10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(MARK ONE)

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

For the quarterly period ended June 30, 2018

☐ 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 001-38113

BOSTON OMAHA CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Delaware	27-0788438
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1411 Harney St., Suite 200, Omaha, Nebraska 68102

(Address of principal executive offices)

(857) 256-0079

(Registrant’s telephone number)

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  ☒    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  ☒    ☐  No

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

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐ (Do not check if a smaller reporting company)	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 21,008,024 shares of Class A common stock and 1,055,560 shares of Class B common stock as of August 10, 2018.

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BOSTON OMAHA CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE PERIOD ENDED JUNE 30, 2018

TABLE OF CONTENTS

	Page
Part I – Financial Information
Item 1. Consolidated Financial Statements.
Consolidated Balance Sheets – June 30, 2018 and December 31, 2017 (unaudited)	4
Consolidated Statements of Operations – Three and Six Months Ended June 30, 2018 and June 30, 2017 (unaudited)	6
Consolidated Statement of Changes in Stockholders’ Equity – June 30, 2018 (unaudited)	7
Consolidated Statements of Cash Flows – Six Months Ended June 30, 2018 and June 30, 2017 (unaudited)	8
Notes to Unaudited Consolidated Financial Statements For the Three and Six Months Ended June 30, 2018 and 2017	10
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	31
Item 3. Quantitative and Qualitative Disclosures About Market Risk.	45
Item 4. Controls and Procedures.	46
Part II – Other Information	47
Item 1. Legal Proceedings.	47
Item 1A. Risk Factors.	47
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	47
Item 3. Defaults Upon Senior Securities.	47
Item 4. Mine Safety Disclosures.	47
Item 5. Other Information.	47
Item 6. Exhibits.	47
Signatures	48
Exhibit Index	49

References in this Quarterly Report on Form 10-Q to “the Company,” “our Company,” “we,” “us,” ”our” and “Boston Omaha” refer to Boston Omaha Corporation and its consolidated subsidiaries, unless otherwise noted.

2

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Consolidated Financial Statements

Unaudited

For the Three Months and Six Months Ended June 30, 2018 and 2017

3

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Consolidated Balance Sheets

Unaudited

ASSETS

	June 30,		December 31,
	2018		2017
Current Assets:
Cash and cash equivalents	$	88,166,783	$	6,838,345
Restricted cash		506,046		392,225
Accounts receivable, net		1,290,966		1,095,777
Interest receivable		692,109		-
Short-term investments		4,856,131		1,659,299
U.S. Treasury trading securities		-		83,100,805
U.S. Treasury securities available for sale		150,346,440		-
Prepaid expenses		1,098,959		755,121
Total Current Assets		246,957,434		93,841,572
Property and Equipment, net		10,280,773		9,111,013
Other Assets:
Goodwill		25,006,161		24,692,161
Intangible assets, net		7,604,863		9,349,623
Investments		32,177,419		13,901,281
Investments in unconsolidated affiliates		847,146		952,128
Funds held as collateral assets		862,046		1,056,330
Other		707,560		572,976
Total Other Assets		67,205,195		50,524,499
Total Assets	$	324,443,402	$	153,477,084

See accompanying notes to the unaudited consolidated financial statements.

4

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Consolidated Balance Sheets (Continued)

Unaudited

LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST,  AND STOCKHOLDERS' EQUITY

	June 30,			December 31,
	2018			2017
Current Liabilities:
Accounts payable and accrued expenses	$	1,843,475		$	2,077,635
Short-term payables for acquisitions		137,000			497,000
Funds held as collateral		862,046			1,056,330
Unearned premiums and deferred revenue		2,127,729			1,400,446
Total Current Liabilities		4,970,250			5,031,411
Long-term Liabilities:
Asset retirement obligations		174,669			-
Deferred tax liability		57,000			57,000
Total Liabilities		5,201,919			5,088,411
Redeemable Noncontrolling Interest		1,190,187			1,234,987
Stockholders' Equity:
Preferred stock, $.001 par value, 1,000,000 shares authorized, 0 shares issued and outstanding		-			-
Class A common stock, $.001 par value, 38,838,884 shares authorized, 20,894,774 and 13,307,157 shares issued and outstanding, respectively		20,895			13,307
Class B common stock, $.001 par value, 1,161,116 shares authorized, 1,055,560 shares issued and outstanding		1,056			1,056
Additional paid-in capital		332,907,911			158,350,410
Accumulated deficit		(14,878,566	)		(11,211,087	)
Total Stockholders' Equity		318,051,296			147,153,686
Total Liabilities, Redeemable Noncontrolling Interest, and Stockholders' Equity	$	324,443,402		$	153,477,084

See accompanying notes to the unaudited consolidated financial statements.

5

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Consolidated Statements of Operations

Unaudited

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2018			2017			2018			2017
Revenues:
Billboard rentals	$	1,699,269		$	1,215,318		$	3,249,459		$	2,229,810
Premiums earned		507,045			531,557			984,349			1,024,099
Insurance commissions		751,684			209,598			1,516,868			542,766
Investment and other income		31,761			38,410			62,027			68,135
Total Revenues		2,989,759			1,994,883			5,812,703			3,864,810
Costs and Expenses:
Cost of billboard revenues (exclusive of depreciation and amortization)		842,787			619,224			1,565,621			1,110,309
Cost of insurance revenues		264,672			68,080			477,536			254,674
Employee costs		1,863,658			929,487			3,706,024			1,760,334
Professional fees		576,461			452,117			1,420,375			906,120
General and administrative		848,942			427,260			1,700,215			837,860
Amortization		690,905			422,673			1,451,240			795,899
Depreciation		306,714			233,241			635,407			456,708
Loss on disposition of assets		81,857			228,431			81,857			228,431
Bad debt expense		14,515			3,680			14,515			3,680
Accretion		2,939			-			5,995			-
Total Costs and Expenses		5,493,450			3,384,193			11,058,785			6,354,015
Net Loss from Operations		(2,503,691	)		(1,389,310	)		(5,246,082	)		(2,489,205	)
Other Income (Expense):
Interest income		648,223			-			1,091,946			-
Equity in income of unconsolidated affiliates		101,429			23,464			385,091			15,233
Unrealized gain on securities		206,306			-			113,303			-
Loss on disposition of investments		(54,733	)		-			(54,733	)		-
Interest expense		(264	)		(1,970	)		(1,804	)		(4,055	)
Net Loss Before Income Taxes		(1,602,730	)		(1,367,816	)		(3,712,279	)		(2,478,027	)
Income Tax (Provision) Benefit		-			-			-			-
Net Loss		(1,602,730	)		(1,367,816	)		(3,712,279	)		(2,478,027	)
Noncontrolling Interest in Subsidiary Loss		4,633			-			44,800			-
Net Loss Attributable to Common Stockholders	$	(1,598,097	)	$	(1,367,816	)	$	(3,667,479	)	$	(2,478,027	)
Basic and Diluted Net Loss per Share	$	(0.08	)	$	(0.18	)	$	(0.21	)	$	(0.34	)
Basic and Diluted Weighted Average Class A and Class B Common Shares Outstanding		19,165,153			7,594,585			17,780,454			7,247,906

See accompanying notes to the unaudited consolidated financial statements.

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BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Consolidated Statement of Changes in Stockholders' Equity

Unaudited

	No. of shares
	Class A Common Stock		Class B Common Stock		Class A Common Stock		Class B Common Stock		Additional Paid-in Capital			Accumulated Deficit			Total
Stockholders' equity December 31, 2017		13,307,157		1,055,560	$	13,307	$	1,056	$	158,350,410		$	(11,211,087	)	$	147,153,686
Stock issued for cash		1,149,849		-		1,150		-		26,086,133			-			26,087,283
Stock issued to related parties for cash		6,437,768		-		6,438		-		149,993,562			-			150,000,000
Offering costs		-		-		-		-		(1,522,194	)		-			(1,522,194	)
Net loss attributable to common stockholders, June 30, 2018		-		-		-		-		-			(3,667,479	)		(3,667,479	)
Stockholders' equity June 30, 2018		20,894,774		1,055,560	$	20,895	$	1,056	$	332,907,911		$	(14,878,566	)	$	318,051,296

See accompanying notes to the unaudited consolidated financial statements.

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BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Consolidated Statements of Cash Flows

Unaudited

	For the Six Months Ended
	June 30,
	2018			2017
Cash Flows from Operating Activities:
Net Loss	$	(3,712,279	)	$	(2,478,027	)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation, amortization, and accretion		2,092,642			1,252,607
Loss on disposition of assets		81,857			228,431
Bad debt expense		14,515			3,680
Equity in earnings of unconsolidated affiliates		(385,091	)		(15,233	)
Loss on disposition of investments		54,733			-
Unrealized gain on securities		(113,303	)		-
Changes in operating assets and liabilities:
Accounts receivable		(209,704	)		(668,549	)
Interest receivable		(692,109	)		-
Short-term investments		-			(531,025	)
Prepaid expenses		(343,838	)		(99,658	)
Distributions from unconsolidated affiliates		382,443			2,700
Other assets		(134,583	)		(134,620	)
Accounts payable and accrued expenses		(234,160	)		380,560
Unearned premiums and deferred revenue		727,283			426,440
Deferred tax liabilities		-			(8,000	)
Net Cash Used in Operating Activities		(2,471,594	)		(1,640,694	)
Cash Flows from Investing Activities:
Payment on short-term payable on acquisition		(360,000	)		-
Proceeds from disposition of assets		30,000			3,667
Purchases of equipment and related assets		(1,769,020	)		(645,236	)
Business acquisitions, net of cash acquired		-			(9,940,794	)
Acquisition of investment in unconsolidated affiliate		-			(66,000	)
Proceeds from sales of investments		431,908,709			-
Purchase of investments		(520,460,925	)		(2,657,670	)
Net Cash Used in Investing Activities		(90,651,236	)		(13,306,033	)
Cash Flows from Financing Activities:
Proceeds from issuance of stock		26,087,283			35,672,498
Proceeds from issuance of stock to related parties		150,000,000			52,467,336
Offering costs		(1,522,194	)		(914,423	)
Net Cash Provided by Financing Activities		174,565,089			87,225,411
Net Increase in Cash, Cash Equivalents, and Restricted Cash		81,442,259			72,278,684
Cash, Cash Equivalents, and Restricted Cash, Beginning of Period		7,230,570			29,844,068
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	88,672,829		$	102,122,752
Interest Paid in Cash	$	1,804		$	4,055
Income Taxes Paid in Cash	$	-		$	-

See accompanying notes to the unaudited consolidated financial statements.

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BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Consolidated Statements of Cash Flows (Continued)

Supplemental Schedules of Non-cash Investing and Financing Activities

Unaudited

	For the Six Months Ended
	June 30,
	2018		2017
Deposit on business acquisition applied to purchase	$	-	$	2,950,000
Equipment exchanged for note receivable		-		38,000
Asset retirement obligations		174,669		-
Note receivable exchanged for preferred stock		104,019		-

See accompanying notes to the unaudited consolidated financial statements.

9

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 1. ORGANIZATION AND BACKGROUND

Boston Omaha was organized on August 11, 2009 with present management taking over operations in February 2015. Our operations include (i) our outdoor advertising business with multiple billboards across Alabama, Florida, Georgia, and Wisconsin; (ii) our insurance business that specializes in surety bond underwriting and brokerage, and (iii) minority investments primarily in real estate services, homebuilding, and banking. Our billboard operations are conducted through our subsidiary, Link Media Holdings, LLC, and our insurance operations are conducted through our subsidiary, General Indemnity Group, LLC.

We completed an acquisition of an outdoor advertising business and entered the outdoor advertising industry on June 19, 2015. During 2015, 2016, and 2017, we completed eleven additional acquisitions of outdoor advertising businesses.

On April 20, 2016, we completed an acquisition of a surety bond brokerage business. On December 7, 2016, we acquired a fidelity and surety bond business; and, from July through November 2017 we completed the acquisition of two surety brokerage businesses, and we acquired a majority stake in a third surety brokerage business, thus expanding our operations in insurance.

In our opinion, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of consolidated financial position and the consolidated results of operations for the interim periods presented have been reflected herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the interim consolidated financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the years ended December 31, 2017 and 2016 as reported in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 30, 2018, have been omitted.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation Policy

The financial statements of Boston Omaha Corporation include the accounts of the Company and its wholly-owned and majority-owned subsidiaries, as follows:

Link Media Holdings, LLC which we refer to as “LMH”

Link Media Alabama, LLC which we refer to as “LMA”

Link Media Florida, LLC which we refer to as “LMF”

Link Media Wisconsin, LLC which we refer to as “LMW”

Link Media Georgia, LLC which we refer to as “LMG”

General Indemnity Group, LLC which we refer to as “GIG”

General Indemnity Insurance Company PCC, LLC which we refer to as “GIIC”

The Warnock Agency, Inc. which we refer to as “Warnock”

United Casualty and Surety Insurance Company which we refer to as “UC&S”

Surety Support Services, Inc. which we refer to as “SSS”

South Coast Surety Insurance Services, LLC which we refer to as “SCS”

Boston Omaha Investments, LLC which we refer to as “BOIC”

All significant intercompany profits, losses, transactions and balances have been eliminated in consolidation.

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BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenues

On January 1, 2018, we adopted FASB Accounting Standards Update (“ASU”) No. 2014-09 (Codified as ASC 606), Revenue from Contracts with Customers using the cumulative effect transition method applied to those contracts which were not completed as of January 1, 2018 and are not accounted for under ASC 840 Leases. Results for the reporting periods beginning after January 1, 2018 are presented under ASC 606 or 840, while comparative information has not been adjusted and continues to be reported under ASC 605.

A majority of our billboard contracts are accounted for under ASC 840 and will continue to be accounted for under the topic until January 1, 2019, our adoption date of FASB ASU No. 2016-02 (Codified as ASC 842), Leases. Contracts which begin prior to January 1, 2019 and are accounted for under ASC 840 will continue to be accounted for as a lease until the contract ends or is modified. Contracts beginning or modified on or after January 1, 2019 which do not meet the criteria of a lease under ASC 842 will be accounted for under ASC 606 Revenue. The majority of our advertising space contracts will not meet the definition of a lease under ASC 842.

Premium revenues derived from our insurance operations are not subject to this guidance.

Revenue Recognition

Billboard Rentals

We generate revenue from outdoor advertising through the leasing of billboards. The terms of the operating leases range from less than one month to three years and are generally billed monthly. Revenue for advertising space rental is recognized on a straight-line basis over the term of the contract. Advertising revenue is reported net of agency commissions. Agency commissions are calculated based on a stated percentage applied to gross billing revenue for operations. Payments received in advance of being earned are recorded as deferred revenue. Another component of billboard rentals consists of production services which include creating and printing advertising copy. Contract revenues for production services are recognized upon satisfaction of the contract, which is typically less than one week.

Deferred Revenues

We record deferred revenues when cash payments are received or due in advance of our performance obligation. The term between invoicing and when a payment is due is not significant. For certain services we require payment before the product or services are delivered to the customer. The balance of deferred income is considered short-term and will be recognized in revenue within twelve months.

Premiums and Unearned Premium Reserves

Premiums written are recognized as revenues based on a pro-rata daily calculation over the respective terms of the policies in-force. The cost of reinsurance ceded is initially written as prepaid reinsurance premiums and is amortized over the reinsurance contract period in proportion to the amount of insurance protection provided. Premiums ceded are netted against premiums written.

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BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenue Recognition (Continued)

Commissions

We generate revenue from commissions on surety bond sales. The insurance commissions are calculated based upon a stated percentage applied to the gross premiums on bonds. Commissions are earned as of the policy effective date and are nonrefundable.

Practical Expedients and Exemptions

Upon our transition to ASC 606 from ASC 840, we plan to utilize the following practical expedients and exemptions from ASC 606. We generally expense sales commissions when incurred because the amortization period is one year or less. These costs are recorded within cost of billboard revenues (exclusive of depreciation and amortization). We do not disclose the value of unsatisfied performance obligations as the majority of our contracts with customers have an original expected length of less than one year. For contracts with customers which exceed one year the future amount to be invoiced to the customer corresponds directly with the value to be received by the customer.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09 (Codified as ASC 606), Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB issued ASU No. 2015-14 deferring the effective date from January 1, 2017 to January 1, 2018, while allowing for early adoption as of January 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. We adopted the provisions of ASU No. 2014-09 on January 1, 2018 using the cumulative effect transition method. We did not have an adjustment to our opening balance of accumulated deficit for the adoption of this update.

In February 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which requires entities to carry all investments in equity securities at fair value and recognize any changes in fair value in net income. Under the standard, equity investments that do not have readily determinable fair values and do not qualify for the net asset value practical expedient are eligible for the measurement alternative. We adopted the provisions of ASU No. 2016-01 on January 1, 2018, for our equity investments in private companies not accounted for under the equity method, using the measurement alternative, defined as cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer.

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230), Restricted Cash. The guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The standard is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. We adopted ASU No. 2016-18 on January 1, 2018. In accordance with the guidance of ASU No. 2016-18, changes in restricted cash have been included with cash and cash equivalents in the consolidated statements of cash flows. We retrospectively adopted the standard.

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BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Recent Accounting Pronouncements (Continued)

The adoption increases the ending cash balance within our consolidated statements of cash flows by the aggregate amount of our restricted cash balances and requires a new disclosure to reconcile the cash balances within our consolidated statements of cash flows to the consolidated balance sheets. 

On January 1, 2018, we adopted ASU No. 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Payments. The ASU is required to be reflected on a retrospective basis and provides guidance on the classification of certain cash receipts and cash payments, including distributions received from an equity method investee. We adopted the cumulative earnings approach, whereby distributions received are considered to be returns on investment and, thus, should be classified as cash inflows from operating activities on our consolidated statement of cash flows. The adoption of ASU No. 2016-15 did not have a material impact on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), specifying the accounting for leases, which supersedes the leases requirements in Topic 840, Leases. The objective of Topic 842 is to establish the principles that lessee and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. Lessees are permitted to make an accounting policy election to not recognize the asset and liability for leases with a term of twelve months or less. Lessors’ accounting is largely unchanged from the previous accounting standard. In addition, Topic 842 expands the disclosure requirements of lease arrangements. Lessees and lessors will use a modified retrospective transition approach, which includes a number of practical expedients. This guidance is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2018 with early adoption permitted.

In January 2018, the FASB issued ASU No. 2018-01, Leases (Topic 842), Land Easement Practical Expedient for Transition to Topic 842. The update provides an optional transition practical expedient to not evaluate under Topic 842 existing or expired land easements that were not previously accounted for as leases under the current lease guidance in Topic 840. An entity that elects this practical expedient should evaluate new or modified land easements under Topic 842 upon adoption. An entity that does not elect this practical expedient should evaluate all existing or expired land easements in connection with the adoption of the new lease requirements in Topic 842 to assess whether they meet the definition of a lease. We plan to elect the provided practical expedient within this update upon our adoption of Topic 842.

In July 2018, the FASB issued ASU No. 2018-10 Leases (Topic 842), Codification Improvements and ASU No. 2018-11 Leases (Topic 842), Targeted Improvements, to provide additional guidance for the adoption of Topic 842. ASU No. 2018-10 clarifies certain provisions and corrects unintended applications of the guidance such as the application of implicit rate, lessee reassessment of lease classification, and certain transition adjustments that should be recognized to earnings rather than to stockholders’ equity. ASU No. 2018-11 provides an alternative transition method which allows recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption rather than in the earliest period presented, and a practical expedient for separating contract components for the adoption of Topic 842. ASU No. 2018-10 and ASU No. 2018-11 (collectively, “the new lease standards”) are effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We are currently assessing the effect the new lease standards will have on our consolidated financial statements.

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BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 3. RESTRICTED CASH

Restricted cash consists of the following:

	June 30,		December 31,
	2018		2017
Insurance premium escrow	$	330,971	$	247,230
Billboard replacement reserve		175,075		144,995
Total Restricted Cash	$	506,046	$	392,225

The following table sets forth a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated statements of cash flows that agrees to the total of those amounts as presented in the consolidated statements of cash flows.

	June 30,
	2018		2017
Cash and cash equivalents	$	88,166,783	$	101,717,930
Restricted cash		506,046		404,822
Total Cash, Cash Equivalents, and Restricted Cash as Presented in the Consolidated Statements of Cash Flows	$	88,672,829	$	102,122,752

NOTE 4. ACCOUNTS RECEIVABLE

Accounts receivable consist of the following:

	June 30,			December 31,
	2018			2017
Trade accounts	$	995,055		$	828,287
Premiums		298,872			288,039
Anticipated salvage and subrogation		3,573			3,572
Allowance for doubtful accounts		(6,534	)		(24,121	)
Total Accounts Receivable, net	$	1,290,966		$	1,095,777

14

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 5. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

	June 30,			December 31,
	2018			2017
Structures and displays	$	12,167,292		$	10,484,725
Vehicles and equipment		232,967			143,154
Office furniture and equipment		418,238			395,981
Accumulated depreciation		(2,537,724	)		(1,912,847	)
Total Property and Equipment, net	$	10,280,773		$	9,111,013

Depreciation expense for the three months and six months ended June 30, 2018 was $306,714 and $635,407 respectively; and for the three months and six months ended June 30, 2017 was $233,241 and $456,708, respectively. During the second quarter of 2018 and 2017, we incurred losses on the disposition of assets in the amount of $81,857 and $228,431, respectively.

NOTE 6. BUSINESS ACQUISITIONS

There were no business acquisitions during the six months ended June 30, 2018. During the six months ended June 30, 2017, we had net cash outflows of $9,940,794, related to business acquisitions.

2017 Acquisitions

During the year ended December 31, 2017, we completed six business acquisitions of billboards and related assets and three insurance company acquisitions. These acquisitions were accounted for as business combinations under the provisions of ASC 805. A summary of the acquisitions is provided below. A summary of the revenues and earnings of each since the acquisition dates included in the consolidated statements of operations for the three months and six months ended June 30, 2017 is provided in the tables below.

Billboard Acquisitions

Clear Channel Outdoor, Inc.

On January 9, 2017, our subsidiary, LMG, entered into a purchase agreement with Clear Channel Outdoor, Inc., which we refer to as “CCO,” for the purchase of over thirty billboard structures and related assets. The assets acquired are located in Georgia. The cash purchase price for the acquired business was $2,983,444, of which $2,950,000 had been deposited into the seller’s escrow account in November 2016 and was subsequently applied to the purchase price. The assets were acquired for the purpose of expanding our presence in the outdoor advertising market. The purchase price allocation is based on an appraisal by an independent third party valuation firm. Finite-lived intangible assets consist of customer relationships and permits. Amortization is computed over the average period of expected benefit, determined from internal information.

15

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 6. BUSINESS ACQUISITIONS (Continued)

2017 Acquisitions (continued)

Billboard Acquisitions (continued)

Hartlind Outdoor, LLC

On January 31, 2017, our subsidiary, LMW, entered into a purchase agreement with Hartlind Outdoor, LLC, which we refer to as “Hartlind,” for the purchase of over ninety billboard structures and related assets. The assets acquired are located in Wisconsin. The cash purchase price for the acquired business was $2,817,000. The assets were acquired for the purpose of expanding our presence in the outdoor advertising market. The purchase price allocation is based on an appraisal by an independent third party valuation firm. Finite-lived intangible assets consist of customer relationships, permits, and a noncompetition agreement. We amortize the noncompetition agreement according to the terms of the asset purchase agreement. Amortization of the other finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information. We also acquired six easements. The easements are permanent easements which grant us the right to use real property not owned by us. Since these rights are perpetual, they are not amortized.

Southeastern United States

Subsequent to the CCO business acquisition, we made additional business acquisitions in the Southeastern United States as presented below.

Corey Companies, Inc.

On June 8, 2017, our subsidiaries, LMG and LMA, entered into a purchase agreement with Corey Companies, Inc., which we refer to as “Corey,” for the purchase of approximately thirty billboard structures, a fifty percent interest in three billboard structures, and related assets. The assets acquired are located in Georgia and Alabama. The cash purchase price for the acquired business was $2,991,314. The assets were acquired for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States. The purchase price allocation for the structures, faces and permits is based on internal information derived from our previous acquisitions in Alabama and Georgia. The purchase price allocation for customer relationships is based on an appraisal by an independent third party valuation firm. The independent appraisal resulted in a decrease in customer relationships of $314,000 and an increase in goodwill of $314,000. The related decrease in amortization expense for the six months ended June 30, 2018 was $64,965. Finite lived intangible assets consist of customer relationships and permits. Amortization of the finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information.

Vision Outdoor Media, LLC

On June 16, 2017, our subsidiary, LMG, entered into a purchase agreement with Vision Outdoor Media, LLC, which we refer to as “Vision,” for the purchase of three billboard structures and related assets. The assets acquired are located in Georgia. The assets were acquired for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States. The cash purchase price for the acquired business was $3,199,036. The purchase price allocation is based on internal information derived from our previous acquisitions in Alabama and Georgia. Finite-lived intangible assets consist of customer relationships and permits. Amortization of the finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information.

16

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 6. BUSINESS ACQUISITIONS (Continued)

2017 Acquisitions (continued)

View Media, LLC

On July 11, 2017, our subsidiary, LMG, entered into a purchase agreement for the purchase of one billboard structure and related assets. The assets acquired are located in Georgia. The cash purchase price of the acquisition was $623,596. The assets were acquired for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States. The purchase price allocation is based on internal information derived from our previous acquisitions in Alabama and Georgia. Finite-lived intangible assets consist of customer relationships and permits. Amortization of the finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information.

In addition, we also made a small acquisition for a cash purchase price of $900,000.

Insurance Acquisitions

Surety Support Services, Inc.

On July 11, 2017, our subsidiary, GIG, entered into a purchase agreement for the purchase of 100% of the stock of an insurance brokerage company, Surety Support Services, Inc., which we refer to as “SSS.” The purchase price of the stock was $450,000, of which $22,500 was paid at closing, with $427,500 due in 2018, and is included in the caption “Short-term payables for acquisitions” on our consolidated balance sheets as of June 30, 2018 and December 31, 2017, respectively. During the six months ended June 30, 2018, we made a payment of $360,000 on the short-term payable for acquisition.

The stock was acquired for the purpose of expanding our presence in the insurance market in the United States. The purchase price allocation is based on internal information derived from our previous insurance brokerage company acquisitions.

Finite-lived intangible assets consist of customer relationships and a non-competition agreement. We amortize the non-competition agreement according to the terms of the asset purchase agreement. For other finite-lived assets, amortization is computed over the average period of expected benefit determined from internal information.

South Coast Surety Insurance Services, LLC

On October 31, 2017, our subsidiary, GIG, entered into a purchase agreement for the purchase of 70% of the membership units of an insurance brokerage company, South Coast Insurance Services, LLC, which we refer to as “SCS.” The cash purchase price of the units was $2,908,581, and was paid at closing. The units were acquired for the purpose of expanding our presence in the insurance market in the United States. The provisional purchase price allocation is based on internal information and will be revised when an independent appraisal has been completed. Due to the timing and complexity of the transaction, the initial accounting for the business combination is incomplete. We are still in the process of obtaining and assessing documentation of the contracts and relationships as well as assessing the initial valuation of the noncontrolling interest.

17

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 6. BUSINESS ACQUISITIONS (Continued)

2017 Acquisitions (continued)

Insurance Acquisitions (continued)

South Coast Surety Insurance Services, LLC (continued)

The seller has agreed to remain as a principal of SCS. The purchase agreement contains an option for the seller to sell us the remaining units (a “put” option). The purchase agreement also contains an option for us to purchase the remaining units (a “call” option) upon the death, incapacitation, or termination of the seller’s employment. Upon exercise of the options by the seller or by us, the purchase price of the remaining units is to be calculated by a formula contained in the purchase agreement. Both the put and the call options are embedded in the purchase agreement, and are not legally detachable or separately exercisable. At any time following the closing date of our purchase, the seller has the option (the put option), but not the obligation to sell us all of the remaining 30% of the membership units. Should the seller exercise his option, we are obligated to purchase all of the remaining units (“redeemable NCI”). Since the put option is currently redeemable, in accordance with the guidance of ASC 480 - 10 (Subtopic- S99 - 30), Distinguishing Liabilities from Equity Overall, the redeemable NCI is presented on our consolidated balance sheet between liabilities and equity. Additionally, we are required to re-measure the value of the redeemable NCI as of the date of each balance sheet presented. We have calculated the value of the redeemable NCI based upon the redemption formula contained in the purchase agreement, and have determined that no adjustment is necessary as of June 30, 2018 and December 31, 2017, respectively.

Finite-lived intangible assets consist of customer relationships, trade names and trademarks, and a noncompetition agreement. We amortize the noncompetition agreement according to the terms of the asset purchase agreement. For other finite-lived assets, amortization is computed over the average period of expected benefit determined from internal information.

Freestate Bonds, Inc.

On November 30, 2017, our subsidiary, Warnock entered into a purchase agreement for the purchase of 100% of the stock of an insurance brokerage company, Freestate Bonds, Inc., which we refer to as “Freestate.” The purchase price of the stock was $293,000, of which $223,500 was paid at closing, with $69,500 due on November 30, 2018, and is included in the caption “Short-term payables for acquisitions” on our consolidated balance sheets as of June 30, 2018 and December 31, 2017. The stock was acquired for the purpose of expanding our presence in the insurance market in the United States. The purchase price allocation is based on internal information derived from our previous insurance brokerage company acquisitions. During May 2018, Freestate was reorganized into Warnock and Freestate was subsequently dissolved.

The following tables present information for the 2017 business acquisitions for the six months ended June 30, 2017, including amortization of finite intangible assets, revenues and earnings included in consolidated net loss for the three months and six months ended June 30, 2017, and the costs of acquisition included in professional fees on our consolidated statement of operations for the three and six months ended June 30, 2017.

18

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 6. BUSINESS ACQUISITIONS (Continued)

2017 Acquisitions (continued)

	Billboards
	CCO			Hartlind		Southeastern US			Subtotal
Amortization of intangible assets acquired for the three months ended June 30, 2017	$	70,846		$	45,770	$	38,181		$	154,797
Revenues since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	204,093		$	99,665	$	5,320		$	309,078
Earnings since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	(21,391	)	$	38,431	$	(54,043	)	$	(37,003	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the three months ended June 30, 2017	$	-		$	831	$	21,563		$	22,394
Amortization of intangible assets acquired for the six months ended June 30, 2017	$	141,693		$	76,284	$	38,181		$	256,158
Revenues since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	359,076		$	152,776	$	5,320		$	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	(41,755	)	$	55,729	$	(54,043	)	$	(40,069	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the six months ended June 30, 2017	$	14,468		$	8,645	$	21,563		$	44,676

19

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 6. BUSINESS ACQUISITIONS (Continued)

2017 Acquisitions (continued)

	Insurance
	SSS		SCS		Freestate		Subtotal		Total
Amortization of intangible assets acquired for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	154,797
Revenues since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	309,078
Earnings since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	(37,003	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	22,394
Amortization of intangible assets acquired for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	256,158
Revenues since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	(40,069	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	44,676

20

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 6. BUSINESS ACQUISITIONS (Continued)

2017 Acquisitions (continued)

Pro Forma Information

The following is the unaudited pro forma information assuming all business acquisitions occurred on January 1, 2017. For all of the business acquisitions depreciation and amortization have been included in the calculation of the below pro forma information based upon the actual acquisition costs. Depreciation is computed on the straight-line method over the estimated remaining economic lives of the assets, ranging from two years to fifteen years. Amortization is computed on the straight-line method over the estimated useful lives of the assets ranging from two to fifty years.

Since there were no acquisitions during the three months and six months ended June 30, 2018, no pro forma results are included.

	Three Months Ended June 30, 2017			Six Months Ended June 30, 2017
Revenue	$	2,960,519		$	5,666,907
Net Loss Attributable to Common Stockholders	$	(1,460,839	)	$	(2,651,967	)
Basic and Diluted Loss per Share	$	(0.19	)	$	(0.37	)
Basic and Diluted Weighted Average Class A and Class B Common Shares Outstanding		7,594,585			7,247,906

The information included in the pro forma amounts is derived from historical information obtained from the sellers of the businesses. With respect to CCO, Corey, Vision, and View, the above pro forma does not contain allocation of management overhead and other shared expenses for lines of business under common ownership, that were not acquired.

21

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 7.     INTANGIBLE ASSETS

Intangible assets consist of the following:

	June 30, 2018							December 31, 2017
			Accumulated							Accumulated
	Cost		Amortization			Balance		Cost		Amortization			Balance
Customer relationships	$	7,818,900	$	(4,232,685	)	$	3,586,215	$	8,132,900	$	(2,970,533	)	$	5,162,367
Permits, licenses, and lease acquisition costs		2,181,621		(239,472	)		1,942,149		2,184,106		(178,835	)		2,005,271
Site location		849,347		(51,904	)		797,443		849,347		(23,593	)		825,754
Noncompetition agreements		285,000		(94,917	)		190,083		285,000		(66,417	)		218,583
Trade names and trademarks		722,200		(158,417	)		563,783		722,200		(112,250	)		609,950
Technology		138,000		(99,660	)		38,340		138,000		(76,662	)		61,338
Nonsolicitation agreement		28,000		(28,000	)		-		28,000		(28,000	)		-
Easements		486,850		-			486,850		466,360		-			466,360
Total	$	12,509,918	$	(4,905,055	)	$	7,604,863	$	12,805,913	$	(3,456,290	)	$	9,349,623

The future amortization associated with the intangible assets is as follows:

	June 30,
	2019		2020		2021		2022		2023		Thereafter		Total
Customer relationships	$	2,256,238	$	1,210,675	$	119,302	$	-	$	-	$	-	$	3,586,215
Permits, licenses, and lease acquisition costs		125,742		125,742		125,742		125,742		125,742		1,313,439		1,942,149
Site location		56,623		56,623		56,623		56,623		56,623		514,328		797,443
Noncompetition agreements		57,000		56,417		40,500		28,000		8,166		-		190,083
Trade names and trademarks		74,000		67,933		64,900		64,900		64,900		227,150		563,783
Technology		38,340		-		-		-		-		-		38,340
Total	$	2,607,943	$	1,517,390	$	407,067	$	275,265	$	255,431	$	2,054,917	$	7,118,013

Amortization expense for the three months ended June 30, 2018 and 2017 was $690,905 and $422,673, respectively. Amortization expense for the six months ended June 30, 2018 and 2017 was $1,451,240 and $795,899, respectively.

22

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 7. INTANGIBLE ASSETS (Continued)

Future Amortization

The weighted average amortization period, in months, for intangible assets is as follows:

Customer relationships	17
Permits, licenses, and lease acquisition costs	185
Site location	169
Noncompetition agreements	40
Trade names and trademarks	67
Technology	10

NOTE 8. INVESTMENTS, INCLUDING INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Short-term Investments

Short-term investments consist of certificates of deposit having maturity dates of less than twelve months and are carried at cost, U.S. Treasury securities and a corporate bond that are held to maturity and mature in less than twelve months, and a convertible note receivable. The certificates of deposit are held to maturity and mature in the upcoming year. The U.S. Treasury notes, the corporate bond, and the certificates of deposit are held by UC&S. For the six months ended June 30, 2018, gains on redemptions of U.S. Treasury notes were $2,137.

	June 30,		December 31,
	2018		2017
Certificates of deposit	$	816,709	$	746,219
U.S. Treasury notes and corporate bond		4,039,422		809,184
Convertible note receivable		-		103,896
Total	$	4,856,131	$	1,659,299

Convertible Note Receivable

On September 13, 2016, we purchased an unsecured convertible note receivable from Breezeway Homes, Inc. (“Breezeway”) for the principal sum of $100,000. The note bore interest at 3% per annum, with principal and accrued interest payable upon demand at the earlier of December 31, 2018 or the closing of Breezeway’s next equity financing.

In January 2018, Breezeway completed a second round of equity financing, in which we agreed to tender our promissory note in exchange for preferred stock. At the time that the note receivable was tendered, principal, together with accrued interest, was $104,019. At December 31, 2017, the balance of the note plus accrued interest was $103,896.

As part of the loan arrangement, the parties entered into a memorandum of understanding for the parties to work together on the sale of damage waiver insurance related products, which the parties may develop, to property managers, lessors, and renters for residential homes through Breezeway’s platform.

23

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 8. INVESTMENTS, INCLUDING INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD (Continued)

Note Receivable

On April 27, 2018, we made a short-term loan to CB&T Holding Corporation (“CB&T”). In connection with the short-term loan, CB&T issued us a promissory note in the principal amount of $2,116,972, with an interest rate of 15% per annum, and reimbursed us for certain costs associated with the transaction. The loan was repaid on June 1, 2018 together with $29,990 in interest.

U.S. Treasury Trading Securities and U.S. Treasury Securities Available for Sale

Our security investments that are bought and held principally for the purpose of selling them in the near term are classified as trading securities. Trading securities are recorded at fair value on the balance sheet in current assets, with the change in fair value during the period included in earnings. Our trading securities consist of U.S. Treasury securities. Trading securities as of June 30, 2018 and December 31, 2017 are as follows:

			Gross
			Unrealized		Fair
	Cost		Gain		Value
U.S. Treasury bills, June 30, 2018	$	-	$	-	$	-
U.S. Treasury bills, December 31, 2017	$	82,968,614	$	132,191	$	83,100,805

We classify our investments in debt securities that we intend to hold for indefinite periods of time as “available for sale.” Our securities available for sale are carried at fair value in the balance sheet. Because we have elected the fair value option for these securities, unrealized holding gains and losses during the period are included in earnings. Interest income is recognized at the coupon rate. Securities available for sale as of June 30, 2018 are as follows:

			Gross
			Unrealized		Fair
	Cost		Gain		Value
U.S. Treasury securities, June 30, 2018	$	150,100,946	$	245,494	$	150,346,440

24

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 8. INVESTMENTS, INCLUDING INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD (Continued)

Long-term Investments

Long-term investments consist of certificates of deposit having maturity dates in excess of twelve months, and U.S. Treasury securities. The certificates of deposit have maturity dates ranging from 2019 through 2021. We have the intent and the ability to hold the investments to maturity. Certificates of deposit and U.S. Treasury securities are stated at carrying value which approximates fair value and are held by UC&S.

Long-term investments consist of the following:

	June 30,		December 31,
	2018		2017
U.S. Treasury securities, held to maturity	$	2,083,624	$	2,820,855
Certificates of deposit		931,291		1,080,426
Preferred stock		104,019		-
Non-voting common units of Dream Finders Holdings, LLC		10,000,000		10,000,000
Voting common stock of CB&T Holding Corporation		19,058,485		-
Total	$	32,177,419	$	13,901,281

Cost Investments

On May 31, 2018, we invested $19,058,485 in voting common stock of CB&T, the privately held parent company of Crescent Bank & Trust. Our investment represents 14.99% of CB&T’s outstanding common stock. CB&T is a closely held corporation, whose majority ownership rests with one family.

During late December 2017, we invested $10,000,000 in non-voting common units of Dream Finders Holdings, LLC, a national homebuilder. Excluding their non-convertible preferred equity, our investment represents an approximately 5% ownership stake in the company.

During January 2018, we exchanged our convertible note receivable from Breezeway for 31,227 shares of preferred stock. The preferred stock is noncumulative and has a dividend rate of $.2665 per share, should dividends be declared. The preferred stock has one vote per share and is convertible into whole shares of common stock, determined according to the conversion formula contained in Breezeway’s amended and restated articles of incorporation.

We reviewed our investments as of June 30, 2018 and December 31, 2017 and concluded that no impairment to the carrying value was required.

Investment in Unconsolidated Affiliates

We have various investments in equity method affiliates, whose businesses are in real estate and real estate services. Our interest in these affiliates ranges from 7.15% to 30%. Two of the investments in affiliates, Logic Real Estate Companies, LLC and TAG SW 1, LLC having a combined carrying amount of $417,287 on June 30, 2018, are managed by a member of our board of directors. During the six months ended June 30, 2018, TAG SW 1, LLC sold its remaining investments and realized a gain on the sale of its assets.

25

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 8. INVESTMENTS, INCLUDING INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD (Continued)

Investment in Unconsolidated Affiliates (continued)

The following table is a reconciliation of our investments in equity affiliates as presented in investments in unconsolidated affiliates on our consolidated balance sheets:

	June 30,			December 31,
	2018			2017
Beginning of period	$	952,128		$	871,918
Additional investments in unconsolidated affiliates		-			66,000
Distributions received		(382,443	)		(59,550	)
Loss on investment in affiliate		(107,630	)		-
Equity in income of unconsolidated affiliates		385,091			73,760
End of period	$	847,146		$	952,128

The loss on investment in affiliate is related to the wind-down of TAG SW 1, LLC and is included on our consolidated statements of operations in the caption “Loss on disposition of investments.”

NOTE 9. FAIR VALUE

At June 30, 2018 and December 31, 2017, our financial instruments included cash, cash equivalents, restricted cash, receivables, marketable securities, investments, and accounts payable. The fair values of cash, cash equivalents, restricted cash, receivables, and accounts payable approximated carrying values because of the short-term nature of these instruments. U.S. Treasury trading securities and U.S. Treasury securities available for sale are reported at fair values. Fair values for investments held at cost are not readily available, but are estimated to approximate fair value. Substantially all of the fair value is determined using observed prices of publicly traded debt, level 1 in the fair value hierarchy.

	Total Carrying		Quoted Prices				Total Changes
	Amount in		in Active				in Fair Values
	Consolidated		Markets for				Included in
	Balance Sheet		Identical		Trading Gains		Current Period
	Jun. 30, 2018		Assets		and Losses		Earnings (Loss)
U.S. Treasury trading securities	$	-	$	-	$	6,406	$	(132,191	)
U.S. Treasury securities available for sale		150,346,440		150,346,440		44,354		245,494
					$	50,760	$	113,303

26

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 10. ASSET RETIREMENT OBLIGATIONS

Our asset retirement obligations include the costs associated with the removal of structures, resurfacing of the land and retirement cost, if applicable, related to our outdoor advertising assets. The following table reflects information related to our asset retirement obligations:

Balance, December 31, 2017	$	-
Additions		179,917
Accretion expense		5,995
Liabilities settled		(11,243	)
Balance, June 30, 2018	$	174,669

NOTE 11. CAPITAL STOCK

On February 22, 2018, we entered into a Class A Common Stock Purchase Agreement, pursuant to which we agreed to issue and sell to three limited partnerships up to an aggregate of $150,000,000 in unregistered shares of Class A common stock at a price of $23.30, a slight premium to the closing price of shares of Class A common stock of $23.29 on the NASDAQ Capital Market, as reported by NASDAQ on February 22, 2018. Two of the three limited partnerships are entities managed by The Magnolia Group, LLC, and the third limited partnership is an entity managed by Boulderado Group, LLC. The Class A Common Stock Purchase Agreement was approved by an independent special committee of our board of directors with the advice of independent legal counsel and an independent investment banking firm which provided a fairness opinion to the special committee. The closing of the first tranche of shares to be sold under the agreement occurred on March 6, 2018. It consisted of a total of 3,300,000 shares resulting in total gross proceeds of $76,890,000. The closing of the second tranche of shares to be sold under the agreement occurred on May 15, 2018. It consisted of the sale of 3,137,768 shares resulting in gross proceeds of approximately $73,110,000 and in aggregate gross proceeds from the private placement of approximately $150,000,000 in total.

Also in February 2018, we filed a shelf registration statement with the SEC allowing us to sell up to $200,000,000 of our securities. This registration statement was declared effective by the SEC on February 9, 2018. We subsequently entered into a Sales Agreement with Cowen and Company, LLC, which we refer to as “Cowen,” relating to the sale of shares of our Class A common stock to be offered. In accordance with the terms of the Sales Agreement, we may offer and sell from time to time up to $50,000,000 of shares of our Class A common stock through Cowen acting as our agent. Cowen is not required to sell any specific amount of securities, but will act as our sales agent using commercially reasonable efforts consistent with its normal trading and sales practices, on mutually agreed terms between Cowen and us. The compensation to Cowen for sales of Class A common stock sold pursuant to the Sales Agreement will be an amount equal to 3% of the gross proceeds of any shares of Class A common stock sold under the Sales Agreement. Through June 30, 2018, Cowen sold an aggregate of 1,149,849 shares of our Class A common stock under this “at the market” offering, resulting in gross proceeds to us of $26,087,283 and net proceeds of $25,304,665, net of commission paid to Cowen.

On May 4, 2018, we filed an amendment to our second amended and restated certificate of incorporation which increased our authorized shares of common stock. Our authorized capital stock now consists of 40,000,000 shares of common stock, of which 38,838,884 shares are designated as Class A common stock and 1,161,116 shares are designated as Class B common stock, and 1,000,000 shares of undesignated preferred stock.

27

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 11. CAPITAL STOCK (Continued)

As of June 30, 2018 there were 105,556 outstanding warrants for our Class B common stock. A summary of warrant activity for the six months ended June 30, 2018 is presented in the following table.

	Shares Under Warrants		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value of Vested Warrants
Outstanding as of December 31, 2017		105,556	$	9.95	7.5	$	2,368,677
Issued		-
Exercised		-
Expired		-
Outstanding as of June 30, 2018		105,556	$	9.95	7.0	$	1,173,783

NOTE 12. FUTURE MINIMUM LEASE PAYMENTS

In connection with the business acquisitions (See Note 6), we acquired the leases for over 450 billboard locations. Some of the leases are non-cancelable operating leases having remaining terms ranging from month-to-month to 1,002 months. In many instances, we can cancel the lease with little or no penalty. Ground rents for the three months and six months ended June 30, 2018 were $447,635 and $850,747 respectively; and for the three months and six months ended June 30, 2017 were $350,781 and $637,924, respectively. Contingent rents included in ground rents for the three months and six months ended June 30, 2018 were $92,081 and $116,685, respectively; and for three months and six months ended June 30, 2017 were $9,302 and $20,234, respectively.

We lease office space under leases expiring between 2018 and 2022. Rent expense included in general and administrative expense for the three months and six months ended June 30, 2018 was $86,559 and $183,096, respectively; and for the three months and six months ended June 30, 2017 was $50,447 and $95,263, respectively.

Future minimum rents are as follows for the twelve months ending June 30:

2019	$	1,312,993
2020		1,202,230
2021		1,104,883
2022		947,708
2023		886,710
Thereafter		4,397,508
Total	$	9,852,032

28

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 13. INDUSTRY SEGMENTS

This summary presents our current segments, as described below.

General Indemnity Group, LLC

GIG conducts our insurance operations through its subsidiaries, Warnock, SSS, SCS, UC&S, and GIIC. UC&S, SSS and SCS clients are multi-state and Warnock clients are nationwide. Revenue consists of surety bond sales and insurance commissions. Currently, GIG’s corporate resources are used to support Warnock, SSS, SCS, UC&S, and GIIC and to make additional business acquisitions in the insurance industry.

Link Media Holdings, LLC

LMH conducts our billboard rental operations. LMH advertisers are located in Alabama, Florida, Georgia, and Wisconsin.

Three Months Ended June 30, 2018	GIG			LMH			Unallocated			Total Consolidated
Revenue	$	1,290,490		$	1,699,269		$	-		$	2,989,759
Segment gross profit		1,025,818			856,482			-			1,882,300
Segment loss from operations		(1,204,432	)		(783,029	)		(516,230	)		(2,503,691	)
Capital expenditures		2,549			1,181,656			-			1,184,205
Depreciation and amortization		316,086			681,533			-			997,619

										Total
Three Months Ended June 30, 2017	GIG			LMH			Unallocated			Consolidated
Revenue	$	779,565		$	1,215,318		$	-		$	1,994,883
Segment gross profit		711,485			596,094			-			1,307,579
Segment loss from operations		(418,264	)		(699,994	)		(271,052	)		(1,389,310	)
Capital expenditures		-			4,468,496			-			4,468,496
Depreciation and amortization		50,678			605,236			-			655,914

										Total
Six Months Ended June 30, 2018	GIG			LMH			Unallocated			Consolidated
Revenue	$	2,563,244		$	3,249,459		$	-		$	5,812,703
Segment gross profit		2,085,708			1,683,838			-			3,769,546
Segment loss from operations		(2,247,811	)		(1,501,711	)		(1,496,560	)		(5,246,082	)
Capital expenditures		10,031			1,758,989			-			1,769,020
Depreciation and amortization		641,220			1,445,427			-			2,086,647

										Total
Six Months Ended June 30, 2017	GIG			LMH			Unallocated			Consolidated
Revenue	$	1,635,000		$	2,229,810		$	-		$	3,864,810
Segment gross profit		1,380,326			1,119,501			-			2,499,827
Segment loss from operations		(651,948	)		(1,158,488	)		(678,769	)		(2,489,205	)
Capital expenditures		-			10,586,030			-			10,586,030
Depreciation and amortization		101,357			1,151,250			-			1,252,607

29

BOSTON OMAHA CORPORATION

and SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

For the Three Months and Six Months Ended June 30, 2018 and 2017

NOTE 13. INDUSTRY SEGMENTS (Continued)

							Total
As of June 30, 2018	GIG		LMH		Unallocated		Consolidated
Accounts receivable, net	$	469,969	$	820,997	$	-	$	1,290,966
Goodwill		8,719,294		16,286,867		-		25,006,161
Total assets		25,237,935		33,256,376		265,949,091		324,443,402

							Total
As of December 31, 2017	GIG		LMH		Unallocated		Consolidated
Accounts receivable, net	$	433,225	$	662,552	$	-	$	1,095,777
Goodwill		8,719,294		15,972,867		-		24,692,161
Total assets		25,762,437		32,443,777		95,270,870		153,477,084

NOTE 14. CUSTODIAL RISK

At June 30, 2018, we had approximately $85,700,000 in excess of federally insured limits on deposit with financial institutions.

NOTE 15. SUBSEQUENT EVENTS

On July 31, 2018, we completed the acquisition of Tammy Lynn Outdoor, LLC (“Tammy Lynn”), based in Bluefield, West Virginia. The assets acquired are located in Virginia and West Virginia. The majority of the purchase price was paid in cash, however, as part of the consideration for the purchase the seller received 85,170 shares of our Class A common stock. The acquisition was completed for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States.

For the month ended July 31, 2018, Cowen sold an additional 28,080 shares of our Class A common stock, under the “at the market” Sales Agreement, resulting in net proceeds to us of $590,844. (See Note 11)

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

CAUTIONARY STATEMENT FOR FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and other federal securities laws. We have based these forward-looking statements on our current intent, expectations and projections about future events, and these forward-looking statements are not guaranteed to occur and may not occur. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “would,” “intend,” “project,” “contemplate,” “potential,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. These statements are only predictions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other Securities and Exchange Commission filings. 

THE OUTCOME OF THE EVENTS DESCRIBED IN THIS REPORT ALSO CONTAINS MARKET DATA RELATED TO OUR BUSINESS AND INDUSTRY. THIS MARKET DATA INCLUDES PROJECTIONS THAT ARE BASED ON A NUMBER OF ASSUMPTIONS. IF THESE ASSUMPTIONS TURN OUT TO BE INCORRECT, ACTUAL RESULTS MAY DIFFER FROM THE PROJECTIONS BASED ON THESE ASSUMPTIONS. AS A RESULT, OUR MARKETS MAY NOT GROW AT THE RATES PROJECTED BY THIS DATA, OR AT ALL. THE FAILURE OF THESE MARKETS TO GROW AT THESE PROJECTED RATES MAY HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS, RESULTS OF OPERATIONS, FINANCIAL CONDITION AND THE MARKET PRICE OF OUR COMMON STOCK.

The following discussion should be read in conjunction with our Financial Statements and related Notes thereto included elsewhere in this report. Any of the forward-looking statements that we make in this quarterly report on Form 10-Q and in other public reports and statements we make may turn out to be inaccurate as a result of our beliefs and assumptions we make in connection with the factors set forth above or because of other unidentified and unpredictable factors. IN ADDITION, OUR BUSINESS AND FUTURE RESULTS ARE SUBJECT TO A NUMBER OF FACTORS, INCLUDING THOSE FACTORS SET FORTH IN THE “risk factors” SECTION OF OUR ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2017. Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements and you should not rely on such statements. We undertake no obligation to publish revised forward-looking statements to reflect the occurrence of unanticipated events or circumstances after the date hereof. These risks could cause our actual results for 2018 and beyond to differ materially from those expressed in any forward-looking statements by or on behalf of us, and could negatively affect our financial condition, liquidity and operating and stock price performance.

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Overview

We are currently engaged in three areas of business: outdoor billboards, surety insurance and related brokerage activities, and minority investments.  In our current corporate form, we began acquiring billboard businesses in June 2015. Since that time, we have completed a number of acquisitions and as of this date (including recent acquisitions) own over 560 billboard structures in six states.  On July 31, 2018, we completed the acquisition of Tammy Lynn Outdoor, LLC, which we refer to as “Tammy Lynn,” the fifth largest billboard company in West Virginia, with over 85 billboard structures and over 260 advertising faces. In the insurance business, we acquired our first surety insurance agency in April 2016 and in December 2016, we completed the acquisition of United Casualty & Surety Insurance Company, which we refer to as “UC&S,” a surety insurance company, which at that time was licensed to conduct business in nine states and is now licensed in 48 states and the District of Columbia.  In 2017, we completed the acquisition of three additional surety insurance brokerage businesses. We expect to continue to acquire additional billboard assets through acquisitions of existing billboard businesses in the United States and we hope to complete licensing UC&S in all 50 states this year.

In addition, we have previously made investments in several commercial real estate management services businesses starting in the second half of 2015, and in late December 2017 we invested $10 million in Dream Finders Holdings LLC, the parent company of Dream Finders Homes, LLC, a national home builder with operations in Florida, Texas, Georgia, Colorado and the greater northern Virginia and Maryland areas.  On May 31, 2018, we invested through one of our subsidiaries approximately $19 million through the purchase of common stock of CB&T Holding Corporation, the privately-held parent company of Crescent Bank & Trust, Inc., which we refer to as “Crescent.” Crescent is a bank that generates the majority of its revenues from indirect auto lending. It also provides retail and business banking services to customers and clients in southeastern Louisiana.

In each of our businesses, we hope to expand our geographic reach and to develop a low cost advantage and/or brand name for our services which we hope will be a differentiating factor for customers. Our insurance market primarily services small contractors, businesses and individuals required to provide surety bonds in connection with their work for government agencies and others, and to meet regulatory licensing and other needs. Our plan is to expand our insurance offerings and underwriting in all 50 states and the District of Columbia. In outdoor billboards, our plan is to continue to grow this business through acquisitions of billboard assets. We also expect to continue to make additional investments in real estate management service businesses as well as in other businesses. In the future, we expect to expand the range of services we provide in the insurance sector, seek to continue to expand our billboard operations and to possibly consider acquisitions of other businesses, as well as investments, in different sectors. Our decision to expand outside of these current business sectors we serve or in which we have made investments will be based on the opportunity to acquire businesses which we believe provide the potential for sustainable earnings at an attractive level relative to capital employed and, with regard to investment, we believe have the potential to provide attractive returns.

Although several large companies control a majority of the outdoor billboard market, industry reports estimate that there are a large number of other smaller independent companies servicing the remainder of the market. In the surety industry, total industry direct-written premiums are estimated to have reached $6.1 billion in 2017. While the top 10 surety insurance companies were estimated to write approximately the majority of all premiums, there were approximately 206 insurers issuing surety bonds in 2017.

We seek to enter markets where we believe demand for our services will grow in the coming years due to certain barriers to entry and/or to anticipated long-term demand for these services. In the outdoor billboard business, government restrictions often limit the number of additional billboards that may be constructed. At the same time, advances in billboard technology provide the opportunity to improve revenues through the use of digital display technologies and other new technologies. In addition to our recent acquisition of Tammy Lynn, we are continuing to pursue additional acquisitions of billboard businesses in different geographic areas of the United States. In the surety insurance business, new insurance companies must be licensed by state agencies that impose capital, management and other strict requirements on these insurers. These hurdles are at the individual state level, with statutes often providing wide latitude to regulators to impose judgmental requirements upon new entrants. In addition, new distribution channels in certain areas of surety may provide a new opportunity. In the real estate management services market, we believe the continued growth of commercial real estate in many sections of the United States will provide opportunities for management services for the foreseeable future. We also believe our investment in Crescent provides the opportunity for Crescent to significantly grow its business.

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How We Generate Our Revenues and Evaluate Our Business

We currently generate revenues primarily through billboard advertising and related services and from the sale of surety insurance and related brokerage activities.  Revenue for outdoor advertising space rental is recognized on a straight-line basis over the term of the contract and advertising revenue is reported net of agency commissions. Payments received in advance of being earned are recorded as deferred revenue. In our surety insurance business, premiums written are recognized as revenues based on a pro rata daily calculation over the respective terms of the policies in-force. Unearned premiums represent the portion of premiums written applicable to the unexpired term of the policies in-force. In connection with our surety agency business, insurance commissions are earned on the policy effective date and are not subject to recapture.

Segment gross profit is a key metric that we use to evaluate segment operating performance and to determine resource allocation between segments. We define segment gross profit as segment revenues less segment direct cost of services. In our billboard business, direct cost of services includes land leases, utilities, repairs and maintenance of equipment, sales commissions, contract services, and other billboard level expenses. In our surety business, direct cost of services includes commissions, premium taxes, and losses and loss adjustment expenses.

Results of Operations

Three Months Ended June 30, 2018 Compared to Three Months Ended June 30, 2017

The following is a comparison of our results of operations for the three months ended June 30, 2018, which we refer to as the “second quarter of fiscal 2018,” compared to the three months ended June 30, 2017, which we refer to as the “second quarter of fiscal 2017.” Our results for the second quarter of fiscal 2018 include the operating results of certain billboard operations which were acquired during fiscal 2017. In addition, these results include our acquisition of a controlling interest in South Coast Surety Insurance Services, LLC, which we refer to as “SCS,” and the acquisition of each of Surety Support Services, Inc., which we refer to as “SSS,” and Freestate Bonds, Inc., which we refer to as “Freestate,” each of which was completed in the second half of fiscal 2017. In the second quarter of fiscal 2018, Freestate was reorganized into The Warnock Insurance Agency, Inc., which we refer to as “Warnock.” Therefore, comparisons of our results for the second quarter of fiscal 2018 to the second quarter of fiscal 2017 may not be meaningful.

Revenues. For the second quarter of fiscal 2018 and the second quarter of fiscal 2017, our revenues in dollars and as a percentage of total revenues were as follows:

	For the Three Months Ended June 30, (unaudited)
	2018					2017					2018 vs 2017
	Amount		As a % of Total Revenues			Amount		As a % of Total Revenues
Revenues:
Billboard rentals	$	1,699,269		56.8	%	$	1,215,318		60.9	%	$	483,951
Premiums earned		507,045		17.0	%		531,557		26.7	%		(24,512	)
Insurance commissions		751,684		25.1	%		209,598		10.5	%		542,086
Investment and other income		31,761		1.1	%		38,410		1.9	%		(6,649	)
Total Revenues	$	2,989,759		100.0	%	$	1,994,883		100.0	%	$	994,876

We realized total revenues of $2,989,759 during the second quarter of fiscal 2018, an increase of 49.9% over revenues of $1,994,883 during the second quarter of fiscal 2017.

● Second quarter of fiscal 2018 billboard rentals increased 39.8% from second quarter of fiscal 2017, reflecting the acquisition of billboards during the second quarter of fiscal 2017 as well as improving rental and occupancy rates of our billboards.

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● Premiums earned from our UC&S insurance subsidiary in the second quarter of fiscal 2018 decreased 4.6% as contrasted to the second quarter of fiscal 2017.  During fiscal 2017, our insurance operations focused on increasing the number of states in which UC&S may sell surety insurance from nine states as of January 1, 2017 to 48 states and the District of Columbia as of August 10, 2018 and, as a result, the company incurred a decline in gross written premium when measured from the previous year. This trend has since reversed itself, however, any increase in bookings from new surety bond issuances will not be immediately fully reflected in our revenues for that quarter as revenues from surety bond premiums are recognized over the life of the surety bond. In addition, during the past three fiscal quarters, UC&S has undergone significant changes, including the addition of senior sales and financial management, improving information technology systems, focusing additional efforts in expanding UC&S’ infrastructure and improving and expanding the use of reinsurance arrangements. We believe that our efforts in repositioning UC&S and our expanded brokerage sales force provide us with a strong foundation over the longer term for increasing revenues from premiums earned.

● Revenues from insurance commissions generated by our surety brokerage operations increased by 258.6%, primarily reflecting increased commission income at Warnock, and the acquisitions of a majority stake in SCS and the acquisitions of each of SSS and Freestate, each of which occurred after the completion of the second quarter of fiscal 2017.

● Investment and other income decreased 17.3% to $31,761 in the second quarter of fiscal 2018 from $38,410 in the second quarter of fiscal 2017.

Expenses. For the second quarter of fiscal 2018 and the second quarter of fiscal 2017, our expenses, in dollars, and as a percentage of total revenues were as follows:

	For the Three Months Ended June 30, (unaudited)
	2018					2017					2018 vs 2017
	Amount		As a % of Total Revenues			Amount		As a % of Total Revenues			$ Variance
Costs and Expenses:
Cost of billboard revenues	$	842,787		28.2	%	$	619,224		31.0	%	$	223,563
Cost of insurance revenues		264,672		8.9	%		68,080		3.4	%		196,592
Employee costs		1,863,658		62.3	%		929,487		46.6	%		934,171
Professional fees		576,461		19.3	%		452,117		22.7	%		124,344
Depreciation		306,714		10.3	%		233,241		11.7	%		73,473
Amortization		690,905		23.1	%		422,673		21.2	%		268,232
General and administrative		848,942		28.3	%		427,260		21.4	%		421,682
Loss on disposition of assets		81,857		2.7	%		228,431		11.5	%		(146,574	)
Accretion		2,939		0.1	%		-		0.0	%		2,939
Bad debt expense		14,515		0.5	%		3,680		0.2	%		10,835
Total Costs and Expenses	$	5,493,450		183.7	%	$	3,384,193		169.7	%	$	2,109,257

During the second quarter of fiscal 2018, we had total costs and expenses of $5,493,450, as compared to total costs and expenses of $3,384,193 in the second quarter of fiscal 2017. Total costs and expenses as a percentage of total revenues increased from 169.7% in the second quarter of fiscal 2017 to 183.7% in the second quarter of fiscal 2018, an increase of 62.3%. Many of our most significant increases in costs reflect our increases in personnel and general and administrative operations from acquisitions made in the second half of fiscal 2017 and to meet future anticipated demand, particularly in our insurance operations. Cost of insurance revenues, employee costs, amortization, and general and administrative expenses increased at a higher rate than revenues in the second quarter of fiscal 2018 as compared to the second quarter of fiscal 2017. Cost of billboard revenues, depreciation, professional fees and loss on disposition of assets as a percentage of total revenues decreased. Accretion and bad debt expense remained relatively constant.

● Cost of billboard revenues increased by $223,563 from the second quarter of fiscal 2017 to the second quarter of fiscal 2018, primarily due to increased land expense as we brought newly acquired billboards on line as well as increased commissions paid reflecting the greater sales volume.

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● Cost of insurance revenues consisted primarily of commissions paid by Warnock, SCS, SSS, and UC&S. Due to the additional insurance brokerages acquired during fiscal 2017, the cost of insurance revenues increased by 288.8% from the second quarter of fiscal 2017 to the second quarter of fiscal 2018.

● During the second quarter of fiscal 2018 total employee costs increased by 100.5% from the second quarter of fiscal 2017. Employee costs as a percentage of revenues increased to 62.3% in the second quarter of fiscal 2018 from 46.6% in the second quarter of fiscal 2017. This increase was due primarily to increased staffing levels in our billboard and insurance operations as we hired in anticipation of future growth through future acquisitions. Employee costs in our insurance operation increased to $1,190,693 in the second quarter of fiscal 2018 from $557,040 in the second quarter of fiscal 2017, an increase of 113.8%. This increase in staffing levels reflects increased headcount in both our brokerage employees as a result of the acquisitions and increased staffing to meet future anticipated demand for our UC&S operations. Additionally, we have also added senior personnel and other personnel in technology and finance roles. Employee costs in our billboard operation increased to $602,411 in the second quarter of fiscal 2018 from $281,638 in the second quarter of fiscal 2017, an increase of 113.9%. This increase in staffing levels reflects increased staffing to meet future anticipated demand in new markets and the addition of finance personnel.

● Professional fees in the second quarter of fiscal 2018 were $576,461, or 19.3% of total revenues, as compared to $452,117, or 22.7% of total revenues, in the second quarter of fiscal 2017. Professional fees increased in the second quarter of fiscal 2018, primarily due to accounting, audit, legal and consulting fees, but decreased as a percentage of total revenues.

● Non-cash expenses in the second quarter of fiscal 2018 included $306,714 in depreciation expenses, $690,905 in amortization expenses and $2,939 in accretion expenses. Depreciation expenses increased by 31.5% and amortization expenses increased by 63.5% from the second quarter of fiscal 2017 to the second quarter of fiscal 2018 and are primarily associated with the acquisition of UC&S in fiscal 2016, our acquisitions of certain billboards in fiscal 2017, and the acquisition of a majority stake in SCS in the second half of fiscal 2017. Accretion expenses are in connection with asset retirement obligations for certain billboard assets. We did not have accretion expenses in the second quarter of fiscal 2017.

● General and administrative expenses increased from $427,260 to $848,942, an increase of 98.7%, reflecting increases primarily due to computer and software expenses, as well as advertising and business licenses expenses associated with our increased operations and acquisitions, and increased insurance costs associated with liability and other insurance products we purchase for our operations. As a percentage of total revenues, general and administrative expenses increased from 21.4% in the second quarter of fiscal 2017 to 28.3% in the second quarter of fiscal 2018.

Net Loss from Operations. As a result of our costs and expenses associated with expanding our business operations, net loss from operations for the second quarter of fiscal 2018 was $2,503,691, or 83.7% of total revenues, as compared to a net loss from operations of $1,389,310, or 69.6% of total revenues, in the second quarter of fiscal 2017.  The increase in net loss from operations as a percentage of total revenues was primarily due to the increases in personnel costs, general and administrative expenses, cost of insurance revenues and amortization expenses as a percentage of total revenues. 

Other Income (Expense).  During the second quarter of fiscal 2018, we had net other income of $900,961, or 30.1% of total revenues. Net other income includes $101,429 in equity in income of unconsolidated affiliates and $206,306 from unrealized gains in securities, which was offset by a $54,733 loss on the disposition of investments. Net other income also includes interest income of $648,223, or 21.7% of total revenues, primarily on the investment of the cash on hand prior to our 2017 public offering, the proceeds of our 2017 public offering, the proceeds from our 2018 private placement, and the proceeds from our “at the market offering” that commenced in March 2018, which was offset by interest expense of $264. 

35

Net Loss Attributable to Common Stockholders. We had a net loss attributable to common stockholders in the amount of $1,598,097 in the second quarter of fiscal 2018, as contrasted to a net loss attributable to common stockholders of $1,367,816 in the second quarter of fiscal 2017. Our loss on a per share basis in the second quarter of fiscal 2018 was $0.08, based on 19,165,153 weighted average shares outstanding, as compared to a per share loss of $0.18, based on 7,594,585 weighted shares outstanding in the second quarter of fiscal 2017. The increase in weighted average shares outstanding reflects the 7,465,342 shares of Class A common stock issued in our June 2017 public offering, as well as 6,437,768 shares of Class A common stock issued in our private placement in the first half of fiscal 2018, and 1,149,849 shares of Class A common stock issued in connection with our “at the market” offering in the first half of fiscal 2018.

Six Months Ended June 30, 2018 Compared to Six Months Ended June 30, 2017

The following is a comparison of our results of operations for the six months ended June 30, 2018, which we refer to as the “first half of fiscal 2018,” compared to the six months ended June 30, 2017, which we refer to as the “first half of fiscal 2017.” Our results for the first half of fiscal 2018 include the operating results of certain billboard operations which were acquired during fiscal 2017. In addition, these results include our acquisition of a controlling interest in SCS, and the acquisitions of SSS and Freestate, each of which was completed in the second half of fiscal 2017. Therefore, comparisons of our results for the first half of fiscal 2018 to the first half of fiscal 2017 may not be meaningful.

Revenues. For the first half of fiscal 2018 and the first half of fiscal 2017, our revenues in dollars and as a percentage of total revenues were as follows:

	For the Six Months Ended June 30, (unaudited)
	2018					2017					2018 vs 2017
	Amount		As a % of Total Revenues			Amount		As a % of Total Revenues
Revenues:
Billboard rentals	$	3,249,459		55.9	%	$	2,229,810		57.7	%	$	1,019,649
Premiums earned		984,349		16.9	%		1,024,099		26.5	%		(39,750	)
Insurance commissions		1,516,868		26.1	%		542,766		14.0	%		974,102
Investment and other income		62,027		1.1	%		68,135		1.8	%		(6,108	)
Total Revenues	$	5,812,703		100.0	%	$	3,864,810		100.0	%	$	1,947,893

We realized total revenues of $5,812,703 during the first half of fiscal 2018, an increase of 50.4% over revenues of $3,864,810 during the first half of fiscal 2017.

● During the first half of fiscal 2018, we realized billboard revenues of $3,249,459, an increase of 45.7% over revenues of $2,229,810 for billboard rentals during the first half of fiscal 2017. This increase was mainly driven by the acquisition of additional billboards and improving rentals and occupancy rates of our billboards.

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● Revenues during the first half of fiscal 2018 included $984,349 in premiums earned from UC&S. During fiscal 2017, our insurance operations focused on increasing the number of states in which UC&S may sell surety insurance. UC&S’ authority to issue surety bonds increased from nine states as of January 1, 2017 to 48 states and the District of Columbia as of August 10, 2018. During the past three fiscal quarters, UC&S has undergone significant changes, including the addition of senior sales and financial management, improving information technology systems, focusing additional efforts in expanding UC&S’ infrastructure and improving and expanding the use of reinsurance arrangements. Also, our revenues from surety bond premiums are recognized over the life of the surety bond. Thus, any increase in bookings from new surety bond issuances will not be immediately fully reflected in our revenues for that quarter. We believe that our efforts in repositioning UC&S and our expanded brokerage sales force provide us with a strong foundation over the longer term for increasing revenues from premiums earned.

● Revenues from insurance commissions generated by our surety brokerage operations were $1,516,868 during the first half of fiscal 2018, an increase of 179.5% from the first half of fiscal 2017. This increase is primarily due to increased commissions at Warnock and during the second half of fiscal 2017 the acquisitions of a majority stake in SCS and the acquisitions of each of SSS and Freestate.

● Investment and other income decreased 9.0% to $62,027 during the first half of fiscal 2018 from $68,135 in the first half of fiscal 2017.

Expenses. For the first half of fiscal 2018 and the first half of fiscal 2017, our expenses, in dollars, and as a percentage of total revenues were as follows:

	For the Six Months Ended June 30, (unaudited)
	2018					2017					2018 vs 2017
	Amount		As a % of Total Revenues			Amount		As a % of Total Revenues			$ Variance
Costs and Expenses:
Cost of billboard revenues	$	1,565,621		26.9	%	$	1,110,309		28.8	%	$	455,312
Cost of insurance revenues		477,536		8.2	%		254,674		6.6	%		222,862
Employee costs		3,706,024		63.8	%		1,760,334		45.5	%		1,945,690
Professional fees		1,420,375		24.4	%		906,120		23.4	%		514,255
Depreciation		635,407		10.9	%		456,708		11.8	%		178,699
Amortization		1,451,240		25.0	%		795,899		20.6	%		655,341
General and administrative		1,700,215		29.3	%		837,860		21.7	%		862,355
Loss on disposition of assets		81,857		1.4	%		228,431		5.9	%		(146,574	)
Accretion		5,995		0.1	%		-		0.0	%		5,995
Bad debt expense		14,515		0.3	%		3,680		0.1	%		10,835
Total Costs and Expenses	$	11,058,785		190.3	%	$	6,354,015		164.4	%	$	4,704,770

During the first half of fiscal 2018, we had total costs and expenses of $11,058,785, primarily from employee and general and administrative costs and non-cash expenses. Total costs and expenses for the first half of fiscal 2018 increased by $4,704,770, an increase of 74.0% from the first half of fiscal 2017. Many of our most significant increases in costs reflect our increases in personnel and general and administrative operations from acquisitions made in the second half of fiscal 2017 and to meet future anticipated demand, particularly in our insurance operations. Cost of insurance revenues, employee costs, professional fees, amortization, and general and administrative expenses increased at a higher rate than revenues in the first half of fiscal 2018 as compared to the first half of fiscal 2017.  Cost of billboard revenues, depreciation, and loss on disposition of assets as a percentage of total revenues decreased. Accretion and bad debt expense remained relatively constant.

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During the first half of fiscal 2018:

● Billboard expenses increased by $455,312 from the first half of fiscal 2017 to the first half of fiscal 2018, but decreased as a percentage of revenues from 28.8% in the first half of fiscal 2017 to 26.9% in the first half of fiscal 2018.

● Cost of insurance revenues was $477,536 in the first half of fiscal 2018, an 87.5% increase from $254,674 in the first half of fiscal 2017, primarily due to the acquisition of a majority stake in SCS and the acquisitions of SSS and Freestate in the second half of fiscal 2017.

● In the first half of fiscal 2018 employee costs increased 110.5% to $3,706,024 from $1,760,334 in the first half of fiscal 2017. This increase was due primarily to increased staffing levels in our billboard and insurance operations, and reflects increased headcount as a result of the acquisitions and increased staffing to meet future anticipated demand for our operations.

● Professional fees in the first half of fiscal 2018 were $1,420,375, or 24.4% of total revenues, compared to $906,120, or 23.4% of total revenues, for the first half of fiscal 2017. Professional fees in the first half of 2018 were primarily due to accounting, audit, legal and consulting fees.

● Non-cash expenses in the first half of fiscal 2018 included $635,407 in depreciation and $1,451,240 in amortization expenses, a combined 35.9% of total revenues, compared to $456,708 in depreciation and $795,899 in amortization expenses, a combined 32.4% of total revenues, during the first half of fiscal 2017. The higher depreciation and amortization expenses are primarily associated with the acquisition of UC&S in fiscal 2016, our acquisitions of certain billboards in fiscal 2017, and the acquisition of a majority stake in SCS in the second half of fiscal 2017.

● General and administrative expenses increased to $1,700,215 from $837,860, an increase of 102.9%. As a percentage of total revenues, general and administrative expenses increased from 21.7% in the first half of fiscal 2017 to 29.3% in the first half of fiscal 2018. The increase in absolute dollars was due primarily to computer and software expenses, as well as advertising and business licenses expenses associated with our increased operations and acquisitions, and increased insurance costs associated with liability and other insurance products we purchase for our operations.

Net Loss from Operations. Net loss from operations for the first half of fiscal 2018 was $5,246,082, or 90.3% of total revenues, as compared to a net loss from operations of $2,489,205, or 64.4% of total revenues, in the first half of fiscal 2017. The increase in net loss from operations as a percentage of total revenues was primarily due to the increases in personnel costs, general and administrative expenses, professional fees and amortization expenses as a percentage of total revenues.

Other Income (Expense).  During the first half of fiscal 2018, we had $1,091,946 in interest income primarily from the investment of the proceeds from our 2018 private placement and proceeds from our “at the market” offering. Interest income was offset by $1,804 of interest expense in the first half of fiscal 2018.  We also had $113,303 in unrealized gains from securities, which was offset by a loss of $54,733 on a loss on the disposition of investments. During the first half of fiscal 2018, we had equity in income of $385,091 from our interests in certain real estate ventures compared to $15,233 during the first half of fiscal 2017.

Net Loss Attributable to Common Stockholders. We had a net loss attributable to common stockholders in the amount of $3,667,479 during the first half of fiscal 2018, or a loss per share of $0.21, based on 17,780,454 weighted average shares outstanding. This compared to a net loss attributable to common stockholders in the amount of $2,478,027 during the first half of fiscal 2017, or a loss per share of $0.34, based on 7,247,906 weighted average shares outstanding. In the first half of fiscal 2018, we completed a private placement and began an “at the market” program, which increased the weighted average shares outstanding from the first half of fiscal 2017 to the first half of fiscal 2018.

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Results of Operations by Segment

The following tables report results for the following two segments in which we operate, billboards and insurance, for the second quarter of fiscal 2018 and the second quarter of fiscal 2017:

Results of Billboard Operations

	For the Three Months Ended June 30, (unaudited)
	2018			2017
Operating Revenues
Billboard rentals	$	1,699,269		$	1,215,318
Cost of Revenues
Ground rents		447,635			350,781
Utilities		87,531			76,938
Commissions paid		181,668			60,132
Other costs of revenues		125,953			131,373
Total cost of revenues		842,787			619,224
Gross profit		856,482			596,094
Other Operating Expenses
Employee costs		602,411			281,638
Professional fees		35,263			82,438
Depreciation		304,256			229,852
Amortization		377,277			375,384
General and administrative		221,867			94,665
Accretion		2,939			-
Loss on disposition of assets		81,857			228,431
Bad debt expense		13,641			3,680
Total expenses		1,639,511			1,296,088
Segment Loss from Operations		(783,029	)		(699,994	)
Interest income (expense)		41			-
Net Loss Attributable to Common Stockholders	$	(782,988	)	$	(699,994	)

Comparison of the Second Quarter of Fiscal 2018 to the Second Quarter of Fiscal 2017. Net loss from operations for this segment increased due primarily to the following:

● Second quarter of fiscal 2018 billboard rentals increased 39.8% from second quarter of fiscal 2017, reflecting the acquisition of billboards during the second quarter of fiscal 2017 as well as improving rental and occupancy rates of our billboards.

● Increased commissions associated with an increase in revenue driven by acquisitions during the first and second quarters of fiscal 2017 as well as an increase in the utilization rate of newly acquired billboards after the second quarter of fiscal 2017.

● Increased ground rents, primarily from the acquisitions during the first and second quarters of fiscal 2017. As a percentage of revenue, ground rents were 26.3% in the second quarter of fiscal 2018, compared to 28.9% in the second quarter of fiscal 2017.

● Increased employee costs associated with increased staffing to meet future anticipated demand in new markets and the addition of sales, operations, finance and administrative personnel.

● Higher general and administrative costs driven by the increase in staffing levels as well as travel related costs associated with routine business operations and acquisition due diligence.

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The segment loss from operations was partially offset by higher revenues primarily associated with increased utilization, the acquisition of additional billboards in 2017 and decreases in depreciation and amortization as a percentage of revenues. Professional fees also decreased from the second quarter of fiscal 2017 as compared to the second quarter of fiscal 2018.

Results of Insurance Operations

	For the Three Months Ended June 30, (unaudited)
	2018			2017
Operating Revenues
Premiums earned	$	507,045		$	531,557
Insurance commissions		751,684			209,598
Salvage and subrogation		-			3,613
Investment and other income		31,761			34,797
Total operating revenues		1,290,490			779,565
Cost of Revenues
Commissions paid		236,289			67,984
Taxes - premium excise		28,383			(3,008	)
Losses and loss adjustment expense		-			3,104
Total cost of revenues		264,672			68,080
Gross profit		1,025,818			711,485
Other Operating Expenses
Employee costs		1,190,693			557,040
Professional fees		223,115			230,172
Depreciation		2,458			3,389
Amortization		313,628			47,289
Bad debt expense		873			-
General and administrative		499,483			291,859
Total expenses		2,230,250			1,129,749
Segment Loss from Operations		(1,204,432	)		(418,264	)
Interest income (expense)		(218	)		(1,833	)
Gain on sale of investments		2,137			-
Noncontrolling interest in subsidiary loss		4,633			-
Net Loss Attributable to Common Stockholders	$	(1,197,880	)	$	(420,097	)

Comparison of the Second Quarter of Fiscal 2018 to the Second Quarter of Fiscal 2017. Net loss from operations for this segment increased due primarily to the following:

● Premiums earned from our UC&S insurance subsidiary in the second quarter of fiscal 2018 decreased 4.6% as contrasted to the second quarter of fiscal 2017.  During fiscal 2017, our insurance operations focused on increasing the number of states in which UC&S may sell surety insurance from nine states as of January 1, 2017 to 48 states and the District of Columbia as of August 10, 2018 and, as a result, the company incurred a decline in gross written premium when measured from the previous year. This trend has since reversed itself, however, any increase in bookings from new surety bond issuances will not be immediately fully reflected in our revenues for that quarter as revenues from surety bond premiums are recognized over the life of the surety bond. In addition, during the past three fiscal quarters, UC&S has undergone significant changes, including the addition of senior sales and financial management, improving information technology systems, focusing additional efforts in expanding UC&S’ infrastructure and improving and expanding the use of reinsurance arrangements.  We believe that our efforts in repositioning UC&S and our expanded brokerage sales force provide us with a strong foundation over the longer term for increasing revenues from premiums earned.

● Increased commissions paid, primarily due to increased revenues within our brokerage operations.

● Higher employee expenses reflecting growth at Warnock, the acquisition of a majority stake in SCS and the acquisitions of SSS and Freestate in the second half of 2017. In addition, overhead was added at GIG generally in the areas of accounting and information technology staffing in fiscal 2017.

● Increased amortization expense primarily associated with the acquisition of UC&S in fiscal 2016 and the acquisition of a majority interest in SCS after the completion of the second quarter of fiscal 2017.

● Increased general and administrative expenses associated with these expanding operations, including increased computer and software, rent, licensing and marketing expenses.

The increase in loss from insurance operations was partially offset by higher insurance commissions associated with Warnock, SCS, SSS and Freestate, and from decreased professional fees and depreciation.

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The following tables report results for the following two segments in which we operate, billboards and insurance, for the first half of fiscal 2018 and the first half of fiscal 2017:

Results of Billboard Operations

	For the Six Months Ended June 30, (unaudited)
	2018			2017
Operating Revenues
Billboard rentals	$	3,249,459		$	2,229,810
Cost of Revenues
Ground rents		850,747			637,924
Utilities		182,114			135,429
Commissions paid		300,082			105,509
Other costs of revenues		232,678			231,447
Total cost of revenues		1,565,621			1,110,309
Gross profit		1,683,838			1,119,501
Other Operating Expenses
Employee costs		1,089,026			561,050
Professional fees		123,347			122,137
Depreciation		626,027			449,928
Amortization		819,400			701,322
General and administrative		426,256			211,441
Accretion		5,995			-
Loss on disposition of assets		81,857			228,431
Bad debt expense		13,641			3,680
Total expenses		3,185,549			2,277,989
Segment Loss from Operations		(1,501,711	)		(1,158,488	)
Interest income (expense)		79			-
Net Loss Attributable to Common Stockholders	$	(1,501,632	)	$	(1,158,488	)

Comparison of the First Half of Fiscal 2018 to the First Half of Fiscal 2017. Net loss from operations for this segment increased due primarily to the following:

● During the first half of fiscal 2018, we realized billboard revenues of $3,249,459, an increase of 45.7% over revenues of $2,229,810 for billboard rentals during the first half of fiscal 2017. This increase was mainly driven by the acquisition of additional billboards and improving rentals and occupancy rates of our billboards.

● Increased ground rents, primarily from the acquisitions during the first and second quarters of fiscal 2017. As a percentage of revenue, ground rents were 26.2% in the first half of fiscal 2018, compared to 28.6% in the first half of fiscal 2017.

● Increased commissions associated with an increase in revenue driven by acquisitions during the first and second quarters of fiscal 2017 as well as an increase in the utilization rate of newly acquired billboards after the second quarter of fiscal 2017.

● Increased employee costs associated with increased staffing to meet future anticipated demand in new markets and the addition of sales, operations, finance and administrative personnel.

● Higher general and administrative costs driven by the increase in staffing levels as well as travel related costs associated with routine business operations and acquisition due diligence.

● Increased non-cash expenses, including a 39.1% increase in depreciation expense and a 16.8% increase in amortization expense, primarily associated with the acquisition of additional billboards during fiscal 2017.

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The segment loss from operations was partially offset by higher revenues associated with increased utilization, the acquisition of additional billboards in 2017 and relatively constant professional fees.

Results of Insurance Operations

	For the Six Months Ended June 30, (unaudited)
	2018			2017
Operating Revenues
Premiums earned	$	984,349		$	1,024,099
Insurance commissions		1,516,868			542,766
Salvage and subrogation		-			11,661
Investment and other income		62,027			56,474
Total operating revenues		2,563,244			1,635,000
Cost of Revenues
Commissions paid		422,928			202,528
Taxes - premium excise		54,608			40,994
Losses and loss adjustment expense		-			11,152
Total cost of revenues		477,536			254,674
Gross profit		2,085,708			1,380,326
Other Operating Expenses
Employee costs		2,386,194			1,044,603
Professional fees		352,398			381,779
Depreciation		9,380			6,780
Amortization		631,840			94,577
Bad debt expense		873			-
General and administrative		952,834			504,535
Total expenses		4,333,519			2,032,274
Segment Loss from Operations		(2,247,811	)		(651,948	)
Interest income (expense)		(1,560	)		(3,666	)
Gain on sale of investments		2,137			-
Noncontrolling interest in subsidiary loss		44,800			-
Net Loss Attributable to Common Stockholders	$	(2,202,434	)	$	(655,614	)

Comparison of the First Half of Fiscal 2018 to the First Half of Fiscal 2017. Net loss from operations for this segment increased due primarily to the following:

● Decreased premiums earned from our UC&S insurance subsidiary in the first half of fiscal 2018. During fiscal 2017, our insurance operations focused on increasing the number of states in which UC&S may sell surety insurance. UC&S’ authority to issue surety bonds increased from nine states as of January 1, 2017 to 48 states and the District of Columbia as of August 10, 2018. During the past three fiscal quarters, UC&S has undergone significant changes, including the addition of senior sales and financial management, improving information technology systems, focusing additional efforts in expanding UC&S’ infrastructure and improving and expanding the use of reinsurance arrangements. Also, our revenues from surety bond premiums are recognized over the life of the surety bond. Thus, any increase in bookings from new surety bond issuances will not be immediately fully reflected in our revenues for that quarter. We believe that our efforts in repositioning UC&S and our expanded brokerage sales force provide us with a strong foundation over the longer term for increasing revenues from premiums earned.

● Increased commissions paid, primarily due to increased revenues within our brokerage operations.

● Higher employee expenses reflecting growth at Warnock, the acquisition of a majority stake in SCS and the acquisitions of SSS and Freestate in the second half of 2017. In addition, overhead was added at GIG generally in the areas of accounting and information technology staffing in the second half of fiscal 2017.

● Increased amortization expense primarily associated with the acquisition of UC&S in fiscal 2016 and the acquisition of a majority interest in SCS after the completion of the second quarter of fiscal 2017.

● Increased general and administrative expenses associated with these expanding operations, including increased computer and software, rent, licensing and marketing expenses.

The increase in loss from insurance operations was partially offset by higher insurance commissions associated with Warnock, SCS, SSS and Freestate, an increase in investment and other income, and from a decrease in professional fees.

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Cash Flows

Cash Flows for the First Half of Fiscal 2018 compared to the First Half of Fiscal 2017

The table below summarizes our cash flows, in dollars, for the first half of fiscal 2018 and the first half of fiscal 2017:

	Six Months Ended June 30, 2018 (unaudited)			Six Months Ended June 30, 2017 (unaudited)
Net cash used in operating activities	$	(2,471,594	)	$	(1,640,694	)
Net cash used in investing activities		(90,651,236	)		(13,306,033	)
Net cash provided by financing activities		174,565,089			87,225,411
Net increase in cash, cash equivalents, and restricted cash	$	81,442,259		$	72,278,684

Net Cash Used in Operating Activities.  Net cash used in operating activities was cash outflow of $2,471,594 for the first half of fiscal 2018 compared to cash outflow of $1,640,694 for the first half of fiscal 2017. The increase in operating cash outflow was primarily attributable to higher operating expenses (excluding depreciation and amortization) as we seek to grow our billboard and insurance businesses.

Net Cash Used in Investing Activities.  Net cash used in investing activities was $90,651,236 for the first half of fiscal 2018 as compared with $13,306,033 during the first half of fiscal 2017. This increase in net cash used in investing activities is primarily attributable to our investment of a portion of the proceeds from the 2017 public offering, the 2018 private placement, and our “at the market” offering in treasury securities.

Net Cash Provided by Financing Activities.  Net cash provided by financing activities was $174,565,089. This consists of gross proceeds of approximately $150,000,000 raised through the sale of our Class A common stock in our 2018 private placement and gross proceeds of $26,087,283 raised through our “at the market” offering during the first half of fiscal 2018, offset by offering costs of $1,522,194 collectively. This is an increase from the $87,225,411 provided by financing activities in the first half of 2017 from the 2017 public offering.

Liquidity and Capital Resources

Currently, we own billboards in Alabama, Florida, Georgia, Virginia, West Virginia and Wisconsin (including billboards acquired subsequent to the second quarter of fiscal 2018 in Virginia and West Virginia), surety insurance brokerage firms we acquired in 2016 and 2017, a surety insurance company we acquired in December 2016, and minority investments in several real estate management entities, a builder of residential homes, and a bank holding entity whose primary source of revenue is in indirect auto lending. Our strategy is to continue to acquire other billboard locations and insurance businesses as well as acquire other businesses which we would expect to generate positive cash flows. We expect to finance future acquisitions primarily with cash and seller or third party financing. In the future, we may also satisfy all or a portion of the purchase price paid for an acquisition with our equity securities.

At June 30, 2018, we had $88,166,783 in unrestricted cash and $155,202,571 primarily in short-term treasuries. There can be no assurance that we will consummate any subsequent acquisitions. Furthermore, our acquisitions are subject to a number of risks and uncertainties, including as to when, whether and to what extent the anticipated benefits and cost savings of a particular acquisition will be realized. Our failure to successfully identify and complete future acquisitions of assets or businesses could reduce future potential earnings, available cash and slow our anticipated growth.

In the first quarter of fiscal 2018, in February 2018, we announced the entry into a stock purchase agreement relating to the issuance and sale of up to $150,000,000 of our unregistered Class A common stock, which we refer to as the “2018 private placement.” 3,300,000 shares were issued in the initial closing, which occurred on March 6, 2018, resulting in gross proceeds to us of $76,890,000, which we refer to as the “Initial Closing.” The remaining 3,137,768 shares were issued during the second quarter of fiscal 2018 in a subsequent closing on May 15, 2018, resulting in gross proceeds to us of approximately $73,110,000, which we refer to as the “Subsequent Closing.” Under the 2018 private placement, all shares were sold at $23.30, a slight premium to the $23.29 closing price of the Class A common stock on the NASDAQ Capital Market, as reported by NASDAQ on February 22, 2018.

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During the second quarter of fiscal 2018, we also continued to utilize our “at the market” offering that is part of our shelf Registration Statement on Form S-3 (File No. 333-222853) that was filed with the Securities and Exchange Commission, which we refer to as the “SEC,” in February 2018. This registration statement was declared effective on February 9, 2018. The “at the market” offering is pursuant to a Sales Agreement with Cowen and Company, LLC, which we refer to as “Cowen,” relating to the sale of shares of our Class A common stock to be offered, that we entered into in the first quarter of fiscal 2018. In accordance with the terms of the Sales Agreement, we may offer and sell from time to time up to $50,000,000 of shares of our Class A common stock through Cowen acting as our agent. Sales of our Class A common stock, if any, will be made in sales deemed to be “at the market offerings” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended, which we refer to as the “Securities Act.” Cowen is not required to sell any specific amount of securities, but will act as our sales agent using commercially reasonable efforts consistent with its normal trading and sales practices, on mutually agreed terms between Cowen and us. There is no arrangement for funds to be received in any escrow, trust or similar arrangement. The compensation to Cowen for sales of Class A common stock sold pursuant to the Sales Agreement will be an amount equal to 3% of the gross proceeds of any shares of Class A common stock sold under the Sales Agreement. In connection with sales of Class A common stock on our behalf, Cowen will be deemed to be an “underwriter” within the meaning of the Securities Act and the compensation payable to Cowen will be deemed to be underwriting commissions or discounts. We have also agreed to provide indemnification and contribution to Cowen with respect to certain liabilities, including liabilities under the Securities Act or the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act.” As of June 30, 2018, Cowen sold an aggregate of 1,149,849 shares of our Class A common stock under this “at the market” offering, resulting in net proceeds to us of $25,304,665, of which 628,159 shares were sold during the second quarter of fiscal 2018 for net proceeds to us of $14,081,780 during the second quarter of fiscal 2018.

Subsequent to the second quarter of fiscal 2018, we announced on July 3, 2018 that Magnolia Capital Fund, LP no longer holds a majority of the voting power necessary to elect our outside directors. As a result, we must comply with all general NASDAQ corporate governance guidelines as we no longer qualify for the “Controlled Company” exemption as defined by NASDAQ rules. We currently meet all NASDAQ general corporate governance requirements except that we must add an additional independent director before June 30, 2019 so that a majority of our Board of Directors is comprised of independent directors.

The change in Magnolia Capital Fund, LP’s percentage of voting power is due to several factors, including its pro rata distribution on June 30, 2018 of its Class A common stock to its limited partners (a majority of which distributed shares continue to be held by other affiliated entities, including Magnolia Capital Fund, LP and Magnolia BOC II, LP, by Adam Peterson, the Company’s Co-Chief Executive Officer, or by The Magnolia Group, LLC, the general partner of Magnolia BOC I, LP and Magnolia BOC II, LP) and our recent share issuances in the 2018 private placement and our previously announced “at the market” offering. After these distributions and issuances, Magnolia Capital Fund, LP, Magnolia BOC I, LP, The Magnolia Group, LLC and Mr. Peterson still collectively hold the largest percentage of voting power of the Company’s Class A common stock and Class B common stock on a combined basis as of July 30, 2018 at approximately 32.5% based on outstanding shares and approximately 33.1% if all Class B common stock warrants held by Magnolia Capital Fund, LP are exercised.

In August 2018, Boulderado Partners, LP redeemed certain interests held by certain limited partners in exchange for 262,634 shares of Class A common stock and 784 Class B warrants. As a result of the provisions of the warrants governing transfers, the transferred Class B warrants were converted to an equivalent number of warrants to purchase Class A common stock. After these distributions, Boulderado Partners, LP still holds 656,550 shares of Class A common stock, 527,780 shares of Class B common stock and warrants to purchase an additional 51,994 shares of Class B common stock.  These shares of Class A common stock and Class B common stock, together with the Class B warrants, all of which are immediately exercisable, represent 19.8% of the voting power of the Company’s outstanding securities, assuming all Class B warrants are exercised.

We believe that our existing cash and short-term investments, the proceeds from the 2017 public offering, the proceeds from the 2018 private placement, the proceeds from the “at the market” offering to date, and additional funds that we may receive in the “at the market” offering will be sufficient to meet working capital requirements, and anticipated capital expenditures for the next 12 months. We also expect that we will have access to adequate cash to continue the implementation of our strategy at least over the next 12 months to grow through additional acquisitions and the expansion of our existing insurance activities.

44

In the future, we may use a number of different sources to finance our acquisitions and operations, including cash flows from operations, seller financing, private financings (such as bank credit facilities, which may or may not be secured by our assets), additional common or preferred equity issuances or any combination of these sources, to the extent available to us, or other sources that may become available from time to time, which could include asset sales and issuance of debt securities. Any debt that we incur may be recourse or non-recourse and may be secured or unsecured. We also may take advantage of joint venture or other partnering opportunities as such opportunities arise in order to acquire properties that would otherwise be unavailable to us. We may use the proceeds of any future borrowings to acquire assets or for general corporate purposes. We expect to use leverage conservatively, assessing the appropriateness of new equity or debt capital based on market conditions, including assumptions regarding future cash flow, the creditworthiness of customers and future rental rates.

Our certificate of incorporation and bylaws do not limit the amount of debt that we may incur. Our Board of Directors has not adopted a policy limiting the total amount of debt that we may incur. Our Board of Directors will consider a number of factors in evaluating the amount of debt that we may incur. If we adopt a debt policy, our Board of Directors may from time to time modify such policy in light of then-current economic conditions, relative costs of debt and equity capital, market values of our properties, general conditions in the market for debt and equity securities, fluctuations in the market price of our Class A common stock if then trading on any exchange, growth and acquisition opportunities and other factors. Our decision to use leverage in the future to finance our assets will be at our discretion and will not be subject to the approval of our stockholders, and we are not restricted by our governing documents or otherwise in the amount of leverage that we may use.

Off-Balance Sheet Arrangements

Except for our normal operating leases, we do not have any off-balance sheet financing arrangements, transactions or special purpose entities.

Quantitative and Qualitative Disclosures About Market Risk

At June 30, 2018, we held no significant derivative instruments that materially increased our exposure to market risks for interest rates, foreign currency rates, commodity prices or other market price risks. Our operations are currently conducted entirely within the U.S.; therefore, we had no significant exposure to foreign currency exchange rate risk.

Critical Accounting Policies and Estimates

The preparation of the consolidated financial statements and related notes to the consolidated financial statements requires us to make estimates that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures of contingent assets and liabilities. We base these estimates on historical results and various other assumptions believed to be reasonable, all of which form the basis for making estimates concerning the carrying values of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates. Information with respect to our critical accounting policies that we believe could have the most significant effect on our reported results or require subjective or complex judgments by management is contained in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, and in the Notes to the Consolidated Financial Statements each in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as filed with the Securities and Exchange Commission on March 30, 2018. We believe that at June 30, 2018, there has been no material change to this information.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable as we are a “smaller reporting company.”

45

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officers and principal financial and accounting officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, our principal executive officers and principal financial and accounting officer each concluded that, as of the end of such period, our disclosure controls and procedures are not effective due to a material weakness in internal control over financial reporting as of June 30, 2018 for the reasons discussed below.

As previously reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, we identified a material weakness resulting from the aggregation of two significant deficiencies in the information technology general control, which we refer to as “ITGC,” environment and certain transaction level controls primarily related to the revenue recognition and expenditures processes at the subsidiary level. We have continued to mitigate these significant deficiencies through the addition of qualified accounting personnel and the engagement of an outside consulting firm to assist with the design and rationalization of both ITGC and financial controls to ensure the design of key controls appropriately addresses the risks related to critical functionality and provides a consistent application of controls. Although, as discussed below, this work is not completed, we expect to have this work significantly completed by September 30, 2018.

In order to remedy our ineffective disclosure controls and procedures, we intend to implement further new processes and procedures to clarify internal reporting channels to ensure that the information we are required to disclose in reports that we file or submit under the Exchange Act (1) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (2) is accumulated and communicated to management, including our principle executive officers and our principle financial and accounting officer, as appropriate to allow timely decisions regarding required disclosure.

Notwithstanding the identified material weakness, management, our principal executive officers, and our principal financial and accounting officer, believe the consolidated financial statements included in this quarterly report on Form 10-Q fairly represent in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance with U.S. generally accepted accounting principles.

Changes in Internal Control over Financial Reporting

There have not been any changes in our internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during the period of this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Effectiveness of Controls and Procedures

Our management, including our principal executive officers and principal financial and accounting officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our Company have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon 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; over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

46

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

Due to the nature of our business, we are, from time to time and in the ordinary course of business, involved in routine litigation or subject to disputes or claims related to our business activities, including, without limitation, workers’ compensation claims and employment-related disputes. In the opinion of our management, none of the pending litigation, disputes or claims against us, if decided adversely, will have a material adverse effect individually or in the aggregate on our financial condition, cash flows or results of operations.

Item 1A. Risk Factors

Not applicable as we are a “smaller reporting company.” For a list of risk factors, please refer to our Annual Report on Form 10-K for the year ended December 31, 2017, as filed with the SEC on March 30, 2018.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

As previously reported on our Current Report on Form 8-K dated May 15, 2018, on May 15, 2018 we completed the Subsequent Closing of the 2018 private placement, issuing 3,137,768 shares of Class A common stock. We received approximately $73,110,000 in gross proceeds from the sale of the Class A common stock in the Subsequent Closing. In the Initial Closing that occurred on March 6, 2018, as reported on our Current Report on Form 8-K dated March 6, 2018, we sold 3,300,000 shares of Class A common stock and received $76,890,000 in gross proceeds.

These unregistered sales of equity securities are in accordance with a Class A Common Stock Purchase Agreement, dated February 22, 2018, pursuant to which we agreed to issue and sell to Magnolia BOC I, LP, which we refer to as “MBOC I,” Magnolia BOC II, LP, which we refer to as “MBOC II,” and Boulderado BOC, LP, which we refer to as “BBOC,” up to $150,000,000 in unregistered shares of Class A common stock at a price of $23.30, a slight premium to the closing price of shares of our Class A common stock of $23.29 on the NASDAQ Capital Market, as reported by NASDAQ on February 22, 2018. The securities at both the Initial Closing and the Subsequent Closing were issued in accordance with Rule 506(b) of Regulation D promulgated under the Securities Act. MBOC I and MBOC II are entities managed by The Magnolia Group, LLC and BBOC is an entity managed by Boulderado Group, LLC. The Class A Common Stock Purchase Agreement was approved by an independent special committee of our Board of Directors with the advice of independent legal counsel and an independent investment banking firm which provided a fairness opinion to the special committee.

Subsequent to the second quarter of fiscal 2018 and as previously reported on our Current Report on Form 8-K dated August 1, 2018, on July 31, 2018, Link Media Southeast, LLC, a subsidiary of Link Media Holdings, LLC, completed the acquisition of Tammy Lynn Outdoor, LLC. The majority of the purchase was completed using cash but, as part of the consideration for the purchase, the seller, W. B. Acken, received 85,170 shares of our Class A common stock. We subsequently filed a Registration Statement on Form S-3 to register such shares on behalf of Mr. Acken.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

The exhibits listed in the Exhibit Index attached hereto are incorporated herein by reference.

47

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.  

BOSTON OMAHA CORPORATION (Registrant)
By:	/s/ Alex B. Rozek
Alex B. Rozek, Co-President (Principal Executive Officer)
August 13, 2018
By:	/s/ Adam K. Peterson
Adam K. Peterson, Co-President (Principal Executive Officer)
August 13, 2018
By:	/s/ Joshua P. Weisenburger
Joshua P. Weisenburger  Chief Financial Officer (Principal Financial and Accounting Officer)
August 13, 2018

48

EXHIBIT INDEX

Exhibit No. Exhibit Description

3.1 (*)  Second Amended and Restated Certificate of Incorporation of the Company, filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on May 26, 2017.

3.2 (*) First Amendment to the Second Amended and Restated Certificate of Incorporation of the Company, filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on May 7, 2018.

3.3 (*) Amended and Restated Bylaws of the Company, filed as Exhibit 3.7 to the Company’s Registration Statement on Form S-1/A filed with the Commission on June 5, 2017.

10.1(+)(#) Executive Employment Agreement Amendment No. 1 dated July 1, 2018, by and between Link Media Holdings, LLC and James A. McLaughlin.

31.1 (#) Certification of Co-Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).

31.2 (#) Certification of Co-Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).

31.3 (#) Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).

32.1 (#)(##) Certification of the Co-Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.

32.2 (#)(##) Certification of the Co-Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.

32.3 (#)(##) Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.

101.INS (#) XBRL Instance Document.

101.SCH (#) XBRL Taxonomy Extension Schema Document.

101.CAL (#) XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF (#) XBRL Taxonomy Extension Definition.

101.LAB (#) XBRL Taxonomy Extension Label Linkbase Document.

101.PRE (#) XBRL Taxonomy Presentation Linkbase Document.

(*) Incorporated by reference to the filing indicated.

(+) Management contract or compensatory plan or arrangement.

(#) Filed herewith.

(##) The certifications attached as Exhibits 32.1, 32.2, and 32.3 that accompany this Report, are not deemed filed with the SEC and are not to be incorporated by reference into any filing of Boston Omaha Corporation under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Report irrespective of any general incorporation language contained in such filing.

49

EX-10.1

Exhibit 10.1

EXECUTIVE EMPLOYMENT AGREEMENT

AMENDMENT NO. 1

This Amendment No. 1 to Executive Employment Agreement (this “Amendment”) is entered into as of July 1, 2018 by and between James A. McLaughlin (the “Executive”) and Link Media Holdings, LLC, a Delaware limited liability company (the “Company”).

The Company and the Executive are parties to an Executive Employment Agreement dated March 3, 2017 (the “Agreement”).

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

1.     Amendment to Section 3 of the Agreement. The Company and the Executive agree that the Agreement is hereby amended by deleting the first sentence of Section 3, and inserting the following in its place:

“Company shall pay Executive an annual base salary equal to Three Hundred Thousand and No/100 Dollars ($300,000) (the “Base Salary”).”

2.     No Other Amendment. Except as expressly amended hereby, the Agreement shall remain unamended and in full force and effect. This Amendment is only effective in the specific instance and for the specific purpose for which it is given and shall not be effective for any other purpose, and shall not be deemed to be a waiver of, amendment of, or consent to or modification of any other term or provision of the Agreement.

3.     Governing Law. This Amendment, the performance of this Amendment and any and all matters arising directly or indirectly herefrom shall be governed by and construed and enforced in accordance with the internal laws of the State of Delaware, without giving effect to the conflict or choice of law provisions and principles thereof.

4.     Counterparts. This Amendment may be executed in any number of counterparts including facsimile or PDF counterpart signature pages, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the Company and the Executive have duly executed this Amendment as of the date first written above.

LINK MEDIA HOLDINGS, LLC By: BOSTON OMAHA CORPORATION, its Managing Member
By:	/s/ Adam K. Peterson
	Name:  Adam K. Peterson
	Title:    Co-Chief Executive Officer

EXECUTIVE
	/s/ James A. McLaughlin
	James A. McLaughlin

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Alex B. Rozek, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Boston Omaha Corporation;

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(s) 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(s) 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 13, 2018

   /s/ Alex B. Rozek                                            

Alex B. Rozek, Co-Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Adam K. Peterson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Boston Omaha Corporation;

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(s) 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(s) 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 13, 2018

   /s/ Adam K. Peterson                                       

Adam K. Peterson, Co-Chief Executive Officer

(Principal Executive Officer)

EX-31.3

Exhibit 31.3

CERTIFICATIONS

I, Joshua P. Weisenburger, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Boston Omaha Corporation;

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(s) 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(s) 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 13, 2018

   /s/ Joshua P. Weisenburger                                      

Joshua P. Weisenburger, Chief Financial Officer

(Principal Financial 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 Boston Omaha Corporation (the "Company") on Form 10-Q for the three months ended June 30, 2018 as filed with the Securities and Exchange Commission on or about the date hereof (the "Report"), the undersigned, in the capacities and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

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

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

Dated: August 13, 2018 /s/ Alex B. Rozek                                            Alex B. Rozek, Co-Chief Executive Officer  (Principal Executive Officer)

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 Boston Omaha Corporation (the "Company") on Form 10-Q for the three months ended June 30, 2018 as filed with the Securities and Exchange Commission on or about the date hereof (the "Report"), the undersigned, in the capacities and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

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

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

Dated: August 13, 2018 /s/ Adam K. Peterson                                            Adam K. Peterson, Co-Chief Executive Officer  (Principal Executive Officer)

EX-32.3

Exhibit 32.3

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 Boston Omaha Corporation (the "Company") on Form 10-Q for the three months ended June 30, 2018 as filed with the Securities and Exchange Commission on or about the date hereof (the "Report"), the undersigned, in the capacities and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

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

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

Dated: August 13, 2018  /s/ Joshua P. Weisenburger                                         Joshua P. Weisenburger, Chief Financial Officer  (Principal Financial Officer)

XML

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 10, 2018
Document Information [Line Items]
Entity Registrant Name	BOSTON OMAHA Corp
Entity Central Index Key	0001494582
Trading Symbol	bomn
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q2
Amendment Flag	false
Common Class B [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding (in shares)		1,055,560
Common Class A [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding (in shares)		21,008,024

XML

Consolidated Balance Sheets (Current Period Unaudited) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Current Assets:
Cash and cash equivalents	$ 88,166,783	$ 6,838,345
Restricted cash	506,046	392,225
Accounts receivable, net	1,290,966	1,095,777
Interest receivable	692,109
Short-term investments	4,856,131	1,659,299
U.S. Treasury trading securities		83,100,805
U.S. Treasury securities available for sale	150,346,440
Prepaid expenses	1,098,959	755,121
Total Current Assets	246,957,434	93,841,572
Property and Equipment, net	10,280,773	9,111,013
Other Assets:
Goodwill	25,006,161	24,692,161
Intangible assets, net	7,604,863	9,349,623
Investments	32,177,419	13,901,281
Investments in unconsolidated affiliates	847,146	952,128
Funds held as collateral assets	862,046	1,056,330
Other	707,560	572,976
Total Other Assets	67,205,195	50,524,499
Total Assets	324,443,402	153,477,084
Current Liabilities:
Accounts payable and accrued expenses	1,843,475	2,077,635
Short-term payables for acquisitions	137,000	497,000
Funds held as collateral	862,046	1,056,330
Unearned premiums and deferred revenue	2,127,729	1,400,446
Total Current Liabilities	4,970,250	5,031,411
Long-term Liabilities:
Asset retirement obligations	174,669
Deferred tax liability	57,000	57,000
Total Liabilities	5,201,919	5,088,411
Redeemable Noncontrolling Interest	1,190,187	1,234,987
Stockholders' Equity:
Preferred stock, $.001 par value, 1,000,000 shares authorized, 0 shares issued and outstanding
Additional paid-in capital	332,907,911	158,350,410
Accumulated deficit	(14,878,566)	(11,211,087)
Total Stockholders' Equity	318,051,296	147,153,686
Total Liabilities, Redeemable Noncontrolling Interest, and Stockholders' Equity	324,443,402	153,477,084
Common Class A [Member]
Stockholders' Equity:
Common stock	20,895	13,307
Common Class B [Member]
Stockholders' Equity:
Common stock	$ 1,056	$ 1,056

XML

Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	1,000,000	1,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common Class A [Member]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	38,838,884	38,838,884
Common stock, shares issued (in shares)	20,894,774	13,307,157
Common stock, shares outstanding (in shares)	20,894,774	13,307,157
Common Class B [Member]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	1,161,116	1,161,116
Common stock, shares issued (in shares)	1,055,560	1,055,560
Common stock, shares outstanding (in shares)	1,055,560	1,055,560

XML

Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenues:
Premiums earned	$ 507,045	$ 531,557	$ 984,349	$ 1,024,099
Insurance commissions	751,684	209,598	1,516,868	542,766
Investment and other income	31,761	38,410	62,027	68,135
Total Revenues	2,989,759	1,994,883	5,812,703	3,864,810
Costs and Expenses:
Cost of billboard revenues (exclusive of depreciation and amortization)	842,787	619,224	1,565,621	1,110,309
Cost of insurance revenues	264,672	68,080	477,536	254,674
Employee costs	1,863,658	929,487	3,706,024	1,760,334
Professional fees	576,461	452,117	1,420,375	906,120
General and administrative	848,942	427,260	1,700,215	837,860
Amortization	690,905	422,673	1,451,240	795,899
Depreciation	306,714	233,241	635,407	456,708
Loss on disposition of assets	81,857	228,431	81,857	228,431
Bad debt expense	14,515	3,680	14,515	3,680
Accretion	2,939		5,995
Total Costs and Expenses	5,493,450	3,384,193	11,058,785	6,354,015
Net Loss from Operations	(2,503,691)	(1,389,310)	(5,246,082)	(2,489,205)
Other Income (Expense):
Interest income	648,223		1,091,946
Equity in income of unconsolidated affiliates	101,429	23,464	385,091	15,233
Unrealized gain on securities	206,306		113,303
Loss on disposition of investments	(54,733)		(54,733)
Interest expense	(264)	(1,970)	(1,804)	(4,055)
Net Loss Before Income Taxes	(1,602,730)	(1,367,816)	(3,712,279)	(2,478,027)
Income Tax (Provision) Benefit
Net Loss	(1,602,730)	(1,367,816)	(3,712,279)	(2,478,027)
Noncontrolling Interest in Subsidiary Loss	4,633		44,800
Net Loss Attributable to Common Stockholders	$ (1,598,097)	$ (1,367,816)	$ (3,667,479)	$ (2,478,027)
Basic and Diluted Net Loss per Share (in dollars per share)	$ (0.08)	$ (0.18)	$ (0.21)	$ (0.34)
Basic and Diluted Weighted Average Class A and Class B Common Shares Outstanding (in shares)	19,165,153	7,594,585	17,780,454	7,247,906
Billboard Rentals [Member]
Revenues:
Billboard rentals	$ 1,699,269	$ 1,215,318	$ 3,249,459	$ 2,229,810

XML

Consolidated Statement of Changes in Stockholders' Equity (Unaudited) - 6 months ended Jun. 30, 2018 - USD ($)	Related Party [Member] Common Stock [Member] Common Class A [Member]	Related Party [Member] Common Stock [Member] Common Class B [Member]	Related Party [Member] Additional Paid-in Capital [Member]	Related Party [Member] Retained Earnings [Member]	Related Party [Member]	Common Stock [Member] Common Class A [Member]	Common Stock [Member] Common Class B [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance (in shares) at Dec. 31, 2017						13,307,157	1,055,560
Balance at Dec. 31, 2017						$ 13,307	$ 1,056	$ 158,350,410	$ (11,211,087)	$ 147,153,686
Stock issued for cash (in shares)	6,437,768					1,149,849
Stock issued for cash	$ 6,438		$ 149,993,562		$ 150,000,000	$ 1,150		26,086,133		26,087,283
Offering costs								(1,522,194)		(1,522,194)
Net loss attributable to common stockholders, June 30, 2018									(3,667,479)	(3,667,479)
Balance (in shares) at Jun. 30, 2018						20,894,774	1,055,560
Balance at Jun. 30, 2018						$ 20,895	$ 1,056	$ 332,907,911	$ (14,878,566)	$ 318,051,296

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash Flows from Operating Activities:
Net Loss	$ (3,712,279)	$ (2,478,027)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation, amortization, and accretion	2,092,642	1,252,607
Loss on disposition of assets	81,857	228,431
Bad debt expense	14,515	3,680
Equity in earnings of unconsolidated affiliates	(385,091)	(15,233)
Loss on disposition of investments	54,733
Unrealized gain on securities	(113,303)
Changes in operating assets and liabilities:
Accounts receivable	(209,704)	(668,549)
Interest receivable	(692,109)
Short-term investments		(531,025)
Prepaid expenses	(343,838)	(99,658)
Distributions from unconsolidated affiliates	382,443	2,700
Other assets	(134,583)	(134,620)
Accounts payable and accrued expenses	(234,160)	380,560
Unearned premiums and deferred revenue	727,283	426,440
Deferred tax liabilities		(8,000)
Net Cash Used in Operating Activities	(2,471,594)	(1,640,694)
Cash Flows from Investing Activities:
Payment on short-term payable on acquisition	(360,000)
Proceeds from disposition of assets	30,000	3,667
Purchases of equipment and related assets	(1,769,020)	(645,236)
Business acquisitions, net of cash acquired	0	(9,940,794)
Acquisition of investment in unconsolidated affiliate		(66,000)
Proceeds from sales of investments	431,908,709
Purchase of investments	(520,460,925)	(2,657,670)
Net Cash Used in Investing Activities	(90,651,236)	(13,306,033)
Cash Flows from Financing Activities:
Proceeds from issuance of stock	26,087,283	35,672,498
Proceeds from issuance of stock to related parties	150,000,000	52,467,336
Offering costs	(1,522,194)	(914,423)
Net Cash Provided by Financing Activities	174,565,089	87,225,411
Net Increase in Cash, Cash Equivalents, and Restricted Cash	81,442,259	72,278,684
Cash, Cash Equivalents, and Restricted Cash, Beginning of Period	7,230,570	29,844,068
Cash, Cash Equivalents, and Restricted Cash, End of Period	88,672,829	102,122,752
Interest Paid in Cash	1,804	4,055
Income Taxes Paid in Cash
Deposit on business acquisition applied to purchase		2,950,000
Equipment exchanged for note receivable		38,000
Asset retirement obligations	174,669
Note receivable exchanged for preferred stock	$ 104,019

XML

Note 1 - Organization and Background

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

NOTE 1. ORGANIZATION AND BACKGROUND

Boston Omaha was organized on

August 11, 2009

with present management taking over operations in

February 2015.

Our operations include (i) our outdoor advertising business with multiple billboards across Alabama, Florida, Georgia, and Wisconsin; (ii) our insurance business that specializes in surety bond underwriting and brokerage, and (iii) minority investments primarily in real estate services, homebuilding, and banking. Our billboard operations are conducted through our subsidiary, Link Media Holdings, LLC, and our insurance operations are conducted through our subsidiary, General Indemnity Group, LLC.

We completed an acquisition of an outdoor advertising business and entered the outdoor advertising industry on

June 19, 2015.

During

2015,

2016,

and

2017,

we completed

eleven

additional acquisitions of outdoor advertising businesses.

On

April 20, 2016,

we completed an acquisition of a surety bond brokerage business. On

December 7, 2016,

we acquired a fidelity and surety bond business; and, from

July

through

November 2017

we completed the acquisition of

two

surety brokerage businesses, and we acquired a majority stake in a

third

surety brokerage business, thus expanding our operations in insurance.

In our opinion, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of consolidated financial position and the consolidated results of operations for the interim periods presented have been reflected herein. The results of operations for the interim periods are

not

necessarily indicative of the results to be expected for the full year. Notes to the interim consolidated financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the years ended

December 31, 2017

and

2016

as reported in our Annual Report on Form

10

-K, filed with the Securities and Exchange Commission on

March 30, 2018,

have been omitted.

XML

Note 2 - Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Significant Accounting Policies [Text Block]

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation Policy

The financial statements of Boston Omaha Corporation include the accounts of the Company and its wholly-owned and majority-owned subsidiaries, as follows:

Link Media Holdings, LLC which we refer to as “LMH”

Link Media Alabama, LLC which we refer to as “LMA”

Link Media Florida, LLC which we refer to as “LMF”

Link Media Wisconsin, LLC which we refer to as “LMW”

Link Media Georgia, LLC which we refer to as “LMG”

General Indemnity Group, LLC which we refer to as “GIG”

General Indemnity Insurance Company PCC, LLC which we refer to as “GIIC”

The Warnock Agency, Inc. which we refer to as “Warnock”

United Casualty and Surety Insurance Company which we refer to as “UC&S”

Surety Support Services, Inc. which we refer to as “SSS”

South Coast Surety Insurance Services, LLC which we refer to as “SCS”

Boston Omaha Investments, LLC which we refer to as “BOIC”

All significant intercompany profits, losses, transactions and balances have been eliminated in consolidation.

Revenue

s

On

January 1, 2018,

we adopted FASB Accounting Standards Update (“ASU”)

No.

2014

-

09

(Codified as ASC

606

),

Revenue from Contracts with Customers

using the cumulative effect transition method applied to those contracts which were

not

completed as of

January 1, 2018

and are

not

accounted for under ASC

840

Leases.

Results for the reporting periods beginning after

January 1, 2018

are presented under ASC

606

or

840,

while comparative information has

not

been adjusted and continues to be reported under ASC

605.

A majority of our billboard contracts are accounted for under ASC

840

and will continue to be accounted for under the topic until

January 1, 2019,

our adoption date of FASB ASU

No.

2016

-

02

(Codified as ASC

842

),

Leases

. Contracts which begin prior to

January 1, 2019

and are accounted for under ASC

840

will continue to be accounted for as a lease until the contract ends or is modified. Contracts beginning or modified on or after

January 1, 2019

which do

not

meet the criteria of a lease under ASC

842

will be accounted for under ASC

606

Revenue

. The majority of our advertising space contracts will

not

meet the definition of a lease under ASC

842.

Premium revenues derived from our insurance operations are

not

subject to this guidance.

Revenue Recognition

Billboard Rentals

We generate revenue from outdoor advertising through the leasing of billboards. The terms of the operating leases range from less than

one

month to

three

years and are generally billed monthly. Revenue for advertising space rental is recognized on a straight-line basis over the term of the contract. Advertising revenue is reported net of agency commissions. Agency commissions are calculated based on a stated percentage applied to gross billing revenue for operations. Payments received in advance of being earned are recorded as deferred revenue. Another component of billboard rentals consists of production services which include creating and printing advertising copy. Contract revenues for production services are recognized upon satisfaction of the contract, which is typically less than

one

week.

Deferred Revenues

We record deferred revenues when cash payments are received or due in advance of our performance obligation. The term between invoicing and when a payment is due is

not

significant. For certain services we require payment before the product or services are delivered to the customer. The balance of deferred income is considered short-term and will be recognized in revenue within

twelve

months.

Premiums and Unearned Premium Reserves

Premiums written are recognized as revenues based on a pro-rata daily calculation over the respective terms of the policies in-force. The cost of reinsurance ceded is initially written as prepaid reinsurance premiums and is amortized over the reinsurance contract period in proportion to the amount of insurance protection provided. Premiums ceded are netted against premiums written.

Commissions

We generate revenue from commissions on surety bond sales. The insurance commissions are calculated based upon a stated percentage applied to the gross premiums on bonds. Commissions are earned as of the policy effective date and are nonrefundable.

Practical Expedients and Exemptions

Upon our transition to ASC

606

from ASC

840,

we plan to utilize the following practical expedients and exemptions from ASC

606.

We generally expense sales commissions when incurred because the amortization period is

one

year or less. These costs are recorded within cost of billboard revenues (exclusive of depreciation and amortization). We do

not

disclose the value of unsatisfied performance obligations as the majority of our contracts with customers have an original expected length of less than

one

year. For contracts with customers which exceed

one

year the future amount to be invoiced to the customer corresponds directly with the value to be received by the customer.

Recent Accounting Pronouncements

In

May 2014,

the FASB issued ASU

No.

2014

-

09

(Codified as ASC

606

),

Revenue from Contracts with Customers

, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In

August 2015,

the FASB issued ASU

No.

2015

-

14

deferring the effective date from

January 1, 2017

to

January 1, 2018,

while allowing for early adoption as of

January 1, 2017.

The standard permits the use of either the retrospective or cumulative effect transition method. We adopted the provisions of ASU

No.

2014

-

09

on

January 1, 2018

using the cumulative effect transition method. We did

not

have an adjustment to our opening balance of accumulated deficit for the adoption of this update.

In

February 2016,

the FASB issued ASU

No.

2016

-

01,

Recognition and Measurement of Financial Assets and Financial Liabilities

, which requires entities to carry all investments in equity securities at fair value and recognize any changes in fair value in net income. Under the standard, equity investments that do

not

have readily determinable fair values and do

not

qualify for the net asset value practical expedient are eligible for the measurement alternative. We adopted the provisions of ASU

No.

2016

-

01

on

January 1, 2018,

for our equity investments in private companies

not

accounted for under the equity method, using the measurement alternative, defined as cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer.

In

November 2016,

the FASB issued ASU

No.

2016

-

18,

Statement of Cash Flows (Topic

230

), Restricted Cash.

The guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The standard is effective for public business entities for fiscal years beginning after

December 15, 2017,

and interim periods within those fiscal years. We adopted ASU

No.

2016

-

18

on

January 1, 2018.

In accordance with the guidance of ASU

No.

2016

-

18,

changes in restricted cash have been included with cash and cash equivalents in the consolidated statements of cash flows. We retrospectively adopted the standard.

The adoption increases the ending cash balance within our consolidated statements of cash flows by the aggregate amount of our restricted cash balances and requires a new disclosure to reconcile the cash balances within our consolidated statements of cash flows to the consolidated balance sheets. 

On

January 1, 2018,

we adopted ASU

No.

2016

-

15

, Statement of Cash Flows (Topic

230

), Classification of Certain Cash Receipts and Payments.

The ASU is required to be reflected on a retrospective basis and provides guidance on the classification of certain cash receipts and cash payments, including distributions received from an equity method investee. We adopted the cumulative earnings approach, whereby distributions received are considered to be returns on investment and, thus, should be classified as cash inflows from operating activities on our consolidated statement of cash flows. The adoption of ASU

No.

2016

-

15

did

not

have a material impact on our consolidated financial statements.

In

February 2016,

the FASB issued ASU

No.

2016

-

02,

Leases (Topic

842

),

specifying the accounting for leases, which supersedes the leases requirements in Topic

840,

Leases.

The objective of Topic

842

is to establish the principles that lessee and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. Lessees are permitted to make an accounting policy election to

not

recognize the asset and liability for leases with a term of

twelve

months or less. Lessors’ accounting is largely unchanged from the previous accounting standard. In addition, Topic

842

expands the disclosure requirements of lease arrangements. Lessees and lessors will use a modified retrospective transition approach, which includes a number of practical expedients. This guidance is effective for fiscal years and interim periods within those fiscal years, beginning after

December 15, 2018

with early adoption permitted.

In

January 2018,

the FASB issued ASU

No.

2018

-

01,

Leases (Topic

842

), Land Easement Practical Expedient for Transition to Topic

842.

The update provides an optional transition practical expedient to

not

evaluate under Topic

842

existing or expired land easements that were

not

previously accounted for as leases under the current lease guidance in Topic

840.

An entity that elects this practical expedient should evaluate new or modified land easements under Topic

842

upon adoption. An entity that does

not

elect this practical expedient should evaluate all existing or expired land easements in connection with the adoption of the new lease requirements in Topic

842

to assess whether they meet the definition of a lease. We plan to elect the provided practical expedient within this update upon our adoption of Topic

842.

In

July 2018,

the FASB issued ASU

No.

2018

-

10

Leases (Topic

842

), Codification Improvements

and ASU

No.

2018

-

11

Leases

(Topic

842

), Targeted Improvements

, to provide additional guidance for the adoption of Topic

842.

ASU

No.

2018

-

10

clarifies certain provisions and corrects unintended applications of the guidance such as the application of implicit rate, lessee reassessment of lease classification, and certain transition adjustments that should be recognized to earnings rather than to stockholders’ equity. ASU

No.

2018

-

11

provides an alternative transition method which allows recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption rather than in the earliest period presented, and a practical expedient for separating contract components for the adoption of Topic

842.

ASU

No.

2018

-

10

and ASU

No.

2018

-

11

(collectively, “the new lease standards”) are effective for fiscal years beginning after

December 15, 2018,

with early adoption permitted. We are currently assessing the effect the new lease standards will have on our consolidated financial statements.

XML

Note 3 - Restricted Cash

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Cash and Cash Equivalents Disclosure [Text Block]

NOTE 3. RESTRICTED CASH

Restricted cash consists of the following:

	June 30,		December 31,
	2018		2017
Insurance premium escrow	$	330,971	$	247,230
Billboard replacement reserve		175,075		144,995
Total Restricted Cash	$	506,046	$	392,225

The following table sets forth a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated statements of cash flows that agrees to the total of those amounts as presented in the consolidated statements of cash flows.

	June 30,
	2018		2017
Cash and cash equivalents	$	88,166,783	$	101,717,930
Restricted cash		506,046		404,822
Total Cash, Cash Equivalents, and Restricted Cash as Presented in the Consolidated Statements of Cash Flows	$	88,672,829	$	102,122,752

XML

Note 4 - Accounts Receivable

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Financing Receivables [Text Block]

NOTE 4. ACCOUNTS RECEIVABLE

Accounts receivable consist of the following:

	June 30,			December 31,
	2018			2017
Trade accounts	$	995,055		$	828,287
Premiums		298,872			288,039
Anticipated salvage and subrogation		3,573			3,572
Allowance for doubtful accounts		(6,534	)		(24,121	)
Total Accounts Receivable, net	$	1,290,966		$	1,095,777

XML

Note 5 - Property and Equipment

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

NOTE 5. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

	June 30,			December 31,
	2018			2017
Structures and displays	$	12,167,292		$	10,484,725
Vehicles and equipment		232,967			143,154
Office furniture and equipment		418,238			395,981
Accumulated depreciation		(2,537,724	)		(1,912,847	)
Total Property and Equipment, net	$	10,280,773		$	9,111,013

Depreciation expense for the

three

months and

six

months ended

June 30, 2018

was

$306,714

and

$635,407

respectively; and for the

three

months and

six

months ended

June 30, 2017

was

$233,241

and

$456,708,

respectively. During the

second

quarter of

2018

and

2017,

we incurred losses on the disposition of assets in the amount of

$81,857

and

$228,431,

respectively.

XML

Note 6 - Business Acquisitions

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Mergers, Acquisitions and Dispositions Disclosures [Text Block]

NOTE 6. BUSINESS ACQUISITIONS

There were

no

business acquisitions during the

six

months ended

June 30, 2018.

During the

six

months ended

June 30, 2017,

we had net cash outflows of

$9,940,794,

related to business acquisitions.

2017

Acquisitions

During the year ended

December 31, 2017,

we completed

six

business acquisitions of billboards and related assets and

three

insurance company acquisitions. These acquisitions were accounted for as business combinations under the provisions of ASC

805.

A summary of the acquisitions is provided below. A summary of the revenues and earnings of each since the acquisition dates included in the consolidated statements of operations for the

three

months and

six

months ended

June 30, 2017

is provided in the tables below.

Billboard Acquisitions

Clear Channel Outdoor, Inc.

On

January 9, 2017,

our subsidiary, LMG, entered into a purchase agreement with Clear Channel Outdoor, Inc., which we refer to as “CCO,” for the purchase of over

thirty

billboard structures and related assets. The assets acquired are located in Georgia. The cash purchase price for the acquired business was

$2,983,444,

of which

$2,950,000

had been deposited into the seller’s escrow account in

November 2016

and was subsequently applied to the purchase price. The assets were acquired for the purpose of expanding our presence in the outdoor advertising market. The purchase price allocation is based on an appraisal by an independent

third

party valuation firm. Finite-lived intangible assets consist of customer relationships and permits. Amortization is computed over the average period of expected benefit, determined from internal information.

Hartlind Outdoor, LLC

On

January 31, 2017,

our subsidiary, LMW, entered into a purchase agreement with Hartlind Outdoor, LLC, which we refer to as “Hartlind,” for the purchase of over

ninety

billboard structures and related assets. The assets acquired are located in Wisconsin. The cash purchase price for the acquired business was

$2,817,000.

The assets were acquired for the purpose of expanding our presence in the outdoor advertising market. The purchase price allocation is based on an appraisal by an independent

third

party valuation firm. Finite-lived intangible assets consist of customer relationships, permits, and a noncompetition agreement. We amortize the noncompetition agreement according to the terms of the asset purchase agreement. Amortization of the other finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information. We also acquired

six

easements. The easements are permanent easements which grant us the right to use real property

not

owned by us. Since these rights are perpetual, they are

not

amortized.

Southeastern United States

Subsequent to the CCO business acquisition, we made additional business acquisitions in the Southeastern United States as presented below.

Corey Companies, Inc.

On

June 8, 2017,

our subsidiaries, LMG and LMA, entered into a purchase agreement with Corey Companies, Inc., which we refer to as “Corey,” for the purchase of approximately

thirty

billboard structures, a

fifty

percent interest in

three

billboard structures, and related assets. The assets acquired are located in Georgia and Alabama. The cash purchase price for the acquired business was

$2,991,314.

The assets were acquired for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States. The purchase price allocation for the structures, faces and permits is based on internal information derived from our previous acquisitions in Alabama and Georgia. The purchase price allocation for customer relationships is based on an appraisal by an independent

third

party valuation firm. The independent appraisal resulted in a decrease in customer relationships of

$314,000

and an increase in goodwill of

$314,000.

The related decrease in amortization expense for the

six

months ended

June 30, 2018

was

$64,965.

Finite lived intangible assets consist of customer relationships and permits. Amortization of the finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information.

Vision Outdoor Media, LLC

On

June 16, 2017,

our subsidiary, LMG, entered into a purchase agreement with Vision Outdoor Media, LLC, which we refer to as “Vision,” for the purchase of

three

billboard structures and related assets. The assets acquired are located in Georgia. The assets were acquired for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States. The cash purchase price for the acquired business was

$3,199,036.

The purchase price allocation is based on internal information derived from our previous acquisitions in Alabama and Georgia. Finite-lived intangible assets consist of customer relationships and permits. Amortization of the finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information.

View Media, LLC

On

July 11, 2017,

our subsidiary, LMG, entered into a purchase agreement for the purchase of

one

billboard structure and related assets. The assets acquired are located in Georgia. The cash purchase price of the acquisition was

$623,596.

The assets were acquired for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States. The purchase price allocation is based on internal information derived from our previous acquisitions in Alabama and Georgia. Finite-lived intangible assets consist of customer relationships and permits. Amortization of the finite-lived intangible assets is computed over the average period of expected benefit, determined from internal information.

In addition, we also made a small acquisition for a cash purchase price of

$900,000.

Insurance Acquisitions

Surety Support Services, Inc.

On

July 11, 2017,

our subsidiary, GIG, entered into a purchase agreement for the purchase of

100%

of the stock of an insurance brokerage company, Surety Support Services, Inc., which we refer to as “SSS.” The purchase price of the stock was

$450,000,

of which

$22,500

was paid at closing, with

$427,500

due in

2018,

and is included in the caption “Short-term payables for acquisitions” on our consolidated balance sheets as of

June 30, 2018

and

December 31, 2017,

respectively. During the

six

months ended

June 30, 2018,

we made a payment of

$360,000

on the short-term payable for acquisition.

The stock was acquired for the purpose of expanding our presence in the insurance market in the United States. The purchase price allocation is based on internal information derived from our previous insurance brokerage company acquisitions.

Finite-lived intangible assets consist of customer relationships and a non-competition agreement. We amortize the non-competition agreement according to the terms of the asset purchase agreement. For other finite-lived assets, amortization is computed over the average period of expected benefit determined from internal information.

South Coast Surety Insurance Services, LLC

On

October 31, 2017,

our subsidiary, GIG, entered into a purchase agreement for the purchase of

70%

of the membership units of an insurance brokerage company, South Coast Insurance Services, LLC, which we refer to as “SCS.” The cash purchase price of the units was

$2,908,581,

and was paid at closing. The units were acquired for the purpose of expanding our presence in the insurance market in the United States. The provisional purchase price allocation is based on internal information and will be revised when an independent appraisal has been completed. Due to the timing and complexity of the transaction, the initial accounting for the business combination is incomplete. We are still in the process of obtaining and assessing documentation of the contracts and relationships as well as assessing the initial valuation of the noncontrolling interest.

The seller has agreed to remain as a principal of SCS. The purchase agreement contains an option for the seller to sell us the remaining units (a “put” option). The purchase agreement also contains an option for us to purchase the remaining units (a “call” option) upon the death, incapacitation, or termination of the seller’s employment. Upon exercise of the options by the seller or by us, the purchase price of the remaining units is to be calculated by a formula contained in the purchase agreement. Both the put and the call options are embedded in the purchase agreement, and are

not

legally detachable or separately exercisable. At any time following the closing date of our purchase, the seller has the option (the put option), but

not

the obligation to sell us all of the remaining

30%

of the membership units. Should the seller exercise his option, we are obligated to purchase all of the remaining units (“redeemable NCI”). Since the put option is currently redeemable, in accordance with the guidance of ASC

480

-

10

(Subtopic-

S99

-

30

),

Distinguishing Liabilities from Equity Overall,

the redeemable NCI is presented on our consolidated balance sheet between liabilities and equity. Additionally, we are required to re-measure the value of the redeemable NCI as of the date of each balance sheet presented. We have calculated the value of the redeemable NCI based upon the redemption formula contained in the purchase agreement, and have determined that

no

adjustment is necessary as of

June 30, 2018

and

December 31, 2017,

respectively.

Finite-lived intangible assets consist of customer relationships, trade names and trademarks, and a noncompetition agreement. We amortize the noncompetition agreement according to the terms of the asset purchase agreement. For other finite-lived assets, amortization is computed over the average period of expected benefit determined from internal information.

Freestate Bonds, Inc.

On

November 30, 2017,

our subsidiary, Warnock entered into a purchase agreement for the purchase of

100%

of the stock of an insurance brokerage company, Freestate Bonds, Inc., which we refer to as “Freestate.” The purchase price of the stock was

$293,000,

of which

$223,500

was paid at closing, with

$69,500

due on

November 30, 2018,

and is included in the caption “Short-term payables for acquisitions” on our consolidated balance sheets as of

June 30, 2018

and

December 31, 2017.

The stock was acquired for the purpose of expanding our presence in the insurance market in the United States. The purchase price allocation is based on internal information derived from our previous insurance brokerage company acquisitions. During

May 2018,

Freestate was reorganized into Warnock and Freestate was subsequently dissolved.

The following tables present information for the

2017

business acquisitions for the

six

months ended

June 30, 2017,

including amortization of finite intangible assets, revenues and earnings included in consolidated net loss for the

three

months and

six

months ended

June 30, 2017,

and the costs of acquisition included in professional fees on our consolidated statement of operations for the

three

and

six

months ended

June 30, 2017.

	Billboards
	CCO			Hartlind		Southeastern US			Subtotal
Amortization of intangible assets acquired for the three months ended June 30, 2017	$	70,846		$	45,770	$	38,181		$	154,797
Revenues since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	204,093		$	99,665	$	5,320		$	309,078
Earnings since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	(21,391	)	$	38,431	$	(54,043	)	$	(37,003	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the three months ended June 30, 2017	$	-		$	831	$	21,563		$	22,394
Amortization of intangible assets acquired for the six months ended June 30, 2017	$	141,693		$	76,284	$	38,181		$	256,158
Revenues since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	359,076		$	152,776	$	5,320		$	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	(41,755	)	$	55,729	$	(54,043	)	$	(40,069	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the six months ended June 30, 2017	$	14,468		$	8,645	$	21,563		$	44,676

	Insurance
	SSS		SCS		Freestate		Subtotal		Total
Amortization of intangible assets acquired for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	154,797
Revenues since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	309,078
Earnings since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	(37,003	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	22,394
Amortization of intangible assets acquired for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	256,158
Revenues since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	(40,069	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	44,676

P

ro Forma Information

The following is the unaudited pro forma information assuming all business acquisitions occurred on

January 1, 2017.

For all of the business acquisitions depreciation and amortization have been included in the calculation of the below pro forma information based upon the actual acquisition costs. Depreciation is computed on the straight-line method over the estimated remaining economic lives of the assets, ranging from

two

years to

fifteen

years. Amortization is computed on the straight-line method over the estimated useful lives of the assets ranging from

two

to

fifty

years.

Since there were

no

acquisitions during the

three

months and

six

months ended

June 30, 2018,

no

pro forma results are included.

	Three Months Ended June 30, 2017			Six Months Ended June 30, 2017
Revenue	$	2,960,519		$	5,666,907
Net Loss Attributable to Common Stockholders	$	(1,460,839	)	$	(2,651,967	)
Basic and Diluted Loss per Share	$	(0.19	)	$	(0.37	)
Basic and Diluted Weighted Average Class A and Class B Common Shares Outstanding		7,594,585			7,247,906

The information included in the pro forma amounts is derived from historical information obtained from the sellers of the businesses. With respect to CCO, Corey, Vision, and View, the above pro forma does

not

contain allocation of management overhead and other shared expenses for lines of business under common ownership, that were

not

acquired.

XML

Note 7 - Intangible Assets

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Intangible Assets Disclosure [Text Block]

NOTE

7.

     

INTANGIBLE ASSETS

Intangible assets consist of the following:

	June 30, 2018							December 31, 2017
			Accumulated							Accumulated
	Cost		Amortization			Balance		Cost		Amortization			Balance
Customer relationships	$	7,818,900	$	(4,232,685	)	$	3,586,215	$	8,132,900	$	(2,970,533	)	$	5,162,367
Permits, licenses, and lease acquisition costs		2,181,621		(239,472	)		1,942,149		2,184,106		(178,835	)		2,005,271
Site location		849,347		(51,904	)		797,443		849,347		(23,593	)		825,754
Noncompetition agreements		285,000		(94,917	)		190,083		285,000		(66,417	)		218,583
Trade names and trademarks		722,200		(158,417	)		563,783		722,200		(112,250	)		609,950
Technology		138,000		(99,660	)		38,340		138,000		(76,662	)		61,338
Nonsolicitation agreement		28,000		(28,000	)		-		28,000		(28,000	)		-
Easements		486,850		-			486,850		466,360		-			466,360
Total	$	12,509,918	$	(4,905,055	)	$	7,604,863	$	12,805,913	$	(3,456,290	)	$	9,349,623

The future amortization associated with the intangible assets is as follows:

	June 30,
	2019		2020		2021		2022		2023		Thereafter		Total
Customer relationships	$	2,256,238	$	1,210,675	$	119,302	$	-	$	-	$	-	$	3,586,215
Permits, licenses, and lease acquisition costs		125,742		125,742		125,742		125,742		125,742		1,313,439		1,942,149
Site location		56,623		56,623		56,623		56,623		56,623		514,328		797,443
Noncompetition agreements		57,000		56,417		40,500		28,000		8,166		-		190,083
Trade names and trademarks		74,000		67,933		64,900		64,900		64,900		227,150		563,783
Technology		38,340		-		-		-		-		-		38,340
Total	$	2,607,943	$	1,517,390	$	407,067	$	275,265	$	255,431	$	2,054,917	$	7,118,013

Amortization expense for the

three

months ended

June 30, 2018

and

2017

was

$690,905

and

$422,673,

respectively. Amortization expense for the

six

months ended

June 30, 2018

and

2017

was

$1,451,240

and

$795,899,

respectively.

Future Amortization

The weighted average amortization period, in months, for intangible assets is as follows:

Customer relationships	17
Permits, licenses, and lease acquisition costs	185
Site location	169
Noncompetition agreements	40
Trade names and trademarks	67
Technology	10

XML

Note 8 - Investments, Including Investments Accounted for Using the Equity Method

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Investment [Text Block]

NOTE 8 . I NVESTMENTS , INCLUDING INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Short-term Investments

Short-term investments consist of certificates of deposit having maturity dates of less than

twelve

months and are carried at cost, U.S. Treasury securities and a corporate bond that are held to maturity and mature in less than

twelve

months, and a convertible note receivable. The certificates of deposit are held to maturity and mature in the upcoming year. The U.S. Treasury notes, the corporate bond, and the certificates of deposit are held by UC&S. For the

six

months ended

June 30, 2018,

gains on redemptions of U.S. Treasury notes were

$2,137.

	June 30,		December 31,
	2018		2017
Certificates of deposit	$	816,709	$	746,219
U.S. Treasury notes and corporate bond		4,039,422		809,184
Convertible note receivable		-		103,896
Total	$	4,856,131	$	1,659,299

Convertible Note Receivable

On

September 13, 2016,

we purchased an unsecured convertible note receivable from Breezeway Homes, Inc. (“Breezeway”) for the principal sum of

$100,000.

The note bore interest at

3%

per annum, with principal and accrued interest payable upon demand at the earlier of

December 31, 2018

or the closing of Breezeway’s next equity financing.

In

January 2018,

Breezeway completed a

second

round of equity financing, in which we agreed to tender our promissory note in exchange for preferred stock. At the time that the note receivable was tendered, principal, together with accrued interest, was

$104,019.

At

December 31, 2017,

the balance of the note plus accrued interest was

$103,896.

As part of the loan arrangement, the parties entered into a memorandum of understanding for the parties to work together on the sale of damage waiver insurance related products, which the parties

may

develop, to property managers, lessors, and renters for residential homes through Breezeway’s platform.

Note Receivable

On

April 27, 2018,

we made a short-term loan to CB&T Holding Corporation (“CB&T”). In connection with the short-term loan, CB&T issued us a promissory note in the principal amount of

$2,116,972,

with an interest rate of

15%

per annum, and reimbursed us for certain costs associated with the transaction. The loan was repaid on

June 1, 2018

together with

$29,990

in interest.

U.S. Treasury Trading Securities

and U.S. Treasury Securities Available for Sale

Our security investments that are bought and held principally for the purpose of selling them in the near term are classified as trading securities. Trading securities are recorded at fair value on the balance sheet in current assets, with the change in fair value during the period included in earnings. Our trading securities consist of U.S. Treasury securities. Trading securities as of

June 30, 2018

and

December 31, 2017

are as follows:

			Gross
			Unrealized		Fair
	Cost		Gain		Value
U.S. Treasury bills, June 30, 2018	$	-	$	-	$	-
U.S. Treasury bills, December 31, 2017	$	82,968,614	$	132,191	$	83,100,805

We classify our investments in debt securities that we intend to hold for indefinite periods of time as “available for sale.” Our securities available for sale are carried at fair value in the balance sheet. Because we have elected the fair value option for these securities, unrealized holding gains and losses during the period are included in earnings. Interest income is recognized at the coupon rate. Securities available for sale as of

June 30, 2018

are as follows:

			Gross
			Unrealized		Fair
	Cost		Gain		Value
U.S. Treasury securities, June 30, 2018	$	150,100,946	$	245,494	$	150,346,440

Long-term Investments

Long-term investments consist of certificates of deposit having maturity dates in excess of

twelve

months, and U.S. Treasury securities. The certificates of deposit have maturity dates ranging from

2019

through

2021.

We have the intent and the ability to hold the investments to maturity. Certificates of deposit and U.S. Treasury securities are stated at carrying value which approximates fair value and are held by UC&S.

Long-term investments consist of the following:

	June 30,		December 31,
	2018		2017
U.S. Treasury securities, held to maturity	$	2,083,624	$	2,820,855
Certificates of deposit		931,291		1,080,426
Preferred stock		104,019		-
Non-voting common units of Dream Finders Holdings, LLC		10,000,000		10,000,000
Voting common stock of CB&T Holding Corporation		19,058,485		-
Total	$	32,177,419	$	13,901,281

Cost Investment

s

On

May 31, 2018,

we invested

$19,058,485

in voting common stock of CB&T, the privately held parent company of Crescent Bank & Trust. Our investment represents

14.99%

of CB&T’s outstanding common stock. CB&T is a closely held corporation, whose majority ownership rests with

one

family.

During late

December 2017,

we invested

$10,000,000

in non-voting common units of Dream Finders Holdings, LLC, a national homebuilder. Excluding their non-convertible preferred equity, our investment represents an approximately

5%

ownership stake in the company.

During

January 2018,

we exchanged our convertible note receivable from Breezeway for

31,227

shares of preferred stock. The preferred stock is noncumulative and has a dividend rate of

$.2665

per share, should dividends be declared. The preferred stock has

one

vote per share and is convertible into whole shares of common stock, determined according to the conversion formula contained in Breezeway’s amended and restated articles of incorporation.

We reviewed our investments as of

June 30, 2018

and

December 31, 2017

and concluded that

no

impairment to the carrying value was required.

Investment in

Unconsolidated

Affiliates

We have various investments in equity method affiliates, whose businesses are in real estate and real estate services. Our interest in these affiliates ranges from

7.15%

to

30%.

Two of the investments in affiliates, Logic Real Estate Companies, LLC and TAG SW

1,

LLC having a combined carrying amount of

$417,287

on

June 30, 2018,

are managed by a member of our board of directors. During the

six

months ended

June 30, 2018,

TAG SW

1,

LLC sold its remaining investments and realized a gain on the sale of its assets.

The following table is a reconciliation of our investments in equity affiliates as presented in investments in unconsolidated affiliates on our consolidated balance sheets:

	June 30,			December 31,
	2018			2017
Beginning of period	$	952,128		$	871,918
Additional investments in unconsolidated affiliates		-			66,000
Distributions received		(382,443	)		(59,550	)
Loss on investment in affiliate		(107,630	)		-
Equity in income of unconsolidated affiliates		385,091			73,760
End of period	$	847,146		$	952,128

The loss on investment in affiliate is related to the wind-down of TAG SW

1,

LLC and is included on our consolidated statements of operations in the caption “Loss on disposition of investments.”

XML

Note 9 - Fair Value

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Fair Value Disclosures [Text Block]

NOTE 9. FAIR VALUE

At

June 30, 2018

and

December 31, 2017,

our financial instruments included cash, cash equivalents, restricted cash, receivables, marketable securities, investments, and accounts payable. The fair values of cash, cash equivalents, restricted cash, receivables, and accounts payable approximated carrying values because of the short-term nature of these instruments. U.S. Treasury trading securities and U.S. Treasury securities available for sale are reported at fair values. Fair values for investments held at cost are

not

readily available, but are estimated to approximate fair value. Substantially all of the fair value is determined using observed prices of publicly traded debt, level

1

in the fair value hierarchy.

	Total Carrying		Quoted Prices				Total Changes
	Amount in		in Active				in Fair Values
	Consolidated		Markets for				Included in
	Balance Sheet		Identical		Trading Gains		Current Period
	Jun. 30, 2018		Assets		and Losses		Earnings (Loss)
U.S. Treasury trading securities	$	-	$	-	$	6,406	$	(132,191	)
U.S. Treasury securities available for sale		150,346,440		150,346,440		44,354		245,494
					$	50,760	$	113,303

XML

Note 10 - Asset Retirement Obligations

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Asset Retirement Obligation Disclosure [Text Block]

NOTE 10. ASSET RETIREMENT OBLIGATIONS

Our asset retirement obligations include the costs associated with the removal of structures, resurfacing of the land and retirement cost, if applicable, related to our outdoor advertising assets. The following table reflects information related to our asset retirement obligations:

Balance, December 31, 2017	$	-
Additions		179,917
Accretion expense		5,995
Liabilities settled		(11,243	)
Balance, June 30, 2018	$	174,669

XML

Note 11 - Capital Stock

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

NOTE 1 1 . CAPITAL STOCK

On

February 22, 2018,

we entered into a Class A Common Stock Purchase Agreement, pursuant to which we agreed to issue and sell to

three

limited partnerships up to an aggregate of

$150,000,000

in unregistered shares of Class A common stock at a price of

$23.30,

a slight premium to the closing price of shares of Class A common stock of

$23.29

on the NASDAQ Capital Market, as reported by NASDAQ on

February 22, 2018.

Two of the

three

limited partnerships are entities managed by The Magnolia Group, LLC, and the

third

limited partnership is an entity managed by Boulderado Group, LLC. The Class A Common Stock Purchase Agreement was approved by an independent special committee of our board of directors with the advice of independent legal counsel and an independent investment banking firm which provided a fairness opinion to the special committee. The closing of the

first

tranche of shares to be sold under the agreement occurred on

March 6, 2018.

It consisted of a total of

3,300,000

shares resulting in total gross proceeds of

$76,890,000.

The closing of the

second

tranche of shares to be sold under the agreement occurred on

May 15, 2018.

It consisted of the sale of

3,137,768

shares resulting in gross proceeds of approximately

$73,110,000

and in aggregate gross proceeds from the private placement of approximately

$150,000,000

in total.

Also in

February 2018,

we filed a shelf registration statement with the SEC allowing us to sell up to

$200,000,000

of our securities. This registration statement was declared effective by the SEC on

February 9, 2018.

We subsequently entered into a Sales Agreement with Cowen and Company, LLC, which we refer to as “Cowen,” relating to the sale of shares of our Class A common stock to be offered. In accordance with the terms of the Sales Agreement, we

may

offer and sell from time to time up to

$50,000,000

of shares of our Class A common stock through Cowen acting as our agent. Cowen is

not

required to sell any specific amount of securities, but will act as our sales agent using commercially reasonable efforts consistent with its normal trading and sales practices, on mutually agreed terms between Cowen and us. The compensation to Cowen for sales of Class A common stock sold pursuant to the Sales Agreement will be an amount equal to

3%

of the gross proceeds of any shares of Class A common stock sold under the Sales Agreement. Through

June 30, 2018,

Cowen sold an aggregate of

1,149,849

shares of our Class A common stock under this “at the market” offering, resulting in gross proceeds to us of

$26,087,283

and net proceeds of

$25,304,665,

net of commission paid to Cowen.

On

May 4, 2018,

we filed an amendment to our

second

amended and restated certificate of incorporation which increased our authorized shares of common stock. Our authorized capital stock now consists of

40,000,000

shares of common stock, of which

38,838,884

shares are designated as Class A common stock and

1,161,116

shares are designated as Class B common stock, and

1,000,000

shares of undesignated preferred stock.

As of

June 30, 2018

there were

105,556

outstanding warrants for our Class B common stock. A summary of warrant activity for the

six

months ended

June 30, 2018

is presented in the following table.

	Shares Under Warrants		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value of Vested Warrants
Outstanding as of December 31, 2017		105,556	$	9.95	7.5	$	2,368,677
Issued		-
Exercised		-
Expired		-
Outstanding as of June 30, 2018		105,556	$	9.95	7.0	$	1,173,783

XML

Note 12 - Future Minimum Lease Payments

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Leases of Lessee Disclosure [Text Block]

NOTE 1 2 . FUTURE MINIMUM LEASE PAYMENTS

In connection with the business acquisitions (See Note

6

), we acquired the leases for over

450

billboard locations. Some of the leases are non-cancelable operating leases having remaining terms ranging from month-to-month to

1,002

months. In many instances, we can cancel the lease with little or

no

penalty. Ground rents for the

three

months and

six

months ended

June 30, 2018

were

$447,635

and

$850,747

respectively; and for the

three

months and

six

months ended

June 30, 2017

were

$350,781

and

$637,924,

respectively. Contingent rents included in ground rents for the

three

months and

six

months ended

June 30, 2018

were

$92,081

and

$116,685,

respectively; and for

three

months and

six

months ended

June 30, 2017

were

$9,302

and

$20,234,

respectively.

We lease office space under leases expiring between

2018

and

2022.

Rent expense included in general and administrative expense for the

three

months and

six

months ended

June 30, 2018

was

$86,559

and

$183,096,

respectively; and for the

three

months and

six

months ended

June 30, 2017

was

$50,447

and

$95,263,

respectively.

Future minimum rents are as follows for the

twelve

months ending

June 30:

2019	$	1,312,993
2020		1,202,230
2021		1,104,883
2022		947,708
2023		886,710
Thereafter		4,397,508
Total	$	9,852,032

XML

Note 13 - Industry Segments

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

NOTE 1 3 . I N DUSTRY SEGMENTS

This summary presents our current segments, as described below.

General Indemnity Group, LLC

GIG conducts our insurance operations through its subsidiaries, Warnock, SSS, SCS, UC&S, and GIIC. UC&S, SSS and SCS clients are multi-state and Warnock clients are nationwide. Revenue consists of surety bond sales and insurance commissions. Currently, GIG’s corporate resources are used to support Warnock, SSS, SCS, UC&S, and GIIC and to make additional business acquisitions in the insurance industry.

Link Media Holdings, LLC

LMH conducts our billboard rental operations. LMH advertisers are located in Alabama, Florida, Georgia, and Wisconsin.

Three Months Ended June 30, 2018	GIG			LMH			Unallocated			Total Consolidated
Revenue	$	1,290,490		$	1,699,269		$	-		$	2,989,759
Segment gross profit		1,025,818			856,482			-			1,882,300
Segment loss from operations		(1,204,432	)		(783,029	)		(516,230	)		(2,503,691	)
Capital expenditures		2,549			1,181,656			-			1,184,205
Depreciation and amortization		316,086			681,533			-			997,619

										Total
Three Months Ended June 30, 2017	GIG			LMH			Unallocated			Consolidated
Revenue	$	779,565		$	1,215,318		$	-		$	1,994,883
Segment gross profit		711,485			596,094			-			1,307,579
Segment loss from operations		(418,264	)		(699,994	)		(271,052	)		(1,389,310	)
Capital expenditures		-			4,468,496			-			4,468,496
Depreciation and amortization		50,678			605,236			-			655,914

										Total
Six Months Ended June 30, 2018	GIG			LMH			Unallocated			Consolidated
Revenue	$	2,563,244		$	3,249,459		$	-		$	5,812,703
Segment gross profit		2,085,708			1,683,838			-			3,769,546
Segment loss from operations		(2,247,811	)		(1,501,711	)		(1,496,560	)		(5,246,082	)
Capital expenditures		10,031			1,758,989			-			1,769,020
Depreciation and amortization		641,220			1,445,427			-			2,086,647

										Total
Six Months Ended June 30, 2017	GIG			LMH			Unallocated			Consolidated
Revenue	$	1,635,000		$	2,229,810		$	-		$	3,864,810
Segment gross profit		1,380,326			1,119,501			-			2,499,827
Segment loss from operations		(651,948	)		(1,158,488	)		(678,769	)		(2,489,205	)
Capital expenditures		-			10,586,030			-			10,586,030
Depreciation and amortization		101,357			1,151,250			-			1,252,607

							Total
As of June 30, 2018	GIG		LMH		Unallocated		Consolidated
Accounts receivable, net	$	469,969	$	820,997	$	-	$	1,290,966
Goodwill		8,719,294		16,286,867		-		25,006,161
Total assets		25,237,935		33,256,376		265,949,091		324,443,402

							Total
As of December 31, 2017	GIG		LMH		Unallocated		Consolidated
Accounts receivable, net	$	433,225	$	662,552	$	-	$	1,095,777
Goodwill		8,719,294		15,972,867		-		24,692,161
Total assets		25,762,437		32,443,777		95,270,870		153,477,084

XML

Note 14 - Custodial Risk

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Custodial Risk Disclosure [Text Block]

NOTE 1 4 . CUSTODIAL RISK

At

June 30, 2018,

we had approximately

$85,700,000

in excess of federally insured limits on deposit with financial institutions.

XML

Note 15 - Subsequent Events

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Subsequent Events [Text Block]

NOTE 1 5 . SUBSEQUENT EVENTS

On

July 31, 2018,

we completed the acquisition of Tammy Lynn Outdoor, LLC (“Tammy Lynn”), based in Bluefield, West Virginia. The assets acquired are located in Virginia and West Virginia. The majority of the purchase price was paid in cash, however, as part of the consideration for the purchase the seller received

85,170

shares of our Class A common stock. The acquisition was completed for the purpose of expanding our presence in the outdoor advertising market in the Southeastern United States.

For the month ended

July 31, 2018,

Cowen sold an additional

28,080

shares of our Class A common stock, under the “at the market” Sales Agreement, resulting in net proceeds to us of

$590,844.

(See Note

11

)

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Consolidation, Policy [Policy Text Block]

Consolidation Policy

The financial statements of Boston Omaha Corporation include the accounts of the Company and its wholly-owned and majority-owned subsidiaries, as follows:

Link Media Holdings, LLC which we refer to as “LMH”

Link Media Alabama, LLC which we refer to as “LMA”

Link Media Florida, LLC which we refer to as “LMF”

Link Media Wisconsin, LLC which we refer to as “LMW”

Link Media Georgia, LLC which we refer to as “LMG”

General Indemnity Group, LLC which we refer to as “GIG”

General Indemnity Insurance Company PCC, LLC which we refer to as “GIIC”

The Warnock Agency, Inc. which we refer to as “Warnock”

United Casualty and Surety Insurance Company which we refer to as “UC&S”

Surety Support Services, Inc. which we refer to as “SSS”

South Coast Surety Insurance Services, LLC which we refer to as “SCS”

Boston Omaha Investments, LLC which we refer to as “BOIC”

All significant intercompany profits, losses, transactions and balances have been eliminated in consolidation.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition

Billboard Rentals

We generate revenue from outdoor advertising through the leasing of billboards. The terms of the operating leases range from less than

one

month to

three

years and are generally billed monthly. Revenue for advertising space rental is recognized on a straight-line basis over the term of the contract. Advertising revenue is reported net of agency commissions. Agency commissions are calculated based on a stated percentage applied to gross billing revenue for operations. Payments received in advance of being earned are recorded as deferred revenue. Another component of billboard rentals consists of production services which include creating and printing advertising copy. Contract revenues for production services are recognized upon satisfaction of the contract, which is typically less than

one

week.

Deferred Revenues

We record deferred revenues when cash payments are received or due in advance of our performance obligation. The term between invoicing and when a payment is due is

not

significant. For certain services we require payment before the product or services are delivered to the customer. The balance of deferred income is considered short-term and will be recognized in revenue within

twelve

months.

Premiums and Unearned Premium Reserves

Premiums written are recognized as revenues based on a pro-rata daily calculation over the respective terms of the policies in-force. The cost of reinsurance ceded is initially written as prepaid reinsurance premiums and is amortized over the reinsurance contract period in proportion to the amount of insurance protection provided. Premiums ceded are netted against premiums written.

Commissions

We generate revenue from commissions on surety bond sales. The insurance commissions are calculated based upon a stated percentage applied to the gross premiums on bonds. Commissions are earned as of the policy effective date and are nonrefundable.

Practical Expedients and Exemptions

Upon our transition to ASC

606

from ASC

840,

we plan to utilize the following practical expedients and exemptions from ASC

606.

We generally expense sales commissions when incurred because the amortization period is

one

year or less. These costs are recorded within cost of billboard revenues (exclusive of depreciation and amortization). We do

not

disclose the value of unsatisfied performance obligations as the majority of our contracts with customers have an original expected length of less than

one

year. For contracts with customers which exceed

one

year the future amount to be invoiced to the customer corresponds directly with the value to be received by the customer.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

In

May 2014,

the FASB issued ASU

No.

2014

-

09

(Codified as ASC

606

),

Revenue from Contracts with Customers

, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In

August 2015,

the FASB issued ASU

No.

2015

-

14

deferring the effective date from

January 1, 2017

to

January 1, 2018,

while allowing for early adoption as of

January 1, 2017.

The standard permits the use of either the retrospective or cumulative effect transition method. We adopted the provisions of ASU

No.

2014

-

09

on

January 1, 2018

using the cumulative effect transition method. We did

not

have an adjustment to our opening balance of accumulated deficit for the adoption of this update.

In

February 2016,

the FASB issued ASU

No.

2016

-

01,

Recognition and Measurement of Financial Assets and Financial Liabilities

, which requires entities to carry all investments in equity securities at fair value and recognize any changes in fair value in net income. Under the standard, equity investments that do

not

have readily determinable fair values and do

not

qualify for the net asset value practical expedient are eligible for the measurement alternative. We adopted the provisions of ASU

No.

2016

-

01

on

January 1, 2018,

for our equity investments in private companies

not

accounted for under the equity method, using the measurement alternative, defined as cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer.

In

November 2016,

the FASB issued ASU

No.

2016

-

18,

Statement of Cash Flows (Topic

230

), Restricted Cash.

The guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The standard is effective for public business entities for fiscal years beginning after

December 15, 2017,

and interim periods within those fiscal years. We adopted ASU

No.

2016

-

18

on

January 1, 2018.

In accordance with the guidance of ASU

No.

2016

-

18,

changes in restricted cash have been included with cash and cash equivalents in the consolidated statements of cash flows. We retrospectively adopted the standard.

The adoption increases the ending cash balance within our consolidated statements of cash flows by the aggregate amount of our restricted cash balances and requires a new disclosure to reconcile the cash balances within our consolidated statements of cash flows to the consolidated balance sheets. 

On

January 1, 2018,

we adopted ASU

No.

2016

-

15

, Statement of Cash Flows (Topic

230

), Classification of Certain Cash Receipts and Payments.

The ASU is required to be reflected on a retrospective basis and provides guidance on the classification of certain cash receipts and cash payments, including distributions received from an equity method investee. We adopted the cumulative earnings approach, whereby distributions received are considered to be returns on investment and, thus, should be classified as cash inflows from operating activities on our consolidated statement of cash flows. The adoption of ASU

No.

2016

-

15

did

not

have a material impact on our consolidated financial statements.

In

February 2016,

the FASB issued ASU

No.

2016

-

02,

Leases (Topic

842

),

specifying the accounting for leases, which supersedes the leases requirements in Topic

840,

Leases.

The objective of Topic

842

is to establish the principles that lessee and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. Lessees are permitted to make an accounting policy election to

not

recognize the asset and liability for leases with a term of

twelve

months or less. Lessors’ accounting is largely unchanged from the previous accounting standard. In addition, Topic

842

expands the disclosure requirements of lease arrangements. Lessees and lessors will use a modified retrospective transition approach, which includes a number of practical expedients. This guidance is effective for fiscal years and interim periods within those fiscal years, beginning after

December 15, 2018

with early adoption permitted.

In

January 2018,

the FASB issued ASU

No.

2018

-

01,

Leases (Topic

842

), Land Easement Practical Expedient for Transition to Topic

842.

The update provides an optional transition practical expedient to

not

evaluate under Topic

842

existing or expired land easements that were

not

previously accounted for as leases under the current lease guidance in Topic

840.

An entity that elects this practical expedient should evaluate new or modified land easements under Topic

842

upon adoption. An entity that does

not

elect this practical expedient should evaluate all existing or expired land easements in connection with the adoption of the new lease requirements in Topic

842

to assess whether they meet the definition of a lease. We plan to elect the provided practical expedient within this update upon our adoption of Topic

842.

In

July 2018,

the FASB issued ASU

No.

2018

-

10

Leases (Topic

842

), Codification Improvements

and ASU

No.

2018

-

11

Leases

(Topic

842

), Targeted Improvements

, to provide additional guidance for the adoption of Topic

842.

ASU

No.

2018

-

10

clarifies certain provisions and corrects unintended applications of the guidance such as the application of implicit rate, lessee reassessment of lease classification, and certain transition adjustments that should be recognized to earnings rather than to stockholders’ equity. ASU

No.

2018

-

11

provides an alternative transition method which allows recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption rather than in the earliest period presented, and a practical expedient for separating contract components for the adoption of Topic

842.

ASU

No.

2018

-

10

and ASU

No.

2018

-

11

(collectively, “the new lease standards”) are effective for fiscal years beginning after

December 15, 2018,

with early adoption permitted. We are currently assessing the effect the new lease standards will have on our consolidated financial statements.

XML

Note 3 - Restricted Cash (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Restrictions on Cash and Cash Equivalents [Table Text Block]

	June 30,		December 31,
	2018		2017
Insurance premium escrow	$	330,971	$	247,230
Billboard replacement reserve		175,075		144,995
Total Restricted Cash	$	506,046	$	392,225

	June 30,
	2018		2017
Cash and cash equivalents	$	88,166,783	$	101,717,930
Restricted cash		506,046		404,822
Total Cash, Cash Equivalents, and Restricted Cash as Presented in the Consolidated Statements of Cash Flows	$	88,672,829	$	102,122,752

XML

Note 4 - Accounts Receivable (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Receivables with Imputed Interest [Table Text Block]

	June 30,			December 31,
	2018			2017
Trade accounts	$	995,055		$	828,287
Premiums		298,872			288,039
Anticipated salvage and subrogation		3,573			3,572
Allowance for doubtful accounts		(6,534	)		(24,121	)
Total Accounts Receivable, net	$	1,290,966		$	1,095,777

XML

Note 5 - Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Property, Plant and Equipment [Table Text Block]

	June 30,			December 31,
	2018			2017
Structures and displays	$	12,167,292		$	10,484,725
Vehicles and equipment		232,967			143,154
Office furniture and equipment		418,238			395,981
Accumulated depreciation		(2,537,724	)		(1,912,847	)
Total Property and Equipment, net	$	10,280,773		$	9,111,013

XML

Note 6 - Business Acquisitions (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

	Billboards
	CCO			Hartlind		Southeastern US			Subtotal
Amortization of intangible assets acquired for the three months ended June 30, 2017	$	70,846		$	45,770	$	38,181		$	154,797
Revenues since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	204,093		$	99,665	$	5,320		$	309,078
Earnings since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	(21,391	)	$	38,431	$	(54,043	)	$	(37,003	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the three months ended June 30, 2017	$	-		$	831	$	21,563		$	22,394
Amortization of intangible assets acquired for the six months ended June 30, 2017	$	141,693		$	76,284	$	38,181		$	256,158
Revenues since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	359,076		$	152,776	$	5,320		$	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	(41,755	)	$	55,729	$	(54,043	)	$	(40,069	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the six months ended June 30, 2017	$	14,468		$	8,645	$	21,563		$	44,676

	Insurance
	SSS		SCS		Freestate		Subtotal		Total
Amortization of intangible assets acquired for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	154,797
Revenues since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	309,078
Earnings since the acquisition date included in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	(37,003	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the three months ended June 30, 2017	$	-	$	-	$	-	$	-	$	22,394
Amortization of intangible assets acquired for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	256,158
Revenues since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	(40,069	)
Costs of acquisition included in professional fees in the consolidated statement of operations for the six months ended June 30, 2017	$	-	$	-	$	-	$	-	$	44,676

Business Acquisition, Pro Forma Information [Table Text Block]

	Three Months Ended June 30, 2017			Six Months Ended June 30, 2017
Revenue	$	2,960,519		$	5,666,907
Net Loss Attributable to Common Stockholders	$	(1,460,839	)	$	(2,651,967	)
Basic and Diluted Loss per Share	$	(0.19	)	$	(0.37	)
Basic and Diluted Weighted Average Class A and Class B Common Shares Outstanding		7,594,585			7,247,906

XML

Note 7 - Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Intangible Assets and Goodwill [Table Text Block]

	June 30, 2018							December 31, 2017
			Accumulated							Accumulated
	Cost		Amortization			Balance		Cost		Amortization			Balance
Customer relationships	$	7,818,900	$	(4,232,685	)	$	3,586,215	$	8,132,900	$	(2,970,533	)	$	5,162,367
Permits, licenses, and lease acquisition costs		2,181,621		(239,472	)		1,942,149		2,184,106		(178,835	)		2,005,271
Site location		849,347		(51,904	)		797,443		849,347		(23,593	)		825,754
Noncompetition agreements		285,000		(94,917	)		190,083		285,000		(66,417	)		218,583
Trade names and trademarks		722,200		(158,417	)		563,783		722,200		(112,250	)		609,950
Technology		138,000		(99,660	)		38,340		138,000		(76,662	)		61,338
Nonsolicitation agreement		28,000		(28,000	)		-		28,000		(28,000	)		-
Easements		486,850		-			486,850		466,360		-			466,360
Total	$	12,509,918	$	(4,905,055	)	$	7,604,863	$	12,805,913	$	(3,456,290	)	$	9,349,623

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

	June 30,
	2019		2020		2021		2022		2023		Thereafter		Total
Customer relationships	$	2,256,238	$	1,210,675	$	119,302	$	-	$	-	$	-	$	3,586,215
Permits, licenses, and lease acquisition costs		125,742		125,742		125,742		125,742		125,742		1,313,439		1,942,149
Site location		56,623		56,623		56,623		56,623		56,623		514,328		797,443
Noncompetition agreements		57,000		56,417		40,500		28,000		8,166		-		190,083
Trade names and trademarks		74,000		67,933		64,900		64,900		64,900		227,150		563,783
Technology		38,340		-		-		-		-		-		38,340
Total	$	2,607,943	$	1,517,390	$	407,067	$	275,265	$	255,431	$	2,054,917	$	7,118,013

Customer relationships	17
Permits, licenses, and lease acquisition costs	185
Site location	169
Noncompetition agreements	40
Trade names and trademarks	67
Technology	10

XML

Note 8 - Investments, Including Investments Accounted for Using the Equity Method (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Investment [Table Text Block]

	June 30,		December 31,
	2018		2017
Certificates of deposit	$	816,709	$	746,219
U.S. Treasury notes and corporate bond		4,039,422		809,184
Convertible note receivable		-		103,896
Total	$	4,856,131	$	1,659,299

	June 30,		December 31,
	2018		2017
U.S. Treasury securities, held to maturity	$	2,083,624	$	2,820,855
Certificates of deposit		931,291		1,080,426
Preferred stock		104,019		-
Non-voting common units of Dream Finders Holdings, LLC		10,000,000		10,000,000
Voting common stock of CB&T Holding Corporation		19,058,485		-
Total	$	32,177,419	$	13,901,281

Debt Securities, Trading, and Equity Securities, FV-NI [Table Text Block]

			Gross
			Unrealized		Fair
	Cost		Gain		Value
U.S. Treasury bills, June 30, 2018	$	-	$	-	$	-
U.S. Treasury bills, December 31, 2017	$	82,968,614	$	132,191	$	83,100,805

Schedule of Available-for-sale Securities Reconciliation [Table Text Block]

			Gross
			Unrealized		Fair
	Cost		Gain		Value
U.S. Treasury securities, June 30, 2018	$	150,100,946	$	245,494	$	150,346,440

Investments in and Advances to Affiliates [Table Text Block]

	June 30,			December 31,
	2018			2017
Beginning of period	$	952,128		$	871,918
Additional investments in unconsolidated affiliates		-			66,000
Distributions received		(382,443	)		(59,550	)
Loss on investment in affiliate		(107,630	)		-
Equity in income of unconsolidated affiliates		385,091			73,760
End of period	$	847,146		$	952,128

XML

Note 9 - Fair Value (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Table Text Block]

	Total Carrying		Quoted Prices				Total Changes
	Amount in		in Active				in Fair Values
	Consolidated		Markets for				Included in
	Balance Sheet		Identical		Trading Gains		Current Period
	Jun. 30, 2018		Assets		and Losses		Earnings (Loss)
U.S. Treasury trading securities	$	-	$	-	$	6,406	$	(132,191	)
U.S. Treasury securities available for sale		150,346,440		150,346,440		44,354		245,494
					$	50,760	$	113,303

XML

Note 10 - Asset Retirement Obligations (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Change in Asset Retirement Obligation [Table Text Block]

Balance, December 31, 2017	$	-
Additions		179,917
Accretion expense		5,995
Liabilities settled		(11,243	)
Balance, June 30, 2018	$	174,669

XML

Note 11 - Capital Stock (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Share-based Compensation, Stock Options, Activity [Table Text Block]

	Shares Under Warrants		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value of Vested Warrants
Outstanding as of December 31, 2017		105,556	$	9.95	7.5	$	2,368,677
Issued		-
Exercised		-
Expired		-
Outstanding as of June 30, 2018		105,556	$	9.95	7.0	$	1,173,783

XML

Note 12 - Future Minimum Lease Payments (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

2019	$	1,312,993
2020		1,202,230
2021		1,104,883
2022		947,708
2023		886,710
Thereafter		4,397,508
Total	$	9,852,032

XML

Note 13 - Industry Segments (Tables)

6 Months Ended

Jun. 30, 2018

Notes Tables

Schedule of Segment Reporting Information, by Segment [Table Text Block]

Three Months Ended June 30, 2018	GIG			LMH			Unallocated			Total Consolidated
Revenue	$	1,290,490		$	1,699,269		$	-		$	2,989,759
Segment gross profit		1,025,818			856,482			-			1,882,300
Segment loss from operations		(1,204,432	)		(783,029	)		(516,230	)		(2,503,691	)
Capital expenditures		2,549			1,181,656			-			1,184,205
Depreciation and amortization		316,086			681,533			-			997,619

										Total
Three Months Ended June 30, 2017	GIG			LMH			Unallocated			Consolidated
Revenue	$	779,565		$	1,215,318		$	-		$	1,994,883
Segment gross profit		711,485			596,094			-			1,307,579
Segment loss from operations		(418,264	)		(699,994	)		(271,052	)		(1,389,310	)
Capital expenditures		-			4,468,496			-			4,468,496
Depreciation and amortization		50,678			605,236			-			655,914

										Total
Six Months Ended June 30, 2018	GIG			LMH			Unallocated			Consolidated
Revenue	$	2,563,244		$	3,249,459		$	-		$	5,812,703
Segment gross profit		2,085,708			1,683,838			-			3,769,546
Segment loss from operations		(2,247,811	)		(1,501,711	)		(1,496,560	)		(5,246,082	)
Capital expenditures		10,031			1,758,989			-			1,769,020
Depreciation and amortization		641,220			1,445,427			-			2,086,647

										Total
Six Months Ended June 30, 2017	GIG			LMH			Unallocated			Consolidated
Revenue	$	1,635,000		$	2,229,810		$	-		$	3,864,810
Segment gross profit		1,380,326			1,119,501			-			2,499,827
Segment loss from operations		(651,948	)		(1,158,488	)		(678,769	)		(2,489,205	)
Capital expenditures		-			10,586,030			-			10,586,030
Depreciation and amortization		101,357			1,151,250			-			1,252,607

							Total
As of June 30, 2018	GIG		LMH		Unallocated		Consolidated
Accounts receivable, net	$	469,969	$	820,997	$	-	$	1,290,966
Goodwill		8,719,294		16,286,867		-		25,006,161
Total assets		25,237,935		33,256,376		265,949,091		324,443,402

							Total
As of December 31, 2017	GIG		LMH		Unallocated		Consolidated
Accounts receivable, net	$	433,225	$	662,552	$	-	$	1,095,777
Goodwill		8,719,294		15,972,867		-		24,692,161
Total assets		25,762,437		32,443,777		95,270,870		153,477,084

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Note 2 - Summary of Significant Accounting Policies (Details Textual)	Jun. 30, 2018
Minimum [Member]
Lessor, Operating Lease, Term of Contract	30 days
Maximum [Member]
Lessor, Operating Lease, Term of Contract	90 days

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Note 3 - Restricted Cash - Schedule of Restricted Cash and Cash Equivalents (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017	Dec. 31, 2016
Restricted cash	$ 506,046	$ 392,225	$ 404,822
Cash and cash equivalents	88,166,783	6,838,345	101,717,930
Total Cash, Cash Equivalents, and Restricted Cash as Presented in the Consolidated Statements of Cash Flows	88,672,829	7,230,570	$ 102,122,752	$ 29,844,068
Insurance Premium Escrow [Member]
Restricted cash	330,971	247,230
Billboard Replacement Reserve [Member]
Restricted cash	$ 175,075	$ 144,995

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Note 4 - Accounts Receivable - Schedule of Receivables (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Allowance for doubtful accounts	$ (6,534)	$ (24,121)
Accounts receivable, net	1,290,966	1,095,777
Trade Accounts Receivable [Member]
Accounts receivable, gross	995,055	828,287
Premium [Member]
Accounts receivable, gross	298,872	288,039
Anticipated Salvage and Subrogation [Member]
Accounts receivable, gross	$ 3,573	$ 3,572

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Note 5 - Property and Equipment (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Depreciation, Total	$ 306,714	$ 233,241	$ 635,407	$ 456,708
Gain (Loss) on Disposition of Property Plant Equipment, Total	$ (81,857)	$ (228,431)	$ (81,857)	$ (228,431)

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Note 5 - Property and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Accumulated depreciation	$ (2,537,724)	$ (1,912,847)
Total Property and Equipment, net	10,280,773	9,111,013
Structures and Displays [Member]
Property, plant and equipment, gross	12,167,292	10,484,725
Vehicles and Equipment [Member]
Property, plant and equipment, gross	232,967	143,154
Office Furniture and Equipment [Member]
Property, plant and equipment, gross	$ 418,238	$ 395,981

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Note 6 - Business Acquisitions (Details Textual) - USD ($)								6 Months Ended
	Nov. 30, 2017	Oct. 31, 2017	Jul. 11, 2017	Jun. 16, 2017	Jun. 08, 2017	Jan. 31, 2017	Jan. 09, 2017	Jun. 30, 2018	Jun. 30, 2017
Payments to Acquire Businesses, Net of Cash Acquired, Total								$ 0	$ 9,940,794
Repayments of Short-term Debt Related to Acquisition								$ 360,000
Minimum [Member]
Property, Plant and Equipment, Useful Life								2 years
Finite-Lived Intangible Asset, Useful Life								2 years
Maximum [Member]
Property, Plant and Equipment, Useful Life								15 years
Finite-Lived Intangible Asset, Useful Life								50 years
Clear Channel Outdoor Inc. [Member]
Payments to Acquire Businesses, Gross							$ 2,983,444
Other Restricted Assets, Noncurrent							$ 2,950,000
Hartlind Outdoor LLC [Member]
Payments to Acquire Businesses, Gross						$ 2,817,000
Corey Companies Inc. [Member] | Southeastern US [Member]
Payments to Acquire Businesses, Gross					$ 2,991,314
Goodwill, Purchase Accounting Adjustments								$ 314,000
Amortization, Purchase Accounting Adjustments								(64,965)
Corey Companies Inc. [Member] | Southeastern US [Member] | Customer Relationships [Member]
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Intangibles								(314,000)
Vision Outdoor Media LLC [Member] | Southeastern US [Member]
Payments to Acquire Businesses, Gross				$ 3,199,036
View Media, LLC [Member] | Southeastern US [Member]
Payments to Acquire Businesses, Gross			$ 623,596
Series of Individually Immaterial Business Acquisitions [Member] | Southeastern US [Member]
Payments to Acquire Businesses, Gross			900,000
Surety Support Services, Inc [Member]
Payments to Acquire Businesses, Gross			$ 22,500
Business Acquisition, Percentage of Voting Interests Acquired			100.00%
Business Combination, Consideration Transferred, Total			$ 450,000
Business Combination, Consideration Transferred, Liabilities Incurred			$ 427,500
Repayments of Short-term Debt Related to Acquisition								$ 360,000
South Coast Surety Insurance Services, LLC [Member]
Business Acquisition, Percentage of Voting Interests Acquired		70.00%
Business Combination, Consideration Transferred, Total		$ 2,908,581
Remaining Ownership Interest Percentage		30.00%
Free State Bonds Inc. [Member]
Payments to Acquire Businesses, Gross	$ 223,500
Business Acquisition, Percentage of Voting Interests Acquired	100.00%
Business Combination, Consideration Transferred, Total	$ 293,000
Business Combination, Consideration Transferred, Liabilities Incurred	$ 69,500

XML

Note 6 - Business Acquisitions - Schedule of Allocation of the Purchase Price (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2017
Amortization of intangible assets acquired for the period	$ 154,797	$ 256,158
Revenues since the acquisition date included in the consolidated statement of operations for the period	309,078	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the period	(37,003)	(40,069)
Costs of acquisition included in professional fees in the consolidated statement of operations for the period	22,394	44,676
Clear Channel Outdoor Inc. [Member]
Amortization of intangible assets acquired for the period	70,846	141,693
Revenues since the acquisition date included in the consolidated statement of operations for the period	204,093	359,076
Earnings since the acquisition date included in the consolidated statement of operations for the period	(21,391)	(41,755)
Costs of acquisition included in professional fees in the consolidated statement of operations for the period		14,468
Hartlind Outdoor LLC [Member]
Amortization of intangible assets acquired for the period	45,770	76,284
Revenues since the acquisition date included in the consolidated statement of operations for the period	99,665	152,776
Earnings since the acquisition date included in the consolidated statement of operations for the period	38,431	55,729
Costs of acquisition included in professional fees in the consolidated statement of operations for the period	831	8,645
Southeastern US [Member]
Amortization of intangible assets acquired for the period	38,181	38,181
Revenues since the acquisition date included in the consolidated statement of operations for the period	5,320	5,320
Earnings since the acquisition date included in the consolidated statement of operations for the period	(54,043)	(54,043)
Costs of acquisition included in professional fees in the consolidated statement of operations for the period	21,563	21,563
Clear Channel Outdoor, Hartlind and Southeastern US [Member]
Amortization of intangible assets acquired for the period	154,797	256,158
Revenues since the acquisition date included in the consolidated statement of operations for the period	309,078	517,172
Earnings since the acquisition date included in the consolidated statement of operations for the period	(37,003)	(40,069)
Costs of acquisition included in professional fees in the consolidated statement of operations for the period	22,394	44,676
Surety Support Services, Inc [Member]
Amortization of intangible assets acquired for the period
Revenues since the acquisition date included in the consolidated statement of operations for the period
Earnings since the acquisition date included in the consolidated statement of operations for the period
Costs of acquisition included in professional fees in the consolidated statement of operations for the period
South Coast Surety Insurance Services, LLC [Member]
Amortization of intangible assets acquired for the period
Revenues since the acquisition date included in the consolidated statement of operations for the period
Earnings since the acquisition date included in the consolidated statement of operations for the period
Costs of acquisition included in professional fees in the consolidated statement of operations for the period
Free State Bonds Inc. [Member]
Amortization of intangible assets acquired for the period
Revenues since the acquisition date included in the consolidated statement of operations for the period
Earnings since the acquisition date included in the consolidated statement of operations for the period
Costs of acquisition included in professional fees in the consolidated statement of operations for the period
Surety Support Services, South Cost Surety Insurances Services LLC, and Free State Bonds Inc. [Member]
Amortization of intangible assets acquired for the period
Revenues since the acquisition date included in the consolidated statement of operations for the period
Earnings since the acquisition date included in the consolidated statement of operations for the period
Costs of acquisition included in professional fees in the consolidated statement of operations for the period

XML

Note 6 - Business Acquisitions - Pro Forma Information (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenue		$ 2,960,519		$ 5,666,907
Net Loss Attributable to Common Stockholders		$ (1,460,839)		$ (2,651,967)
Basic and Diluted Loss per Share (in dollars per share)		$ (0.19)		$ (0.37)
Basic and Diluted Weighted Average Class A and Class B Common Shares Outstanding (in shares)	19,165,153	7,594,585	17,780,454	7,247,906

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Note 7 - Intangible Assets (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Amortization, Total	$ 690,905	$ 422,673	$ 1,451,240	$ 795,899

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Note 7 - Intangible Assets - Schedule of Intangible Assets (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Accumulated amortization	$ (4,905,055)	$ (3,456,290)
Balance	7,118,013
Total, cost	12,509,918	12,805,913
Intangible assets, net	7,604,863	9,349,623
Easements [Member]
Accumulated amortization
Balance	486,850	466,360
Customer Relationships [Member]
Cost	7,818,900	8,132,900
Accumulated amortization	(4,232,685)	(2,970,533)
Balance	3,586,215	5,162,367
Permits, Licenses and Lease Acquisition Costs [Member]
Cost	2,181,621	2,184,106
Accumulated amortization	(239,472)	(178,835)
Balance	1,942,149	2,005,271
Site Location [Member]
Cost	849,347	849,347
Accumulated amortization	(51,904)	(23,593)
Balance	797,443	825,754
Noncompete Agreements [Member]
Cost	285,000	285,000
Accumulated amortization	(94,917)	(66,417)
Balance	190,083	218,583
Trademarks and Trade Names [Member]
Cost	722,200	722,200
Accumulated amortization	(158,417)	(112,250)
Balance	563,783	609,950
Technology-Based Intangible Assets [Member]
Cost	138,000	138,000
Accumulated amortization	(99,660)	(76,662)
Balance	38,340	61,338
Nonsolicitation Agreement [Member]
Cost	28,000	28,000
Accumulated amortization	(28,000)	(28,000)
Balance

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Note 7 - Intangible Assets - Schedule of Future Amortization, Intangible Assets Acquired in Acquisitions (Details) - USD ($)	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
2018	$ 2,607,943
2019	1,517,390
2020	407,067
2021	275,265
2022	255,431
Thereafter	2,054,917
Total	7,118,013
Customer Relationships [Member]
2018	2,256,238
2019	1,210,675
2020	119,302
2021
2022
Thereafter
Total	$ 3,586,215	$ 5,162,367
Intangible assets, weighted average useful life (Month)	1 year 150 days
Permits, Licenses and Lease Acquisition Costs [Member]
2018	$ 125,742
2019	125,742
2020	125,742
2021	125,742
2022	125,742
Thereafter	1,313,439
Total	$ 1,942,149	2,005,271
Intangible assets, weighted average useful life (Month)	15 years 150 days
Site Location [Member]
2018	$ 56,623
2019	56,623
2020	56,623
2021	56,623
2022	56,623
Thereafter	514,328
Total	$ 797,443	825,754
Intangible assets, weighted average useful life (Month)	14 years 30 days
Noncompete Agreements [Member]
2018	$ 57,000
2019	56,417
2020	40,500
2021	28,000
2022	8,166
Thereafter
Total	$ 190,083	218,583
Intangible assets, weighted average useful life (Month)	3 years 120 days
Trademarks and Trade Names [Member]
2018	$ 74,000
2019	67,933
2020	64,900
2021	64,900
2022	64,900
Thereafter	227,150
Total	$ 563,783	609,950
Intangible assets, weighted average useful life (Month)	5 years 210 days
Technology-Based Intangible Assets [Member]
2018	$ 38,340
2019
2020
2021
2022
Thereafter
Total	$ 38,340	$ 61,338
Intangible assets, weighted average useful life (Month)	300 days

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Note 8 - Investments, Including Investments Accounted for Using the Equity Method (Details Textual) - USD ($)				1 Months Ended	6 Months Ended
	Jun. 01, 2018	May 31, 2018	Dec. 31, 2017	Jan. 31, 2018	Jun. 30, 2018	Apr. 27, 2018	Sep. 13, 2016
Financing Receivable, Gross						$ 2,116,972
Note Receivable, Stated Interest Rate						15.00%
Proceeds from Interest Received	$ 29,990
Unconsolidated Affiliates [Member] | Board of Directors [Member]
Equity Method Investments					$ 417,287
Unconsolidated Affiliates [Member] | Minimum [Member]
Equity Method Investment, Ownership Percentage					7.15%
Unconsolidated Affiliates [Member] | Maximum [Member]
Equity Method Investment, Ownership Percentage					30.00%
Breezeway Homes Inc. [Member]
Preferred Stock, Dividend Rate, Per-Dollar-Amount				$ 0.2665
Preferred Stock [Member] | Breezeway Homes Inc. [Member]
Debt Conversion, Converted Instrument, Shares Issued				31,227
Limited Liability Company [Member]
Cost Method Investment, Ownership Percentage			5.00%
Cost-method Investments, Other than Temporary Impairment					$ 0
Breezeway Homes Inc. [Member]
Financing Receivable, Net, Total							$ 100,000
Debt Instrument, Interest Rate, Stated Percentage							3.00%
Financing Receivable, Gross			$ 103,896	$ 104,019
US Treasury Notes Securities [Member]
Gain on Sale of Investments					$ 2,137
Voting Common Stock of Privately Held Company CB&T Holding Corporation [Member]
Payments to Acquire Long-term Investments		$ 19,058,485
Cost Method Investment, Ownership Percentage		14.99%
Non-voting Common Units of LLC [Member]
Payments to Acquire Long-term Investments			$ 10,000,000

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Note 8 - Investments, Including Investments Accounted for Using the Equity Method - Schedule of Investments (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Short-term Investments	$ 4,856,131	$ 1,659,299
Long-term investments	32,177,419	13,901,281
Certificates of Deposit [Member]
Short-term Investments	816,709	746,219
Long-term investments	931,291	1,080,426
US Treasury Securities [Member]
Long-term investments	2,083,624	2,820,855
U.S. Treasury Notes and Corporate Bonds [Member]
Short-term Investments	4,039,422	809,184
Convertible Debt Securities [Member]
Short-term Investments		103,896
Preferred Stock [Member]
Long-term investments	104,019
Non-voting Common Units of LLC [Member]
Long-term investments	10,000,000	10,000,000
Voting Common Stock of Privately Held Company CB&T Holding Corporation [Member]
Long-term investments	$ 19,058,485

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Note 8 - Investments, Including Investments Accounted for Using the Equity Method - Trading Securities (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
U.S. Treasury trading securities		$ 83,100,805
US Treasury Bill Securities [Member]
Cost		82,968,614
Gross unrealized gain		132,191
U.S. Treasury trading securities		$ 83,100,805

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Note 8 - Investments, Including Investments Accounted for Using the Equity Method - Available for Sale Securities (Details) - US Treasury Notes Securities [Member]	Jun. 30, 2018 USD ($)
U.S. Treasury securities, June 30, 2018	$ 150,100,946
U.S. Treasury securities, June 30, 2018	245,494
U.S. Treasury securities, June 30, 2018	$ 150,346,440

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Note 8 - Investments, Including Investments Accounted for Using the Equity Method - Reconciliation of the Company's Investments in Equity Affiliates (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Beginning of period			$ 952,128	$ 871,918	$ 871,918
Additional investments in unconsolidated affiliates					66,000
Distributions received			(382,443)		(59,550)
Loss on investment in affiliate			(107,630)
Equity in income of unconsolidated affiliates	$ 101,429	$ 23,464	385,091	$ 15,233	73,760
End of period	$ 847,146		$ 847,146		$ 952,128

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Note 9 - Fair Value - Fair Values for Investments (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
U.S. Treasury trading securities					$ 83,100,805
U.S. Treasury trading securities			6,406
U.S. Treasury trading securities			(132,191)
U.S. Treasury securities available for sale			44,354
U.S. Treasury securities available for sale			245,494
Realized gain (loss)			50,760
Unrealized gain (loss)	206,306		113,303
Reported Value Measurement [Member]
U.S. Treasury trading securities
U.S. Treasury securities available for sale	150,346,440		150,346,440
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member]
U.S. Treasury trading securities
U.S. Treasury securities available for sale	$ 150,346,440		$ 150,346,440

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Note 10 - Asset Retirement Obligations - Asset Retirement Obligations (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Balance, December 31, 2017
Additions			179,917
Accretion expense	$ 2,939		5,995
Liabilities settled			(11,243)
Balance, June 30, 2018	$ 174,669		$ 174,669

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Note 11 - Capital Stock (Details Textual) - USD ($)			2 Months Ended	6 Months Ended
	May 15, 2018	Mar. 06, 2018	May 15, 2018	Jun. 30, 2018	Jun. 30, 2017	May 04, 2018	Feb. 28, 2018	Feb. 22, 2018	Dec. 31, 2017
Proceeds from Issuance of Common Stock				$ 150,000,000	$ 52,467,336
Common Stock, Shares Authorized						40,000,000
Preferred Stock, Shares Authorized				1,000,000		1,000,000			1,000,000
Class of Warrant or Right, Outstanding				105,556					105,556
Common Class A [Member]
Sale of Stock, Value, Available to Issue								$ 150,000,000
Sale of Stock, Price Per Share								$ 23.30
Share Price								$ 23.29
Stock Issued During Period, Shares, New Issues	3,137,768	3,300,000
Proceeds from Issuance of Common Stock	$ 73,110,000	$ 76,890,000	$ 150,000,000
Common Stock, Shares Authorized				38,838,884		38,838,884			38,838,884
Common Class A [Member] | Shelf Registration [Member]
Sale of Stock, Shelf Registration, Value, Available to Issue							$ 200,000,000
Sale of Stock, Shelf Registration, Value, Incremental Amount Available to Issue							$ 50,000,000
Common Class A [Member] | Shelf Registration [Member] | Cowen and Company LLC [Member]
Stock Issued During Period, Shares, New Issues				1,149,849
Proceeds from Issuance of Common Stock				$ 26,087,283
Compensation, Percentage of Common Stock Sales							3.00%
Proceeds from Issuance of Common Stock, Net				$ 25,304,665
Common Class B [Member]
Common Stock, Shares Authorized				1,161,116		1,161,116			1,161,116
Class of Warrant or Right, Outstanding				105,556

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Note 11 - Capital Stock - Summary of Warrant Activity (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Outstanding (in shares)	105,556
Outstanding, weighted average exercise price (in dollars per share)	$ 9.95
Outstanding, weighted average remaining contractual life (Year)	7 years	7 years 182 days
Outstanding, aggregate intrinsic value of vested warrants	$ 1,173,783	$ 2,368,677
Issued (in shares)
Issued, weighted average exercise price (in dollars per share)
Exercised (in shares)
Exercised, weighted average exercise price (in dollars per share)
Expired (in shares)
Outstanding (in shares)	105,556	105,556
Outstanding, weighted average exercise price (in dollars per share)	$ 9.95	$ 9.95

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Note 12 - Future Minimum Lease Payments (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Lessee, Operating Lease, Term of Contract	83 years 180 days		83 years 180 days
Annual Ground Lease Base Rent	$ 447,635	$ 350,781	$ 850,747	$ 637,924
Operating Leases, Rent Expense, Contingent Rentals	92,081	9,302	116,685	20,234
Operating Leases, Rent Expense, Net, Total	$ 86,559	$ 50,447	$ 183,096	$ 95,263

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Note 12 - Future Minimum Lease Payments - Summary of Future Minimum Rents (Details)	Jun. 30, 2018 USD ($)
2019	$ 1,312,993
2020	1,202,230
2021	1,104,883
2022	947,708
2023	886,710
Thereafter	4,397,508
Total	$ 9,852,032

XML

Note 13 - Industry Segments - Schedule of Segment Reporting Information, by Segment (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Revenue	$ 2,989,759	$ 1,994,883	$ 5,812,703	$ 3,864,810
Segment gross profit	1,882,300	1,307,579	3,769,546	2,499,827
Segment loss from operations	(2,503,691)	(1,389,310)	(5,246,082)	(2,489,205)
Capital expenditures	1,184,205	4,468,496	1,769,020	10,586,030
Depreciation and amortization	997,619	655,914	2,086,647	1,252,607
Accounts receivable, net	1,290,966		1,290,966		$ 1,095,777
Goodwill	25,006,161		25,006,161		24,692,161
Total assets	324,443,402		324,443,402		153,477,084
Unallocated [Member]
Revenue
Segment gross profit
Segment loss from operations	(516,230)	(271,052)	(1,496,560)	(678,769)
Capital expenditures
Depreciation and amortization
Accounts receivable, net
Goodwill
Total assets	265,949,091		265,949,091		95,270,870
Operating Segments [Member] | GIG [Member]
Revenue	1,290,490	779,565	2,563,244	1,635,000
Segment gross profit	1,025,818	711,485	2,085,708	1,380,326
Segment loss from operations	(1,204,432)	(418,264)	(2,247,811)	(651,948)
Capital expenditures	2,549		10,031
Depreciation and amortization	316,086	50,678	641,220	101,357
Accounts receivable, net	469,969		469,969		433,225
Goodwill	8,719,294		8,719,294		8,719,294
Total assets	25,237,935		25,237,935		25,762,437
Operating Segments [Member] | LMH [Member]
Revenue	1,699,269	1,215,318	3,249,459	2,229,810
Segment gross profit	856,482	596,094	1,683,838	1,119,501
Segment loss from operations	(783,029)	(699,994)	(1,501,711)	(1,158,488)
Capital expenditures	1,181,656	4,468,496	1,758,989	10,586,030
Depreciation and amortization	681,533	$ 605,236	1,445,427	$ 1,151,250
Accounts receivable, net	820,997		820,997		662,552
Goodwill	16,286,867		16,286,867		15,972,867
Total assets	$ 33,256,376		$ 33,256,376		$ 32,443,777

XML

Note 14 - Custodial Risk (Details Textual)	Jun. 30, 2018 USD ($)
Cash, Uninsured Amount	$ 85,700,000

XML

Note 15 - Subsequent Events (Details Textual) - USD ($)				1 Months Ended	2 Months Ended	6 Months Ended
	Jul. 31, 2018	May 15, 2018	Mar. 06, 2018	Jul. 31, 2018	May 15, 2018	Jun. 30, 2018	Jun. 30, 2017
Proceeds from Issuance of Common Stock						$ 150,000,000	$ 52,467,336
Common Class A [Member]
Stock Issued During Period, Shares, New Issues		3,137,768	3,300,000
Proceeds from Issuance of Common Stock		$ 73,110,000	$ 76,890,000		$ 150,000,000
Common Class A [Member] | Shelf Registration [Member] | Cowen and Company LLC [Member]
Stock Issued During Period, Shares, New Issues						1,149,849
Proceeds from Issuance of Common Stock						$ 26,087,283
Common Class A [Member] | Subsequent Event [Member] | Shelf Registration [Member] | Cowen and Company LLC [Member]
Stock Issued During Period, Shares, New Issues				28,080
Proceeds from Issuance of Common Stock				$ 590,844
Tammy Lynn Outdoor, LLC [Member] | Common Class A [Member] | Subsequent Event [Member]
Stock Issued During Period, Shares, Acquisitions	85,170