ended June 30, 2013 and 2012, respectively.

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Condensed Consolidated Statements of Comprehensive Loss (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Net loss	$ (4,472)	$ (2,325)	$ (19,700)	$ (22,663)
Other comprehensive loss:
Foreign currency translation	(1,004)	(923)	(1,557)	(37)
Total other comprehensive loss	(1,004)	(923)	(1,557)	(37)
Comprehensive loss	$ (5,476)	$ (3,248)	$ (21,257)	$ (22,700)

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Summary of Market Stock Activity (Detail) (MSU, USD $)	6 Months Ended
	Jun. 30, 2013
MSU
Number
Granted	931,574
Released
Cancelled or expired	(50,000)
Unvested at June 30, 2013	881,574
Weighted-Average Grant Date Fair Value
Granted	$ 6.22
Released
Cancelled or expired	$ 5.60
Unvested at June 30, 2013	$ 6.25

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 108,135	$ 58,493
Restricted cash	624	1,145
Registrations receivable	31,281	16,260
Accounts receivable, net	52,980	51,363
Inventories	4,588	4,809
Prepaid expenses and other current assets	11,151	8,922
Total current assets	208,759	140,992
Property and equipment, net	44,527	41,236
Software development costs, net	49,869	51,151
Goodwill	242,369	243,716
Intangible assets, net	51,607	62,806
Other long-term assets	2,536	2,569
Total assets	599,667	542,470
Current liabilities:
Accounts payable	6,383	8,174
Registration fees payable	117,242	61,272
Accrued expenses	42,826	38,865
Deferred revenue	73,207	66,846
Capital lease obligations, current portion	2,319	2,774
Other current liabilities	3,719	4,373
Total current liabilities	245,696	182,304
Capital lease obligations, net of current portion	1,793	2,462
Other long-term liabilities	6,039	6,192
Deferred tax liability	20,707	19,065
Total liabilities	274,235	210,023
Commitments and contingencies (Note 13)
Stockholders' equity:
Preferred stock, $0.001 par value-authorized, 100,000 shares; no shares issued and outstanding
Common stock, $0.001 par value-authorized, 1,000,000; issued, 64,037 and 60,670; outstanding, 62,262 and 60,894	62	62
Treasury stock (at cost, 1,776 shares)	(11,959)	(11,959)
Additional paid-in capital	667,936	653,694
Accumulated other comprehensive income	7,377	8,934
Accumulated deficit	(337,984)	(318,284)
Total stockholders' equity	325,432	332,447
Total liabilities and stockholders' equity	$ 599,667	$ 542,470

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Long-Term Debt - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	1 Months Ended	6 Months Ended
	Dec. 31, 2011	Jun. 30, 2013	Dec. 31, 2012	Jul. 31, 2012
Debt Instrument [Line Items]
Period of secured revolving credit facility	5 years
Initial aggregate principal amount	$ 50			$ 100
Credit Facility, maturity date		Dec. 16, 2016
Credit Facility, description		Any advance under the Credit Facility will accrue interest at rates per annum that are equal to, based on certain conditions, either (a) 1.5% above the applicable LIBOR rate, or (b) 0.5% above (i) the greatest of (x) the prime rate, (y) the federal funds effective rate plus 0.5% or (z) a daily rate equal to one-month LIBOR plus 1.00%. The unused portion of the Credit Facility will also be subject to an unused fee that will be calculated at a per annum rate of 0.25%.
Credit facility, LIBOR rate		Any advance under the Credit Facility will accrue interest at rates per annum that are equal to, based on certain conditions, either (a) 1.5% above the applicable LIBOR rate, or (b) 0.5% above (i) the greatest of (x) the prime rate, (y) the federal funds effective rate plus 0.5% or (z) a daily rate equal to one-month LIBOR plus 1.00%.
Rate at which any unused Credit Facility fee will be calculated		0.25%
Credit Facility , interest rate		1.77%	1.81%
Indebtedness to EBITDA		250.00%
Fixed charge coverage ratio		150.00%
Credit Facility, available		94.9	93.9
Outstanding letters of credit		5.1	6.1
Letters of credit
Debt Instrument [Line Items]
Credit facility	15			25
Swing line loans
Debt Instrument [Line Items]
Credit facility	5
Accordion feature
Debt Instrument [Line Items]
Credit facility		$ 25		$ 50

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Business Combination (Tables) (Acquisition of StarCite, Inc.)

6 Months Ended

Jun. 30, 2013

Acquisition of StarCite, Inc.

Fair Value of Assets Acquired and Liabilities Assumed

The estimated fair values of assets acquired and liabilities assumed for the StarCite acquisition, are as follows (in thousands):

Cash	$	572
Restricted cash		692
Accounts receivable		14,566
Prepaid and other assets		1,301
Fixed assets		1,912
Goodwill		21,690
Intangible assets		36,500
Accounts payable		(1,398	)
Accrued expenses		(5,459	)
Deferred revenue		(11,286	)
Capital lease obligations		(480	)
Other liabilities		(528	)
Unfavorable leases		(695	)
Total purchase price	$	57,387

Identifiable Intangible Assets Acquired

The acquisition was accounted for as a purchase business combination. The following table summarizes the identifiable intangible assets acquired as of the date of the acquisition (dollars in thousands):

	Gross Amount at Acquisition Date		Amortization Period
Trademarks	$	5,100		9 years
Customer relationships		17,300		9 years
Customer contracts		6,800		3 years
Complete technology		6,500		9 years
Non-compete agreements		800		1 year
Total intangible assets	$	36,500

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Segment Information

6 Months Ended

Jun. 30, 2013

Segment Information

17. Segment Information

The Company’s Chief Executive Officer who is considered to be the chief operating decision maker (“CODM”) reviews financial information presented on a consolidated basis, accompanied by information about operating segments for purposes of making operating decisions and assessing financial performance. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the CODM in deciding how to allocate resources and in assessing performance.

The Company determined its operating segments to be technology and marketing services. Technology derives substantially all of its revenue from technology fees, software licensing, installation, training, maintenance, and hosting subscriptions. Marketing services derives substantially all of its revenue from online services, field marketing services, and membership programs.

The Company evaluates the performance of its operating segments based on net revenues and operating income before interest, taxes, depreciation, amortization and stock-based compensation expense.

The Company does not allocate most of its assets, depreciation and amortization expense, stock-based compensation expense, interest income, interest expense or income tax expense by segment. Accordingly, the Company does not report such information.

Summarized information by segment is as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Net revenue by segment:
Technology	$	119,473	$	108,155	$	214,463	$	192,275
Marketing services		12,887		13,409		23,908		23,727
Total net revenue	$	132,360	$	121,564	$	238,371	$	216,002

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs:
Technology	$	33,044		$	25,956		$	49,355		$	32,008
Marketing services		3,532			4,493			4,941			6,802
Total segment operating income before depreciation, amortization, stock-based compensation expense and unallocated corporate costs		36,576			30,449			54,296			38,810
Depreciation and amortization		(15,460	)		(15,118	)		(30,859	)		(30,094	)
Stock-based compensation expense		(9,526	)		(4,302	)		(13,452	)		(7,331	)
Unallocated corporate costs		(14,328	)		(10,296	)		(25,913	)		(21,654	)
(Loss) income from operations	$	(2,738	)	$	733		$	(15,928	)	$	(20,269	)

The Company allocates its net revenue to geographic regions based on the location at which each sale originates. The following tables set forth net revenue and long-lived assets by major geographic region (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Net revenue:
North America	$	128,930	$	118,762	$	231,695	$	209,984
Europe and other		3,430		2,802		6,676		6,018
Total net revenue	$	132,360	$	121,564	$	238,371	$	216,002

	June 30, 2013		December 31, 2012
Assets:
North America	$	593,015	$	537,220
Europe and other		6,652		5,250
Total assets	$	599,667	$	542,470
Property and equipment, net:
North America	$	41,819	$	39,460
Europe and other		2,708		1,776
Total property and equipment, net	$	44,527	$	41,236

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Property and Equipment - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Property, Plant and Equipment [Line Items]
Depreciation of property and equipment	$ 4.1	$ 3.9	$ 8.2	$ 7.7
Fixed assets under capital leases	14.5		14.5		14.5
Accumulated amortization of assets under capital leases	$ 9.1		$ 9.1		$ 7.9

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Summary of Stock Option Activity (Detail) (USD $)	6 Months Ended
	Jun. 30, 2013
Number of Shares Underlying Options
Outstanding at December 31, 2012	8,369,021
Granted	100,000
Exercised	(423,113)
Cancelled or expired	(714,748)
Outstanding at June 30, 2013	7,331,160
Weighted-Average Exercise Price
Outstanding at December 31, 2012	$ 5.78
Granted	$ 5.03
Exercised	$ 2.36
Cancelled or expired	$ 10.91
Outstanding at June 30, 2013	$ 5.47

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Net Revenue and Long-Lived Assets by Major Geographic Region (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Revenues from External Customers and Long-Lived Assets [Line Items]
Total net revenue	$ 132,360	$ 121,564	$ 238,371	$ 216,002
Total assets	599,667		599,667		542,470
Property and equipment, net:
Total property and equipment, net	44,527		44,527		41,236
North America
Revenues from External Customers and Long-Lived Assets [Line Items]
Total net revenue	128,930	118,762	231,695	209,984
Total assets	593,015		593,015		537,220
Property and equipment, net:
Total property and equipment, net	41,819		41,819		39,460
Europe And Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Total net revenue	3,430	2,802	6,676	6,018
Total assets	6,652		6,652		5,250
Property and equipment, net:
Total property and equipment, net	$ 2,708		$ 2,708		$ 1,776

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Business Combination - Additional Information (Detail) (USD $)			1 Months Ended	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Dec. 31, 2011 Acquisition of StarCite, Inc.	Dec. 31, 2012 Acquisition of StarCite, Inc.	Apr. 10, 2012 Acquisition of StarCite, Inc.	Dec. 30, 2011 Acquisition of StarCite, Inc.
Business Acquisition [Line Items]
Business combination, cost of acquired entity			$ 57,400,000
Cash component of total acquisition consideration			38,100,000
Shares of common stock component of total acquisition consideration			1,350,000
Fair value of shares of common stock component of total acquisition consideration			18,400,000
Contingently issuable shares			150,000
Fair value of contingently issuable shares			1,100,000		38,000
Common stock per share						$ 15.00
Number of days of trading			3 days
Contingent consideration time period			60 days
Cash held in escrow related to business acquisition						300,000
Shares held in escrow related to business acquisition				34,197		300,000
Fair value of shares held in escrow related to business acquisition				500,000		4,100,000
Escrow period				12 months
Escrow shares cancelled, shares				20,320
Escrow shares cancelled, value				300,000
Shares issued and released from escrow related to business acquisition				245,483
Goodwill	$ 242,369,000	$ 243,716,000				$ 21,690,000

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Accrued Expenses (Tables)

6 Months Ended

Jun. 30, 2013

Accrued Expenses

The following table presents the detail of accrued expenses for the periods presented (in thousands):

	June 30, 2013		December 31, 2012
Accrued compensation	$	17,390	$	14,569
Sales and other foreign taxes		7,053		6,065
Accrued rebates		5,267		4,234
Other accrued expenses		13,116		13,997
Accrued expenses	$	42,826	$	38,865

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Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2013

Summary of Stock Option Activity

Stock option activity for the six months ended June 30, 2013 is as follows:

Stock Options	Number of Shares Underlying Options			Weighted-Average Exercise Price
Outstanding at December 31, 2012		8,369,021		$	5.78
Granted		100,000			5.03
Exercised		(423,113	)		2.36
Cancelled or expired		(714,748	)		10.91
Outstanding at June 30, 2013		7,331,160		$	5.47

Weighted-Average Assumptions Used to Estimate the Fair Value of Stock Options Granted

The fair value of stock options granted that contain only a service condition as a requirement for vesting, was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Volatility		58.0	%		52.6-52.8	%		58	%		51.8-52.8	%
Expected dividend yield		—			—			—			—
Risk-free rate		0.1	%		0.7-0.8	%		0.1	%		0.7-1.1	%
Expected term (in years)		0.7			5.0			0.7			5.0

Weighted-Average Assumptions Used to Estimate Fair Value of Purchase Option Under ESPP Plan

The fair value of each purchase option under the 2011 ESPP is estimated at the beginning of each six-month offering period using the Black-Scholes model with the following weighted-average assumptions:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Volatility		43.1-55.1	%		44.5-57.9	%		43.1-55.1	%		44.5-57.9	%
Expected dividend yield		—			—			—			—
Risk-free rate		0.1	%		0.1	%		0.1	%		0.2	%
Expected term (in years)		0.5			0.5			0.5			0.5

Classification of Stock-Based Compensation in the Statements of Operations

The following table presents the effects of stock-based compensation expense related to stock-based awards to employees in the Company’s condensed consolidated statements of operations during the periods presented (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Cost of revenue	$	118	$	192	$	283	$	252
Sales and marketing		841		1,006		1,591		1,702
Research and development		410		668		1,009		1,120
General and administrative		8,157		2,436		10,569		4,257
Total stock-based compensation	$	9,526	$	4,302	$	13,452	$	7,331

Components of Stock-Based Compensation Expense

The components of stock-based compensation expense were as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Stock options	$	3,387	$	1,837	$	4,856	$	4,005
Restricted stock		1,963		2,179		4,221		2,834
Common stock		2,797		—		2,797		—
MSUs		323		—		441		—
PRSUs		953		87		931		123
ESPP		103		199		206		369
Total stock-based compensation	$	9,526	$	4,302	$	13,452	$	7,331

MSU

Summary of Restricted Stock Activity

MSU activity for the six months ended June 30, 2013 is as follows:

MSUs	Number of MSUs			Weighted- Average Grant Date Fair Value of MSUs
Unvested at December 31, 2012		—		$	—
Granted		931,574			6.22
Released		—			—
Cancelled or expired		(50,000	)		5.60
Unvested at June 30, 2013		881,574		$	6.25

RSUs and PRSUs

Summary of Restricted Stock Activity

RSU and PRSU activity for the six months ended June 30, 2013 is as follows:

RSUs and PRSUs	Number of RSUs			Weighted- Average Grant Date Fair Value of RSUs		Number of PRSUs			Weighted- Average Grant Date Fair Value of PRSUs
Unvested at December 31, 2012		1,786,301		$	13.97		742,882		$	12.14
Granted		1,823,016			6.22		—			—
Released		(432,591	)		15.62		(69,642	)		13.06
Cancelled or expired		(190,883	)		12.95		(257,376	)		11.32
Unvested at June 30, 2013		2,985,843		$	9.35		415,864			12.49

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Property and Equipment

6 Months Ended

Jun. 30, 2013

Property and Equipment

7. Property and Equipment

Property and equipment by category is as follows (in thousands):

	June 30, 2013			December 31, 2012
Computer and software	$	90,931		$	80,521
Furniture and fixtures		10,570			10,307
Leasehold improvements		7,174			6,485
Property and equipment		108,675			97,313
Less: Accumulated depreciation		(64,148	)		(56,077	)
Property and equipment, net	$	44,527		$	41,236

Depreciation expense was $4.1 million and $3.9 million for the three months ended June 30, 2013 and 2012, respectively, and $8.2 million and $7.7 million for the six months ended June 30, 2013 and 2012, respectively.

Included in fixed assets are $14.5 million of equipment under capital leases at June 30, 2013 and December 31, 2012. Accumulated amortization of assets under capital leases totaled $9.1 million and $7.9 million at June 30, 2013 and December 31, 2012, respectively.

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Calculation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Net loss per share:
Net loss attributable to common stockholders	$ (4,472)	$ (2,325)	$ (19,700)	$ (22,663)
Weighted-average common shares outstanding:
Basic	61,611	58,322	61,190	57,655
Diluted	61,611	58,322	61,190	57,655
Net loss per share attributable to common stockholders:
Basic	$ (0.07)	$ (0.04)	$ (0.32)	$ (0.39)
Diluted	$ (0.07)	$ (0.04)	$ (0.32)	$ (0.39)

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Accounts Receivable and Allowance for Doubtful Accounts (Tables)

6 Months Ended

Jun. 30, 2013

Summary of Accounts Receivable

Accounts receivable, net, by category is as follows (in thousands):

	June, 30 2013			December 31, 2012
Accounts receivable	$	54,101		$	52,353
Less: Allowance for doubtful accounts		(1,121	)		(990	)
Accounts receivable, net	$	52,980		$	51,363

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Summary of Accounts Receivable (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	$ 54,101	$ 52,353
Less: Allowance for doubtful accounts	(1,121)	(990)
Accounts receivable, net	$ 52,980	$ 51,363

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Intangible Assets

6 Months Ended

Jun. 30, 2013

Intangible Assets

10. Intangible Assets

Intangible assets are amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the assets.

Certain of the Company’s intangible assets were recorded in foreign currencies and both the gross carrying amounts and accumulated amortization are subject to foreign exchange adjustments. The carrying values of amortized intangible assets are as follows (in thousands):

	June 30, 2013							December 31, 2012
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intellectual property	$	24,089	$	(15,873	)	$	8,216	$	24,800	$	(14,124	)	$	10,676
Non-compete agreements		2,098		(1,182	)		916		2,098		(832	)		1,266
Customer relationships		44,132		(14,468	)		29,664		44,132		(11,256	)		32,876
Trade names		13,042		(4,832	)		8,210		13,385		(4,113	)		9,272
Customer contracts		27,566		(22,965	)		4,601		46,888		(38,172	)		8,716
Intangible assets	$	110,927	$	(59,320	)	$	51,607	$	131,303	$	(68,497	)	$	62,806

Amortization of intellectual property is recorded in cost of revenue, while the amortization of other acquired intangible assets is included in operating expenses. The following table summarizes the classification of amortization expense of acquired intangible assets for the periods indicated (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Cost of technology revenue	$	1,177	$	1,363	$	2,364	$	2,711
Cost of marketing services revenue		15		115		29		232
Operating expenses		3,986		5,596		8,440		11,288
Total amortization of acquired intangible assets	$	5,178	$	7,074	$	10,833	$	14,231

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Accounts Receivable and Allowance for Doubtful Accounts

6 Months Ended

Jun. 30, 2013

Accounts Receivable and Allowance for Doubtful Accounts

6. Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable, net, by category is as follows (in thousands):

	June, 30 2013			December 31, 2012
Accounts receivable	$	54,101		$	52,353
Less: Allowance for doubtful accounts		(1,121	)		(990	)
Accounts receivable, net	$	52,980		$	51,363

Allowances for doubtful accounts are established based on various factors including individual accounts receivable over a specific aging, historical payments, and current economic trends. The Company reviews its allowances by assessing individual accounts receivable over a specific aging and amount, and all other balances on a pooled basis based on historical collection experience. Accounts receivable are written off on a case-by-case basis, net of any amounts that may be collected.

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Business

6 Months Ended

Jun. 30, 2013

Business

1. Business

The Active Network, Inc., a Delaware corporation, and its subsidiaries (“Active” or the “Company”), provide cloud computing applications for Activity and Participant Management™ that form an online network connecting a fragmented and diverse group of activity and event organizers with a large base of potential participants. The Company’s technology platform transforms the way organizers manage their activities and events by automating online registrations and streamlining other critical management functions, while driving consumer participation to their activities and events.

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Commitments and Contingencies - Additional Information (Detail) (USD $)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Commitments and Contingencies Disclosure [Line Items]
Rent expense	$ 3,500,000	$ 3,600,000	$ 7,100,000	$ 7,000,000
Company guarantees	5,400,000		5,400,000		7,200,000
Company's accrued health benefits liability	1,400,000		1,400,000		1,200,000
Reserve for state sales and use tax			5,500,000		5,100,000
Reduction in sales and use tax liability	599,000
Accrued liability	1,300,000		1,300,000		1,500,000
Severance Charges	7,200,000		7,200,000
Unrecognized stock-based compensation expense	$ 665,000		$ 665,000
Weighted average period for which unrecognized compensation is expected to be recognized			1 year

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Carrying Amount of Goodwill (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013
Goodwill [Line Items]
Beginning balance	$ 243,716
Effect of exchange rate changes	(1,347)
Ending balance	242,369
Technology
Goodwill [Line Items]
Beginning balance	230,998
Effect of exchange rate changes	(1,347)
Ending balance	229,651
Marketing Services
Goodwill [Line Items]
Beginning balance	12,718
Effect of exchange rate changes
Ending balance	$ 12,718

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Goodwill (Tables)

6 Months Ended

Jun. 30, 2013

Carrying Amount of Goodwill

The change in the carrying amount of goodwill for the six months ended June 30, 2013 is as follows (in thousands):

	Technology			Marketing Services		Total
Balance at December 31, 2012	$	230,998		$	12,718	$	243,716
Effect of exchange rate changes		(1,347	)		—		(1,347	)
Balance at June 30, 2013	$	229,651		$	12,718	$	242,369

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Income Taxes - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Income Tax [Line Items]
Effective tax rate	(14.20%)
Uncertain tax positions	$ 1.3	$ 1.3
Accrued interest and penalties	0	0.9
Deferred tax assets	$ 0.7	$ 0.7

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Weighted-Average Assumptions Used to Estimate Fair Value of Purchase Option Under ESPP Plan (Detail)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	58.00%		58.00%
Expected dividend yield
Risk-free rate	0.10%		0.10%
Expected term (in years)	8 months 12 days	5 years	8 months 12 days	5 years
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility		52.60%		51.80%
Risk-free rate		0.70%		0.70%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility		52.80%		52.80%
Risk-free rate		0.80%		1.10%
2011 ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend yield
Risk-free rate	0.10%	0.10%	0.10%	0.20%
Expected term (in years)	6 months	6 months	6 months	6 months
2011 ESPP | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	43.10%	44.50%	43.10%	44.50%
2011 ESPP | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	55.10%	57.90%	55.10%	57.90%

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2013

Commitments and Contingencies

13. Commitments and Contingencies

Operating Leases

The Company leases its office and datacenter facilities under non-cancelable leases that expire at various times through 2021. The Company is also responsible for certain real estate taxes, utilities and maintenance costs on its office facilities. Rent expense was approximately $3.5 million and $3.6 million for the three months ended June 30, 2013 and 2012, respectively, and $7.1 million and $7.0 million for the six months ended June 30, 2013 and 2012, respectively.

Guarantees

The Company enters into arrangements with third-party customers to guarantee performance by the Company. The Company may provide a corporate guarantee, irrevocable letter of credit, surety bond or any other form of guarantee acceptable to the third-party customer. As of June 30, 2013 and December 31, 2012, the Company had guarantees of $5.4 million and $7.2 million, respectively.

Self-Insured Health Plan

The Company is generally self-insured for losses and liabilities related to health benefits. The Company’s self-insurance accruals are based on estimates, and while the Company believes that the amounts accrued are adequate, the ultimate claims may be in excess of the amounts provided. The Company’s accrued health benefits liability was $1.4 million and $1.2 million at June 30, 2013 and December 31, 2012, respectively.

Sales and Use Tax

In the normal course of business, the Company is subject to sales and use tax audits in certain states. As a result, the Company records a liability for sales and use taxes and evaluates the adequacy of such amounts each reporting period. At June 30, 2013 and December 31, 2012, the Company maintained a liability for sales and use taxes of approximately $5.5 million and $5.1 million, respectively.

In June 2013, the Company was notified by the Texas Comptroller of Public Accounts that it had concluded its sales and use tax audit for the periods of April 1, 2009 through June 30, 2012. Based on the results of their audit, the Company reduced its sales and use tax liability by approximately $599,000, which the Company recorded as a reduction to its operating expenses on its condensed consolidated financial statements during the quarter ended June 30, 2013.

Indemnification

The Company enters into indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to its technology. The term of these indemnification agreements is generally perpetual any time after the execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements.

The Company indemnifies its officers and directors under the terms of indemnity agreements entered into with them, as well as pursuant to the Company’s certificate of incorporation, bylaws and applicable Delaware law.

Penalty Accruals

The Company maintains a liability of $1.3 million and $1.5 million at June 30, 2013 and December 31, 2012, respectively, as a result of the potential exposure for penalties from its customers for various technical disruptions. The Company estimates the penalty accrual based on specific identification and the Company’s historical experience.

Separation Arrangements

On May 1, 2013, Matthew Landa resigned from his position as Chief Executive Officer of the Company effective April 30, 2013.

On May 1, 2013, David Alberga resigned from his position as Executive Chairman of the Company and Chairman of the Board of Directors of the Company effective April 30, 2013. Mr. Alberga will remain a member of the Board of Directors through the Company’s Annual Meeting of Stockholders in 2014.

In connection with their separations, Mr. Landa and Mr. Alberga are entitled to certain termination benefits including severance payments equal to twelve months of their base salaries, prorated annual target bonus payments, health coverage for twelve months from the date of termination, acceleration of certain unvested stock-based awards and an extension to exercise vested stock-based awards. The Company recorded severance charges of approximately $7.2 million during the quarter ended June 30, 2013. The Company will record an additional $665,000 of stock-based compensation expense for Mr. Alberga over his remaining one-year term as a member of the Company’s Board of Directors.

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Goodwill

6 Months Ended

Jun. 30, 2013

Goodwill

9. Goodwill

The change in the carrying amount of goodwill for the six months ended June 30, 2013 is as follows (in thousands):

	Technology			Marketing Services		Total
Balance at December 31, 2012	$	230,998		$	12,718	$	243,716
Effect of exchange rate changes		(1,347	)		—		(1,347	)
Balance at June 30, 2013	$	229,651		$	12,718	$	242,369

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Employee Benefit Plans - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013 Maximum	Dec. 31, 2012 Maximum
Employee Benefit Plan [Line Items]
Pre-tax compensation			4.00%
Matching contributions of company	$ 0.3	$ 0.2	$ 0.6	$ 0.5
Deferred Compensation Plan on base salaries			80.00%
Deferred Compensation Plan, performance-based compensation and commissions			100.00%
Contribution vesting period			4 years
Deferred compensation plan					0.1	0.1
Investments in company-owned life insurance policies					$ 0.1

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Net Loss Attributable to Common Stockholders

6 Months Ended

Jun. 30, 2013

Net Loss Attributable to Common Stockholders

16. Net Loss Attributable to Common Stockholders

Basic net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. Under the two-class method, basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period.

The following tables present the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except per share data):

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Net loss per share:
Net loss attributable to common stockholders	$	(4,472	)	$	(2,325	)	$	(19,700	)	$	(22,663	)
Weighted-average common shares outstanding:
Basic		61,611			58,322			61,190			57,655
Diluted		61,611			58,322			61,190			57,655
Net loss per share attributable to common stockholders:
Basic	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)
Diluted	$	(0.07	)	$	(0.04	)	$	(0.32	)	$	(0.39	)

Potentially dilutive securities not included in the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Options to purchase common stock and common stock subject to repurchase		7,203,438		10,126,396		7,409,418		10,646,606
Restricted stock		2,152,848		1,603,734		2,133,019		1,167,338
Employee stock purchase plan shares		146,220		94,525		156,683		84,694
Market Stock Units		539,679		—		422,963		—
Common stock warrants		—		634		—		634
		10,042,185		11,825,289		10,122,083		11,899,272

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Legal Proceedings

6 Months Ended

Jun. 30, 2013

Legal Proceedings

14. Legal Proceedings

From time to time, the Company is involved in disputes, litigation and other legal actions. The Company records a charge equal to at least the minimum estimated liability for a loss contingency only when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements, and (ii) the range of loss can be reasonably estimated. The actual liability in any such matters may be materially different from the Company’s estimates, which could result in the need to adjust the liability and record additional expenses. The Company is not aware of any pending or threatened litigation that is reasonably likely to have a material adverse effect on our results of operations, financial position or liquidity.

Monster Litigation

On December 16, 2011, Monster Worldwide, Inc. (“Monster”) filed a complaint in the United States District Court for the Southern District of New York against a former Monster employee and current Active executive (the “Active Executive”). The complaint asserted various claims contending that the Active Executive violated the non-solicitation terms in certain of the Active Executive’s agreements with Monster by soliciting and hiring two former technology employees of Monster who are current employees of the Company.

On February 7, 2012, Monster filed an amended complaint to add additional allegations, and on June 7, 2012, Monster filed a second amended complaint to add allegations and claims against (1) Active; and (2) a second former Monster employee and current Active employee. The claims against this employee were similar to the claims alleged in the original complaint against the Active Executive and arose from alleged violations of this second employee’s non-solicitation agreement with Monster claiming the second employee solicited for hire a third former employee of Monster that is a current employee of the Company. The Company was added as a defendant to the complaint resulting from allegations by Monster that it interfered with the non-solicitation agreements by hiring the three former employees of Monster. Additionally, the second amended complaint included a new claim for breach of fiduciary duty against the Active Executive.

On February 27, 2013, the parties entered into a settlement and general release agreement, releasing all claims against Active and its employees in exchange for a cash settlement of $1.0 million. The Company’s insurer paid $0.8 million of the total settlement. As a result, the Company recorded the net settlement expense of $0.2 million in general and administrative expenses.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2013	Jul. 30, 2013
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2
Trading Symbol	ACTV
Entity Registrant Name	ACTIVE NETWORK INC
Entity Central Index Key	0001163932
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		62,363,680

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Stock-Based Compensation

6 Months Ended

Jun. 30, 2013

Stock-Based Compensation

15. Stock-Based Compensation

The Company’s stock-based compensation is comprised of stock options, stock options with market conditions (“Market Stock Options”), restricted stock units with service conditions (“RSUs”), restricted stock units with market conditions (“MSUs”), and performance-based restricted stock units (“PRSUs”) which are issued under our 2002 and/or 2011 equity incentive plan, as well as common stock issued under the Employee Stock Purchase Plan (“ESPP”).

Stock Options and Market Stock Options

Stock option activity for the six months ended June 30, 2013 is as follows:

Stock Options	Number of Shares Underlying Options			Weighted-Average Exercise Price
Outstanding at December 31, 2012		8,369,021		$	5.78
Granted		100,000			5.03
Exercised		(423,113	)		2.36
Cancelled or expired		(714,748	)		10.91
Outstanding at June 30, 2013		7,331,160		$	5.47

On April 30, 2013, the Company granted 100,000 stock options to its interim chief executive officer which vest over eight months.

The fair value of stock options granted that contain only a service condition as a requirement for vesting, was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Volatility		58.0	%		52.6-52.8	%		58	%		51.8-52.8	%
Expected dividend yield		—			—			—			—
Risk-free rate		0.1	%		0.7-0.8	%		0.1	%		0.7-1.1	%
Expected term (in years)		0.7			5.0			0.7			5.0

The fair value of Market Stock Options was estimated on the date of grant using the Monte Carlo Simulation valuation model, which estimates the potential outcome of reaching the market condition based on simulated future stock prices, with the following assumptions: contractual life of six years; expected volatility of 47% and risk free interest rate of 0.74%. These options vest over four years and are exercisable if specified stock prices are achieved. 513,208 Market Stock Options remain issued and outstanding at June 30, 2013.

Total unrecognized compensation cost, adjusted for estimated forfeitures, related to non-vested stock options and market stock options is approximately $7.6 million as of June 30, 2013 and is expected to be recognized over a weighted-average period of 2 years.

Restricted Stock Units

RSU and PRSU activity for the six months ended June 30, 2013 is as follows:

RSUs and PRSUs	Number of RSUs			Weighted- Average Grant Date Fair Value of RSUs		Number of PRSUs			Weighted- Average Grant Date Fair Value of PRSUs
Unvested at December 31, 2012		1,786,301		$	13.97		742,882		$	12.14
Granted		1,823,016			6.22		—			—
Released		(432,591	)		15.62		(69,642	)		13.06
Cancelled or expired		(190,883	)		12.95		(257,376	)		11.32
Unvested at June 30, 2013		2,985,843		$	9.35		415,864			12.49

The fair value of RSUs and PRSUs is based on the stock price on the date of grant. The RSUs vest over a four year period following the date of grant. The PRSUs vest over a two to four year period following the date of grant, subject to achievement of performance objectives and the participant’s continued service through the applicable vesting dates.

The number of PRSUs granted in the table above represents the maximum number of awards that could ultimately be issued if certain Company financial targets, as defined under the agreements, are achieved. The shares, if any, will be issued on a one-for-one basis following the end of the applicable performance and service periods. 232,510 PRSUs can be settled in cash or shares at the election of the Company. Compensation cost associated with the PRSUs is recognized when the performance metrics are determined to be probable of achievement over the requisite service periods.

At June 30, 2013, the remaining unrecognized compensation expense, adjusted for estimated forfeitures, related to RSUs is $24.3 million and is expected to be recognized over a weighted-average period of 3 years. The remaining unrecognized compensation expense associated with the maximum number of PRSUs that could ultimately be issued of $4.6 million will be recognized if and when the Company concludes that it is probable that the performance condition will be achieved, net of an estimate of pre-vesting forfeitures, over the requisite service period. The Company will reassess the probability of vesting at each reporting period for awards with performance conditions and adjust its stock-based compensation expense based on its probability assessment.

Market Stock Units

MSU activity for the six months ended June 30, 2013 is as follows:

MSUs	Number of MSUs			Weighted- Average Grant Date Fair Value of MSUs
Unvested at December 31, 2012		—		$	—
Granted		931,574			6.22
Released		—			—
Cancelled or expired		(50,000	)		5.60
Unvested at June 30, 2013		881,574		$	6.25

The fair value of MSUs is measured using the Monte Carlo simulation model which estimates the potential outcome of reaching the market condition based on simulated future stock prices and is recognized over the requisite service period. The MSUs vest over a one to four year period following the date of grant, subject to the achievement of certain market performance objectives and the participant’s continued service through the applicable vesting dates.

At June 30, 2013, the remaining unrecognized compensation cost, adjusted for estimated forfeitures, related to MSUs is $6.5 million and is expected to be recognized over a weighted-average period of 1.8 years.

Employee Stock Purchase Plan

The Company issued 158,292 shares for approximately $0.7 million in employee contributions during the three and six months ended June 30, 2013 under the Company’s 2011 Employee Stock Purchase Plan (“2011 ESPP”).

The fair value of each purchase option under the 2011 ESPP is estimated at the beginning of each six-month offering period using the Black-Scholes model with the following weighted-average assumptions:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Volatility		43.1-55.1	%		44.5-57.9	%		43.1-55.1	%		44.5-57.9	%
Expected dividend yield		—			—			—			—
Risk-free rate		0.1	%		0.1	%		0.1	%		0.2	%
Expected term (in years)		0.5			0.5			0.5			0.5

As of June 30, 2012, total unrecognized compensation cost related to non-vested stock-based compensation arrangements granted under the 2011 ESPP was $0.2 million, which is expected to be recognized over a weighted-average period of six months. As of December 31, 2012, 244,947 shares were issued with a weighted average fair value of $7.80.

Stock-Based Compensation Expense

The following table presents the effects of stock-based compensation expense related to stock-based awards to employees in the Company’s condensed consolidated statements of operations during the periods presented (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Cost of revenue	$	118	$	192	$	283	$	252
Sales and marketing		841		1,006		1,591		1,702
Research and development		410		668		1,009		1,120
General and administrative		8,157		2,436		10,569		4,257
Total stock-based compensation	$	9,526	$	4,302	$	13,452	$	7,331

The components of stock-based compensation expense were as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Stock options	$	3,387	$	1,837	$	4,856	$	4,005
Restricted stock		1,963		2,179		4,221		2,834
Common stock		2,797		—		2,797		—
MSUs		323		—		441		—
PRSUs		953		87		931		123
ESPP		103		199		206		369
Total stock-based compensation	$	9,526	$	4,302	$	13,452	$	7,331

Stock-based compensation expense for the three and six months ended June 30, 2013 included $5.7 million related to separation payments for the acceleration of non-vested equity awards and the grant of 456,297 shares of the Company’s common stock, due to the departures of the Company’s former chief executive officer and executive chairman on April 30, 2013. (see note 13)

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Components of Stock-Based Compensation Expense (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 9,526	$ 4,302	$ 13,452	$ 7,331
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	3,387	1,837	4,856	4,005
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	1,963	2,179	4,221	2,834
Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	2,797		2,797
MSU
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	323		441
Performance Restricted Stock Units (PRSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	953	87	931	123
2011 ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 103	$ 199	$ 206	$ 369

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Classification of Stock-Based Compensation in Statements of Operations (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 9,526	$ 4,302	$ 13,452	$ 7,331
Cost of Revenue
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	118	192	283	252
Sales and Marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	841	1,006	1,591	1,702
Research and Development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	410	668	1,009	1,120
General and Administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 8,157	$ 2,436	$ 10,569	$ 4,257