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Schedule I: Condensed Financial Information of Registrant
 12 Months Ended
Dec. 31, 2022
Condensed Financial Information Disclosure [Abstract]  
Schedule I: Condensed Financial Information of Registrant
Schedule I: Condensed Financial Information of Registrant

FUNKO, INC.
CONDENSED STATEMENTS OF OPERATIONS
(PARENT COMPANY ONLY)

 Year Ended December 31,
202220212020
(in thousands)
Intercompany revenue$564 $82 $307 
Selling, general, and administrative expenses16,941 13,163 10,269 
Total operating expenses16,941 13,163 10,269 
Loss from operations(16,377)(13,081)(9,962)
Interest (expense) income, net(168)3 (36)
Tax receivable agreement liability adjustment(3,987)(1,590)(87)
Equity in net (loss) income of subsidiaries(8,040)72,916 13,674 
(Loss) income before income taxes(28,572)58,248 3,589 
Income tax (benefit) expense (20,537)14,348 (372)
Net (loss) income$(8,035)$43,900 $3,961 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
CONDENSED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME
(PARENT COMPANY ONLY)

Year Ended December 31,
202220212020
(in thousands)
Net (loss) income$(8,035)$43,900 $3,961 
Other comprehensive (loss) income:
Foreign currency translation (loss) gain, net of tax effect of $1,169, $163 and $(274) for the years ended December 31, 2022, 2021 and 2020, respectively
(3,681)(544)927 
Reclassification of foreign currency translation gain into net (loss) income$— $(96)$— 
Comprehensive (loss) income attributable to
Funko, Inc.		$(11,716)$43,260 $4,888 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
CONDENSED BALANCE SHEETS
(PARENT COMPANY ONLY)
December 31,
20222021
(in thousands, except per share data)
Assets
Current assets:
Cash and cash equivalents$911 $61,943 
Income tax receivable7,530 — 
Total current assets8,441 61,943 
Intercompany receivable119,219 116,746 
Deferred tax asset123,893 74,464 
Investment in subsidiaries225,858 166,054 
Total assets$477,411 $419,207 
Liabilities and Stockholders' Equity
Current liabilities:
Tax payable$— $14,684 
Current portion of liabilities under tax receivable agreement9,567 7,362 
Total current liabilities9,567 22,046 
Liabilities under tax receivable agreement, net of current portion99,620 75,523 
Commitments and contingencies
Stockholders' equity:
Class A common stock, par value $0.0001 per share, 200,000 shares authorized; 47,192 shares and 40,088 shares issued and outstanding as of December 31, 2022 and 2021, respectively
5 4 
Class B common stock, par value $0.0001 per share, 50,000 shares authorized; 3,293 shares and 10,691 shares issued and outstanding as of December 31, 2022 and 2021, respectively
— 1 
Additional paid-in-capital310,807 252,505 
Accumulated other comprehensive (loss) income(2,603)1,078 
Retained earnings60,015 68,050 
Total stockholders' equity368,224 321,638 
Total liabilities and stockholders' equity$477,411 $419,207 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(PARENT COMPANY ONLY)

Year Ended December 31,
202220212020
(in thousands)
Operating Activities
Net (loss) income$(8,035)$43,900 $3,961 
Adjustments to reconcile net (loss) income to net cash (used in) provided by
operating activities:
Equity in net loss (income) of subsidiaries8,040 (72,916)(13,674)
Equity-based compensation16,591 12,994 10,007 
Deferred tax expense (benefit)(17,173)(203)2,792 
Tax receivable liability adjustment3,987 1,590 87 
Changes in operating assets and liabilities:
Income tax receivable(7,530)294 3,521 
Due from related parties, net(984)1,351 26,007 
Prepaid expenses and other assets(11,019)— — 
Income taxes payable(14,684)14,684 — 
Accrued expenses and other liabilities11,190 (571)304 
Net cash (used in) provided by operating activities(19,617)1,123 33,005 
Investing Activities
Capital contribution to FAH, LLC(73,980)— — 
Net cash (used in) investing activities(73,980)— — 
Financing Activities
Tax distribution received from FAH, LLC38,811 24,173 5,825 
Tax receivable agreement payments(7,718)(1,715)(4,639)
Proceeds from exercise of equity-based options1,472 3,794 41 
Net cash provided by financing activities32,565 26,252 1,227 
Net change in cash and cash equivalents(61,032)27,375 34,232 
Cash and cash equivalents at beginning of period61,943 34,568 336 
Cash and cash equivalents at end of period$911 $61,943 $34,568 
Supplemental Cash Flow Information
Income tax payments$18,999 $23 $2,116 
Establishment of liabilities under tax receivable agreement30,034 20,691 1,000 
Issuance of equity instruments for acquisitions1,487 — — 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
NOTES TO CONDENSED FINANCIAL INFORMATION
(PARENT COMPANY ONLY)
December 31, 2022
1. Organization
Funko, Inc. (the “Parent Company”) was formed on April 21, 2017 as a Delaware corporation and is a holding company with no direct operations. The Parent Company's assets consist primarily of cash and cash equivalents, its equity interest in FAH, LLC, and certain deferred tax assets.
The Parent Company's cash inflows are primarily from distributions and other transfers from FAH, LLC. The amounts available to the Parent Company to fulfill cash commitments are subject to certain restrictions in FAH, LLC’s Credit Facilities. See Note 10 to the Funko, Inc. consolidated financial statements, appearing elsewhere in this Form 10-K.
2. Basis of Presentation
These condensed Parent Company financial statements should be read in conjunction with the consolidated financial statements of Funko, Inc. and its subsidiaries and the accompanying notes thereto, included in this Form 10-K. For purposes of this condensed financial information, the Parent Company's interest in FAH, LLC is recorded based upon its proportionate share of FAH, LLC's net assets (similar to presenting them on the equity method).
The Parent Company is the sole managing member of FAH, LLC, and pursuant to the Amended and Restated LLC Agreement of FAH, LLC (the “LLC Agreement”), receives compensation in the form of reimbursements for all costs associated with being a public company. Intercompany revenue consists of these reimbursement payments and is recognized when the corresponding expense to which it relates is recognized.
Certain intercompany balances presented in these condensed Parent Company financial statements are eliminated in the consolidated financial statements. For the years ended December 31, 2022, 2021, and 2020, the full amounts of intercompany revenue and equity in net (loss) income of subsidiaries in the Parent Company Statements of Operations were eliminated in consolidation. An intercompany receivable was owed to the Parent Company by FAH, LLC of $119.2 million and $116.7 million as of December 31, 2022 and 2021, respectively. On May 3, 2022, the Parent Company entered into a common unit subscription agreement with FAH, LLC pursuant to which the Parent Company purchased 4,251,701 newly issued common units in exchange for a capital contribution of approximately $74.0 million (the “Capital Contribution”). Following the Capital Contribution, (i) the common units of FAH, LLC were recapitalized through a reverse unit split in order to maintain a one-to-one ratio between the number of common units owned by the Parent Company and the number of outstanding shares of Class A common stock in accordance with the FAH LLC Agreement, and (ii) approximately 0.9 million outstanding shares of Class B common stock were cancelled. Related party amounts that were not eliminated in the consolidated financial statements include the Parent Company's liabilities under the tax receivable agreement, which totaled $109.2 million and $82.9 million as of December 31, 2022 and 2021, respectively.
3. Commitments and Contingencies
The Parent Company is party to a tax receivable agreement that provides for the payment by the Parent Company to the TRA Parties of 85% of the amount of any tax benefits that the Parent Company actually realizes, or in some cases is deemed to realize, as a result of certain transactions. See Note 13 to the Funko, Inc. consolidated financial statements, appearing elsewhere in this Form 10-K, for more information regarding the Parent Company's tax receivable agreement. As described in Note 13 to the Funko, Inc. consolidated financial statements, appearing elsewhere in the Form 10-K, amounts payable under the tax receivable agreement are contingent upon, among other things, (i) generation of future taxable income of Funko, Inc. over the term of the tax receivable agreement and (ii) future changes in tax laws. As of December 31, 2022 and 2021, liabilities under the tax receivable agreement totaled $109.2 million and $82.9 million, respectively.
See Note 14 to the Funko, Inc. consolidated financial statements, appearing elsewhere in this Form 10-K, for information regarding pending and threatened litigation. Pursuant to the LLC Agreement, the Parent Company receives reimbursements for all costs associated with being a public company, which includes costs of litigation.