8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

October 19, 2016

Rocket Fuel Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-36071	30-0472319
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1900 Seaport Blvd.

Redwood City, CA 94063

(Address of principal executive offices, including zip code)

(650) 595-1300

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.02.    Termination of a Material Definitive Agreement.

On October 21, 2016, Rocket Fuel Inc. (the “Company”) entered into a Lease Termination and Release Agreement (the “Termination Agreement”) with Google Inc. (the “Landlord”) which provides for an early termination of the Company's Office Lease dated as of August 7, 2013, by and between the Company and the Landlord, as amended (the “Lease”), pursuant to which the Company leased approximately 141,180 square feet of the building located at 1900 Seaport Boulevard, Redwood City, CA 94063 for its corporate headquarters. The Lease was previously scheduled to expire on December 31, 2019. Pursuant to and subject to the terms of the Termination Agreement, the Lease will be terminated early, effective as of January 2, 2017 (the “Termination Date”). Following the Termination Date, the Company will have no further rent obligations to the Landlord pursuant to the Lease. The Company’s monthly base rent under the Lease prior to the Termination Date is $486,779.04. The Company will not incur any early termination fees as a result of this termination.

The foregoing description of the Termination Agreement does not purport to be complete and is qualified in its entirety by reference to the Termination Agreement, a copy of which is attached as Exhibit 10.1 hereto and is incorporated under this Item 1.02 by reference.

Item 2.02.    Results of Operations and Financial Condition.

On October 25, 2016, the Company issued a press release announcing its financial results for the three months ended September 30, 2016. The attached press release includes a discussion of certain non-GAAP financial measures as well as a reconciliation of such non-GAAP financial measures to the corresponding GAAP financial measures.

A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated under this Item 2.02 by reference.

The information set forth under this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as expressly set forth by specific reference in any such filing.

Item 5.02.  Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b), (c), (e)

Resignation of Chief Financial Officer

On October 19, 2016, Rex S. Jackson, the Company’s Chief Financial Officer (“CFO”), announced that he will resign from the Company effective October 26, 2016.

Appointment of Interim Chief Financial Officer

Beginning on October 27, 2016, Henrik Gerdes, the Company's Vice President, Corporate Controller and Treasurer, will serve as interim CFO until November 9, 2016. Mr. Gerdes, age 41, will also serve as principal financial officer and principal accounting officer for the Company. Mr. Gerdes joined Rocket Fuel in September 2014 as Corporate Controller. From November 2011 to August 2014, Mr. Gerdes served as Finance Director of TIBCO Software Inc., a publicly traded enterprise-software company. Before joining TIBCO, Mr. Gerdes was Corporate Reporting Manager at Quinstreet, Inc., a publicly traded online marketing company from April 2010 to October 2011. After starting his career with Deutsche Bank, Mr. Gerdes spent nine years at PricewaterhouseCoopers. Mr. Gerdes holds a Masters of Finance and Accounting from the University of Goettingen, Germany.

On October 23, 2016, the Compensation Committee (the “Compensation Committee”) of the Board of Directors (the “Board”) of the Company approved the payment of two special bonuses in the amounts of $35,000 (the “First Bonus”) and $40,000 (the “Second Bonus”) to Mr. Gerdes in recognition of his serving as interim CFO. The First Bonus is payable on the date that the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016 is filed, and the Second Bonus is payable on October 27, 2017, with each bonus payment subject to Mr. Gerdes' continued employment with the Company through the date that the applicable bonus is earned.

There are no arrangements or understandings between Mr. Gerdes and any other persons pursuant to which Mr. Gerdes was selected as interim CFO of the Company. There are no family relationships between Mr. Gerdes and any director or executive officer of the Company, and Mr. Gerdes has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K promulgated under the Securities Exchange Act of 1934, as amended, nor are any such transactions currently proposed.

Appointment of Chief Financial Officer

Stephen Snyder will join the Company as CFO beginning on or about November 10, 2016 and will succeed Mr. Gerdes as the Company’s principal financial officer and principal accounting officer.

Before joining the Company, Mr. Snyder, age 49, was Chief Financial Officer at Trilliant Incorporated, a global, venture-backed, late-stage energy company, from December 2015 to October 2016. Previously, he served as Vice President of Finance in the office of the CFO at Adobe Systems Incorporated and before that, as Vice President and General Manager, Worldwide Channel Sales. Mr. Snyder has more than 20 years of finance and sales experience in executive roles at technology companies, including Adobe Systems and Hewlett Packard Company. Mr. Snyder received his B.A. in Management Science from the University of California, San Diego and his M.B.A from the University of Southern California.

There are no arrangements or understandings between Mr. Snyder and any other persons pursuant to which Mr. Snyder was selected as the CFO of the Company. There are no family relationships between Mr. Snyder and any director or executive officer of the Company, and, other than the indemnification agreement described below, Mr. Snyder has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K promulgated under the Securities Exchange Act of 1934, as amended, nor are any such transactions currently proposed.

Offer Letter

On October 23, 2016, the Company and Mr. Snyder entered into an employment offer letter (the “Offer Letter”). Mr. Snyder’s employment with the Company is on an at-will basis. Under the terms of the Offer Letter, Mr. Snyder will be paid an annual base salary of $325,000 and will be eligible for a bonus of 60% of his base salary under the Company’s Executive Incentive Compensation Plan (the “Executive Bonus Plan”), subject to continued service through the date the bonus is earned pursuant to the terms of the Executive Bonus Plan. Mr. Snyder is eligible to participate in the Executive Bonus Plan on a pro-rated basis for the second half of the 2016 fiscal year, subject to his continued employment. The Offer Letter also provides that Mr. Snyder is eligible to participate in the benefits programs generally available to employees of the Company.

The Offer Letter also provides that (i) the Company recommend to the Board or the Compensation Committee that it grant Mr. Snyder an option to purchase 380,000 shares of the Company’s common stock (the "Snyder Option") with an exercise price equal to the fair market value of the shares on the date of grant, pursuant to the Company’s 2013 Equity Incentive Plan and form of option agreement approved by the Compensation Committee for use thereunder; and (ii) the Snyder Option will vest over a four-year period contingent on Mr. Snyder’s continued service with the Company on each vesting date. On October 24, 2016, the Compensation Committee approved the Snyder Option effective as of Mr. Snyder's start date, provided his start date occurs no later than December 31, 2016.

In addition, the Offer Letter provides that if, during the first 12 months of his employment, Mr. Snyder becomes entitled to receive cash severance under his Retention Agreement, as described below, in connection with a Qualifying Termination (as defined below) that occurs outside of the “change in control period” (as defined below), he will receive a lump sum cash severance payment equal to 9 months of his annual base salary, generally payable on the same terms and conditions as any cash severance benefits under the Retention Agreement. Any such severance payment under the Offer Letter will reduce the benefits to which he is entitled under the Retention Agreement. This provision has the effect of increasing from 6 months of annual base salary to 9 months of annual base salary the potential base-salary related cash severance to which he may become entitled upon a Qualifying Termination that occurs both within his first 12 months of employment and outside of the change in control period.

The foregoing description of the Offer Letter is qualified in its entirety by reference to the full text of the Offer Letter, which will be filed as an exhibit to the Company’s Form 10-K Annual Report for the year ending December 31, 2016.

Management Retention Agreement

On October 23, 2016, the Company and Mr. Snyder entered into a Management Retention Agreement (the “Retention Agreement”), which provides for potential payments and benefits upon a qualifying termination of employment. The Retention Agreement will terminate upon the completion of all payments (if any) thereunder or on the third anniversary of its effective date if a change in control (as defined under the Retention Agreement) has not occurred by such date unless the term of the Retention Agreement is extended by the parties. If, prior to the expiration of the term of the Retention Agreement, the Company enters into a definitive agreement with a third party (or third parties), the consummation of which would result in a change in control of the Company, then the term of the Retention Agreement will automatically be extended to 24 months following the resulting change in control, unless the definitive agreement terminates or is canceled without resulting in a change in control, in which case, the extension will not be effective.

The Retention Agreement provides that if, during the period beginning on the date that is three months before a change in control and ending on the date that is 12 months following a change in control (the “change in control period”), (i) Mr. Snyder terminates his employment with the Company (or any parent or subsidiary) for good reason (as defined in the Retention Agreement), or (ii) the Company (or any parent or subsidiary) terminates Mr. Snyder’s employment for a reason other than cause (as defined in the Retention Agreement) and other than death or disability (as defined in the Retention Agreement) (a termination under clause (i) or (ii), a “Qualifying Termination”), Mr. Snyder will be eligible to receive the following severance benefits from the Company: (x) a lump-sum payment equal to the sum of (a) 100% of Mr. Snyder’s annual base salary (as in effect immediately prior to (A) a change in control (if Mr. Snyder’s employment terminates on or after the change in control), or (B) Mr. Snyder’s termination, whichever is greater) and (b) 100% of Mr. Snyder’s target bonus for the fiscal year in which Mr. Snyder’s employment terminates (minus any bonus or commission payments already received for that fiscal year’s performance); and (y) reimbursement for continued group health plan coverage premiums under COBRA for 12 months following Mr. Snyder’s termination, for Mr. Snyder and his spouse and/or eligible dependents. However, if the Company determines that it cannot provide the COBRA reimbursement benefits without potentially violating applicable laws, the Company will instead provide Mr. Snyder’s a taxable lump sum payment equal to 1.5 times the monthly COBRA premium (based on the first month’s premium) for the 12-month severance period. Additionally, if, during the change in control period, (i) Mr. Snyder has a Qualifying Termination, or (ii) Mr. Snyder’s employment is terminated due to death or disability, then 100% of the shares of the Company’s common stock subject to Mr. Snyder’s then outstanding unvested equity compensation awards will immediately vest (for performance-based awards, performance will be deemed achieved at 100% of target levels).

The Retention Agreement further provides that if Mr. Snyder has a Qualifying Termination, and such termination occurs outside of the change in control period, Mr. Snyder will be eligible to receive the following severance benefits from the Company: (i) a lump-sum payment equal to six months of his annual base salary, and (ii) reimbursement for continued group health plan coverage premiums under COBRA for six months following Mr. Snyder’s termination for Mr. Snyder and his spouse and/or eligible dependents. However, if the Company determines that it cannot provide the COBRA reimbursement benefits without potentially violating applicable laws, the Company will instead provide Mr. Snyder a taxable lump sum payment equal to 1.5 times the monthly COBRA premium (based on the first month’s premium) for the six-month severance period.

In order to receive severance benefits under the Retention Agreement, Mr. Snyder must sign and not revoke a separation and release of claims agreement in a form reasonably satisfactory to the Company. The Retention Agreement also provides that in the event that the payments and benefits provided for in the agreement or other payments and benefits payable or provided to Mr. Snyder (i) constitute “parachute payments” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) would otherwise be subject to the excise tax imposed by Section 4999 of the Code, then Mr. Snyder’s payments and benefits under the agreement or other payments or benefits (the “payment”) will be reduced to either (x) the largest portion of the payment that would result in no portion of the payment being subject to the excise tax or (y) the largest portion, up to and including the total, of the payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes and the excise tax, results in Mr. Snyder’s receipt, on an after-tax basis, of the greater amount of the payment, notwithstanding that all or some portion of the payment may be subject to the excise tax.

The foregoing descriptions of the Retention Agreement is qualified in its entirety by reference to the full text of the Retention Agreement, which will be filed as an exhibit to the Company’s Form 10-K Annual Report for the year ending December 31, 2016.

Indemnification Agreement

In addition, the Company intends to enter into its standard form of indemnification agreement with Mr. Snyder, which is filed as Exhibit 10.1 to the Company’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on August 16, 2013 and is incorporated herein by reference.

Item 9.01.    Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
10.1	Lease Termination and Release Agreement, dated October 21, 2016, by and between Google Inc. and Rocket Fuel Inc.
99.1	Press release announcing financial results dated October 25, 2016.

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 hereunto duly authorized.

ROCKET FUEL INC.
By:	/s/ Rex S. Jackson
	Rex S. Jackson
	Chief Financial Officer

Date: October 25, 2016

EXHIBIT INDEX

Exhibit No.	Description
10.1	Lease Termination and Release Agreement, dated October 21, 2016, by and between Google Inc. and Rocket Fuel Inc.
99.1	Press release announcing financial results dated October 25, 2016.

EX-10.1

Exhibit 10.1

LEASE TERMINATION ANDRELEASE AGREEMENT

THIS LEASE TERMINATION AND RELEASE AGREEMENT ("Agreement") is made and entered into as of this 21st day of October, 2016 (the "Effective Date") by and between GOOGLE INC., a Delaware corporation ("Landlord"), and ROCKET FUEL INC., a Delaware corporation ("Tenant").

R E C I T A L S:

A.    Landlord (as successor in interest to VII Pac Shores Investors, L.L.C., a Delaware limited liability company) and Tenant are parties to that certain Office Lease dated as of August 7, 2013, as amended by that certain First Amendment, dated as of December 18, 2013 (collectively, the "Lease"), pursuant to which Tenant leases certain premises ("Premises") from Landlord described as Suite Nos. 100, 200, 300 and 400 on the 1^st, 2^nd, 3^rd and 4^th floors of the building commonly known as Pacific Shores Center – Building Number 9 located at 1900 Seaport Boulevard, Redwood City, CA 94063.

B.    Capitalized terms not otherwise defined in this Agreement shall have the meanings given to them in the Lease.

C.    Landlord and Tenant desire to terminate the Lease early on the terms set forth herein.

NOW, THEREFORE, for and in consideration of the payment by Tenant to Landlord of all rent and other monetary obligations under the Lease (collectively, "Rent") due under the Lease through January 2, 2017, the fulfillment of the obligations described herein, and the releases, agreements, covenants and undertakings set forth herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

A G R E E M E N T:

1.Termination Date. Subject to the provisions set forth herein, the Lease and all of the rights, duties and obligations set forth therein shall be terminated effective as of January 2, 2017 (the "Early Termination Date"), except for the "Reserved Claims" of Landlord described in Paragraph 5(e) below.

2.Surrender. On or before 5:00 p.m. Pacific Time on January 2, 2017, Tenant shall surrender possession of the Premises to Landlord in accordance with the requirements set forth in the Lease, including, without limitation, the provisions of Sections 7.2, 8, 15 and 23 of the Lease, at Tenant's sole cost and expense, including without limitation, removing all Lines, signage, furniture, fixtures, equipment, debris, rubbish and repairing any and all damage to the Premises caused by the removal of Tenant's personalty from the Premises. Notwithstanding the foregoing, Tenant shall not be required to remove any Alterations or Leasehold Improvements. Landlord and Tenant agree to conduct a joint walk-through of the Premises on or before December 20, 2016 to verify that Tenant has complied with the surrender requirements set forth herein. Upon conducting

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such joint walk-through, Landlord shall specify any work that needs to be done by Tenant to satisfy the foregoing requirements (said work identified by Landlord following the joint walk-through being referred to herein as the "Surrender Work"). Tenant shall complete the Surrender Work no later than the Early Termination Date. If Landlord fails to identify any Surrender Work during the joint walk-through of the Premises, Tenant shall not be required to perform any Surrender Work. From and after the date Tenant surrenders the Premises to Landlord in accordance with the requirements set forth in the Lease, Tenant shall have no further rights to the possession or use of the Premises.

3.Letter of Credit. The terms and conditions regarding the Letter of Credit set forth in Section 3 of Exhibit F of the Lease shall continue to apply until the date which is sixty (60) days following the Early Termination Date (the "Final LC Expiration Date"), upon which Final LC Expiration Date Landlord shall return the original Letter of Credit (and all amendments thereto) to Tenant and execute any documentation reasonably required by the issuer of the Letter of Credit for the cancellation thereof.

4.Consent to Sublease. Tenant acknowledges that, as of the Effective Date, Tenant has withdrawn its request for Landlord's consent to Tenant subletting the Premises (the "Sublease Request"), and that such Sublease Request is null and void and of no further force and effect.

5.Mutual Release.

(a)Release of Landlord. Tenant hereby releases and discharges Landlord and agrees to hold Landlord and each of its partners, shareholders, officers, directors, agents and employees, and their respective predecessors, successors and assigns and the partners, employees, shareholders, officers, directors, agents and employees of each of them (collectively, "Successors"), free and harmless from any and all claims, demands, causes of action, losses, penalties, fines, expenses, obligations, damages, attorneys' fees, costs and liabilities of any nature whatsoever (collectively "Claims"), whether or not now known, suspected or claimed, which Tenant (or any individual or entity acting through Tenant) ever had, now has or may claim to have, against Landlord or any of its Successors resulting from, arising out of or related to the Lease or the Premises (the "Landlord Release").

(b)Release of Tenant. Subject to the limitations contained in subparagraph (e) below, effective as of the Early Termination Date, provided Tenant timely performs all of its obligations under this Agreement, Landlord hereby releases and discharges Tenant and agrees to hold Tenant and each of its successors, partners, shareholders, officers, directors, agents and employees, free and harmless from any and all Claims, whether or not now known, suspected or claimed, which Landlord (or any individual or entity acting through Landlord) ever had, now has or may claim to have, against Tenant or any of its Successors resulting from, arising out of or related to the Lease or the Premises (the "Tenant Release").

(c)Additional Facts. Landlord and Tenant each acknowledge that it may hereafter discover facts different from or in addition to those it now knows or believes to be true with respect to the Claims which are the subject of the Landlord Release set forth in subparagraph (a) above and the Tenant Release set forth in subparagraph (b) above, and Landlord and Tenant each

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expressly agree to assume the risk of the possible discovery of additional or different facts, and agree that the Landlord Release and the Tenant Release shall be and remain effective in all respects, regardless of such additional or different facts.

(d)Waiver of California Civil Code Section 1542. Landlord and Tenant each understand and agree, by initialing below, that each party expressly waives and relinquishes all rights and benefits, if any, it may have under Section 1542 of the California Civil Code with respect only to the Claims which are the subject of the Landlord Release set forth in subparagraph (a) above and the Tenant Release set forth in subparagraph (b) above. California Civil Code Section 1542 reads as follows:

"§1542 [CERTAIN CLAIMS NOT AFFECTED BY GENERAL RELEASE.] A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR."

/s/ DR	/s/ RSJ
Landlord's Initials	Tenant's Initials

(e)Landlord Reserved Claims. Notwithstanding anything to the contrary contained in subparagraphs (a) through (d) above, (1) Landlord does not waive or release any Claims specifically arising pursuant to a breach of Tenant's obligation(s) under this Agreement, (2) Landlord does not waive or release any Claims arising or accruing under the Lease during the Term prior to the Early Termination Date to the extent such Claims are expressly intended to survive the expiration or termination of the Lease, (3) Landlord does not waive or release any Claims relating to any violation of the terms of the Lease relating to liens against the Premises for Tenant's actions prior to the Early Termination Date, (4) Landlord does not waive or release any Claims relating to any violation by Tenant or its subtenants, agents, employees or contractors relative to environmental laws concerning hazardous or toxic materials or substances, and/or (5) Landlord does not waive or release any Claims relative to the occurrence of any events arising or accruing under the Lease during the Term prior to the Early Termination Date in connection with which Tenant is required to indemnify Landlord or hold Landlord harmless as provided in the Lease (collectively, the "Landlord Reserved Claims").

6.Representations of Tenant. Tenant represents and warrants to Landlord that: (i) Tenant has not heretofore assigned or sublet all or any portion of its interest in the Lease; (ii) no other person, firm or entity has any right, title or interest in the Lease; (iii) Tenant has the full right, legal power and actual authority to enter into this Agreement and to terminate the Lease without the consent of any person, firm or entity; and (iv) Tenant has the full right, legal power and actual authority to bind Tenant to the terms and conditions hereof. Tenant further represents and warrants to Landlord that as of the Effective Date there are no, and as of the Early Termination Date there shall not be any, mechanics' liens and/or other liens encumbering all or any portion of the Premises, by virtue of any act or omission on the part of Tenant, its contractors, agents, employees, successors

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and/or assigns. Notwithstanding the early termination of the Lease and the release of liability as provided for herein, the representations and warranties set forth in this Section 6 shall survive the Early Termination Date and Tenant shall be liable for any loss incurred by Landlord as a result of any inaccuracies or breach of the enumerated representations and warranties.

7.No Other Promises. It is further expressly agreed and warranted by the parties hereto that, except as set forth herein, (i) no promise or inducement has been offered by either party to the other and (ii) this Agreement is executed without reliance upon any statement or representation of any of the parties hereto concerning the nature or extent of any damages and/or the legal liability therefor.

8.Authority. Landlord and Tenant each represents and warrant that their respective signatories hereto hereby have full and complete authority to bind their respective parties to the Agreement and that no other consent is necessary or required in order for the signatories to execute this Agreement on behalf of their respective parties. Tenant represents that it has not sublet any portion of the Premises and that it has not heretofore assigned the Lease or any of its rights or obligations under the Lease.

9.Entire Agreement. This Agreement constitutes the entire agreement of the parties hereto regarding the matters set forth herein; supersedes all other prior agreements, representations and covenants, written or oral, with respect thereto; and may not be varied or amended except by a writing signed by all of the parties hereto.

10.Agreement Binding. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective predecessors, heirs, beneficiaries, legal and personal representatives, successors and assigns.

11.Further Assurances. Each party hereto shall execute and deliver to the other such other additional documentation as may be reasonably requested by the other party hereto in order to (i) evidence the due authorization of this Agreement by the other party and the capacity of the person executing same to so sign for and on behalf of such party and/or (ii) further evidence, accomplish or facilitate the agreements and representations set forth herein.

12.Brokers. Landlord and Tenant each hereby represents and warrants to the other that it has had no dealings with any real estate broker or agent in connection with the negotiation of this Agreement, except for Jonathan Moeller, Payam Tabar, and Mina Mohamadi of CBRE, Inc. (collectively, "Landlord's Broker"), representing Landlord, and Kristoph Lodge and Eric Anderson of Newmark Cornish & Carey (collectively, "Tenant's Broker"), representing Tenant, and that it knows of no other real estate broker or agent (other than the Landlord's Broker and Tenant's Broker) who is entitled to a commission in connection with this Agreement. Landlord shall pay any broker's commission due to Landlord's Broker with respect to this Agreement pursuant to a separate agreement between Landlord and Landlord's Broker. Tenant shall pay any broker's commission due to Tenant's Broker with respect to this Agreement pursuant to a separate agreement between Tenant and Tenant's Broker. Each party agrees to indemnify and defend the other party against and hold the other party harmless from any and all claims, demands, losses, liabilities, lawsuits, judgments, and costs and expenses (including, without limitation, reasonable attorneys' fees) with

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respect to any leasing commission or equivalent compensation alleged to be owing on account of any breach of the foregoing representation and warranty by the indemnifying party in connection with this Agreement.

13.Legal Fees. In any dispute involving the enforcement of this Agreement, the non-prevailing party in such dispute shall pay all costs, including but not limited to reasonable attorney's fees, incurred by the party prevailing in such dispute.

14.Time of Essence. Time is of the essence of each and every term, condition, obligation and provision hereof.

15.Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute one and the same instrument.

16.Holdover Rent. If Tenant fails to surrender possession of the Premises to Landlord in accordance with the terms of this Agreement, then notwithstanding anything to the contrary in the Lease, Tenant shall be required to pay holdover rent as provided in the Lease. Other than such holdover rent, Tenant shall not be liable for any damages for such holdover during the first sixty (60) days thereof.

17.Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California.

[Signature pages follow]

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IN WITNESS WHEREOF, this Agreement has been executed by an authorized representative of each party as of the day and year first above written.

"TENANT"	ROCKET FUEL INC.,
	a Delaware corporation
	By:	/s/ Rex S. Jackson
		Name:	Rex S. Jackson
		Title:	CFO
"LANDLORD"	GOOGLE INC.,
	a Delaware corporation
	By:	/s/ David Radcliffe
		Name:	David Radcliffe
		Title:	VP Real Estate

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EX-99.1

Exhibit 99.1

Rocket Fuel Reports Financial Results for Third Quarter 2016

and Announces Management Changes

GAAP Operating Cash Flow of $8.3 Million and Non-GAAP Free Cash Flow of $3.8 Million in the Third Quarter of 2016

REDWOOD CITY, Calif., October 25, 2016 - Rocket Fuel Inc. (NASDAQ: FUEL), a leading programmatic marketing platform provider, today announced financial results for the third quarter ended September 30, 2016.

“Rocket Fuel’s third quarter net revenue of $62.6 million was slightly below our guidance of $63 to $66 million primarily due to unexpected weakness in our political and EMEA businesses,” said Randy Wootton, chief executive officer.  “While we are disappointed with our top-line performance, we are pleased to see steady growth in our platform solutions business, with revenue increasing 141% year-over-year.  Our ongoing focus to drive further operational improvements was evident, as we delivered adjusted EBITDA at the high-end of our guidance range, representing strong improvement both sequentially and year-over-year.  Additionally, we had a good quarter from a free cash flow perspective, and made progress towards our stated goal of being free cash flow positive for 2016.  We remain committed to our plans to return the company to growth and build a successful platform solutions business.”

Financial Highlights for the Third Quarter of 2016

GAAP Revenue:$109.7 million, 2% below last year's third quarter total of $111.8 million.

Revenue derived from North America was $90.9 million, down 3% from last year's third quarter. Revenue from outside North America was $18.8 million, up 2% from last year.

Platform Solutions revenue grew significantly year-on-year, representing 19% of GAAP revenue in the third quarter versus 8% in last year’s third quarter. Media Services revenue was 81% and 92% of GAAP revenue, respectively.

Non-GAAP Net Revenue:$62.6 million, down 8% compared to $68.2 million non-GAAP Net Revenue in the third quarter of 2015.

GAAP Net Loss:$(10.7) million, or $(0.24) per diluted share compared to a net loss of $(136.6) million, or $(3.19) per diluted share, in the third quarter of 2015.

Non-GAAP Adjusted EBITDA:$6.6 million compared to $3.4 million in the third quarter of 2015.

Non-GAAP Adjusted Net Loss:$(3.6) million, or $(0.08) per diluted share, compared to an adjusted net loss of $(7.0) million, or $(0.16) per diluted share, for the third quarter of 2015.

GAAP Net Cash provided by Operating Activities:$8.3 million, compared to $9.5 million in the third quarter of 2015.

Non-GAAP Free Cash Flow:$3.8 million, compared to $5.6 million in the third quarter of 2015.

Cash and Cash Equivalents:$78.7 million as of September 30, 2016, up sequentially by $12.0 million from the second quarter 2016. Cash and Cash Equivalents was $78.6 million as of December 31, 2015.

Top Customers: Revenue from top 50 customers was 59% of total revenue, compared to 49% in the third quarter of fiscal year 2015. Revenue from top 250 customers was 86% of total revenue, compared to 80% in the third quarter of fiscal year 2015.

Employee Headcount:858 as of September 30, 2016, down from 962 in the third quarter of 2015.

Financial Outlook for the Fourth Quarter of 2016

For the fourth quarter of 2016, the Company expects:

- Non-GAAP net revenue between $57 million and $62 million.

- Non-GAAP Adjusted EBITDA between $1 million and $6 million.

The Company does not reconcile its forward-looking non-GAAP financial measures, net revenue and Adjusted EBITDA, to the corresponding GAAP measures due to the high variability and difficulty in making accurate forecasts and projections in respect to the interplay between revenue and the corresponding margins. Our Media Services and Platform Solutions have different media margins and the pace of the transition of some of our business from Media Services to Platform Solutions, the pace of adoption, or activation of existing Platform Solutions customers, and the corresponding future margins cannot be reasonably predicted. The GAAP measure net income includes stock-based compensation expense that is impacted by future hiring and retention needs, and the future share price of Rocket Fuel’s stock. Similarly, restructuring charges, which we exclude from our non-GAAP measure Adjusted EBITDA, are impacted by future decisions and by actions involving our facilities that are difficult to predict. The actual amounts of these excluded items will have a significant impact on the Company’s GAAP net income. Accordingly, reconciliations of these two forward-looking non-GAAP financial measures to the corresponding GAAP measures are not available without unreasonable effort.

Management Changes

Today, the Company announces that Stephen Snyder, an experienced SaaS executive, will join the Company as its Chief Financial Officer, effective November 10, 2016.  Mr. Snyder will succeed Rex S. Jackson, who is resigning from the Company, effective October 26, 2016, to pursue another opportunity.  Mr. Snyder brings to Rocket Fuel more than 20 years of financial leadership, most recently as CFO of a technology platform company in the energy industry,and having served in executive roles in finance, operations and sales at Adobe Systems and Hewlett Packard. Beginning on October 27, 2016, Henrik Gerdes, the Company's Vice President, Corporate Controller and Treasurer, will serve as interim Chief Financial Officer.

“Stephen’s financial expertise will be invaluable to Rocket Fuel as we continue our transformation into a SaaS-based platform. He is a great addition to our strong management team,” said CEO Randy Wootton. “Rex has made many valuable contributions to our company that have set us up for success, and I wish him the best of luck in his new role.”

Conference Call, Webcast and Related Information

The Rocket Fuel third quarter 2016 teleconference and webcast is scheduled to begin at 2:00 PM Pacific time on Tuesday, October 25, 2016. To participate on the live call, analysts and investors should dial 1-888-632-5006, or outside the U.S. 913-312-1448, at least ten minutes prior to the call. Rocket Fuel will post supplemental slides with the Company's latest financial results on http://investor.rocketfuel.com under Events & Presentations concurrently with this earnings press release. Rocket Fuel will also offer a live and archived webcast of the conference call, accessible from the “Investors” section of its website at http://investor.rocketfuel.com.

Use of Non-GAAP Measures

We provide information relating to non-GAAP net revenue, non-GAAP adjusted EBITDA, non-GAAP adjusted net income (loss), non-GAAP operating expenses and non-GAAP free cash flow, which are financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). These non-GAAP financial measures have been included in this press release, or discussed on our teleconference and webcast, because they are measures 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.

We define non-GAAP net revenue as GAAP revenue less media costs. Media costs consist of costs for advertising impressions we purchase from advertising exchanges or other third parties. A limitation of non-GAAP net revenue is that it is a measure designed for internal purposes that may be unique to Rocket Fuel and may not enhance the comparability of Rocket Fuel’s results to other companies in the same industry that have similar business arrangements but present the impact of media costs differently. Our management compensates for this limitation by also considering the comparable GAAP financial measures of revenue, media costs and other costs of revenue.

We define non-GAAP adjusted EBITDA as GAAP net income (loss) before interest expense, other income (expense), net, income tax provision (benefit), depreciation and amortization expense (including amortization of capitalized software development expenses), stock-based compensation expense and related payroll taxes, acquisition and restructuring related expenses, and impairment charges. Non-GAAP adjusted EBITDA has a number of limitations, including the following: although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and non-GAAP adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; non-GAAP adjusted EBITDA is often considered an approximation of operating cash flow, but in our case excludes software development costs capitalized in a current period and excludes those costs as they are amortized over future periods; non-GAAP adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; non-GAAP adjusted EBITDA does not consider the potentially dilutive impact of equity-based compensation; non-GAAP adjusted EBITDA does not reflect acquisition and restructuring related expenses, the expenses capitalized for internal-use software, tax and interest expenses that may represent payments reducing the cash available to us; and other companies, including those in our industry, may calculate non-GAAP adjusted EBITDA differently, which reduces its usefulness as a comparative measure. Because of these limitations, our management considers non-GAAP adjusted EBITDA alongside other financial performance measures, including cash flow metrics, net income (loss) and our other GAAP results.

We define non-GAAP adjusted net income (loss) as GAAP net income (loss) excluding stock-based compensation expense, amortization of intangible assets, impairment charges, acquisition and restructuring related expenses and the estimated tax impact of the foregoing items. A limitation of non-GAAP adjusted net income (loss) is that it is a measure that may be unique to Rocket Fuel and may not enhance the comparability of Rocket Fuel’s results to other companies in the same industry that define adjusted net income (loss) differently. This measure may also exclude expenses that may have a material impact on Rocket Fuel’s reported financial results. Our management compensates for these limitations by also considering the comparable GAAP financial measure of net income (loss).

We define non-GAAP operating expenses as GAAP total costs and expenses less media costs, depreciation and amortization expense (including amortization of capitalized software development costs), impairment charges, stock-based compensation expense and related payroll taxes, and acquisition and restructuring related expense. Non-GAAP operating expenses has a number of limitations, including the following: although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and this measure does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; non-GAAP operating expenses is often considered an approximation of operating cash flow, but in our case excludes software development costs capitalized in a current period and excludes those costs as they are amortized

over future periods; non-GAAP operating expenses does not reflect changes in, or cash requirements for, our working capital needs; non-GAAP operating expenses does not consider the potentially dilutive impact of equity-based compensation; non-GAAP operating expenses does not reflect acquisition and restructuring related expenses, the expenses capitalized for internal-use software, tax and interest expenses that may represent payments reducing the cash available to us; and other companies, including those in our industry, may calculate non-GAAP operating expenses differently, which reduces its usefulness as a comparative measure. Because of these limitations, our management considers non-GAAP operating expenses alongside other financial performance measures, including total expenses, cash from operating activities and our other GAAP results.

In addition, we provide information about our non-GAAP free cash flow. We define non-GAAP free cash flow as the net cash provided by (or used in) operating activities less the cash used for purchases of property, equipment and software and for capitalized internal-use software development costs. A limitation of free cash flow is that it may be unique to Rocket Fuel and may not enhance the comparability of Rocket Fuel’s results to other companies in the same industry that define free cash flow differently from us. This measure also does not represent the residual cash flow available to us for discretionary expenditures or investments because we have mandatory capital leases and debt service requirements that may have a material impact on Rocket Fuel’s liquidity. Our management compensates for these limitations by also considering the comparable GAAP financial measure of net cash provided by (or used in) operating activities.

For a reconciliation of non-GAAP financial measures to the nearest comparable GAAP financial measures, see “Reconciliation from GAAP Revenue to Non-GAAP Net Revenue,” “Reconciliation from GAAP Net Income (Loss) to Non-GAAP Adjusted EBITDA,” “Reconciliation from GAAP Net Income (Loss) to Non-GAAP Adjusted Net Income (Loss)”, “Reconciliation from GAAP Total Cost and Expenses to Non-GAAP Operating Expenses" and “Reconciliation from GAAP Net Cash Provided by (or Used in) Operating Activities to Non-GAAP Free Cash Flow" included in this press release.

These non-GAAP financial measures are not intended to be considered in isolation from, as substitutes for, or as superior to, the corresponding financial measures prepared in accordance with GAAP.

Cautions Regarding Forward-Looking Statements

This press release and the webcast of the same date contain forward-looking statements regarding future events and our future financial performance, including but not limited to expected progress against achieving our three strategic imperatives; the value of our Moment Scoring technology; our sales and marketing execution and focus on high value accounts; expectations regarding our platform solutions business and our media services business; expected changes in our revenue mix and shifts in margins; our ability to improve and activate relationships with agencies and agency holding companies; our customer and supplier relationships; our operating expenses and cost structure; and expectations for fourth quarter non-GAAP net revenue and non-GAAP adjusted EBITDA, and financial goals for fiscal year 2017. Words such as "expect," "believe," "intend," "plan," "goal," "focus," "anticipate," and other similar words are also intended to identify forward-looking statements.

These forward-looking statements are subject to a number of risks and uncertainties that may cause actual results to differ materially from the results anticipated by such statements, including, without limitation: our limited operating history, particularly as a relatively new public company; fluctuations in our operating results, including but not limited to fluctuations due to seasonality; our history of losses; our ability to achieve the expected benefits of our efficiency improvement plans; risks due to employee attrition and integration of new leadership and employees; risks associated with our growth, including growth outside of the U.S.; risks associated with margin shifts in the industry; our ability to adequately address competition, particularly from agency trading desks; our ability to serve the needs of agencies and agency holding companies and make the right investment decisions with regard to new

products, technology, and sales strategies; and risks associated with maintaining or increasing sales to new and existing customers and maintaining customer satisfaction.

Additional factors that could cause actual results to differ materially from those anticipated by our forward-looking statements are under the caption “Risk Factors” in our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (“SEC”) on August 8, 2016 and in subsequent SEC filings. These forward-looking statements are made as of the date of this press release and the related webcast, and Rocket Fuel expressly disclaims any obligation or undertaking to update the forward-looking statements contained herein or therein to reflect events that occur or circumstances that exist after the date on which the statements were made.

About Rocket Fuel

Rocket Fuel applies artificial intelligence and big data to predict the potential of every moment and make marketing more meaningful and accountable.

Headquartered in Redwood City, California, Rocket Fuel has more than 20 offices worldwide and trades on the NASDAQ Global Select Market under the ticker symbol "FUEL." For more information, please visit http://www.rocketfuel.com or call 1-888-717-8873.

Investor Relations:

(650) 481-6082

ir@rocketfuel.com

Rocket Fuel, the Rocket Fuel logo, and Moment Scoring are trademarks or registered trademarks of Rocket Fuel Inc. in theUnited States and other countries.

Rocket Fuel Inc.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
	September 30,			December 31,
	2016			2015
Assets
Current Assets:
Cash and cash equivalents	$	78,663		$	78,560
Accounts receivable, net	113,169			124,998
Prepaid expenses	2,812			3,803
Other current assets	4,034			2,081
Total current assets	198,678			209,442
Property, equipment and software, net	65,431			82,781
Restricted cash	1,839			2,141
Intangible assets, net	38,639			50,919
Deferred tax assets, net	676			718
Other assets	640			1,053
Total Assets	$	305,903		$	347,054
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable	$	64,068		$	71,292
Accrued and other current liabilities	33,623			40,734
Deferred revenue	3,556			2,116
Current portion of capital leases	8,807			8,602
Current portion of debt	71,112			45,720
Total current liabilities	181,166			168,464
Debt - Less current portion	—			17,617
Capital leases - Less current portion	7,911			11,855
Deferred rent - Less current portion	15,254			14,042
Other liabilities	850			1,176
Total liabilities	205,181			213,154
Stockholders' Equity:
Common stock	45			44
Additional paid-in capital	468,907			453,338
Accumulated other comprehensive loss	(698		)	(151		)
Accumulated deficit	(367,532		)	(319,331		)
Total stockholders' equity	100,722			133,900
Total Liabilities and Stockholders' Equity	$	305,903		$	347,054

Rocket Fuel Inc.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except loss per share data)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Revenue	$	109,720		$	111,836		$	331,433		$	336,235
Costs and expenses:
Media costs	47,092			43,673			140,573			138,389
Other cost of revenue (1)	22,790			20,105			63,272			59,887
Research and development (1)	7,913			11,022			27,990			34,136
Sales and marketing (1)	29,084			41,681			102,114			126,309
General and administrative (1)	11,912			12,328			38,998			44,663
Impairment of goodwill	—			117,521			—			117,521
Restructuring	—			—			1,567			6,471
Total costs and expenses	118,791			246,330			374,514			527,376
Operating loss	(9,071		)	(134,494		)	(43,081		)	(191,141		)
Interest expense	1,082			1,087			3,351			3,472
Other (income) expense, net	411			797			1,083			2,309
Loss before income taxes	$	(10,564	)	$	(136,378	)	$	(47,515	)	$	(196,922	)
Income tax provision	171			213			686			942
Net loss	$	(10,735	)	$	(136,591	)	$	(48,201	)	$	(197,864	)
Basic and diluted net income (loss) per share attributable to common stockholders	$	(0.24	)	$	(3.19	)	$	(1.09	)	$	(4.67	)
Basic and diluted weighted-average shares used to compute net loss per share attributable to common stockholders	44,353			42,763			44,167			42,350

(1) Includes unaudited stock-based compensation expense as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Other cost of revenue	$	523	$	465	$	1,546	$	1,567
Research and development	451		1,688		2,797		5,769
Sales and marketing	1,011		2,478		3,857		7,634
General and administrative	1,127		1,676		3,804		5,218
	$	3,112	$	6,307	$	12,004	$	20,188

Rocket Fuel Inc.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Operating Activities:
Net loss	$	(10,735	)	$	(136,591	)	$	(48,201	)	$	(197,864	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Impairment of goodwill	—			117,521			—			117,521
Depreciation and amortization	12,546			14,055			37,691			38,078
Impairment of long-lived assets	—			—			1,225			2,704
Accelerated amortization of leasehold improvements	—			—			7,059			—
Stock-based compensation	3,112			6,307			12,004			20,188
Deferred taxes	(152		)	20			41			—
Other non-cash adjustments, net	1,110			71			2,717			1,115
Changes in operating assets and liabilities:
Accounts receivable	(173		)	8,771			9,929			24,133
Prepaid expenses and other assets	1,109			3,574			(1,100		)	9,892
Accounts payable, accrued and other liabilities	317			(3,764		)	(5,599		)	(15,120		)
Deferred rent	(392		)	(206		)	(6,495		)	684
Deferred revenue	1,568			(280		)	1,440			1,058
Net cash provided by operating activities	8,310			9,478			10,711			2,389
Investing Activities:
Purchases of property, equipment and software	(1,977		)	(712		)	(5,032		)	(10,797		)
Business acquisition, net	—			(367		)	—			(367		)
Capitalized internal-use software development costs	(2,496		)	(3,159		)	(8,420		)	(9,207		)
Other investing activities	92			—			424			636
Net cash used in investing activities	(4,381		)	(4,238		)	(13,028		)	(19,735		)
Financing Activities:
Proceeds from issuance of stock, net of issuance costs	1,632			—			1,632			—
Proceeds from employee stock plans, net	174			234			1,254			3,373
Tax withholdings related to net share settlements of restricted stock units	(411		)	(441		)	(1,020		)	(974		)
Repayment of capital lease obligations	(2,191		)	(1,582		)	(6,409		)	(4,337		)
Proceeds from debt facilities, net of issuance costs	9,000			—			31,350			(242		)
Repayment of debt facilities	—			(1,500		)	(24,000		)	(4,500		)
Net cash provided by (used in) financing activities	8,204			(3,289		)	2,807			(6,680		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(134		)	67			(387		)	53
Change in Cash and Cash Equivalents	11,999			2,018			103			(23,973		)
Cash and Cash Equivalents—Beginning of period	66,664			81,065			78,560			107,056
Cash and Cash Equivalents—End of period	$	78,663		$	83,083		$	78,663		$	83,083

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Supplemental Disclosures of Other Cash Flow Information:
Cash paid for income taxes, net of refunds	$	65	$	380	$	449	$	834
Cash paid for interest	939		1,009		2,876		2,930
Supplemental Disclosures of Non-Cash Investing and Financing Activities:
Purchases of property, equipment and software recorded in accounts payable and accruals	$	556	$	1,664	$	556	$	1,664
Stock issuance costs recorded in in accounts payable and accruals	132		—		132		—
Property, equipment and software acquired under capital lease obligations	2,024		3,330		2,670		5,116
Vesting of early exercised options	39		36		64		133
Stock-based compensation capitalized in internal-use software costs	573		732		1,881		2,018

Rocket Fuel Inc.
UNAUDITED NON-GAAP MEASURES
(In thousands, except per share data)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Non-GAAP net revenue	$	62,628		$	68,163		$	190,860		$	197,846
Non-GAAP adjusted EBITDA	$	6,587		$	3,422		$	8,181		$	(8,810	)
Non-GAAP adjusted net income (loss)	$	(3,597	)	$	(6,957	)	$	(22,350	)	$	(39,233	)
Non-GAAP adjusted diluted net income (loss) per share	$	(0.08	)	$	(0.16	)	$	(0.51	)	$	(0.93	)
Non-GAAP operating expenses	$	56,041		$	64,741		$	182,679		$	206,656
Non-GAAP free cash flow	$	3,837		$	5,607		$	(2,741	)	$	(17,615	)

Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP REVENUE TO NON-GAAP NET REVENUE
(In thousands)
	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Revenue	$	109,720	$	111,836	$	331,433	$	336,235
Less: Media costs	47,092		43,673		140,573		138,389
Non-GAAP net revenue	$	62,628	$	68,163	$	190,860	$	197,846

Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA
(In thousands)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Net loss	$	(10,735	)	$	(136,591	)	$	(48,201	)	$	(197,864	)
Adjustments:
Interest expense	1,082			1,087			3,351			3,472
Income tax provision (benefit)	171			213			686			942
Amortization of intangibles	4,026			5,799			12,280			14,253
Amortization of capitalized software	2,891			2,027			7,924			5,471
Depreciation	5,629			6,229			17,487			18,354
Stock-based compensation expense	3,112			6,307			12,004			20,188
Other (income) expense, net	411			797			1,083			2,309
Restructuring expense (credit), net	—			—			1,567			6,471
Payroll tax expense related to stock-based compensation	—			33			—			73
Impairment of goodwill	—			117,521			—			117,521
Total adjustments	17,322			140,013			56,382			189,054
Non-GAAP adjusted EBITDA	$	6,587		$	3,422		$	8,181		$	(8,810	)

Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP NET LOSS TO NON-GAAP ADJUSTED NET INCOME (LOSS)
(In thousands, except per share data)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Net loss	$	(10,735	)	$	(136,591	)	$	(48,201	)	$	(197,864	)
Stock-based compensation expense	3,112			6,307			12,004			20,188
Amortization of intangible assets	4,026			5,799			12,280			14,253
Restructuring expense (credit), net	—			—			1,567			6,471
Tax impact of the above items	—			7			—			198
Impairment of goodwill	—			117,521			$	—		117,521
Non-GAAP adjusted net income (loss)	$	(3,597	)	$	(6,957	)	$	(22,350	)	$	(39,233	)
Basic and diluted net income (loss) per share attributable to common stockholders	$	(0.24	)	$	(3.19	)	$	(1.09	)	$	(4.67	)
Non-GAAP adjusted net income (loss) per diluted share	$	(0.08	)	$	(0.16	)	$	(0.51	)	$	(0.93	)
Weighted average shares used in computing non-GAAP adjusted net income (loss) per diluted share	44,353			42,763			44,167			42,350

Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP TOTAL COSTS AND EXPENSES TO NON-GAAP OPERATING EXPENSES
(In thousands)
	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Total costs and expenses	$	118,791	$	246,330	$	374,514	$	527,376
Less media costs	47,092		43,673		140,573		138,389
Adjustments:
Amortization of intangibles	4,026		5,799		12,280		14,253
Amortization of capitalized software	2,891		2,027		7,924		5,471
Depreciation	5,629		6,229		17,487		18,354
Stock-based compensation	3,112		6,307		12,004		20,188
Restructuring expense (credit), net	—		—		1,567		6,471
Payroll tax expense related to stock based compensation	—		33		—		73
Impairment of goodwill	—		117,521		—		117,521
Total adjustments	15,658		137,916		51,262		182,331
Non-GAAP operating expenses	$	56,041	$	64,741	$	182,679	$	206,656

Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES TO NON-GAAP FREE CASH FLOW
(In thousands)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Cash provided by (used in) operating activities	8,310			9,478			10,711			2,389
Less: Purchases of property, equipment and software	(1,977		)	(712		)	(5,032		)	(10,797		)
Less: Capitalized internal-use software development costs	(2,496		)	(3,159		)	(8,420		)	(9,207		)
Non-GAAP free cash flow	$	3,837		$	5,607		$	(2,741	)	$	(17,615	)