MEET Meet Group Inc

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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): December 24, 2014

 

MeetMe, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		001-33105		86-0879433
(State or other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

 

100 Union Square Drive New Hope, Pennsylvania		18938
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (215) 862-1162

 

(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))

 

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Item 1.01     Entry Into a Material Definitive Agreement.

 

On December 24, 2014, MeetMe, Inc. (the “Company”) entered into an Advertising Agreement with Beanstock Media, Inc. (“Beanstock”) (the “Agreement”). The Agreement is dated as of December 23, 2014 and its term runs through December 31, 2015, unless earlier terminated.

 

Pursuant to the Agreement, Beanstock has the right and obligation to fill substantially all of the Company’s advertising inventory on its MeetMe mobile app for iOS and Android, as well as the meetme.com website when accessed using a mobile device and as optimized for mobile devices (collectively, the “App”). The Agreement does not apply to interstitially placed advertisements, advertisements on versions of the App specific to the iPad and other Apple tablet devices, other mobile apps or virtual currency features on the App, including without limitation offer wall features and the Company’s Social Theater business.

 

The Agreement contemplates that the Company will begin placing ad calls (not including prior test calls) with Beanstock on or about March 1, 2015 (the “Effective Date”).

 

The Company may, on a basis substantially consistent with its advertising display logic (as set forth in the Agreement) (“Ad Logic”), (i) add additional sections or features to the App and provision them with ads, and (ii) change the locations and sizes of particular ad placements within the App; in any such case, all resulting ad placements will be subject to the Agreement. In addition, if the Company wishes to increase the number, type, frequency or scope of placements in the Ad Logic, it must first notify Beanstock and upon Beanstock’s written consent, such additional inventory will be added to the Ad Logic. If Beanstock withholds or denies said consent, then the additional inventory will remain outside of the scope of the Agreement and the Company may fill it otherwise.

 

Beanstock must pay for all ad requests that the Company delivers, whether or not Beanstock fills them. Beanstock will pay specified CPM rates depending on the type of ad; provided, however, that if more than a stated percentage of impressions originates outside of the United States and Canada, then Beanstock will pay the Company a percentage of Beanstock’s gross revenue relating to such international ad impressions in excess of that percentage.

 

Beanstock will remit payments due to the Company within thirty days following the last day of each calendar month for that month regardless of advertiser campaign duration; provided, however, that if the balance owing under the Agreement exceeds a stated amount, then the Company may request Beanstock to accelerate payments so that the balance does not at any point exceed that amount, and Beanstock must do so within ten days and for so long as necessary to keep said balance under that amount. Beanstock assumes all risk in regards to collection of all applicable advertiser fees with respect to all of the advertising inventory and may not delay payment to the Company as a result of non-collection or delay of payment of fees by advertisers. Beanstock may not withhold or offset amounts owing the Agreement for any reason.

 

The Company will determine the number of ad calls that it places under the Agreement. If Beanstock determines that number to be less than 90% of the Company’s number for any particular month and the parties cannot resolve the discrepancy, then the ad call number for that month will be 90% of the number that the Company originally determined.

 

 

Beanstock will comply with the Company’s advertising editorial guidelines as in effect from time to time.

 

The Company may terminate the Agreement upon written notice (i) from the date thereof to the sixtieth day after the Effective Date, or (ii) if, in the Company’s sole discretion, the placement or running of ads on the App causes a diminution in user experience, including without limitation with respect to the crash rate.

 

In addition, the Agreement may be terminated upon written notice by (A) either party if the other party (i) is in material breach of its obligations and that party fails to cure said breach within ten days after receipt of written notice thereof from the non-breaching party, or (ii) files a petition for bankruptcy, becomes insolvent, makes an assignment for the benefit of its creditors, or a receiver is appointed for such other party or its business, or (B) the Company if Beanstock fails to pay any amount hereunder when due (any of the events in this sentence, “Cause”). If the Company terminates the Agreement for Cause or Beanstock terminates it wrongfully, then Beanstock must pay the Company a stated amount as liquidated damages.

 

In connection with the Agreement, Beanstock has agreed to issue to the Company warrants to purchase 50,000 shares of Beanstock’s common stock at a purchase price of $0.01 per share.

 

 

Item 7.01 Regulation FD Disclosure.

 

On December 29, 2014, the Company issued a press release announcing its entry into an agreement with Beanstock. A copy of the Company’s press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

 

The information in this Current Report on Form 8-K, including the exhibit hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, nor shall it be deemed incorporated by reference in any filing under the Securities Act, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

 

Item 8.01 Other Events.

 

The Company previously disclosed certain risks related to its business and operations, which we believe should be considered in evaluating our business, financial position, future results and prospects. We disclosed these risks in Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2013 (our “Form 10-K”) and the Prospectus Supplement (Rule 424(b)(5)) filed on July 24, 2014 (together, with the Form 10-K, the “Additional Filings”). The information presented below updates and supplements those risk factors for the matters identified below and should be read in conjunction with the risks and other information contained in our Additional Filings. The risks described in the Additional Filings, as updated as described in this Current Report on Form 8-K, are not the only risks we face. Additional risks that we do not presently know or that we currently believe are immaterial could also materially and adversely affect any of our business, financial position, future results or prospects. Additional risk factors that we believe should be considered are set forth below.

 

 

We have entered into significant agreements with advertising partners, and their default or other inability to perform under these contracts could harm our business and results of operations.

 

We have entered into a Media Publisher Agreement with Beanstock Media, Inc. (“Beanstock”) whereby Beanstock has the exclusive right and obligation to fill substantially all of our remnant advertising inventory on www.meetme.com through December 31, 2015. We anticipate that revenue under this agreement for the year 2015 will constitute approximately 12% of our total revenue. We have also entered into an Advertising Agreement with Beanstock whereby Beanstock will have the right and obligation to fill certain advertising inventory on our MeetMe mobile apps for iOS and Android, as well as the meetme.com website when accessed using a mobile device and as optimized for mobile devices, starting on or about March 1, 2015. We anticipate that revenue under this agreement for the year 2015 will constitute approximately 50% of our total revenue. A failure by us to renew either agreement, or to do so on terms less favorable, or a failure by Beanstock to effectively perform its obligations under either agreement could have detrimental operating, financial and reputational consequences for our business. In particular, if Beanstock files for bankruptcy protection, becomes insolvent or otherwise fails to meet its payment obligations to us, we could be prevented from collecting on receivables under the respective agreement, which would have an adverse effect on our results of operations.

 

 

Item 9.01 Financial Statements and Exhibits.

 

(d)      Exhibits

 

Exhibit No.	Description
99.1	MeetMe, Inc. press release, dated December 29, 2014.

 

 

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.

 

 

	MEETME, INC.
Date: December 29, 2014	By: /s/ Geoffrey Cook
	Name: Geoffrey Cook Title: Chief Executive Officer

 

 

Exhibit 99.1

 

 

MeetMe Expands Relationship with Beanstock Media

to Manage Mobile Ad Inventory

 

Provides Fiscal 2015 Annual Total Revenue and EBITDA Guidance

  

NEW HOPE, PA. December 29, 2014 – MeetMe, Inc. (NASDAQ: MEET), the public market leader for social discovery, today announced an expansion of its ad management relationship with Beanstock Media, the world’s first premium Publisher Trading Desk, to begin delivering its mobile advertising inventory to Beanstock at guaranteed CPMs. Under the agreement MeetMe will begin placing ad calls with Beanstock Media on March 1, 2015 and will do so for the remainder of the year. This new agreement will take the place of the company’s current ad management agreement with Pinsight Media+, which expires on December 31, 2014 and has a 60-day transition period.

 

Bill Alena, Chief Revenue Officer of MeetMe, said, “Beanstock Media has proven to be a trusted and reliable partner since we began working with them in October 2013 to optimize revenue from our global web-based remnant ad inventory, and we are excited to expand our relationship to mobile. With this agreement, we expect to have continued strong visibility into revenue and smoothed quarterly seasonality in advertising rates. In 2015, we will continue our focus on driving high usage and engagement as we seek to build the pre-eminent mobile chat app for connecting with new people.”

 

David Clark, Chief Financial Officer of MeetMe said, “Our mobile daily active users (DAU) in 2014 have increased 20 percent, from approximately 770,000 in the first quarter to approximately 920,000 in the fourth quarter to date. During the same period, chat grew more than 100 percent, and mobile visits per DAU increased more than 15%. MeetMe mobile has grown significantly in both users and in engagement per user in 2014. This growth in usage has contributed to the continued growth in mobile revenue we have delivered throughout this year. In 2015, we project annual revenue to grow to between $47 million and $53 million for the year. We also project annual adjusted EBITDA to grow to between $7 million and $10 million in 2015.”

 

About MeetMe, Inc.

MeetMe® is the leading social network for meeting new people in the US and the public market leader for social discovery (NASDAQ: MEET). MeetMe makes it easy to discover new people to chat with on mobile devices. With approximately 80 percent of traffic coming from mobile and more than one million total daily active users, MeetMe is fast becoming the social gathering place for the mobile generation. MeetMe is a leader in mobile monetization with a diverse revenue model comprising advertising, native advertising, virtual currency, and subscription. MeetMe apps are available on iPhone, iPad, and Android in multiple languages, including English, Spanish, Portuguese, French, Italian, German, Chinese (Traditional and Simplified), Russian, Japanese, Dutch, Turkish and Korean. For more information, please visit meetmecorp.com.

 

 

Cautionary Note Concerning Forward-Looking Statements

Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including whether will begin placing add calls with Beanstock as anticipated, whether the agreement will allow us strong visibility into revenue and smoothed quarterly seasonality in advertising rates, whether we will drive high usage and engagement as anticipated, whether we will successfully build the pre-eminent mobile chat app for connecting with new people, whether DAU, chat, and mobile visits per DAU will continue to grow, whether mobile revenue will continue to grow as anticipated, whether we will achieve annual revenue in 2015 as projected, and whether our adjusted annual EBITDA in 2015 will grow as anticipated to the amount projected. All statements other than statements of historical facts contained herein are forward-looking statements. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “project,” “is likely,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Important factors that could cause actual results to differ from those in the forward-looking statements include the risk that our applications will not function easily or otherwise as anticipated, the risk that we will not launch additional features and upgrades as anticipated, the risk that unanticipated events affect the functionality of our applications with popular mobile operating systems, any changes in such operating systems that degrade our mobile applications’ functionality and other unexpected issues which could adversely affect usage on mobile devices. Further information on our risk factors is contained in our filings with the Securities and Exchange Commission (“SEC”), including the Form 10-K for the year ended December 31, 2013, the Prospectus Supplement (Rule 424(b)(5)) filed on July 24, 2014,and the Current Report on Form 8-K filed on December 29, 2014. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

 

Press contact:

Fresh PR
☐

Jeannine Jacobi,

323-903-7063☐
jeannine@freshpr.net
☐

or

Investor Contact:

MKR Group, Inc.

Todd Kehrli or Jim Byers

(323) 468-2300

meet@mkr-group.com

 

Source: MeetMe, Inc.