8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): November 16, 2015

 

 

IDI, Inc.

(Exact name of registrant as specified in its charter)

 

 

Delaware

(State or Other Jurisdiction

of Incorporation)

 

333-158336   77-0688094

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

2650 North Military Trail, Suite 300,

Boca Raton, Florida

  33431
(Address of Principal Executive Offices)   (Zip Code)

561-757-4000

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, If Changed Since Last Report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

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

 

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

 

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

 

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

 

 

 


Item 2.02 Results of Operations and Financial Condition.

Item 2.02 Results of Operations and Financial Condition.

On November 16, 2015, IDI, Inc., a Delaware corporation (the “Company”), issued a press release announcing financial results for the quarter ended September 30, 2015. A copy of the press release is attached hereto as Exhibit 99.1.

The information included herein and in Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (“Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

 

Item 9.01 Financial Statements and Exhibits.

Item 9.01 Financial Statements and Exhibits.

99.1 Press Release, dated November 16, 2015

 

2


SIGNATURES

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

 

    IDI, INC.
Date: November 19, 2015     By:  

/s/ Derek Dubner

      Derek Dubner
      Co-Chief Executive Officer

 

3


EXHIBIT INDEX

 

Exhibit
No.

  

Description

99.1    Press Release of IDI, Inc., dated November 16, 2015.

 

4

EX-99.1

Exhibit 99.1

IDI, Inc. Reports Third Quarter 2015 Results

BOCA RATON, Fla.—November 16, 2015—IDI, Inc. (NYSE MKT: IDI), an information solutions provider, today announced its financial and operating results for the third quarter ended September 30, 2015. The Company reported revenue of $1.0 million and $3.3 million from data fusion operations for the three and nine months ended September 30, 2015, respectively. The Company reported a net loss of $4.4 million (including $1.5 million of non-cash share-based compensation expenses) from data fusion operations and $0.4 million from discontinued China operations for the three months ended September 30, 2015. Cash and cash equivalents as of September 30, 2015 were $9.1 million, as compared to $6.0 million as of December 31, 2014.

Key highlights for the third quarter of 2015 include:

 

    Successful internal alpha testing of next generation data fusion technology, with expected release of the first phase of idiCORE™ in Q4 2015.

 

    Deployment of secure, production ready cloud infrastructure to support product offerings and minimize server related Capex.

 

    Continued acquisition of massive data sets to further fuel current and new offerings.

 

    Rapid customer onboarding continues in anticipation of idiCORE release.

Mr. Derek Dubner, Co-CEO of IDI, Inc. stated, “Great strides continue to be made in the development of our data fusion system. We believe this extremely sophisticated and complex data analytics platform represents next generation technology and will be instrumental in continuing IDI’s transformation into a leading information solutions provider across many industries. We expect the Company’s focus on development during 2016 strongly positions our product offerings and facilitates rapid customer acquisition and revenue growth for years to come.”

IDI is currently developing its full investigative system, idiCORE™, which is expected to begin a phased launch in Q4 2015.

About IDI, Inc.

IDI, Inc. is an information solutions provider focused on the multi-billion dollar data fusion market. IDI delivers otherwise unattainable insight into the ever-expanding universe of consumer- and business-centric data. Through proprietary linking technology, advanced systems architecture, and a massive data repository, IDI will address the rapidly growing need for actionable intelligence to support the entirety of the risk management industry, for purposes including due diligence, risk assessment, fraud detection and prevention, authentication and verification, and more. Additionally, IDI’s cross-functional core systems and processes are designed to deliver products and solutions to the marketing industry and to enable the public and private sectors to layer our solutions over their unique data sets, providing otherwise unattainable insight.

RELATED LINKS http://ididata.com/

FORWARD-LOOKING STATEMENTS

This press release contains “forward-looking statements,” as that term is defined under the Private Securities Litigation Reform Act of 1995 (PSLRA), which statements may be identified by words such as “expects,” “plans,” “projects,” “will,” “may,” “anticipate,” “believes,” “should,” “intends,” “estimates,” and other words of similar meaning. Such forward looking statements include statements about whether our data fusion system will be instrumental in continuing IDI’s transformation into a leading information solutions provider and whether our focus on development during 2016 will position our product offerings and facilitates rapid customer acquisition and revenue growth for years to come and whether idiCORE™ will begin a phased launched in the 2015 fourth quarter, as well as other non-historical statements about our expectations, beliefs or intentions regarding our business, technologies and products, financial condition, strategies or prospects. Readers are cautioned not to place undue reliance on these forward-looking statements, which are based on our expectations as of the date of this press release and speak only as of the date of this press release and are advised to consider the factors listed above together with the additional factors under the heading “Forward-Looking Statements” and “Risk Factors” in the Company’s Annual Report on Form 10-K, as may be supplemented or amended by the Company’s Quarterly Reports on Form 10-Q and other SEC filings. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Media and Investor Relations Contact:

David Zazoff

MDM Worldwide

Tel: (212) 643-0417

IDI@mdmworldwide.com


IDI, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

(unaudited)

 

     September 30, 2015     December 31, 2014  

ASSETS

    

CURRENT ASSETS

    

Cash and cash equivalents

   $ 9,078      $ 5,996   

Accounts receivable, net

     610        295   

Prepaid expenses and other current assets

     1,193        190   

Deferred tax assets, current

     —          95   
  

 

 

   

 

 

 

Total current assets

     10,881        6,576   

NON-CURRENT ASSETS

    

Property and equipment, net

     834        301   

Intangible assets, net

     3,077        796   

Goodwill

     5,227        5,227   

Other assets

     38        38   

Deferred tax assets, non-current

     —          275   
  

 

 

   

 

 

 

Total non-current assets

     9,176        6,637   
  

 

 

   

 

 

 

Total assets

   $ 20,057      $ 13,213   
  

 

 

   

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

    

CURRENT LIABILITIES

    

Accounts payable and accrued expenses

   $ 1,741      $ 890   

Amounts due to related parties

     20        52   

Deferred revenue

     150        164   
  

 

 

   

 

 

 

Total current liabilities

     1,911        1,106   
  

 

 

   

 

 

 

Total liabilities

     1,911        1,106   
  

 

 

   

 

 

 

SHAREHOLDERS’ EQUITY

    

Preferred Shares—$0.0001 par value 10,000,000 shares authorized, 4,965,302 shares issued and outstanding on September 30, 2015 and December 31, 2014

     —          —     

Common Shares—$0.0005 par value 200,000,000 shares authorized, 15,603,286 and 6,597,155 shares issued and outstanding on September 30, 2015 and December 31, 2014, respectively

     8        3   

Additional paid-in capital

     70,644        12,714   

Accumulated deficit

     (52,506     (610
  

 

 

   

 

 

 

Total shareholders’ equity

     18,146        12,107   
  

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 20,057      $ 13,213   
  

 

 

   

 

 

 


IDI, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Amounts in thousands, except share and per share data)

(unaudited)

 

     Three Months Ended     Nine Months Ended  
     September 30,     September 30,  
     2015     2014 (1)     2015     2014 (1)  

Revenue from data fusion operations

   $ 1,002      $ —        $ 3,254      $ —     

Cost of revenues

     766        —          1,744        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     236        —          1,510        —     

Operating expenses

        

Sales and marketing expenses

     524        —          1,529        —     

General and administrative expenses

     4,235        16        9,783        16   
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss from operations

     (4,523     (16     (9,802     (16
  

 

 

   

 

 

   

 

 

   

 

 

 

Other income/(expense)

        

Interest expense, net

     (3     —          (3     —     

Other expense, net

     —          (32     —          (32
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other expense

     (3     (32     (3     (32
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss from continuing operations before income taxes

     (4,526     (48     (9,805     (48

Income taxes

     (124     (16     141        (16
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss from continuing operations

     (4,402     (32     (9,946     (32

Discontinued operations

        

Pretax income/(loss) from operations of discontinued operations

     26        —          (1,236     —     

Pretax gain/(loss) on disposal of discontinued operations

     376        —          (41,095     —     

Income taxes

     —          —          (127     —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income/(loss) from discontinued operations

     402        —          (42,458     —     

Less: Non-controlling interests

     789        —          (508     —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss from discontinued operations attributable to IDI, Inc.

     (387     —          (41,950     —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

   $ (4,789   $ (32   $ (51,896   $ (32
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss per share

        

Basic and diluted

        

Continuing operations

   $ (0.29   $ —        $ (0.82   $ —     

Discontinued operations

     (0.03     —          (3.45     —     
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ (0.32   $ —        $ (4.27   $ —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of shares outstanding -

        

Basic and diluted

     15,034,224        6,597,155        12,167,469        6,597,155   

Comprehensive loss:

        

Net loss

   $ (4,789   $ (32   $ (51,896   $ (32

Foreign currency translation adjustment

     130        —          —          —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Net comprehensive loss

   $ (4,659   $ (32   $ (51,896   $ (32
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1)  As IDI Holdings, LLC, the accounting acquirer of the merger consummated effective as of March 21, 2015, was incorporated on September 22, 2014, the comparative figures for the corresponding periods in 2014 were from the date of inception through September 30, 2014.


IDI, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands, except share data)

(unaudited)

 

     Nine Months Ended  
     September 30,  
     2015     2014 (1)  

CASH FLOWS FROM OPERATING ACTIVITIES

    

Net loss

   $ (51,896   $ (32

Less: Loss from discontinued operations, net of tax

     (41,950     —     

Adjustments to reconcile net loss to net cash used in operating activities:

    

Depreciation and amortization

     133        —     

Share-based compensation

     3,424        —     

Change in allowance for doubtful accounts

     (37     —     

Deferred income tax expenses

     370        —     

Changes in assets and liabilities of continuing operations, net of the effects of acquisition:

    

Accounts receivable

     (278     —     

Prepaid expenses and other current assets

     (601     (16

Accounts payable and accrued expenses

     274        48   

Amounts due to related parties

     (46     —     

Deferred revenue

     (14     —     
  

 

 

   

 

 

 

Cash used in operating activities from continuing operations

     (6,721     —     

Cash used in operating activities from discontinued operations

     (337     —     
  

 

 

   

 

 

 

Net cash used in operating activities

     (7,058     —     
  

 

 

   

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

    

Purchase of property and equipment

     (626     —     

Capitalized costs of intangible assets

     (2,082     —     

Proceeds from acquisition

     3,569        —     
  

 

 

   

 

 

 

Cash provided by investing activities from continuing operations

     861        —     

Cash used in investing activities from discontinued operations

     (121     —     
  

 

 

   

 

 

 

Net cash provided by investing activities

     740        —     
  

 

 

   

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

    

Proceeds from capital contribution

     9,400        2,238   
  

 

 

   

 

 

 

Net cash provided by financing activities

     9,400        2,238   
  

 

 

   

 

 

 

Net increase in cash and cash equivalents

   $ 3,082      $ 2,238   

Cash and cash equivalents at beginning of period

     5,996        —     
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 9,078      $   2,238   
  

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURE INFORMATION

    

Cash paid for interest

   $ (3   $ —     

Cash paid for income taxes

   $ —        $ —     

Share-based compensation expenses capitalized as intangible assets

   $ 239      $ —     

Stock issuance for acquisition

   $ 44,112      $ —     

 

(1)  As IDI Holdings, LLC, the accounting acquirer of the merger consummated effective as of March 21, 2015, was incorporated on September 22, 2014, the comparative figures for the corresponding period in 2014 were from the date of inception through September 30, 2014.