10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2019

OR

o 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: 001-31989

INTERNAP CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Delaware	91-2145721
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

 12120 Sunset Hills Road, Suite 330

Reston, VA 20190

(Address of Principal Executive Offices, Including Zip Code)

(404) 302-9700

(Registrant’s Telephone Number, Including Area Code)

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 ý No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý 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 definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one): 

Large accelerated filer	¨	Accelerated filer	ý
Non-accelerated filer	¨	Smaller reporting company	ý
		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 ý

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common stock, $0.001 par value	INAP	Nasdaq Global Market

As of November 8, 2019, 26,621,105 shares of the registrant’s outstanding common stock, $0.001 par value per share, were outstanding.

INTERNAP CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2019

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED)
	Condensed Consolidated Statements of Operations and Comprehensive Loss	1
	Condensed Consolidated Balance Sheets	2
	Condensed Consolidated Statements of Stockholders' (Deficit) Equity	3
	Condensed Consolidated Statements of Cash Flows	7
	Notes to Condensed Consolidated Financial Statements	8
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	29
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	38
ITEM 4.	CONTROLS AND PROCEDURES	38
PART II. OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	40
ITEM 1A.	RISK FACTORS	40
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	40
ITEM 6.	EXHIBITS	41
SIGNATURES

ITEM 1. FINANCIAL STATEMENTS

INTERNAP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE LOSS

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net revenues	$	72,878		$	82,972		$	219,576		$	239,135
Operating costs and expenses:
Costs of sales and services, exclusive of depreciation and amortization	27,504			28,221			79,186			80,160
Costs of customer support	8,145			7,984			25,661			24,212
Sales, general and administrative	15,791			18,170			48,995			57,625
Depreciation and amortization	21,582			23,553			65,715			67,422
Exit activities, restructuring and impairments	3,792			2,347			5,439			3,140
Total operating costs and expenses	76,814			80,275			224,996			232,559
(Loss) income from operations	(3,936		)	2,697			(5,420		)	6,576
Interest expense	19,913			17,794			56,578			50,138
Loss on foreign currency, net	6			195			328			5
Total non-operating expenses	19,919			17,989			56,906			50,143
Loss before income taxes and equity in earnings of equity-method investment	(23,855		)	(15,292		)	(62,326		)	(43,567		)
(Benefit) provision for income taxes	(6		)	162			(320		)	404
Net loss	(23,849		)	(15,454		)	(62,006		)	(43,971		)
Less net income attributable to non-controlling interests	21			25			63			75
Net loss attributable to shareholders	(23,870		)	(15,479		)	(62,069		)	(44,046		)
Other comprehensive (loss) income:
Foreign currency translation adjustment	(18		)	(98		)	152			24
Total other comprehensive (loss) income	(18		)	(98		)	152			24
Comprehensive loss	$	(23,888	)	$	(15,577	)	$	(61,917	)	$	(44,022	)
Basic and diluted net loss per share	$	(1.01	)	$	(0.77	)	$	(2.62	)	$	(2.21	)
Weighted average shares outstanding used in computing basic and diluted net loss per share	23,671			20,206			23,703			19,968

See Notes to Condensed Consolidated Financial Statements.

1

INTERNAP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value amounts)

(Unaudited)

	September 30, 2019			December 31, 2018
ASSETS
Current assets:
Cash and cash equivalents	$	10,895		$	17,823
Accounts receivable, net of allowance for doubtful accounts of $1,077 and $1,547, respectively	17,948			20,054
Contract assets	9,202			8,844
Term loan, less discount and issuance costs of $4,909	552			—
Prepaid expenses and other assets	7,572			7,377
Total current assets	46,169			54,098
Property and equipment, net	216,548			478,061
Operating lease right-of-use assets	33,723			—
Finance lease right-of-use assets	226,619			—
Intangible assets, net	64,215			73,042
Goodwill	116,217			116,217
Contract assets	15,032			16,104
Deposits and other assets	6,178			7,409
Total assets	$	724,701		$	744,931
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	25,287		$	23,435
Accrued liabilities	9,813			15,540
Deferred revenues	7,493			8,022
Capital lease obligations	—			9,080
Revolving credit facility	14,000			—
Term loan, less discount and issuance costs of $4,036	—			321
Exit activities and restructuring liability	550			2,526
Short-term operating lease liabilities	6,686			—
Short-term finance lease liabilities	5,867			—
Other current liabilities	70			1,063
Total current liabilities	69,766			59,987
Deferred revenues	259			511
Operating lease liabilities	30,382			—
Finance lease liabilities	264,223			—
Capital lease obligations	—			262,382
Term loan, less discount and issuance costs of $7,587 and $9,508, respectively	415,126			415,278
Deferred tax liability	1,443			2,211
Other long-term liabilities	3,714			4,505
Total liabilities	784,913			744,874
Commitments and contingencies (Refer to Note 10)
Stockholders’ (deficit) equity:
Preferred stock, $0.001 par value; 5,000 shares authorized; no shares issued or outstanding	—			—
Common stock, $0.001 par value; 50,000 shares authorized; 26,486 and 25,455 shares outstanding, respectively	26			25
Additional paid-in capital	1,372,016			1,368,968
Treasury stock, at cost, 388 and 330 shares, respectively	(7,958		)	(7,646		)
Accumulated deficit	(1,425,140		)	(1,363,019		)
Accumulated items of other comprehensive loss	(913		)	(1,065		)
Total INAP stockholders’ deficit	(61,969		)	(2,737		)
Non-controlling interests	1,757			2,794
Total stockholders’ (deficit) equity	(60,212		)	57
Total liabilities and stockholders’ (deficit) equity	$	724,701		$	744,931

See Notes to Condensed Consolidated Financial Statements.

2

INTERNAP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY

(In thousands)

(Unaudited)

	Common Stock
	Shares		Par Value		Additional Paid-In Capital		Treasury Stock			Accumulated Deficit			Accumulated Items of Other Comprehensive Loss			Non-Controlling Interest			Total Stockholders' (Deficit) Equity
Three and Nine Months Ended September 30, 2018
Balance, December 31, 2017	20,804		$	21	$	1,327,084	$	(7,159	)	$	(1,323,723	)	$	(1,324	)	$	4,069		$	(1,032	)
Adoption of ASC 606	—		—		—		—			24,185			—			—			24,185
Net loss	—		—		—		—			(14,261		)	—			—			(14,261		)
Net income attributable to non-controlling interest	—		—		—		—			(27		)	—			27			—
Foreign currency translation	—		—		—		—			—			61			—			61
Movement in non-controlling interest	—		—		—		—			—			—			(990		)	(990		)
Common stock issuance, net	343		—		—		—			—			—			—			—
Employee taxes paid on withholding shares	(20	)	—		—		(270		)	—			—			—			(270		)
Stock-based compensation	—		—		869		—			—			—			—			869
Proceeds from exercise of stock options, net	4		—		32		—			—			—			—			32
Balance, March 31, 2018	21,131		21		1,327,985		(7,429		)	(1,313,826		)	(1,263		)	3,106			8,594
Adoption of ASC 606	—		—		—		—			(981		)	—			—			(981		)
Net loss	—		—		—		—			(14,256		)	—			—			(14,256		)
Net income attributable to non-controlling interest	—		—		—		—			(23		)	—			23			—
Foreign currency translation	—		—		—		—			—			61			—			61
Movement in non-controlling interest	—		—		—		—			—			—			(205		)	(205		)
Common stock issuance, net	104		—		—		—			—			—			—			—
Employee taxes paid on withholding shares	(16	)	—		—		(201		)	—			—			—			(201		)
Stock-based compensation	—		—		1,382		—			—			—			—			1,382
Proceeds from exercise of stock options, net	—		—		1		—			—			—			—			1
Balance, June 30, 2018	21,219		$	21	$	1,329,368	$	(7,630	)	$	(1,329,086	)	$	(1,202	)	$	2,924		$	(5,605	)
See Notes to Condensed Consolidated Financial Statements.

3

INTERNAP CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY (CONTINUED)
(In thousands)
(Unaudited)
	Common Stock
	Shares		Par Value		Additional Paid-In Capital		Treasury Stock			Accumulated Deficit			Accumulated Items of Other Comprehensive Loss			Non-Controlling Interest			Total Stockholders' (Deficit) Equity
Balance, June 30, 2018	21,219		$	21	$	1,329,368	$	(7,630	)	$	(1,329,086	)	$	(1,202	)	$	2,924		$	(5,605	)
Adoption of ASC 606	—		—		—		—			(1		)	—			—			(1		)
Net loss	—		—		—		—			(15,454		)	—			—			(15,454		)
Net income attributable to non-controlling interest	—		—		—		—			(25		)	—			25			—
Foreign currency translation	—		—		—		—			—			(98		)	—			(98		)
Movement in non-controlling interest	—		—		—		—			—			—			(133		)	(133		)
Common stock issuance, net	82		—		—		—			—			—			—			—
Employee taxes paid on withholding shares	(1	)	—		—		(15		)	—			—			—			(15		)
Stock-based compensation	—		—		1,320		—			—			—			—			1,320
Proceeds from exercise of stock options, net	2		—		63		—			—			—			—			63
Balance, September 30, 2018	21,302		$	21	$	1,330,751	$	(7,645	)	$	(1,344,566	)	$	(1,300	)	$	2,816		$	(19,923	)
See Notes to Condensed Consolidated Financial Statements.

4

INTERNAP CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY (CONTINUED)
(In thousands)
(Unaudited)
	Common Stock
	Shares		Par Value		Additional Paid-In Capital			Treasury Stock			Accumulated Deficit			Accumulated Items of Other Comprehensive Loss			Non-Controlling Interest			Total Stockholders' (Deficit) Equity
Three and Nine Months Ended September 30, 2019
Balance, December 31, 2018	25,455		$	25	$	1,368,968		$	(7,646	)	$	(1,363,019	)	$	(1,065	)	$	2,794		$	57
Adoption of ASC 842	—		—		—			—			(52		)	—			—			(52		)
Net loss	—		—		—			—			(19,622		)	—			—			(19,622		)
Net income attributable to non-controlling interest	—		—		—			—			(22		)	—			22			—
Foreign currency translation	—		—		—			—			—			197			—			197
Movement in non-controlling interest	—		—		—			—			—			—			(1,133		)	(1,133		)
Common stock issuance, net	1,339		2		(43		)	—			—			—			—			(41		)
Employee taxes paid on withholding shares	(48	)	—		—			(268		)	—			—			—			(268		)
Stock-based compensation	—		—		890			—			—			—			—			890
Balance, March 31, 2019	26,746		27		1,369,815			(7,914		)	(1,382,715		)	(868		)	1,683			(19,972		)
Net loss	—		—		—			—			(18,535		)	—			—			(18,535		)
Net income attributable to non-controlling interest	—		—		—			—			(20		)	—			20			—
Foreign currency translation	—		—		—			—			—			(27		)	—			(27		)
Movement in non-controlling interest	—		—		—			—			—			—			23			23
Common stock issuance, net	33		—		—			—			—			—			—			—
Employee taxes paid on withholding shares	(9	)	—		—			(42		)	—			—			—			(42		)
Stock-based compensation	—		—		1,020			—			—			—			—			1,020
Balance, June 30, 2019	26,770		$	27	$	1,370,835		$	(7,956	)	$	(1,401,270	)	$	(895	)	$	1,726		$	(37,533	)
See Notes to Condensed Consolidated Financial Statements.

5

INTERNAP CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY (CONTINUED)
(In thousands)
(Unaudited)
	Common Stock
	Shares		Par Value			Additional Paid-In Capital		Treasury Stock			Accumulated Deficit			Accumulated Items of Other Comprehensive Loss			Non-Controlling Interest		Total Stockholders' (Deficit) Equity
Balance, June 30, 2019	26,770		$	27		$	1,370,835	$	(7,956	)	$	(1,401,270	)	$	(895	)	$	1,726	$	(37,533	)
Net loss	—		—			—		—			(23,849		)	—			—		(23,849		)
Net income attributable to non-controlling interest	—		—			—		—			(21		)	—			21		—
Foreign currency translation	—		—			—		—			—			(18		)	—		(18		)
Movement in non-controlling interest	—		—			—		—			—			—			10		10
Common stock issuance, net	(283	)	(1		)	—		—			—			—			—		(1		)
Employee taxes paid on withholding shares	(1	)	—			—		(2		)	—			—			—		(2		)
Stock-based compensation	—		—			1,181		—			—			—			—		1,181
Balance, September 30, 2019	26,486		$	26		$	1,372,016	$	(7,958	)	$	(1,425,140	)	$	(913	)	$	1,757	$	(60,212	)
See Notes to Condensed Consolidated Financial Statements.

6

INTERNAP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended September 30,
	2019			2018
Cash Flows from Operating Activities:
Net loss	$	(62,006	)	$	(43,971	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	65,715			67,422
Loss (gain) on disposal of property and equipment	468			(98		)
Amortization of debt discount and issuance costs	4,109			2,798
Stock-based compensation expense, net of capitalized amount	3,074			3,573
Provision for doubtful accounts	629			706
Non-cash change in finance lease liabilities	4,863			(241		)
Non-cash change in exit activities and restructuring liability	5,164			3,198
Non-cash change in deferred rent	—			(778		)
Deferred taxes	(787		)	65
Accreted interest	1,194			—
Other, net	(78		)	(6		)
Changes in operating assets and liabilities:
Accounts receivable	1,593			(4,990		)
Prepaid expenses, deposits and other assets	1,355			(3,531		)
Operating lease right-of-use assets	(5,211		)	—
Accounts payable	756			5,155
Accrued and other liabilities	(5,378		)	(601		)
Deferred revenues	(804		)	617
Exit activities and restructuring liability	(3,870		)	(4,597		)
Short and long-term operating lease liabilities	7,614			—
Asset retirement obligation	202			(141		)
Other liabilities	57			(199		)
Net cash provided by operating activities	18,659			24,381
Cash Flows from Investing Activities:
Purchases of property and equipment	(23,277		)	(23,100		)
Proceeds from disposal of property and equipment	272			570
Business acquisition, net of cash acquired	—			(131,748		)
Additions to acquired and developed technology	(881		)	(2,128		)
Net cash used in investing activities	(23,886		)	(156,406		)
Cash Flows from Financing Activities:
Proceeds from credit agreements	14,000			148,500
Principal payments on credit agreements	(3,268		)	(3,267		)
Debt issuance costs	(2,815		)	(7,696		)
Payments on finance lease liabilities	(8,212		)	(6,643		)
Acquisition of non-controlling interests	(973		)	(1,130		)
Proceeds from exercise of stock options	—			(210		)
Acquisition of common stock for income tax withholdings	(311		)	(487		)
Other, net	50			175
Net cash (used in) provided by financing activities	(1,529		)	129,242
Effect of exchange rates on cash and cash equivalents	(172		)	24
Net decrease in cash and cash equivalents	(6,928		)	(2,759		)
Cash and cash equivalents at beginning of period	17,823			14,603
Cash and cash equivalents at end of period	$	10,895		$	11,844
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	$	46,540		$	46,676
Additions to property and equipment included in accounts payable	5,153			10,235

See Notes to Condensed Consolidated Financial Statements.

7

INTERNAP CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Internap Corporation ("we," "us," "our," "INAP," or "the Company") is a leading-edge provider of high-performance data center and cloud solutions with 100 network Points of Presence (“POP”) worldwide. INAP's full-spectrum portfolio of high-density colocation, managed cloud hosting and network solutions supports evolving IT infrastructure requirements for customers ranging from the Fortune 500 to emerging startups. INAP operates in 21 metropolitan markets, primarily in North America, with 14 INAP Data Center Flagships connected by a low-latency, high-capacity network. 

We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information. These financial statements include all of our accounts and those of our wholly-owned subsidiaries. We have eliminated all intercompany transactions and balances in the accompanying financial statements. In the opinion of management, all adjustments necessary for a fair presentation of the interim results have been reflected therein. All such adjustments were of a normal and recurring nature with the exception of those related to the adoption of new accounting standards as discussed in Note 2, "Recent Accounting Pronouncements" and Note 4, "Leases."

We have condensed or omitted certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP. The accompanying financial statements reflect all adjustments, which consist of normal recurring adjustments unless otherwise disclosed, necessary for a fair statement of our financial position as of September 30, 2019 and our operating results and cash flows for the interim periods presented. The balance sheet at December 31, 2018 was derived from our audited financial statements, but does not include all disclosures required by GAAP. You should read the accompanying financial statements and the related notes in conjunction with our financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission ("SEC").

The preparation of financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Actual results may differ materially from these estimates. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the 2019 fiscal year or any future periods.

Correction of Immaterial Error

The Company corrected an error in the consolidated statements of cash flows for all periods in 2017, 2018, the three months ended March 31, 2019 and the six months ended June 30, 2019. The Company had previously included only a portion of the additions to property and equipment that were outstanding in accounts payable in the supplemental disclosures of cash flow information, “Additions to property and equipment included in accounts payable,” and the related adjustments to "Accounts payable" and "Purchases of property and equipment" on the consolidated statements of cash flows. The correction had no impact on the consolidated statements of operations and comprehensive loss or the consolidated balance sheets. The Company has evaluated this correction in accordance with Accounting Standards Codification ("ASC") 250-10-S99, SEC Materials (formerly SEC Staff Accounting Bulletin 99, Materiality) and concluded that the correction was not material.

8

The adjustments to the Company’s previously issued consolidated statements of cash flows are as follows (in thousands):

	Three Months Ended March 31, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(2,247	)	$	(512	)	$	(2,759	)
Net cash provided by operating activities	7,264			(512		)	6,752
Purchases of property and equipment	(5,789		)	512			(5,277		)
Net cash used in investing activities	(5,989		)	512			(5,477		)
Additions to property and equipment included in accounts payable	$	1,247		$	2,744		$	3,991

	Six Months Ended June 30, 2017
	As reported			Adjustments			As restated
Accounts payable	$	477		$	(2,100	)	$	(1,623	)
Net cash provided by operating activities	24,634			(2,100		)	22,534
Purchases of property and equipment	(12,293		)	2,100			(10,193		)
Net cash used in investing activities	(12,737		)	2,100			(10,637		)
Additions to property and equipment included in accounts payable	$	1,269		$	4,331		$	5,600

	Nine Months Ended September 30, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(3,498	)	$	1,330		$	(2,168	)
Net cash provided by operating activities	27,940			1,330			29,270
Purchases of property and equipment	(23,198		)	(1,330		)	(24,528		)
Net cash used in investing activities	(19,789		)	(1,330		)	(21,119		)
Additions to property and equipment included in accounts payable	$	701		$	901		$	1,602

9

	Year Ended December 31, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(1,167	)	$	218		$	(949	)
Net cash provided by operating activities	41,748			218			41,966
Purchases of property and equipment	(35,714		)	(218		)	(35,932		)
Net cash used in investing activities	(32,209		)	(218		)	(32,427		)
Additions to property and equipment included in accounts payable	$	1,932		$	2,014		$	3,946

	Three Months Ended March 31, 2018
	As reported			Adjustments			As restated
Accounts payable	$	(636	)	$	(124	)	$	(760	)
Net cash provided by operating activities	3,697			(124		)	3,573
Purchases of property and equipment	(6,082		)	124			(5,958		)
Net cash used in investing activities	(138,065		)	124			(137,941		)
Additions to property and equipment included in accounts payable	$	2,287		$	2,138		$	4,425

	Six Months Ended June 30, 2018
	As reported			Adjustments			As restated
Accounts payable	$	6,939		$	(3,598	)	$	3,341
Net cash provided by operating activities	18,533			(3,598		)	14,935
Purchases of property and equipment	(16,102		)	3,598			(12,504		)
Net cash used in investing activities	(148,649		)	3,598			(145,051		)
Additions to property and equipment included in accounts payable	$	4,023		$	5,613		$	9,636

10

	Nine Months Ended September 30, 2018
	As reported			Adjustments			As restated
Accounts payable	$	9,372		$	(4,217	)	$	5,155
Net cash provided by operating activities	28,598			(4,217		)	24,381
Purchases of property and equipment	(27,317		)	4,217			(23,100		)
Net cash used in investing activities	(160,623		)	4,217			(156,406		)
Additions to property and equipment included in accounts payable	$	4,004		$	6,231		$	10,235

	Year Ended December 31, 2018
	As reported			Adjustments			As restated
Accounts payable	$	1,339		$	207		$	1,546
Net cash provided by operating activities	34,572			207			34,779
Purchases of property and equipment	(38,298		)	(207		)	(38,505		)
Net cash used in investing activities	(174,037		)	(207		)	(174,244		)
Additions to property and equipment included in accounts payable	$	2,459		$	1,807		$	4,266

	Three Months Ended March 31, 2019
	As reported			Adjustments			As restated
Accounts payable	$	763		$	(556	)	$	207
Net cash provided by operating activities	2,262			(556		)	1,706
Purchases of property and equipment	(8,094		)	556			(7,538		)
Net cash used in investing activities	(8,568		)	556			(8,012		)
Additions to property and equipment included in accounts payable	$	1,850		$	1,881		$	3,731

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	Six Months Ended June 30, 2019
	As reported			Adjustments			As restated
Accounts payable	$	3,375		$	(944	)	$	2,431
Net cash provided by operating activities	14,081			(944		)	13,137
Purchases of property and equipment	(15,642		)	944			(14,698		)
Net cash used in investing activities	(16,359		)	944			(15,415		)
Additions to property and equipment included in accounts payable	$	1,268		$	2,751		$	4,019

Out of Period Adjustment

In connection with the preparation, review and audit of the Company's consolidated financial statements required to be included in the Annual Report on Form 10-K for the year ended December 31, 2018, management identified certain errors in the Company's historical financial statements, resulting in a conclusion that certain corrections need to be made to the Company's unaudited quarters during 2018. The Company has revised its prior period consolidated financial statements accordingly and included such revisions herein. Based on an analysis of quantitative and qualitative factors, the Company concluded that these errors were not material to the consolidated financial position, results of operations or cash flows as presented in the Company’s quarterly financial statements that have been previously filed in the Company’s Quarterly Reports on Form 10-Q. As a result, amendment of such reports was not required. The revisions to correct errors relate to the correction of accounting for an amendment to a capital lease executed in February 2018.

The adjustments to the Company’s previously issued quarterly financial statements for the three and nine months ended September 30, 2018 are as follows (in thousands):

	Three and Nine Months Ended September 30, 2018
	As reported			Adjustments			As adjusted
Costs of sales and services, exclusive of depreciation and amortization - QTD	$	28,866		$	(645	)	$	28,221
Costs of sales and services, exclusive of depreciation and amortization - YTD	81,880			(1,720		)	80,160
Depreciation and amortization - QTD	23,431			122			23,553
Depreciation and amortization - YTD	67,097			325			67,422
Interest expense - QTD	16,898			896			17,794
Interest expense - YTD	47,786			2,352			50,138
Net loss attributable to INAP shareholders - QTD	(15,106		)	(373		)	(15,479		)
Net loss attributable to INAP shareholders - YTD	(43,089		)	(957		)	(44,046		)
Property and equipment, net	477,423			10,193			487,616
Total assets	746,038			10,193			756,231
Capital lease obligations - non-current	252,599			11,077			263,676
Total liabilities	765,004			11,150			776,154
Accumulated deficit	(1,343,609		)	(957		)	(1,344,566		)
Total stockholders' (deficit) equity	$	(18,966	)	$	(957	)	$	(19,923	)

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2.    RECENT ACCOUNTING PRONOUNCEMENTS

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842), which states that a lessee should recognize the assets and liabilities that arise from leases. The standard has since been modified with several ASUs (collectively, the "new lease standard"). The new lease standard is effective for annual and interim periods beginning after December 15, 2018. Earlier adoption is permitted. The Company adopted the new lease standard on January 1, 2019, the beginning of fiscal 2019. Prior periods presented in our condensed consolidated financial statements continue to be presented in accordance with the former lease standard, Topic 840, Leases.

The new lease standard provides entities two options for applying the modified retrospective approach (1) retrospectively to each prior reporting period presented in the financial statements with the cumulative-effect adjustment recognized at the beginning of the earliest comparative period presented or (2) retrospectively at the beginning of the period of adoption (January 1, 2019) through a cumulative-effect adjustment recognized then. The Company adopted the new lease standard by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application. The most significant impact relates to the recognition on the Company's balance sheet of right-of-use ("ROU") assets and lease liabilities for all operating leases. Consistent with current guidance, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily depends on its classification. For income statement purposes, operating leases will result in a straight-line expense while finance leases will result in a front-loaded expense pattern.

The Company elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs. The Company did not separately record lease components from non-lease components, and accounts for them together as a single lease component. INAP made an accounting policy election to not record leases with an initial term of 12 months or less on the balance sheet. The Company recognizes lease expense for these short-term leases on a straight-line basis over the lease term in the consolidated statements of operations and comprehensive loss. The Company has elected to not record a ROU asset or ROU liability for leases with an asset or liability balance that would be less than one thousand dollars ($1,000) on the adoption date on the basis of materiality. This threshold continues to be consistent with the Company’s Property and Equipment capitalization threshold.

As a result of our adoption of the new lease standard, we have implemented a new lease accounting system, accounting policies and processes which changed the Company's internal controls over financial reporting for lease accounting.

The Company has capital leases which have been recorded on the consolidated balance sheets and as of the January 1, 2019 transition date, the capital leases became finance leases establishing the ROU asset and liability. The ROU assets and liabilities for operating leases were $28.5 million and $31.0 million of total Company assets and liabilities, respectively, as of January 1, 2019.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires the measurement of all expected credit losses for financial assets including trade receivables, loans and held-to-maturity debt securities held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This will result in the earlier recognition of credit losses. For available-for-sale debt securities, entities will be required to recognize an allowance for credit losses rather than a reduction to the carrying value of the asset. If expected cash flows improve, an entity will reduce the allowance and reverse the expense through income. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Entities will have to make more disclosures, including disclosures by year of origination for certain financing receivables. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

In February 2018, the FASB issued ASU No. 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220). This standard provides an option to reclassify stranded tax effects within accumulated other comprehensive income (loss) (“AOCI”) to retained earnings due to the U.S. federal corporate income tax rate change in the Tax Cuts and Jobs Act of 2017. This standard was effective for interim and annual reporting periods beginning after December 15, 2018. We did not exercise the option to make this reclassification.

In June 2018, the FASB issued ASU 2018-07, Improvements to Non-employee Share-Based Payment Accounting. This standardbroadens the scope of FASB ASC Topic 718, Compensation — Stock Compensation, which currently covers only share-based payments to employees. The change substantially aligns the accounting for share-based payments for both employees and non-

13

employees. The ASU supersedes Subtopic 505-50, Equity — Equity-Based Payments to Non-Employees. The measurement of equity-classified non-employee awards will be fixed at the grant date, and entities will measure the cost of awards subject to a performance condition using the outcome that is probable at the balance sheet date. Entities may use the expected term to measure non-employee options or elect to use the contractual term as the expected term, on an award-by-award basis. Entities will recognize a cumulative-effect adjustment to retained earnings for equity classified non-employee awards for which a measurement date has not been established and liability-classified non-employee awards that have not been settled. The guidance is effective for calendar-year public business entities in annual periods beginning after December 15, 2018, and interim periods within those years. The Company adopted this pronouncement in the first quarter of 2019 and it did not have a material impact on its condensed consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), relating to a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by a vendor (i.e., a service contract). Under the new guidance, a customer will apply the same criteria for capitalizing implementation costs as it would for an arrangement that has a software license. The new guidance also prescribes the balance sheet, income statement, and cash flow classification of the capitalized implementation costs and related amortization expense, and requires additional quantitative and qualitative disclosures. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application is permitted.  The Company can choose to adopt the new guidance (1) prospectively to eligible costs incurred on or after the date this guidance is first applied, or (2) retrospectively. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, which removes, adds and modifies certain disclosure requirements for fair value measurements in Topic 820. The Company will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the valuation processes of Level 3 fair value measurements. However, the Company will be required to additionally disclose the changes in unrealized gains and losses included in other comprehensive income for recurring Level 3 fair value measurements, and the range and weighted average of assumptions used to develop significant unobservable inputs for Level 3 fair value measurements. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.  The amendments relating to additional disclosure requirements will be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments will be applied retrospectively to all periods presented upon their effective date. The Company is permitted to early adopt either the entire ASU or only the provisions that eliminate or modify the requirements. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

3.    REVENUES

We generate revenues primarily from the sale of data center services, including colocation, hosting and cloud, and IP services. Our revenues typically consist of monthly recurring revenues from contracts with terms of one year or more and we typically recognize the monthly minimum as revenue each month as our performance obligations are fulfilled. We record installation fees as deferred revenue and recognized the revenue ratably over the estimated customer life.

For our data center service revenues, we typically determine colocation revenues by occupied square feet and both allocated and variable-based usage, which includes both physical space for hosting customers' network and other equipment plus associated services such as power and network connectivity, environmental controls and security. We typically determine hosting revenues by the number of servers utilized (physical or virtual) and cloud revenues by the amount of processing and storage consumed. We typically determine IP services revenues on fixed-commitment or usage-based pricing. IP service contracts usually have fixed minimum commitments based on a certain level of bandwidth usage with additional charges for any usage over a specified limit. If a customer's usage of our services exceeds the monthly minimum, we recognize revenue for such excess in the period of the usage. We use contracts and sales or purchase orders as evidence of an arrangement. We test for availability or connectivity to verify delivery of our services.

We assess whether:

a. the parties to the contract have an approved contract;

b. the Company can identify each party's rights regarding the goods and services to be transferred;

c. the Company can identify the payment terms for the goods or services to be transferred;

d. the contract has commercial substance; and

e. it is probable that the Company will collect substantially all of the consideration to which it will be entitled in exchange for the goods and services that will be transferred to the customer.

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The transaction price reflects INAP’s expectations about the consideration it will be entitled to receive from the customer. The Company considers the terms of the contract and its customary business practices to determine the transaction price. The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. After contract inception, the transaction price can change for various reasons, including the resolution of uncertain events or other changes in circumstances that change the amount of consideration to which INAP expects to be entitled in exchange for the promised goods or services. Once the separate performance obligations are identified and the transaction price has been determined, the Company allocates the transaction price to the performance obligations in proportion to their standalone selling price ("SSP"). When allocating on a relative SSP basis, any discount within the contract generally is allocated proportionately to all of the performance obligations in the contract.

To allocate the transaction price on a relative SSP basis, the Company first determines the SSP of the distinct good or service underlying each performance obligation. It is the price at which the Company would sell a good or service on a standalone (or separate) basis at contract inception. The observable price of a good or service sold separately provides the best evidence of SSP. If a SSP is not directly observable, the Company will estimate the SSP. The Company will be able to consider its facts and circumstances in order to determine how frequently it will need to update the estimates. If the information used to estimate the SSP for similar transactions has not changed, the Company will determine that it is reasonable to use the previously determined SSP.

Revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations.

The Company's contracts with customers often include performance obligations to transfer multiple products and services to a customer. Common performance obligations of the Company include delivery of services. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together requires significant judgment by the Company.

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC 606. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Total transaction price is estimated for impact of variable consideration, such as INAP's service level arrangements, additional usage and late fees, discounts and promotions, and customer care credits. The majority of contracts have multiple performance obligations, as the promise to transfer individual goods or services is separately identifiable from other promises in the contracts and, therefore, is distinct. For contracts with multiple performance obligations, the Company allocates the contract's transaction price to each performance obligation based on its relative SSP.

The SSP is determined based on observable price. In instances where the SSP is not directly observable, such as when the Company does not sell the product or service separately, INAP determines the SSP using information that may include market conditions and other observable inputs. The Company typically has more than one SSP for individual products and services due to the stratification of those products and services by customers and circumstances. In these instances, the Company may use information such as the size of the customer and geographic region in determining the SSP.

The most significant impact of the adoption of the new standard was the requirement for incremental costs to obtain a customer, such as commissions, which previously were expensed as incurred, to be deferred and amortized over the period of contract performance or a longer period if renewals are expected and the renewal commission does not equal the initial commission.

In addition, installation revenues are recognized over the initial contract life rather than over the estimated customer life, as installation revenues are not significant to the total contract and therefore do not represent a material right.

Most performance obligations, with the exception of occasional sales of equipment or hardware, are satisfied over time as the customer consumes the benefits as we perform. For equipment and hardware sales, the performance obligation is satisfied when control transfers to the customer.

In evaluating the treatment of certain contracts, the Company exercised heightened judgment in deferring installation revenue as well as expense fulfillment and commission costs over the appropriate life. With the exception of the revenues noted above, revenue recognition remains materially consistent with historical practice.

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The Company routinely reviews the collectability of its accounts receivable and payment status of customers. If the Company determines that collection of revenue is uncertain, it does not recognize revenue until collection is reasonably assured. Additionally, the Company maintains an allowance for doubtful accounts resulting from the inability of the Company's customers to make required payments on accounts receivable. The allowance for doubtful accounts is based on historical write-offs as a percentage of revenues. The Company assesses the payment status of customers by reference to the terms under which it provides services or goods, with any payments not made on or before their due date considered past-due. Once all collection efforts have been exhausted, the uncollectible balance is written off against the allowance for doubtful accounts. The Company routinely performs credit checks for new and existing customers and requires deposits or prepayments for customers that are perceived as being a credit risk. In addition, the Company records a reserve amount for potential credits to be issued under service level agreements and other sales adjustments.

Management expects that commission fees paid to sales representatives as a result of obtaining service contracts and contract renewals are recoverable and therefore the Company deferred them as contract costs in the amount of $24.2 million and $24.9 million at September 30, 2019 and December 31, 2018, respectively. Capitalized commission fees are amortized on a straight-line basis over the determined life, which vary based on the customer segment. For the three months ended September 30, 2019 and September 30, 2018, amortization recognized was $2.5 million for both years. For the nine months ended September 30, 2019 and September 30, 2018, amortization recognized was $7.3 million and $7.2 million, respectively. There was no impairment loss recorded on capitalized contract costs for the three and nine months ended September 30, 2019 and September 30, 2018.

Applying the practical expedient pertaining to contract costs, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in "Sales, general and administrative" expenses in the accompanying condensed consolidated statements of operations and comprehensive loss. The Company includes only those incremental costs that would not have been incurred if the contracts had not been entered into as follows (in thousands):

	Current			Non-current
Balance at December 31, 2018	$	8,844		$	16,104
Deferred customer acquisition costs incurred in the period	1,345			5,274
Amounts recognized as expense in the period	(7,333		)	—
Transition between short-term and long-term	6,346			(6,346		)
Balance at September 30, 2019	$	9,202		$	15,032

The Company classifies its right to consideration in exchange for deliverables as either a receivable or a contract asset. A receivable is a right to consideration that is unconditional (i.e. only the passage of time is required before payment is due). For example, the Company recognizes a receivable for revenues related to its time and materials and transaction or volume-based contracts. The Company presents such receivables in "Accounts receivable, net" it its condensed consolidated balance sheets at their net estimated realizable value.

As of September 30, 2019, approximately $198.0 million of total revenues and deferred revenues are expected to be recognized in future periods with a weighted average life of 2.13 years for remaining performance obligations under the initial contract terms. The remaining performance obligations do not include variable consideration related to unsatisfied performance obligations such as the level of bandwidth usage, physical space for hosting customers’ network, and associated services for power and network connectivity.

Amounts collected in advance of services being provided are accounted for as contract liabilities, which are presented as "Deferred revenues" on the accompanying condensed consolidated balance sheets and are realized with the associated revenue recognized under the contract. Nearly all of the Company's contract liabilities balance is related to service revenue.

Significant changes in the deferred revenues balance (current and non-current) during the period are as follows (in thousands):

Balance at December 31, 2018	$	8,533
Revenue recognized that was included in the deferred revenue balance at December 31, 2018	(5,931		)
Increases due to cash received, excluding amounts recognized as revenue during the period	5,150
Balance at September 30, 2019	$	7,752

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In accordance with ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASC 606"), the Company disaggregates revenue from contracts with customers based on the timing of revenue recognition. The Company determined that disaggregating revenue into these categories depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. As discussed in this note and Note 11, "Operating Segments," the Company business consists of INAP US and INAP INTL colocation, cloud and network services. The following table presents disaggregated revenues by category as follows (in thousands):

	Three Months Ended September 30, 2019				Three Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
Colocation	$	27,334	$	1,452	$	32,946	$	1,372
Network services	11,225		2,772		13,015		2,719
Cloud	18,388		11,707		19,717		13,203
	$	56,947	$	15,931	$	65,678	$	17,294

	Nine Months Ended September 30, 2019				Nine Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
Colocation	$	82,245	$	4,344	$	94,747	$	4,349
Network services	34,381		8,224		40,398		8,482
Cloud	55,302		35,080		51,676		39,483
	$	171,928	$	47,648	$	186,821	$	52,314

Revenue by geography is as follows (in thousands):

	Three Months Ended September 30, 2019				Three Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
United States	$	57,939	$	—	$	66,752	$	—
Canada	—		8,181		—		9,187
Other countries	—		6,758		—		7,033
	$	57,939	$	14,939	$	66,752	$	16,220

	Nine Months Ended September 30, 2019				Nine Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
United States	$	174,964	$	—	$	190,071	$	—
Canada	—		24,208		—		27,846
Other countries	—		20,404		—		21,218
	$	174,964	$	44,612	$	190,071	$	49,064

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4.    LEASES

We have commitments under lease arrangements for data centers, office space, partner sites and equipment. Our leases have initial lease terms ranging from 2 years to 34 years, most of which include options to extend or renew the leases for 5 to 15 years, and some of which may include options to terminate the leases within 4 to 120 months.

At contract inception, we evaluate whether an arrangement is or contains a lease for which we are the lessee (that is, arrangements which provide us with the right to control a physical asset for a period of time). Operating leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Operating lease right-of-use assets" and lease liabilities recognized in "Short-term operating lease liabilities" and "Operating lease liabilities." Finance leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Finance lease right-of-use assets" and lease liabilities recognized in "Short-term finance lease liabilities" and "Finance lease liabilities."

All lease liabilities are measured at the present value of the unpaid lease payments, discounted using our incremental borrowing rate based on the information available at commencement date or modification date of the lease. ROU assets, for both operating and finance leases, are initially measured based on the lease liability, adjusted for initial direct costs, prepaid rent, and lease incentives received. The operating lease ROU assets are subsequently measured at the carrying amount of the lease liability adjusted for initial direct costs, prepaid or accrued lease payments and lease incentives. The finance lease ROU assets are subsequently amortized using the straight-line method.

Operating lease expenses are recognized on a straight-line basis over the lease term. With respect to finance leases, amortization of the ROU asset is presented separately from interest expense related to the finance lease liability.

We have elected to combine lease and non-lease components for all lease contracts where we are the lessee. Additionally, for arrangements with lease terms of 12 months or less, we do not recognize ROU assets and lease liabilities and lease payments are recognized on a straight-line basis over the lease term with variable lease payments recognized in the period in which the obligation is incurred.

Lease-related costs for the three and nine months ended September 30, 2019 are as follows (in thousands):

	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Finance lease cost
Amortization of right-of-use assets		$	3,861	$	12,384
Interest on lease liabilities		7,445		22,124
Finance lease cost		$	11,306	$	34,508
Operating lease cost		$	2,269	$	5,964
Short-term lease cost		1,106		4,302
Total lease cost		$	14,681	$	44,774

Other information related to leases as of September 30, 2019 is as follows (in thousands, except lease term and rate):

	Operating Leases			Finance Leases
Right-of-use assets	$	33,723		$	226,619
Lease liabilities	37,068			270,090
Weighted-average remaining lease term (years)	5.26			19.05
Weighted-average discount rate	7.25		%	13.80		%

18

The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2019 (in thousands):

Operating Leases
Operating cash paid to settle operating lease liabilities	$	5,913
Right-of-use assets obtained in exchange for lease liabilities	921
Finance Leases
Operating cash paid for interest	$	17,577
Right-of-use assets obtained in exchange for lease liabilities	1,639

Future minimum lease payments under non-cancellable leases as of September 30, 2019 are as follows (in thousands):

	Operating Leases			Finance Leases
2019 (excluding the nine months ended September 30, 2019)		$	2,270		$	8,412
2020		9,073			33,406
2021		9,098			35,243
2022		8,519			33,995
2023		7,541			33,244
Thereafter		8,698			633,139
Total undiscounted lease payments		$	45,199		$	777,439
Less: Imputed interest		8,131			507,349
Total lease liabilities		$	37,068		$	270,090

As of September 30, 2019, we did not have additional operating and finance leases that have not yet commenced.

5. ACQUISITION

On February 28, 2018, the Company acquired SingleHop LLC ("SingleHop"), a provider of high-performance data center services including colocation, managed hosting, cloud and network services for $132.0 million net of working capital adjustments of approximately $0.4 million, liabilities assumed, and net of cash acquired. The transaction was funded with an incremental term loan and cash from the balance sheet. As part of the financing, INAP obtained amendments to its credit agreement to allow for the incremental term loan and to provide further operational flexibility under the credit agreement covenants. The amendments to the credit agreement are described in more detail in Note 8, "Debt."

19

The following table summarizes the final fair values of the assets acquired and liabilities assumed at the acquisition date and includes purchase accounting adjustments subsequent to the acquisition date (in thousands):

	Final Valuation as of December 31, 2018
Cash	$	2,823
Prepaid expenses and other assets	2,227
Property, plant and equipment	14,253
Other long-term assets	576
Intangible assets:
Noncompete agreements	4,000
Trade names	1,700
Technology	15,100
Customer relationships	34,100
Goodwill	66,008
Total assets acquired	140,787
Accounts payable and accrued liabilities	2,819
Deferred revenue	2,434
Long term liabilities	534
Net assets acquired	$	135,000

The fair value assigned to identifiable intangible assets acquired was based on estimates and assumptions made by management. The intangible assets are being amortized over periods which reflect the pattern in which economic benefits of the assets are expected to be realized. The customer relationships are being amortized on an accelerated basis over an estimated useful life of ten years and the noncompete agreements, trade names, and technology are being amortized on a straight-line basis over four, eight, and seven years, respectively.

Goodwill represents the excess of the consideration transferred over the aggregate fair values of assets acquired and liabilities assumed. The goodwill recorded in connection with this acquisition was based on operating synergies and other benefits expected to result from the combined operations and the assembled workforce acquired. The goodwill acquired is deductible for tax purposes.

Pro Forma Financial Information

The following unaudited pro forma financial information presents the combined results of operations of INAP and SingleHop as if the acquisition had occurred on January 1, 2017. The unaudited pro forma financial information is not intended to represent or be indicative of our consolidated results of operations that would have been reported had the INAP and SingleHop acquisition been completed as of January 1, 2017, and should not be taken as indicative of our future consolidated results of operations. The pro forma results are as follows (in thousands, except for per share amounts):

	Nine Months Ended September 30,
		2018
Net revenues		$	247,260
Net loss		(45,173		)
Basic and diluted net loss per share		(2.27		)
Weighted average shares outstanding used in computing basic and diluted net loss per share		19,968

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6.    FAIR VALUE MEASUREMENTS

We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

• Level 1: Quoted prices in active markets for identical assets or liabilities;

• Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

• Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Assets and liabilities measured at fair value on a recurring basis are summarized as follows (in thousands):

	Level 1		Level 2		Level 3		Total
September 30, 2019
Available-for-sale securities	$	—	$	2,386	$	—	$	2,386
Asset retirement obligations(1)	—		—		2,292		2,292
December 31, 2018
Available-for-sale securities	$	—	$	2,309	$	—	$	2,309
Asset retirement obligations(1)	—		—		2,090		2,090

⁽¹⁾  We calculated the fair value of asset retirement obligations by discounting the estimated amount using the Treasury bill rate adjusted for our credit risk. At September 30, 2019 and December 31, 2018, the balances are included in "Other long-term liabilities," in the accompanying condensed consolidated balance sheets.

The following table provides a summary of changes in our Level 3 asset retirement obligations for the nine months ended September 30, 2019 (in thousands): 

	2019
Balance, January 1, 2019	$	2,090
Accretion	202
Payments	—
Balance, September 30, 2019	$	2,292

As of September 30, 2019, the Company held $2.4 million of available-for-sale debt securities which are reported at fair value on the Company's condensed consolidated balance sheets in "Deposits and other assets." A decline in the fair value of a marketable security below the Company's cost basis is determined to be other than temporary, such marketable security is written down to its estimated fair value as a new cost basis and the amount of the write-down is included in earnings as an impairment charge. The Company may sell certain of its marketable securities prior to their stated maturities for strategic reasons including, but not limited to, anticipation of credit deterioration and maturity management.

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The fair values of our Level 2 available-for-sale debt securities, based upon quoted prices for similar items in active markets, are as follows (in thousands):

	September 30, 2019
	Cost		Unrealized Gain		Unrealized Loss			Fair Value
Japanese Corporate Bonds	$	2,221	$	189	$	(114	)	$	2,296
Japanese Government Bonds	88		7		(5		)	90
Total Bonds	$	2,309	$	196	$	(119	)	$	2,386
	December 31, 2018
	Cost		Unrealized Gain		Unrealized Loss			Fair Value
Japanese Corporate Bonds	$	2,184	$	144	$	(107	)	$	2,221
Japanese Government Bonds	87		5		(4		)	88
Total Bonds	$	2,271	$	149	$	(111	)	$	2,309

The fair values of our Level 2 debt liabilities, based upon quoted prices for similar items in active markets, are as follows (in thousands):

	September 30, 2019				December 31, 2018
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Term loan	$	427,070	$	330,979	$	429,143	$	428,071
Revolving credit facility	14,000		10,850		—		—

7.    GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

The Company tests goodwill and intangible assets with indefinite lives for impairment annually as of August 1. Additionally, the Company may perform interim tests if an event occurs or circumstances change that could potentially reduce the fair value of a reporting unit or indefinite lived intangible asset below its carrying amount. The carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units.

The Company tests goodwill for impairment by either performing a qualitative evaluation or a quantitative test. The qualitative evaluation is an assessment of factors, including reporting unit specific operating results as well as industry, market and general economic conditions, to determine whether it is more likely than not that the fair values of a reporting unit is less than its carrying amount, including goodwill. The Company may elect to bypass this qualitative assessment for some or all of its reporting units and perform a quantitative test.

Goodwill is considered impaired if the carrying amount of the net assets exceeds the fair value of the reporting unit. Impairment, if any, would be recorded in operating income / (loss) and this could result in a material impact to net income / (loss) and income / (loss) per share.

Annual Testing

2019

We performed our annual impairment review as of August 1, 2019. To determine the estimated fair value of our reporting units, we utilized the discounted cash flow and market methods. We have consistently utilized both methods in our goodwill impairment assessments and weighted both as appropriate based on relevant factors for each reporting unit. The discounted cash flow method is specific to our anticipated future results of the reporting unit, while the market method is based on our market sector including our competitors.

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We determined the assumptions supporting the discounted cash flow method, including the discount rate, using our estimates as of the date of the impairment review. To determine the reasonableness of these assumptions, we considered our past performance and empirical trending of results, looked to market and industry expectations used in the discounted cash flow method, such as forecasted revenues and discount rate. We used reasonable judgment in developing our estimates and assumptions. The market method estimates fair value based on market multiples of revenue and earnings derived from comparable companies with similar operating and investment characteristics as the reporting unit.

The assumptions, inputs and judgments used in performing the valuation analysis are inherently subjective and reflect estimates based on known facts and circumstances at the time we perform the valuation. These estimates and assumptions primarily include, but are not limited to, discount rates; terminal growth rates; projected revenues and costs; earnings before interest, taxes, depreciation and amortization for expected cash flows; market comparables and capital expenditure forecasts. In performing this test as of August 1, 2019, the Company utilized a long-term growth rate for its reporting units of 2.0% in its estimation of fair value and discount rates ranging from 8.0% to 13.0% versus the prior year discount rates of 9.0% to 16.0% to reflect changes in market conditions. The assumptions used in evaluating goodwill for impairment are subject to change and are tracked against historical results by management. The use of different assumptions, inputs and judgments, or changes in circumstances, could materially affect the results of the valuation. Due to inherent uncertainty involved in making these estimates, actual results could differ from our estimates and could result in additional non-cash impairment charges in the future.

The Company determined, after performing the fair value analysis above, that all reporting units’ fair values were in excess of its carrying value. No impairment of goodwill has been identified for the nine months ended September 30, 2019.

8.    DEBT

Credit Agreement

On April 6, 2017, we entered into a new credit agreement (the “2017 Credit Agreement”), which provided for a $300.0 million term loan facility ("2017 Term Loan") and a $25.0 million Revolving Credit Facility (the "2017 Revolving Credit Facility"). The proceeds of the 2017 Term Loan were used to refinance the Company’s existing credit facility and to pay costs and expenses associated with the 2017 Credit Agreement.

Certain portions of refinancing transaction were considered an extinguishment of debt and certain portions were considered a modification. A total of $5.7 million was paid for debt issuance costs related to the 2017 Credit Agreement. Of the $5.7 million in costs paid, $1.9 million was related to the exchange of debt and was expensed, $3.3 million related to 2017 Term Loan third party costs and will be amortized over the 2017 Term Loan and $0.4 million prepaid debt issuance costs related to the 2017 Revolving Credit Facility and will be amortized over the term of the 2017 Revolving Credit Facility. In addition, $4.8 million of debt discount and debt issuance costs related to the previous credit facility were expensed due to the extinguishment of that credit facility. The maturity date of the 2017 Term Loan is April 6, 2022 and the maturity date of the 2017 Revolving Credit Facility is October 6, 2021. As of September 30, 2019, the outstanding balance of the 2017 Term Loan and the 2017 Revolving Credit Facility was $414.6 million and $14.0 million, respectively. The interest rate on the 2017 Term Loan and the 2017 Revolving Credit Facility as of September 30, 2019 were 8.31% and 11.00%, respectively.

Borrowings under the 2017 Credit Agreement bear interest at a rate per annum equal to an applicable margin plus, at our option, a base rate or an adjusted LIBOR rate. The applicable margin for loans under the 2017 Revolving Credit Facility is 6.00% for loans bearing interest calculated using the base rate (“Base Rate Loans”) and 7.00% for loans bearing interest calculated using the adjusted LIBOR rate. The applicable margin for loans under the 2017 Term Loan is 4.75% for Base Rate Loans and 5.75% for adjusted LIBOR rate loans. The base rate is equal to the highest of (a) the adjusted U.S. Prime Lending Rate as published in the Wall Street Journal, (b) with respect to term loans issued on the closing date, 2.00%, (c) the federal funds effective rate from time to time, plus 0.50%, and (d) the adjusted LIBOR rate, as defined below, for a one-month interest period, plus 1.00%. The adjusted LIBOR rate is equal to the rate per annum (adjusted for statutory reserve requirements for Eurocurrency liabilities) at which Eurodollar deposits are offered in the interbank Eurodollar market for the applicable interest period (one, two, three or six months), as quoted on Reuters screen LIBOR (or any successor page or service). The financing commitments of the lenders extending the 2017 Revolving Credit Facility are subject to various conditions, as set forth in the 2017 Credit Agreement. As of September 30, 2019, the Company has been in compliance with all covenants.  

First Amendment

On June 28, 2017, the Company entered into an amendment to the 2017 Credit Agreement ("First Amendment"), by and among the Company, each of the Lenders party thereto, and Jefferies Finance LLC, as Administrative Agent. The First Amendment clarified

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that for all purposes of the 2017 Credit Agreement the Company's liabilities pursuant to any lease that was treated as rental and lease expense, and not as a capital lease obligation or indebtedness on the closing date of the 2017 Credit Agreement, would continue to be treated as a rental and lease expense, and not as a capital lease obligation or indebtedness notwithstanding any amendment of the lease that results in the treatment of such lease as a capital lease obligation or indebtedness for financial reporting purposes.

Second Amendment

On February 6, 2018, the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent, entered into a Second Amendment to Credit Agreement (the "Second Amendment") that amended the 2017 Credit Agreement.

The Second Amendment, among other things, amends the 2017 Credit Agreement to (i) permit the Company to incur incremental term loans under the 2017 Credit Agreement of up to $135.0 million to finance the Company's acquisition of SingleHop and to pay related fees, costs and expenses, and (ii) revises the maximum total net leverage ratio and minimum consolidated interest coverage ratio covenants.  The financial covenant amendments became effective upon the consummation of the SingleHop acquisition, while the other provisions of the Second Amendment became effective upon the execution and delivery of the Second Amendment. This transaction was considered a modification.

A total of $1.0 million was paid for debt issuance costs related to the Second Amendment. Of the $1.0 million in costs paid, $0.2 million related to the payment of legal and professional fees which were expensed, $0.8 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Third Amendment

On February 28, 2018, INAP entered into the Incremental and Third Amendment to the Credit Agreement among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the "Third Amendment"). The Third Amendment provides for a funding of the new incremental term loan facility under the 2017 Credit Agreement of $135.0 million (the "Incremental Term Loan"). The Incremental Term Loan has terms and conditions identical to the existing loans under the 2017 Credit Agreement, as amended.  Proceeds of the Incremental Term Loan were used to complete the acquisition of SingleHop and to pay fees, costs and expenses related to the acquisition, the Third Amendment and the Incremental Term Loan. This transaction was considered a modification. 

A total of $5.0 million was paid for debt issuance costs related to the Third Amendment. Of the $5.0 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $4.9 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Fourth Amendment

On April 9, 2018, the Company entered into the Fourth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the "Fourth Amendment"). The Fourth Amendment amends the 2017 Credit Agreement to lower the interest rate margins applicable to the outstanding term loans under the 2017 Credit Agreement by 1.25%. This transaction was considered a modification.

A total of $1.7 million was paid for debt issuance costs related to the Fourth Amendment. Of the $1.7 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $1.6 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Fifth Amendment

On August 28, 2018, the Company entered into the Fifth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the “Fifth Amendment”). The Fifth Amendment amended the 2017 Credit Agreement by increasing the aggregate revolving commitment capacity by $10.0 million to $35.0 million.

Sixth Amendment

On May 8, 2019, the Company entered into the Sixth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the “Sixth Amendment”). The Sixth Amendment (i) adjusted the applicable interest rates under the 2017 Credit Agreement, (ii) modified the maximum total net leverage ratio requirements and the minimum consolidated interest coverage ratio requirements and (iii) modified certain other covenants.

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Pursuant to the Sixth Amendment, the applicable margin for the alternate base rate loan was increased from 4.75% per annum to 5.25% per annum and for the Eurodollar loan was increased from 5.75% per annum to 6.25% per annum, with such interest payable in cash, and in addition such term loans bear interest payable in kind at the rate of 0.75% per annum.

The Sixth Amendment also made the following modifications:

• Added an additional basket of $500,000 for finance lease obligations.

• The maximum amount of permitted asset dispositions was decreased from $150,000,000 to $50,000,000.

• The amount of net cash proceeds from asset sales that may be reinvested is limited to $2,500,000 in any fiscal year of the Company, with net cash proceeds that are not so reinvested used to prepay loans under the 2017 Credit Agreement.

• The restricted payment basket was decreased from $5,000,000 to $1,000,000.

The maximum total leverage ratio increases to 6.80 to 1 as of June 30, 2019, 6.90 to 1 as of September 30, 2019 - December 31, 2019, decreases to 6.75 to 1 as of March 31, 2020, 6.25 to 1 as of June 30, 2020, 6.00 to 1 as of September 30, 2020, 5.75 to 1 as of December 31, 2020, 5.50 to 1 as of March 2021, 5.00 to 1 as of June 30, 2021 and 4.50 to 1 as of September 30, 2021 and thereafter.

The minimum consolidated interest coverage ratio decreases to 1.75 to 1 as of June 30, 2019, 1.70 to 1 as of September 30, 2019 - March 31, 2020, increases to 1.80 to 1 as of June 30, 2020, 1.85 to 1 as of September 2020 and 2.00 to 1 as of December 31, 2020 and thereafter. This transaction was considered a modification.

A total of $2.9 million was paid for debt issuance costs related to the Sixth Amendment. Of the $2.9 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $2.8 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

9.    EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES

During 2019 and 2018, we recorded exit activity charges due to ceasing use of office and data center space. We include initial charges and plan adjustments in "Exit activities, restructuring and impairments" in the accompanying condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2019 and 2018.

The following table displays the transactions and balances for exit activities and restructuring charges during the nine months ended September 30, 2019 and 2018 (in thousands). Our real estate and severance obligations are substantially related to our INAP US segment.

	Balance										Balance
	December 31, 2018		Initial Charges (1)		Plan Adjustments			Cash Payments			September 30, 2019
Activity for 2019 restructuring charge:
Real estate obligations	$	—	$	1,629	$	(115	)	$	(1,098	)	$	416
Activity for 2018 restructuring charge:
Real estate obligations	1,922		—		186			(2,108		)	—
Activity for 2017 restructuring charge:
Real estate obligations	100		—		(10		)	(90		)	—
Activity for 2016 restructuring charge:
Real estate obligations	125		—		16			(116		)	25
Activity for 2015 restructuring charge:
Real estate obligation	27		—		29			(49		)	7
Service contracts	221		—		30			(149		)	102
Activity for 2014 restructuring charge:
Real estate obligation	206		—		54			(260		)	—
	$	2,601	$	1,629	$	190		$	(3,870	)	$	550

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^{(1) Additional expense related to the disposal of leasehold improvements of $3,345 was recorded for the three and nine months ended September 30, 2019 and not included in the table above.} 

	Balance									Balance
	December 31, 2017		Initial Charges		Plan Adjustments		Cash Payments			September 30, 2018
Activity for 2018 restructuring charge:
Real estate obligations	$	—	$	1,821	$	902	$	(961	)	$	1,762
Activity for 2017 restructuring charge:
Real estate obligations	3,380		—		220		(2,747		)	853
Activity for 2016 restructuring charge:
Severance	46		—		35		(35		)	46
Real estate obligations	247		—		29		(122		)	154
Activity for 2015 restructuring charge:
Real estate obligation	64		—		8		(36		)	36
Service contracts	388		—		22		(148		)	262
Activity for 2014 restructuring charge:
Real estate obligation	691		—		161		(548		)	304
	$	4,816	$	1,821	$	1,377	$	(4,597	)	$	3,417

10.     COMMITMENTS, CONTINGENCIES AND LITIGATION

We are subject to legal proceedings, claims and litigation arising in the ordinary course of business. Although the outcome of these matters is currently not determinable, we do not expect that the ultimate costs to resolve these matters will have a material adverse impact on our financial condition, results of operations or cash flows.

11. OPERATING SEGMENTS

The Company has two reportable segments: INAP US and INAP INTL. These segments are comprised of strategic businesses that are defined by the location of the service offerings. Our INAP US segment consists of US Colocation, US Cloud, and US Network services based in the United States. Our INAP INTL segment consists of these same services based in countries other than the United States, and Ubersmith.

Each segment is managed as an operation with well-established strategic directions and performance requirements. Each segment is led by a separate General Manager who reports to the Chief Operating Officer. The Chief Operating Officer reports directly to the Company's CODM. The CODM evaluates segment performance using business unit contribution which is defined as business unit revenues less direct costs of sales and services, customer support, and sales and marketing, exclusive of depreciation and amortization.

Our services, which are included within both our reportable segments, are described as follows:

Colocation

Colocation involves providing conditioned power with back-up capacity and physical space within data centers along with associated services such as interconnection, remote hands, environmental controls, monitoring and security while allowing our customers to deploy and manage their servers, storage and other equipment in our secure data centers. We design the data center infrastructure, procure the capital equipment, deploy the infrastructure and are responsible for the operation and maintenance of the facility.

Cloud

Cloud services involve providing compute resources and storage services on demand via an integrated platform that includes our automated bare metal solutions. We offer our next generation cloud platforms in our high density colocation facilities and utilize the INAP Performance IP for low latency connectivity. 

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Network

Network services includes our patented Performance IP™ service, content delivery network services, as well as our IP routing hardware and software platform. By intelligently routing traffic with redundant, high-speed connections over multiple, major Internet backbones, our IP connectivity provides high-performance and highly-reliable delivery of content, applications and communications to end users globally. We deliver our IP connectivity through 100 network POPs around the world.

The following table provides segment results (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
INAP US	$	56,947		$	65,678		$	171,928		$	186,821
INAP INTL	15,931			17,294			47,648			52,314
Net revenues	72,878			82,972			219,576			239,135
Cost of sales and services, customer support and sales and marketing:
INAP US	32,920			35,197			97,780			99,532
INAP INTL	10,148			11,478			29,892			34,483
Total costs of sales and services, customer support and sales and marketing	43,068			46,675			127,672			134,015
										.
Segment profit:
INAP US	24,027			30,481			74,148			87,289
INAP INTL	5,783			5,816			17,756			17,831
Total segment profit	29,810			36,297			91,904			105,120
Exit activities, restructuring and impairments	3,792			2,347			5,439			3,140
Other operating expenses, including sales, general and administrative and depreciation and amortization expenses	29,954			31,253			91,885			95,404
(Loss) income from operations	(3,936		)	2,697			(5,420		)	6,576
Non-operating expenses	19,919			17,989			56,906			50,143
Loss before income taxes and equity in earnings of equity-method investment	$	(23,855	)	$	(15,292	)	$	(62,326	)	$	(43,567	)

The CODM does not manage the operating segments based on asset allocations. Therefore, assets by operating segment have not been provided.

12. NET LOSS PER SHARE

We compute basic net loss per share by dividing net loss attributable to our common stockholders by the weighted average number of shares of common stock outstanding during the period. We exclude all outstanding options and unvested restricted stock as such securities are anti-dilutive for all periods presented.

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Basic and diluted net loss per share is calculated as follows (in thousands, except per share amounts):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net loss	$	(23,849	)	$	(15,454	)	$	(62,006	)	$	(43,971	)
Less net income attributable to non-controlling interests	21			25			63			75
Net loss attributable to shareholders	$	(23,870	)	$	(15,479	)	$	(62,069	)	$	(44,046	)
Weighted average shares outstanding, basic and diluted	23,671			20,206			23,703			19,968
Net loss per share, basic and diluted	$	(1.01	)	$	(0.77	)	$	(2.62	)	$	(2.21	)
Anti-dilutive securities excluded from diluted net loss per share calculation for stock-based compensation plans	1,920			1,065			1,920			1,065

13. INVESTMENT IN AFFLIATES AND OTHER ENTITIES

In the normal course of business, INAP enters into various types of investment arrangements, each having unique terms and conditions.

In previous years, INAP invested $4.1 million in Internap Japan Co., Ltd., ("INAP Japan") our joint venture with NTT-ME Corporation ("NTT-ME") and Nippon Telegraph and Telephone Corporation. Through August 15, 2017, we qualified and accounted for this investment using the equity method. We recorded our proportional share of the income and losses of INAP Japan one month in arrears on the accompanying consolidated balance sheets as a long-term investment and our share of INAP Japan's income and losses, net of taxes, as a separate caption in our accompanying consolidated statements of operations and comprehensive loss.

On August 15, 2017, INAP exercised certain rights to obtain a controlling interest in Internap Japan Co., Ltd. Upon obtaining control of the venture, we recognized INAP Japan's assets and liabilities at fair value resulting in a gain of $1.1 million. Once INAP obtained control of the Internap Japan Co., Ltd. venture, the investment was consolidated with INAP using the voting model.

On January 15, 2019, NTT-ME exercised its first put option that resulted in NTT-ME having an ownership of 15% and INAP of 85%. The put option was exercised at $1.0 million which represents the fair market value of the shares purchased.

14. SUBSEQUENT EVENTS

On October 29, 2019, the Company entered into the Seventh Amendment to 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the “Seventh  Amendment”). The Seventh Amendment (i) modified the maximum total net leverage ratio requirements and the minimum consolidated interest coverage ratio requirements under the 2017 Credit Agreement and (ii) effected certain other modifications, including changes to certain baskets.

The maximum total leverage ratio increases to 7.25 to 1 as of December 31, 2019 - December 31, 2020, 5.50 to 1 as of March 31, 2021, 5.00 to 1 as of June 30, 2021, 4.50 to 1 as of September 30, 2021 and thereafter.

The minimum consolidated interest coverage ratio decreases to 1.60 to 1 as of December 31, 2019 - December 31, 2020, 2.00 to 1.00 as of March 31, 2021 and thereafter.

The Seventh Amendment also made the following modifications:

• Reduced the disposition of property basket from $50.0 million to $25.0 million.

• Reduced reinvestment of net cash proceeds from asset sales from $2.5 million to $1.0 million.

• Reduced investment basket from greater of $25.0 million and 30% of EBITDA to greater of $12.5 million and 15% of EBITDA.

• Reduced incremental facility from $50.0 million to $25.0 million.

• Reduced foreign subsidiary debt basket from greater of $15.0 million and 18% of EBITDA to greater of $5.0 million and 6% of EBITDA.

• Reduced general basket from greater of $50.0 million and 61% of EBITDA to greater of $25.0 million and 30% of EBITDA.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS

As used herein, except as otherwise indicated by context, references to "we," "us," "our," "INAP," or "the Company" refers to Internap Corporation and our subsidiaries.

Forward-Looking Statements

Certain statements in this Form 10-Q contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements regarding industry trends, our future financial position and performance, business strategy, revenues and expenses in future periods, projected levels of growth, availability of capital resources and liquidity and other matters that do not relate strictly to historical facts. These statements are often identified by words such as "may," "will," "seeks," "anticipates," "believes," "estimates," "expects," "projects," "forecasts," "plans," "intends," "continue," "could" or "should," that an "opportunity" exists, that we are "positioned" for a particular result, statements regarding our vision or similar expressions or variations. These statements are based on the beliefs and expectations of our management team based on information available at the time such statements are made. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated by such forward-looking statements.

Therefore, actual future results and trends may differ materially from what is forecast in such forward-looking statements due to a variety of factors, including, without limitation: our ability to drive growth while reducing costs; our ability to maintain current customers and obtain new ones, whether in a cost-effective manner or at all; the robustness of the IT infrastructure services market; our ability to achieve or sustain profitability; our ability to expand margins and drive higher returns on investment; our ability to sell into new and existing data center space; the actual performance of our IT infrastructure services and our ability to improve operations; our ability to correctly forecast capital needs, demand and space utilization; our ability to respond successfully to technological change and the resulting competition; the geographic concentration of our data centers in certain markets and any adverse developments in local economic conditions or the demand for data center space in these markets; the uncertainty as to whether any strategic alternative will be pursued or, if pursued, closed; uncertainty as to the terms, value and timing of any such strategic alternative; the impact of the announcement of the evaluation of strategic alternatives on INAP’s common stock, its businesses, and its operating results; the availability of services from Internet network service providers or network service providers providing network access loops and local loops on favorable terms, or at all; the failure of third party suppliers to deliver their products and services on favorable terms, or at all; failures in our network operations centers, data centers, network access points or computer systems; our ability to provide or improve Internet infrastructure services to our customers; our ability to protect our intellectual property; our substantial amount of indebtedness, our ability to raise additional capital when needed, on attractive terms, or at all, and our ability to service existing debt or maintain compliance with financial and other covenants contained in our credit agreement; our compliance with and changes in complex laws and regulations in the U.S. and internationally; our ability to attract and retain qualified management and other personnel; and volatility in the trading price of INAP common stock.

These risks and other important factors discussed under the caption "Risk Factors" in our most recent Annual Report on Form 10-K filed with the SEC and our other reports filed with the SEC could cause actual results to differ materially from those expressed or implied by forward-looking statements made in this Form 10-Q.

Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. All forward-looking statements attributable to INAP or persons acting on our behalf are expressly qualified in their entirety by the foregoing forward-looking statements. All such statements speak only as of the date made, and INAP undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

INAP is a leading-edge provider of high-performance data center and cloud solutions with 100 network Points of Presence (“POP”) worldwide. INAP's full-spectrum portfolio of high-density colocation, managed cloud hosting and network solutions supports evolving IT infrastructure requirements for customers ranging from the Fortune 500 to emerging startups. INAP operates in 21 metropolitan markets, primarily in North America, with 14 INAP Data Center Flagships connected by a low-latency, high-capacity network. 

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Recent Accounting Pronouncements

Recent accounting pronouncements are summarized in Note 2, "Recent Accounting Pronouncements," in the accompanying condensed consolidated financial statements.

Results of Operations

Three Months Ended September 30, 2019 and 2018

The following table sets forth selected consolidated statements of operations and comprehensive loss data during the periods presented, including comparative information between the periods (dollars in thousands):

	Three Months Ended September 30,					Variance
	2019			2018		Amount			Percent
Net revenues	$	72,878		$	82,972	$	(10,094	)	(12	)%
Operating costs and expenses:
Costs of sales and services, exclusive of depreciation and amortization	27,504			28,221		(717		)	(3	)%
Costs of customer support	8,145			7,984		161			2	%
Sales, general and administrative	15,791			18,170		(2,379		)	(13	)%
Depreciation and amortization	21,582			23,553		(1,971		)	(8	)%
Exit activities, restructuring and impairments	3,792			2,347		1,445			62	%
Total operating costs and expenses	76,814			80,275		(3,461		)	(4	)%
(Loss) income from operations	$	(3,936	)	$	2,697	$	(6,633	)	(246	)%
Interest expense	$	19,913		$	17,794	$	2,119		12	%

Supplemental Schedule

	Three Months Ended September 30,				Variance
	2019		2018		Amount			Percent
Revenues:
INAP US	$	56,947	$	65,678	$	(8,731	)	(13	)%
INAP INTL	15,931		17,294		(1,363		)	(8	)%
Net revenues	72,878		82,972		(10,094		)	(12	)%
Costs of sales and services, exclusive of depreciation and amortization:
INAP US	20,716		21,208		(492		)	(2	)%
INAP INTL	6,788		7,013		(225		)	(3	)%
Total costs of sales and services, exclusive of depreciation and amortization	$	27,504	$	28,221	$	(717	)	(3	)%

INAP US

Revenues for our INAP US segment decreased approximately 13% to $56.9 million for the three months ended September 30, 2019 compared to $65.7 million for the same period in 2018. The decrease was primarily due to planned data center exits and churn from several large customers in 2018.

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Costs of sales and services, exclusive of depreciation and amortization, of our INAP US segment decreased 2% to $20.7 million for the three months ended September 30, 2019, compared to $21.2 million for the same period in 2018. The decrease was primarily due to exited facilities and cost savings initiatives beginning in the first quarter of 2019 offset by net lease adjustments due to change in lease classification.

INAP INTL

Revenues for our INAP INTL segment decreased 8% to $15.9 million for the three months ended September 30, 2019 compared to $17.3 million for the same period in 2018. The decrease was primarily due to churn from large customers in 2018.

Costs of sales and services, exclusive of depreciation and amortization, of our INAP INTL segment decreased 3% to $6.8 million for the three months ended September 30, 2019, compared to $7.0 million for the same period in 2018. The change was primarily due to cost savings initiatives.

Other Operating Costs and Expenses

Compensation. Total compensation and benefits, including stock-based compensation, was $15.9 million for the three months ended September 30, 2019 compared to $16.9 million for the same period in 2018. The decrease was due to cost savings initiatives.

Stock-based compensation, net of amount capitalized, decreased $0.1 million to $1.2 million during the three months ended September 30, 2019 compared to $1.3 million during the same period in 2018.

Costs of Customer Support. Costs of customer support increased slightly to $8.1 million for the three months ended September 30, 2019 compared to $8.0 million during the same period in 2018.

Sales, General and Administrative. Sales, general and administrative costs decreased to $15.8 million during the three months ended September 30, 2019 compared to $18.2 million during the same period in 2018. The decrease was primarily due to reductions in commission expense due to lower revenues and reductions in wages due to cost savings initiatives.

Depreciation and Amortization. Depreciation and amortization decreased to $21.6 million during the three months ended September 30, 2019 compared to $23.6 million during the same period in 2018. The decrease is primarily due to lower capital expenditures and continued use of depreciated assets.

Exit Activities and Restructuring. Exit activities and restructuring increased to $3.8 million during the three months ended September 30, 2019 compared to $2.3 million during the same period in 2018. The increase is primarily due to the disposal of leasehold improvements of $3.3 million for an exited facility.

Interest Expense. Interest expense increased to $19.9 million during the three months ended September 30, 2019 from $17.8 million during the same period in 2018. The increase is primarily due to increased interest on the 2017 Term Loan due to higher interest rates and additional interest expense related to finance leases.

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Nine Months Ended September 30, 2019 and 2018

The following table sets forth selected consolidated statements of operations and comprehensive loss data during the periods presented, including comparative information between the periods (dollars in thousands):

	Nine Months Ended September 30,					Variance
	2019			2018		Amount			Percent
Net revenues	$	219,576		$	239,135	$	(19,559	)	(8	)%
Operating costs and expenses:
Costs of sales and services, exclusive of depreciation and amortization	79,186			80,160		(974		)	(1	)%
Costs of customer support	25,661			24,212		1,449			6	%
Sales, general and administrative	48,995			57,625		(8,630		)	(15	)%
Depreciation and amortization	65,715			67,422		(1,707		)	(3	)%
Exit activities, restructuring and impairments	5,439			3,140		2,299			73	%
Total operating costs and expenses	224,996			232,559		(7,563		)	(3	)%
(Loss) income from operations	$	(5,420	)	$	6,576	$	(11,996	)	(182	)%
Interest expense	$	56,578		$	50,138	$	6,440		13	%

Supplemental Schedule

	Nine Months Ended September 30,				Variance
	2019		2018		Amount			Percent
Revenues:
INAP US	$	171,928	$	186,821	$	(14,893	)	(8	)%
INAP INTL	47,648		52,314		(4,666		)	(9	)%
Net revenues	219,576		239,135		(19,559		)	(8	)%
Costs of sales and services, exclusive of depreciation and amortization:
INAP US	59,713		59,405		308			1	%
INAP INTL	19,473		20,755		(1,282		)	(6	)%
Total costs of sales and services, exclusive of depreciation and amortization	$	79,186	$	80,160	$	(974	)	(1	)%

INAP US

Revenues for our INAP US segment decreased 8% to $171.9 million for the nine months ended September 30, 2019 compared to $186.8 million for the same period in 2018. The decrease in revenue is primarily due to planned data center exits and churn from several larger customers in 2018, partially offset by the addition of SingleHop.

Costs of sales and services, exclusive of depreciation and amortization, of our INAP US segment increased 1% to $59.7 million for the nine months ended September 30, 2019, compared to $59.4 million for the same period in 2018. The increase was primarily due to SingleHop costs and a global transfer pricing adjustment between segments, partially offset by lower space and power costs from ongoing data center exits and cost savings initiatives.

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INAP INTL

Revenues for our INAP INTL segment decreased 9% to $47.6 million for the nine months ended September 30, 2019 compared to $52.3 million for the same period in 2018. The decrease was primarily due to churn from large customers in 2018.

Costs of sales and services, exclusive of depreciation and amortization, of our INAP INTL segment decreased 6% to $19.5 million for the nine months ended September 30, 2019, compared to $20.8 million for the same period in 2018. The decrease was primarily due to ongoing cost savings initiatives and a global transfer pricing adjustment between segments.

Other Operating Costs and Expenses

Compensation. Total compensation and benefits, including stock-based compensation, was $49.5 million for the nine months ended September 30, 2019 compared to $51.5 million for the same period in 2018. The change was primarily due to ongoing cost savings initiatives.

Stock-based compensation, net of amount capitalized, decreased to $3.1 million during the nine months ended September 30, 2019 from $3.6 million during the same period in 2018. The decrease is due to lower headcount as a result of cost savings initiatives.

Costs of Customer Support. Costs of customer support increased to $25.7 million during the nine months ended September 30, 2019 compared to $24.2 million during the same period in 2018. The increase was primarily due to the SingleHop acquisition.

Sales, General and Administrative. Sales, general and administrative costs decreased to $49.0 million during the nine months ended September 30, 2019 compared to $57.6 million during the same period in 2018. The decrease was primarily due to cost savings initiatives and certain costs from 2018 that did not recur in 2019, such as acquisition costs and a non-income tax settlement.

Depreciation and Amortization. Depreciation and amortization decreased to $65.7 million during the nine months ended September 30, 2019 compared to $67.4 million during the same period in 2018. The decrease is primarily due to lower capital expenditures and continued use of depreciated assets.

Exit Activities, Restructuring and Impairments. Exit activities, restructuring and impairments increased to $5.4 million during the nine months ended September 30, 2019 compared to $3.1 million of expense during the same period in 2018. The increase is primarily due to data center exits in 2019.

Interest Expense. Interest expense increased to $56.6 million during the nine months ended September 30, 2019 from $50.1 million during the same period in 2018. The increase is primarily due to increased borrowings and additional interest expense related to finance leases.

Non-GAAP Financial Measure

We report our consolidated financial statements in accordance with GAAP. In addition, we present Adjusted EBITDA, an additional financial measure that is not prepared in accordance with GAAP ("non-GAAP"). A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure can be found below.

We define Adjusted EBITDA as GAAP net loss attributable to shareholders plus depreciation and amortization, interest expense, (benefit) provision for income taxes, other expense (income), (gain) loss on disposal of property and equipment, exit activities, restructuring and impairments, stock-based compensation, non-income tax contingency, strategic alternatives and related costs, organizational realignment costs and acquisition costs.

Adjusted EBITDA is not a measure of financial performance calculated in accordance with GAAP, and should be viewed as a supplement to - not a substitute for - our results of operations presented on the basis of GAAP. Adjusted EBITDA does not purport to represent cash flow provided by operating activities as defined by GAAP. Our statements of cash flows present our cash flow activity in accordance with GAAP. Furthermore, Adjusted EBITDA is not necessarily comparable to similarly-titled measures reported by other companies.

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We believe Adjusted EBITDA is used by and is useful to investors and other users of our financial statements in evaluating our operating performance because it provides them with an additional tool to compare business performance across companies and across periods. We believe that:

• EBITDA is widely used by investors to measure a company’s operating performance without regard to items such as interest expense, income taxes, depreciation and amortization, which can vary substantially from company-to-company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired;

• investors commonly adjust EBITDA information to eliminate the effect of disposals of property and equipment, impairments, restructuring and stock-based compensation which vary widely from company-to-company and impair comparability; and

• certain investors use EBITDA as a measure of our ability to service debt.

Our management uses Adjusted EBITDA:

• as a measure of operating performance to assist in comparing performance from period-to-period on a consistent basis;

• as a measure for planning and forecasting overall expectations and for evaluating actual results against such expectations;

• as a key measure to calculate our debt covenants; and

• in communications with the board of directors, analysts and investors concerning our financial performance.

Adjusted EBITDA, as presented, may not be comparable to similarly titled measures of other companies.

Although we believe, for the foregoing reasons, that our presentation of the non-GAAP financial measure provides useful supplemental information to investors regarding our results of operations, our non-GAAP financial measure should only be considered in addition to, and not as a substitute for, or superior to, any measure of financial performance prepared in accordance with GAAP.

The following table reconciles net loss attributable to shareholders as presented in our condensed consolidated statements of operations and comprehensive loss to Adjusted EBITDA (non-GAAP) (in thousands): 

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net revenues	$	72,878		$	82,972		$	219,576		$	239,135
Net loss attributable to shareholders	$	(23,870	)	$	(15,479	)	$	(62,069	)	$	(44,046	)
Depreciation and amortization	21,582			23,553			65,715			67,422
Interest expense	19,913			17,794			56,578			50,138
(Benefit) provision for income taxes	(6		)	162			(320		)	404
Other expense	6			195			328			11
(Gain) loss on disposal of property and equipment, net	(13		)	(66		)	515			(96		)
Exit activities, restructuring and impairments	3,792			2,347			5,439			3,140
Stock-based compensation	1,173			1,341			3,074			3,573
Acquisition costs(1)	273			5			577			2,869
Strategic alternatives and related costs(2)	21			25			63			75
Organizational realignment costs(3)	119			118			975			789
Non-income tax contingency	—			36			150			836
Adjusted EBITDA	$	22,990		$	30,031		$	71,025		$	85,115

⁽¹⁾ On February 28, 2018, we acquired SingleHop which resulted in higher acquisition costs for the nine months ended September

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30, 2018.

⁽²⁾  Primarily legal and other professional fees incurred in connection with the evaluation by our board of directors of strategic alternatives and related shareholder communications. We include these costs in sales, general and administrative ("SG&A") in the accompanying condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2019 and 2018.

⁽³⁾  Primarily professional fees, employee retention bonus and severance and executive search costs incurred related to our organization realignment. We include these costs in SG&A in the accompanying condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2019 and 2018.

Liquidity and Capital Resources

Liquidity

On an ongoing basis, we require capital to fund our current sales and operations, make acquisitions, expand our IT infrastructure services, upgrade existing facilities or establish new facilities, products, services or capabilities. As of September 30, 2019, we had $17.2 million of borrowing capacity under our 2017 Revolving Credit Facility. Together with our cash and cash equivalents, the Company’s liquidity as of September 30, 2019 was $28.1 million.

As of September 30, 2019, we had a deficit of $23.6 million in working capital, which represented an excess of current liabilities over current assets. We believe that cash flows from operations, together with our cash and cash equivalents and borrowing capacity under our 2017 Revolving Credit Facility (as defined below), will be sufficient to meet our cash requirements for the next 12 months. If our cash requirements vary materially from our expectations or if we fail to generate sufficient cash flows from our operations or if we fail to implement our cost reduction strategies, we may require additional financing sooner than anticipated. We can offer no assurance that we will be able to obtain additional financing on commercially favorable terms, or at all, and provisions in our 2017 Credit Agreement limit our ability to incur additional indebtedness. Our anticipated uses of cash include capital expenditures in the range of $30.0 to $32.0 million in 2019, working capital needs and required payments on our 2017 Credit Agreement and other commitments. We continue to optimize our cost structure through implementing cost reductions through such strategies as reorganizing our business units, right-sizing headcount and streamlining other operational aspects of our business. However, there can be no guarantee that we will achieve any of our cost reduction goals. 

Our sources of capital include, but are not limited to, funds derived from selling our services and results of our operations, sales of assets, borrowings under our credit arrangement, and the issuance of debt or equity securities. Our short term and long term liquidity depend primarily upon the funds derived from selling our services net of our costs to deliver those services, working capital management (cash, accounts receivable, accounts payable and other liabilities), and bank borrowings. In an effort to increase liquidity and generate cash, we may pursue sales of non-strategic assets, reduce our expenses, amend our credit facility, pursue sales of debt or equity securities or other recapitalization transactions, or seek other external sources of funds. 

Capital Resources

Credit Agreement

On April 6, 2017, we entered into a new credit agreement (the "2017 Credit Agreement"), which provided for a $300.0 million term loan facility ("2017 Term Loan") and a $25.0 million Revolving Credit Facility (the "2017 Revolving Credit Facility"). The proceeds of the 2017 Term Loan were used to refinance the Company's existing credit facility and to pay costs and expenses associated with the 2017 Credit Agreement.

Certain portions of the refinancing transaction were considered an extinguishment of debt and certain portions were considered a modification. A total of $5.7 million was paid for debt issuance costs related to the 2017 Credit Agreement. Of the $5.7 million in costs paid, $1.9 million was related to the exchange of debt and was expensed, $3.3 million related to 2017 Term Loan third party costs and will be amortized over the 2017 Term Loan and $0.4 million prepaid debt issuance costs related to the 2017 Revolving Credit Facility and will be amortized over the term of the 2017 Revolving Credit Facility. In addition, $4.8 million of debt discount and debt issuance costs related to the previous credit facility were expensed due to the extinguishment of that credit facility. The maturity date of the 2017 Term Loan is April 6, 2022 and the maturity date of the 2017 Revolving Credit Facility is October 6, 2021.

As of September 30, 2019, the outstanding balance of the 2017 Term Loan and the 2017 Revolving Credit Facility was $414.6 million and $14.0 million, respectively. The interest rate on the 2017 Term Loan and the 2017 Revolving Credit Facility as of September 30, 2019 were 8.31% and 11.00%, respectively.

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Borrowings under the 2017 Credit Agreement bear interest at a rate per annum equal to an applicable margin plus, at our option, a base rate or an adjusted LIBOR rate. The applicable margin for loans under the 2017 Revolving Credit Facility is 6.0% for loans bearing interest calculated using the base rate ("Base Rate Loans") and 7.0% for loans bearing interest calculated using the adjusted LIBOR rate. The applicable margin for loans under the 2017 Term Loan is 4.75% for Base Rate Loans and 5.75% for adjusted LIBOR rate loans. The base rate is equal to the highest of (a) the adjusted U.S. Prime Lending Rate as published in the Wall Street Journal, (b) with respect to term loans issued on the closing date, 2.00%, (c) the federal funds effective rate from time to time, plus 0.50%, and (d) the adjusted LIBOR rate, as defined below, for a one-month interest period, plus 1.00%. The adjusted LIBOR rate is equal to the rate per annum (adjusted for statutory reserve requirements for Eurocurrency liabilities) at which Eurodollar deposits are offered in the interbank Eurodollar market for the applicable interest period (one, two, three or six months), as quoted on Reuters screen LIBOR (or any successor page or service). The financing commitments of the lenders extending the 2017 Revolving Credit Facility are subject to various conditions, as set forth in the 2017 Credit Agreement. As of September 30, 2019, the Company has been in compliance with all covenants.  

First Amendment

On June 28, 2017, the Company entered into an amendment to the 2017 Credit Agreement ("First Amendment"), by and among the Company, each of the Lenders party thereto, and Jefferies Finance LLC, as Administrative Agent. The First Amendment clarified that for all purposes of the 2017 Credit Agreement, the Company's liabilities pursuant to any lease that was treated as rental and lease expense, and not as a capital lease obligation or indebtedness on the closing date of the 2017 Credit Agreement, would continue to be treated as a rental and lease expense, and not as a capital lease obligation or indebtedness, notwithstanding any amendment of the lease that results in the treatment of such lease as a capital lease obligation or indebtedness for financial reporting purposes.

Second Amendment

On February 6, 2018, the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent, entered into a Second Amendment to Credit Agreement (the "Second Amendment") that amended the 2017 Credit Agreement.

The Second Amendment, among other things, amends the 2017 Credit Agreement to (i) permit the Company to incur incremental term loans under the 2017 Credit Agreement of up to $135.0 million to finance the Company's acquisition of SingleHop and to pay related fees, costs and expenses, and (ii) revises the maximum total net leverage ratio and minimum consolidated interest coverage ratio covenants.  The financial covenant amendments became effective upon the consummation of the SingleHop acquisition, while the other provisions of the Second Amendment became effective upon the execution and delivery of the Second Amendment. This transaction was considered a modification.

A total of $1.0 million was paid for debt issuance costs related to the Second Amendment. Of the $1.0 million in costs paid, $0.2 million related to the payment of legal and professional fees which were expensed, $0.8 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Third Amendment

On February 28, 2018, INAP entered into the Incremental and Third Amendment to the Credit Agreement among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the "Third Amendment"). The Third Amendment provides for a funding of the new incremental term loan facility under the 2017 Credit Agreement of $135.0 million (the "Incremental Term Loan"). The Incremental Term Loan has terms and conditions identical to the existing loans under the 2017 Credit Agreement, as amended. Proceeds of the Incremental Term Loan were used to complete the acquisition of SingleHop and to pay fees, costs and expenses related to the acquisition, the Third Amendment and the Incremental Term Loan. This transaction was considered a modification. 

A total of $5.0 million was paid for debt issuance costs related to the Third Amendment. Of the $5.0 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $4.9 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Fourth Amendment

On April 9, 2018, the Company entered into the Fourth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the "Fourth Amendment"). The Fourth Amendment amends the 2017 Credit Agreement to lower the interest rate margins applicable to the outstanding term loans under the 2017

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Credit Agreement by 1.25%. This transaction was considered a modification.

A total of $1.7 million was paid for debt issuance costs related to the Fourth Amendment. Of the $1.7 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $1.6 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Fifth Amendment

On August 28, 2018, the Company entered into the Fifth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the "Fifth Amendment"). The Fifth Amendment amended the 2017 Credit Agreement by increasing the aggregate revolving commitment capacity by $10.0 million to $35.0 million.

Sixth Amendment

On May 8, 2019, the Company entered into the Sixth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the “Sixth Amendment”). The Sixth Amendment (i) adjusted the applicable interest rates under the 2017 Credit Agreement, (ii) modified the maximum total net leverage ratio requirements and the minimum consolidated interest coverage ratio requirements and (iii) modified certain other covenants.

Pursuant to the Sixth Amendment, the applicable margin for the alternate base rate loan was increased from 4.75% per annum to 5.25% per annum and for the Eurodollar loan was increased from 5.75% per annum to 6.25% per annum, with such interest payable in cash, and in addition such term loans bear interest payable in kind at the rate of 0.75% per annum.

The Sixth Amendment also made the following modifications:

• Added an additional basket of $500,000 for finance lease obligations.

• The maximum amount of permitted asset dispositions was decreased from $150,000,000 to $50,000,000.

• The amount of net cash proceeds from asset sales that may be reinvested is limited to $2,500,000 in any fiscal year of the Company, with net cash proceeds that are not so reinvested used to prepay loans under the 2017 Credit Agreement.

• The restricted payment basket was decreased from $5,000,000 to $1,000,000.

The maximum total leverage ratio increases to 6.80 to 1 as of June 30, 2019, 6.90 to 1 as of September 30, 2019 - December 31, 2019, decreases to 6.75 to 1 as of March 31, 2020, 6.25 to 1 as of June 30, 2020, 6.00 to 1 as of September 30, 2020, 5.75 to 1 as of December 31, 2020, 5.50 to 1 as of March 2021, 5.00 to 1 as of June 30, 2021 and 4.50 to 1 as of September 30, 2021 and thereafter.

The minimum consolidated interest coverage ratio decreases to 1.75 to 1 as of June 30, 2019, 1.70 to 1 as of September 30, 2019 - March 31, 2020, increases to 1.80 to 1 as of June 30, 2020, 1.85 to 1 as of September 2020 and 2.00 to 1 as of December 31, 2020 and thereafter. This transaction was considered a modification.

A total of $2.9 million was paid for debt issuance costs related to the Sixth Amendment. Of the $2.9 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $2.8 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Cash Flows

Operating Activities

During the nine months ended September 30, 2019, net cash provided by operating activities decreased $5.7 million to $18.7 million primarily due to changes in working capital.

Investing Activities

During the nine months ended September 30, 2019, net cash used in investing activities decreased $132.5 million to $23.9 million primarily due to the acquisition of SingleHop in 2018.

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Financing Activities

During the nine months ended September 30, 2019, net cash used in financing activities was $1.5 million compared to $129.2 million of net cash provided by financing activities for the same period in 2018. The use of cash in 2019 was primarily due to principal payments of $11.5 million on the credit facilities and finance lease obligations, offset by $14.0 million of proceeds from the revolving credit facility. In 2018, cash proceeds from financing activities was primarily due to $148.5 million of proceeds from the credit agreement used to fund the acquisition of SingleHop, offset by debt issuance costs of $7.7 million and principal payments of $9.9 million on the credit facilities and finance lease obligations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

Our objective in managing interest rate risk is to maintain favorable long-term fixed rate or a balance of fixed and variable rate debt within reasonable risk parameters. As of September 30, 2019, the outstanding balance of our long-term debt was $414.6 million net of loan costs and discounts on the 2017 Term Loan and $14.0 million on the 2017 Revolving Credit Facility.

At September 30, 2019, the interest rate on the 2017 Term Loan and 2017 Revolving Credit Facility was 8.31% and 11.00%, respectively. We summarize the 2017 Credit Agreement in “Liquidity and Capital Resources—Capital Resources—Credit Agreement.” We are required to pay a commitment fee at a rate of 0.50% per annum on the average daily unused portion of the 2017 Revolving Credit Facility, payable quarterly in arrears. In addition, we are required to pay certain participation fees and fronting fees in connection with standby letters of credit issued under the 2017 Revolving Credit Facility. 

The interest rate on the 2017 Term Loan does include a variable component. We estimate that a change in the interest rate of 100 basis points would change our interest expense and payments by approximately $4.4 million per year, assuming we do not increase our borrowings.

In July 2017, the Financial Conduct Authority (the authority that regulates LIBOR) announced it intends to stop compelling banks to submit rates for the calculation of LIBOR after 2021. The Alternative Reference Rates Committee, or ARRC, has proposed that the Secured Overnight Financing Rate, or SOFR, is the rate that represents best practice as the alternative to LIBOR for use in derivatives and other financial contracts that are currently indexed to LIBOR. The ARRC has proposed a paced market transition plan to SOFR from LIBOR and organizations are currently working on industry wide and company specific transition plans as it relates to derivatives and cash markets exposed to LIBOR. At September 30, 2019, the Company does have contracts that are indexed to LIBOR, including the 2017 Credit Agreement, and continues to monitor this activity and evaluate the related risks.

Foreign Currency Risk

As of September 30, 2019, the majority of our revenue was in U.S. dollars. However, our results of operations and cash flows are subject to fluctuations in foreign currency exchange rates. We also have exposure to foreign currency transaction gains and losses as the result of certain receivables due from our foreign subsidiaries. During the three and nine months ended September 30, 2019, we realized a foreign currency loss of less than $0.1 million and $0.3 million, respectively, which we included in “Loss on foreign currency, net,” and we recorded an unrealized foreign currency translation loss of less than $0.1 million and a gain of $0.2 million, respectively, which we included in “Foreign currency translation adjustment,” both in the accompanying condensed consolidated statements of operations and comprehensive loss. As we grow our international operations, our exposure to foreign currency risk will become more significant.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the "Exchange Act"). Disclosure controls are designed to provide reasonable assurance that we are able to record, process, summarize and report the information required to be disclosed in our reports under the Exchange Act within the time periods specified in SEC rules and forms. Based on their evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective.

38

Changes in Internal Control over Financial Reporting

Effective January 1, 2019, we adopted the new lease standard as discussed in Note 2, "Recent Accounting Pronouncements" and Note 4, "Leases" to the notes to condensed consolidated financial statements. As a result of our adoption of the new lease standard, we have implemented a new lease accounting system, accounting policies and processes which changed the Company's internal controls over financial reporting for lease accounting.

There were no other changes in our internal control over financial reporting during the quarter ended September 30, 2019, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

39

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are subject to legal proceedings, claims and litigation arising in the ordinary course of business. Although the outcome of these matters is currently not determinable, we do not expect that the ultimate costs to resolve these matters will have a material adverse impact on our financial condition, results of operations or cash flows.

ITEM 1A. RISK FACTORS

We believe that there have been no material changes from the Risk Factors we previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on March 18, 2019.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table sets forth information regarding our repurchases of securities for each calendar month in the three months ended September 30, 2019:

ISSUER PURCHASES OF EQUITY SECURITIES

Period	Total Number of Shares Purchased(1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Plans or Programs
July 1 to 31, 2019	176	$	3.17	—	$	5,000,000
August 1 to 31, 2019	213	2.35		—	5,000,000
September 1 to 30, 2019	133	2.28		—	5,000,000
Total	522	$	2.61	—

⁽¹⁾  These shares were surrendered to us to satisfy tax withholding obligations in connection with the vesting of shares of restricted stock and restricted stock units previously issued to employees.

40

ITEM 6. EXHIBITS

The following exhibits are filed as part of this report:

Exhibit Number	Description
10.1+	Employment Agreement, dated August 26, 2019, by and between the Company and Michael T. Sicoli (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed August 27, 2019).
10.2+	Restricted Stock Inducement Award Agreement, dated August 26, 2019, by and between the Company and Michael T. Sicoli (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed August 27, 2019).
10.3+	Notice of Grant of Restricted Stock, dated August 26, 2019, by and between the Company and Michael T. Sicoli (incorporated herein by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed August 27, 2019).
10.4+	Indemnity Agreement, dated August 26, 2019, by and between the Company and Michael T. Sicoli (incorporated herein by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K, filed August 27, 2019).
10.5+	Employment Covenants Agreement, dated August 26, 2019, by and between the Company and Michael T. Sicoli (incorporated herein by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K, filed August 27, 2019).
10.6+#	Offer Letter, dated November 14, 2017, by and between the Company and Joseph DuFresne.
10.7+#	Amendment to Offer Letter, dated January 10, 2019, by and between the Company and Joseph DuFresne.
10.8+#	Letter of Understanding, dated July 12, 2019, by and between the Company and Joseph DuFresne.
10.9+#	Offer Letter, dated March 23, 2017, by and between the Company and Christine A. Herren.
10.10+#	Letter of Understanding, dated May 29, 2019, by and between the Company and Christine A. Herren.
31.1	Rule 13a-14(a)/15d-14(a) Certification, executed by Peter D. Aquino, Chief Executive Officer
31.2	Rule 13a-14(a)/15d-14(a) Certification, executed by Michael T. Sicoli, President, Chief Financial Officer
32.1*	Section 1350 Certification, executed by Peter D. Aquino, Chief Executive Officer
32.2*	Section 1350 Certification, executed by Michael T. Sicoli, President, Chief Financial Officer
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema Document.

41

101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.

*      This exhibit is furnished and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of

1934, as amended (15 U.S.C. 78r) ("Exchange Act"), or otherwise subject to the liability of that section. Such exhibit will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or Exchange Act, except to the extent that the Registrant specifically incorporates it by reference.

#    Filed herewith.

+      Management contract and compensatory plan and arrangement.

42

SIGNATURE

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.

INTERNAP CORPORATION
By:	/s/ Peter D. Aquino
	Peter D. Aquino
	Chief Executive Officer
	(Principal Executive Officer)
	/s/ Michael T. Sicoli
	Michael T. Sicoli
	President, Chief Financial Officer
	(Principal Financial Officer)
	/s/ Christine A. Herren
	Christine A. Herren
	VP, Accounting and Controller
	(Principal Accounting Officer)
	Date: November 12, 2019

EX-10.6

November 14, 2017

PERSONAL AND CONFIDENTIAL

Joseph DuFresne

Re:    Offer of Employment

Dear Joseph:

We are pleased to extend this offer to you to join Internap Corporation (“INAP”) as our Vice President of Corporate Development beginning on November 15, 2017. This position will report directly to me. You will be based in our Secaucus, NJ office, but you may be required to travel from time-to-time as part of your duties.

We are excited that you have chosen to become part of our highly motivated team and believe you will become a key player in INAP’s success.

• You will receive a starting base salary of $6,730.77 ($175,000 on an annualized basis) per pay-period less payroll deductions and all required withholdings. You will also be subject to review through our performance evaluation process.

• You will be eligible to participate in the INAP 2018 Short Term Incentive Plan (“Incentive Plan”). Any payments that may be made to you will be based on INAP’s achievement of goals approved by the Board of Directors. Your initial bonus opportunity under the Incentive Plan will be 35% of your 2018 actual earned base salary, subject to the terms of the Incentive Plan.

• You will be eligible for an annual Equity Award equal to 100% of your base salary at the discretion of the Compensation Committee and based on performance. The Equity Award may be in the form or restricted stock or options and will be subject to a three-year vest; 50% of the grant will be subject to time, and 50% will be subject to performance as part of the Compensation Committee’s approve metrics – TBD.

All vesting is subject to you being an employee in good standing on each date of vesting.  All shares are governed by the language in our incentive stock plan (a copy of which will be mailed to you separately) as well as the actual grant documents which define the specific terms of your grant. You will be subject to INAP’s Insider Trading Policy. 

• You will be eligible to participate in the benefits we offer generally to our employees. A benefit summary is included in your new hire packet.

One Ravinia Drive | Suite 1300 | Atlanta, GA 30346 | www.inap.com

Although we hope that your relationship with INAP will be a long and productive one, we are not requiring a commitment from you for a particular length of time. Your employment with INAP will be “at will” meaning that you may choose to resign at any time for any reason, and INAP may choose to end your employment at any time for any reason. This offer should not be construed as creating a contract of employment for a specific period of time and the at will nature of your employment can only be changed by a written employment agreement signed by you and INAP’s Chief Executive Officer.

INAP is required to verify the identity and employment authorization of all new hires. To comply with this legal obligation, we must complete an Employment Eligibility Verification Form I-9 within three days of your start date. Information about what you will need to bring to work with you to complete this form will be provided to you once you sign and return this offer letter. This offer is also contingent upon successful completion of a background check.

You must also sign the attached Employment Covenants Agreement and certify you have read and agree to be bound by the INAP Code of Conduct included in your new hire packet.

Joseph, again, we look forward to working with you as part of the INAP team. Please sign and date this letter, and return it to the Human Resources Department before your start date.

Sincerely,

/s/ Peter D. Aquino

Peter D. Aquino

President & CEO

I accept the offer of employment contained in this letter and hereby agree that I have read and understand the statements contained in this letter including all attachments.

/s/ Joseph DuFresne            Date: 11/14/2017

Joseph DuFresne

EMPLOYMENT COVENANTS AGREEMENT

This Employment Covenants Agreement (the “Agreement”) is made this 11^th day of November, 2017 (the “Effective Date”), between Internap Corporation (the “Company”) and Joseph DuFresne (“You” or “Your”) (collectively, the “Parties”).

For and in consideration of the Company’s agreement to employ You or continue to employ You, You agree to the following terms:

1.Acknowledgments. You acknowledge and agree that the restrictions contained in this Agreement, including, but not limited to, the restrictive covenants set forth in Sections 2 through 5 below, are reasonable and necessary to protect the legitimate business interests of the Company, and they will not impair or infringe upon Your right to work or earn a living when Your employment with the Company ends for any reason, and:

(a)You will (i) serve the Company as a Key Employee; and/or (ii) serve the Company as a Professional; and/or (iii) customarily and regularly solicit Customers and/or Prospective Customers for the Company; and/or (iv) customarily and regularly engage in making sales or obtaining orders or contracts for products or services to be provided or performed by others in the Company; and/or (v) (A) have a primary duty of managing a department or subdivision of the Company, (B) customarily and regularly direct the work of two or more other employees, and (C) have the authority to hire or fire other employees; and/or

(b)Your position is a position of trust and responsibility with access to (i) Confidential Information, (ii) Trade Secrets, (iii) information concerning employees of the Company, (iv) information concerning Customers of the Company, and/or (v) information concerning Prospective Customers of the Company.

2.Trade Secrets and Confidential Information.

(a)You represent and warrant that: (i) You are not subject to any legal or contractual duty or agreement that would prevent or prohibit You from performing Your duties for the Company or complying with this Agreement, and (ii) You are not in breach of any legal or contractual duty or agreement, including any agreement concerning trade secrets or confidential information, owned by any other person or entity.

(b)You shall not: (i) both during and after Your employment with the Company, use, disclose, reverse engineer, divulge, sell, exchange, furnish, give away, or transfer in any way the Trade Secrets or the Confidential Information for any purpose other than the Company’s Business, except as authorized in writing by the Company; (ii) during Your employment with the Company, use, disclose, reverse engineer, divulge, sell, exchange, furnish, give away, or transfer in any way (a) any confidential information or trade secrets of any former employer or third party, or (b) any works of authorship developed in whole or in part by You during any former employment or for any other party, unless authorized in writing by the former employer or third party; or (iii) upon the termination of Your employment for any reason, (a) retain any Trade Secrets or Confidential Information, including any copies existing in any form (including electronic form) that are in Your possession or control, or (b) destroy, delete, or alter the Trade Secrets or Confidential Information without the Company’s prior written consent.

(c)The obligations under this Agreement shall: (i) with regard to the Trade Secrets, remain in effect as long as the information constitutes a trade secret under applicable law; and (ii) with regard to the Confidential Information, remain in effect for so long as such information constitutes Confidential Information as defined in this Agreement.

(d)The confidentiality, property, and proprietary rights protections available in this Agreement are in addition to, and not exclusive of, any and all other rights to which the Company is entitled under federal and state law, including, but not limited to, rights provided under copyright laws, trade secret and confidential information laws, and laws concerning fiduciary duties.

(e)Notwithstanding the foregoing, nothing in this Agreement shall prohibit You from (i) exercising Your rights under federal, state or local law (including, but not limited to, Section 7 of the National Labor Relations Act or in acting as or cooperating with a whistleblower), (ii) cooperating in a government or administrative investigation, or (iii) revealing alleged criminal wrongdoing to law enforcement.

3.Non-Solicitation of Customers. During the Restricted Period, You shall not, directly or indirectly, solicit any Customer of the Company for the purpose of selling or providing any products or services competitive with the Business. The restrictions set forth in this Section shall apply only to those Customers (a) with whom or which You dealt on behalf of the Company,

/s/ J.D.     3

J.D.        

(b) whose dealings with the Company were coordinated or supervised by You, (c) about whom You obtained Confidential Information in the ordinary course of business as a result of Your association with the Company, or (d) who receive products or services authorized by the Company, the sale or provision of which results or resulted in compensation, commissions, or earnings for You within two (2) years prior to the date of Your termination.

4.Non-Solicitation of Prospective Customers. During the Restricted Period, You shall not, directly or indirectly, solicit any Prospective Customer of the Company for the purpose of selling or providing any products or services competitive with the Business. The restrictions set forth in this Section shall apply only to those Prospective Customers (a) with whom or which You dealt on behalf of the Company, (b) whose dealings with the Company were coordinated or supervised by You, or (c) about whom You obtained Confidential Information in the ordinary course of business as a result of Your association with the Company.

5.Non-Recruit of Employees. During the Restricted Period, You shall not, directly or indirectly, solicit, recruit, or induce any Employee to (i) terminate his or her employment relationship with the Company, or (ii) work for any other person or entity engaged in the Business. The restrictions set forth in this Section shall apply only to Employees (a) with whom You had Material Interaction, or (b) You, directly or indirectly, supervised.

6.Non-Disparagement. During Your employment and following the termination of Your employment with the Company for any reason, You shall not make any disparaging or defamatory statements, whether written or oral, regarding the Company; provided, however, that nothing in this Agreement shall prohibit You from making truthful oral or written statements (a) in the exercise of Your rights under federal, state or local law (including, but not limited to, Section 7 of the National Labor Relations Act or in acting as or cooperating with a whistleblower), (b) in connection with Your cooperation in a government or administrative investigation, or (c) to reveal alleged criminal wrongdoing to law enforcement.

7.Fiduciary Duty. You owe a duty of care and loyalty to the Company, as well as a duty to perform Your duties to the Company in a manner that is in the best interests of the Company. You owe such duties to the Company in addition to duties imposed upon You under applicable law.

8.Assignment of Rights. You acknowledge and agree that, as between You and the Company, the Company shall own, and You hereby assign and, upon future creation, automatically assign to the Company, all right, title and interest, including, without limitation all Intellectual Property Rights, in and to any existing and future Work Product (whether created prior to, on or after the Effective Date) that (a) is or was created within the scope of Your employment, (b) is based on, results from, or is suggested by any work performed within the scope of Your employment and is related to the Business, (c) has been or will be paid for by the Company, or (d) was created or improved in whole or in part through use of the Company’s time, personnel, resources, data, facilities, or equipment. All Work Product, to the extent permitted by applicable law, shall constitute work made for hire and shall be owned upon its creation exclusively by the Company.

You shall not take any actions inconsistent with the provisions of this Section, including but not limited to the execution of any agreements with any third parties that may affect the Company’s title in and to any Work Product. At the Company’s request, You agree to perform, during or after Your employment with the Company, any acts to transfer, perfect and defend the Company’s ownership of the Work Product, including, but not limited to: (i) executing all documents and instruments (including additional written assignments to the Company), whether for filing an application or registration for protection of the Work Product (an “Application”) or otherwise under any form of intellectual property laws whether in the United States or elsewhere in the world, (ii) explaining the nature and technical details of construction and operation of the Work Product to persons designated by the Company, (iii) reviewing and approving Applications and other related papers, or (iv) providing any other assistance reasonably required for the orderly prosecution of Applications. You agree to provide additional evidence to support the foregoing if such evidence is considered necessary by the Company, is in Your possession or control, and is reasonably available and retrievable.

You agree to disclose to the Company and provide the Company with a complete written description of any Work Product in which You are involved (solely or jointly with others) and the circumstances surrounding the creation of such Work Product, upon creation of any subject matter that may constitute Work Product, and upon request by the Company. Your failure to provide such a description to the Company, or the Company’s failure to request such a description from You, will not alter the rights of the Company to any Work Product under this Section or otherwise.

9.License. During Your employment and after Your employment with the Company ends, You grant to the Company an irrevocable, nonexclusive, worldwide, royalty-free license to: (i) make, use, sell, copy, perform, display, distribute, or otherwise utilize copies of the Licensed Materials, (ii) prepare, use and distribute derivative works based upon the Licensed

/s/ J.D.     4

J.D.        

Materials, and (iii) authorize others to do the same. You shall notify the Company in writing of any Licensed Materials You deliver to the Company.

10.Release. During Your employment and after Your employment with the Company ends, You consent to the Company’s use of Your image, likeness, voice, or other characteristics in the Company’s products, services, or marketing or informational materials. You release the Company from any cause of action which You have or may have arising out of the use, distribution, adaptation, reproduction, broadcast, or exhibition of such characteristics. You represent that You have obtained, for the benefit of the Company, the same release in writing from all third parties whose characteristics are included in the services, materials, computer programs and other deliverables that You provide to the Company.

11.Post-Employment Disclosure. During the Restricted Period, You shall provide a copy of this Agreement to persons and/or entities for whom You work or consult as an owner, partner, joint venturer, employee or independent contractor. During the Restricted Period, You authorize the Company to provide a copy of this Agreement to persons and/or entities whom You work or consult as an owner, partner, joint venturer, employee or independent contractor.

12.Post-Employment Activities. You acknowledge and agree that, beginning on the date Your employment with the Company terminates for any reason, (i) You shall remove any reference to the Company as Your current employer from any source You control, either directly or indirectly, including, but not limited to, any Social Media such as LinkedIn, Facebook, Google+, and/or MySpace, and (ii) You are not permitted to represent Yourself as currently being employed by the Company to any person or entity, including, but not limited to, on any Social Media.

13.Return of Company Property/Materials. Upon the termination of Your employment for any reason or upon the Company’s request at any time, You shall immediately return to the Company all of the Company’s property, including, but not limited to, mobile phone, personal digital assistant (PDA), keys, passcards, credit cards, confidential or proprietary lists (including, but not limited to, customer, supplier, licensor, and client lists), rolodexes, tapes, laptop computer, electronic storage device, software, computer files, marketing and sales materials, and any other property, record, document, or piece of equipment belonging to the Company. You shall not (i) retain any copies of the Company’s property, including any copies existing in electronic form, which are in Your possession, custody or control, or (ii) destroy, delete, or alter any Company property, including, but not limited to, any files stored electronically, without the Company’s prior written consent. The obligations contained in this Section shall also apply to any property which belongs to a third party, including, but not limited to, (i) any entity which is affiliated or related to the Company, or (ii) the Company’s customers, licensors, or suppliers.

14.Injunctive Relief. If You breach or threaten to breach any portion of this Agreement, You agree that: (a) the Company would suffer irreparable harm; (b) it would be difficult to determine damages, and money damages alone would be an inadequate remedy for the injuries suffered by the Company; and (c) if the Company seeks injunctive relief to enforce this Agreement, You shall waive and shall not (i) assert any defense that the Company has an adequate remedy at law with respect to the breach, (ii) require that the Company submit proof of the economic value of any Trade Secret or Confidential Information, or (iii) require the Company to post a bond or any other security. Nothing contained in this Agreement shall limit the Company’s right to any other remedies at law or in equity.

15.Independent Enforcement. Each of the covenants set forth in Sections 2 through 5 of this Agreement shall be construed as an agreement independent of (i) any other agreements, or (ii) any other provision in this Agreement, and the existence of any claim or cause of action by You against the Company, whether predicated on this Agreement or otherwise, regardless of who was at fault and regardless of any claims that either You or the Company may have against the other, shall not constitute a defense to the enforcement by the Company of any of the covenants set forth in Sections 2 through 5 of this Agreement. The Company shall not be barred from enforcing any of the covenants set forth in Sections 2 through 5 of this Agreement by reason of any breach of (i) any other part of this Agreement, or (ii) any other agreement with You.

16.At-will Employment. This Agreement does not create a contract of employment or a contract for benefits. Your employment relationship with the Company is at-will. This means that at either Your option or the Company’s option, Your employment may be terminated at any time, with or without cause or notice.

17.Attorneys’ Fees. In the event of litigation relating to this Agreement, the Company shall, if it is the prevailing party, be entitled to recover attorneys’ fees and costs of litigation in addition to all other remedies available at law or in equity.

18.Waiver. The Company’s failure to enforce any provision of this Agreement shall not act as a waiver of that or any other provision. The Company’s waiver of any breach of this Agreement shall not act as a waiver of any other breach.

/s/ J.D.     5

J.D.        

19.Severability. The provisions of this Agreement are severable. If any provision is determined to be invalid, illegal, or unenforceable, in whole or in part, then such provision shall be modified so as to be enforceable to the maximum extent permitted by law. If such provision cannot be modified to be enforceable, the provision shall be severed from this Agreement to the extent unenforceable. The remaining provisions and any partially enforceable provisions shall remain in full force and effect.

20.Governing Law. The laws of the State of Georgia shall govern this Agreement. If Georgia’s conflict of law rules would apply another state’s laws, the Parties agree that Georgia law shall still govern.

21.No Strict Construction. If there is a dispute about the language of this Agreement, the fact that one Party drafted the Agreement shall not be used in its interpretation.

22.Entire Agreement. This Agreement, including Exhibit A which is incorporated by reference, constitutes the entire agreement between the Parties concerning the subject matter of this Agreement. This Agreement supersedes any prior communications, agreements or understandings, whether oral or written, between the Parties relating to the subject matter of this Agreement.

23.Amendment. As a condition of employment and a material term under this Agreement, You agree that, at any time during Your employment, if requested by the Company, You shall sign an amendment to this Agreement which would modify the Restrictive Covenants in Sections 2 through 5 of this Agreement (the “Amendment”) based on changes to Your duties, changes in the Company’s Business, changes to Your Territory, or changes in the law regarding restrictive covenants. You agree that You shall not be entitled to any additional consideration to execute the Amendment. You agree that Your refusal to sign any such Amendment shall constitute a material breach of this Agreement. This Agreement may not otherwise be amended or modified except in writing signed by both Parties.

24.Successors and Assigns. This Agreement shall be assignable to, and shall inure to the benefit of, the Company’s successors and assigns, including, without limitation, successors through merger, name change, consolidation, or sale of a majority of the Company’s stock or assets, and shall be binding upon You. You shall not have the right to assign Your rights or obligations under this Agreement. The covenants contained in this Agreement shall survive cessation of Your employment with the Company, regardless of who causes the cessation or the reason for the cessation.

25.Execution. This Agreement may be executed in one or more counterparts, including, but not limited to, facsimiles and scanned images. Each counterpart shall for all purposes be deemed to be an original, and each counterpart shall constitute this Agreement.

26.Consent to Jurisdiction and Venue. You agree that any and all claims arising out of or relating to this Agreement shall be brought in a state or federal court of competent jurisdiction in Georgia. You consent to the personal jurisdiction of the state and/or federal courts located in Georgia. You waive (a) any objection to jurisdiction or venue, or (b) any defense claiming lack of jurisdiction or improper venue, in any action brought in such courts.

27.Affirmation. You acknowledge that You have carefully read this Agreement, You know and understand its terms and conditions, and You have had the opportunity to ask the Company any questions You may have had prior to signing this Agreement.

IN WITNESS WHEREOF, the Parties have signed this Agreement as of the Effective Date.

Internap Corporation By: /s/ John Filipowicz Name: John Filipowicz Title: VP, HR Employee Signature: /s/ Joseph DuFresne Printed Name: Joseph DuFresne

/s/ J.D.     6

J.D.        

EXHIBIT A

DEFINITIONS

A.“Business” means (i) those activities, products, and services that are the same as or similar to the activities conducted and products and services offered and/or provided by the Company within two years prior to termination of Your employment with the Company, and (ii) the business of providing information technology (IT) infrastructure services that enable businesses to securely store, host, access, and deliver their online applications and media content through the Internet. Such services include, but are not limited to: (a) Internet connectivity and content delivery software, (b) collocation services, (c) managed hosting services, and (d) “Cloud” computing services.

B.“Confidential Information” means (1) information of the Company, to the extent not considered a Trade Secret under applicable law, that (a) relates to the business of the Company, (b) was disclosed to You or of which You became aware of as a consequence of Your relationship with the Company, (c) possesses an element of value to the Company, and (d) is not generally known to the Company’s competitors, and (2) information of any third party provided to the Company which the Company is obligated to treat as confidential, including, but not limited to, information provided to the Company by its licensors, suppliers, or customers. Confidential Information includes, but is not limited to, (i) methods of operation, (ii) price lists, (iii) financial information and projections, (iv) personnel data, (v) future business plans, (vi) the composition, description, schematic or design of products, future products or equipment of the Company or any third party, (vii) the Work Product, (viii) advertising or marketing plans, and (ix) information regarding independent contractors, employees, clients, licensors, suppliers, Customers, Prospective Customers, or any third party, including, but not limited to, the names of Customers and Prospective Customers, Customer and Prospective Customer lists compiled by the Company, and Customer and Prospective Customer information compiled by the Company. Confidential Information shall not include any information that (x) is or becomes generally available to the public other than as a result of an unauthorized disclosure, (y) has been independently developed and disclosed by others without violating this Agreement or the legal rights of any party, or (z) otherwise enters the public domain through lawful means. Notwithstanding the foregoing, Confidential Information does not include information related to the terms and conditions of Your employment with the Company.

C.“Customer” means any person or entity to which the Company has sold its products or services.

D.“Employee” means any person who (i) is employed by the Company at the time Your employment with the Company ends, or (ii) was employed by the Company during the last year of Your employment with the Company (or during Your employment if employed less than a year).

E.“Intellectual Property Rights” are all: (a) patents and associated reissues, divisions, renewals, extensions, provisionals, continuations and continuations-in-part; (b) all inventions, whether patentable or not and whether or not reduced to practice; (c) registered and unregistered trademarks, service marks, certification marks, trade dress, logos, trade names, brand names, corporate names, business and product names, internet domain names, internet uniform resource locators, and internet protocol addresses and all goodwill associated with these rights; (d) Trade Secrets, industrial rights, industrial designs; (e) registered and unregistered works of authorship, copyrights, moral rights and publicity rights; (f) all rights to computer software, computer software source code, proprietary databases and mask works and all documentation and developer tools associated with these; (g) proprietary rights that are similar in nature to those enumerated in (a) through (f) anywhere in the world, (h) all enhancements and improvements to and all derivations of any of the rights enumerated in (a) through (g); and (i) all applications, registrations and documentation associated with the rights described in (a) through (g).

F.“Key Employee” means that, by reason of the Company’s investment of time, training, money, trust, exposure to the public, or exposure to Customers, vendors, or other business relationships during the course of Your employment with the Company, You will gain a high level of notoriety, fame, reputation, or public persona as the Company’s representative or spokesperson, or will gain a high level of influence or credibility with the Company’s Customers, vendors, or other business relationships, or will be intimately involved in the planning for or direction of the business of the Company or a defined unit of the business of the Company. Such term also means that You

/s/ J.D.     7

J.D.        

will possess selective or specialized skills, learning, or abilities or customer contacts or customer information by reason of having worked for the Company.

G.“Licensed Materials” means any materials that You utilize for the benefit of the Company, or deliver to the Company or the Company’s customers, which (i) do not constitute Work Product, (ii) are created by You or of which You are otherwise in lawful possession, and (iii) You may lawfully utilize for the benefit of, or distribute to, the Company or the Company’s customers, regardless of whether they are resellers, distributors or end users.

H.“Material Interaction” means any interaction with an Employee which relates or related, directly or indirectly, to the performance of Your duties or the Employee’s duties for the Company.

I.“Professional” means an employee who has a primary duty the performance of work requiring knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction or requiring invention, imagination, originality, or talent in a recognized field of artistic or creative endeavor. Such term shall not include employees performing technician work using knowledge acquired through on-the-job and classroom training, rather than by acquiring the knowledge through prolonged academic study, such as might be performed, without limitation, by a mechanic, a manual laborer, or a ministerial employee.

J.“Prospective Customer” means any person or entity to which the Company has solicited to purchase the Company’s products or services.

K.“Restricted Period” means the time period during Your employment with the Company and for six (6) months after Your employment with the Company ends for any reason.

L.“Social Media” means any form of electronic communication (such as Web sites for social networking and micro blogging) through which users create online communities to share information, ideas, personal messages, and other content, such as videos.

N. “Trade Secrets” means information of the Company, and its licensors, suppliers, clients, and customers, without regard to form, including, but not limited to, technical or nontechnical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, a list of actual customers, clients, licensors, or suppliers, or a list of potential customers, clients, licensors, or suppliers which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

O. “Work Product” means:

(a) any data, databases, materials, documentation, computer programs, inventions (whether or not patentable), designs, trademarks, trade dress, and/or works of authorship, including but not limited to, discoveries, ideas, concepts, properties, formulas, compositions, methods, programs, procedures, systems, techniques, products, improvements, innovations, writings, pictures, audio, video, images, and artistic works, and any related application or registrations, and each and every original, interim and final version, copy, replica, prototype, or other original work of authorship thereof or in any way related thereto, any and all reproductions, distribution rights, ancillary rights, performances, displays, derivative works, amendments, versions, modifications, copies, or other permutations of the foregoing, regardless of the form or type and the renewals and extensions thereof;

(b) any subject matter (including but not limited to any new and useful process, machine, manufacture, composition, or matter, or any new and useful improvement thereof) protected or eligible for protection under patent, copyright, proprietary database, trademark, trade dress, Trade Secret, rights of publicity, confidential information, or other property rights, including all worldwide rights therein;

/s/ J.D.     8

J.D.        

(c) any goodwill, commercial and economic benefits, relationship and contracts arising out of or resulting from Your employment; and any Intellectual Property Rights included within and associated with the items

/s/ J.D.     9

J.D.        

EX-10.7

Amendment to Offer Letter

January 10, 2019

Joe DuFresne,

I am pleased to confirm the following amendments to your original Offer Letter dated November 14, 2017.

The following are the amended terms and conditions effective December 13, 2018:

CURRENT BASE SALARY:    $175,000

NEW BASE SALARY:        $185,000 (effective 1/1/2019)

SEVERANCE: You will also be eligible (i) severance equal to 12 months base salary upon a termination without cause; or (ii) severance equal to 12 months base salary plus target bonus (as if met 100% of target bonus objectives) for a termination without Cause in connection with a Change of Control (as defined in the 2017 Internap Corporation 2017 Stock Incentive Plan). “Cause” means the occurrence of any of the following: (i) the willful and continued failure by you to substantially perform your material duties to the Company (ii) your willful and continued failure to substantially follow and comply with such specific and lawful directives of the Company that are not inconsistent with your position (iii) you have been convicted of, or pleaded nolo contendere to a felony involving moral turpitude, (iv) you have engaged in fraud against the Company or misappropriated Company property or the property of the Company’s Affiliates (other than incidental property) resulting in a material economic or financial injury to the Company or any Affiliate; (v) you materially breach any Company policy, which breach causes (A) financial to the Company or (B) real or potential reputational harm to the Company.

You will continue to be bound by INAP’s terms and conditions including the restrictive covenants previously outlined in your offer agreement, dated November 14, 2017, unless otherwise, previously revised by the Compensation Committee and the Company.

/s/ Joseph DuFresne/s/ Peter Aquino
Joseph DuFresne                    Peter Aquino

Vice President of Corporate Development        President & CEO

EX-10.8

July 12, 2019

Mr. Joseph DuFresne

1 Enterprise Avenue North

Secaucus, New Jersey 07094

RE:    LETTER OF UNDERSTANDING

Dear Joe:

We are pleased to offer you the position of SVP of Finance, Corporate Development and Treasury effective July 16, 2019. Your salary will increase to $225,000 annually ($8,653.85 pay period) less payroll deductions and all required withholdings. In this position, you will report directly to me.

You will be eligible to participate in the 2019 Short Term Incentive Plan with a bonus opportunity of up to 50% of your actual earned base salary. Payment of the STIP award is based achievement of measurable goals as well as certain company budgeted goals being achieved or exceeded.

You will also be eligible for an annual grant in accordance with INAP's 2019 Long Term Incentive Plan ("LTIP") or equivalent, equal to 100% of your base salary at the discretion of the Compensation Committee and based on performance. The annual grant may be in the form of restricted stock and will be subject to a three-year vest; no less than 50% of the grant will be subject to time, and 50% will be subject to performance as part of the Compensation Committee's approve metrics and the committee's discretion.

All vesting is subject to you being an employee in good standing on each date of vesting. All shares are governed by the language in our incentive stock plan (a copy of which will be mailed to you separately) as well as the actual grant documents which define the specific terms of your grant. You will be subject to INAP's Insider Trading Policy.

Although we hope that your relationship with INAP will be a long and productive one, we are not requiring a commitment from you for a particular length of time. Your employment with INAP will be "at will" meaning that you may choose to resign at any time for any reason, and INAP may choose to end your employment at any time for any reason. This offer should not be construed as creating a contract of employment for a specific period of time and the at-will nature of your employment can only be changed by a written employment agreement signed by you and INAP's Chief Executive Officer.

Please indicate your acceptance of this letter of understanding by signing and returning to the Human Resource Department.

Sincerely,

/s/ Peter Aquino

Peter Aquino

President & CEO

ACCEPTED:     /s/ Joseph DuFresne            July 12, 2019

Joseph DuFresne                Date

EX-10.9

March 23, 2017

PERSONAL AND CONFIDENTIAL

Christine Herren

Re: Offer or Employment

Dear Christine:

We are pleased to extend this offer to you to join Internap Corporation as our Sr. Director, Accounting & Assistant Controller beginning on April 10, 2017. In this position, you will report to me. You will be based in our Atlanta office, but you may be required to travel from time-to-time as part of your duties. We are excited that you have chosen to become pan of our highly motivated team and believe you will become a key player in INAP's success.

• You will receive a starting base salary of $6,346.15 ($165,000.00 on an annualized basis) per pay-period less payroll deductions and all required withholdings. You will also be subject to review through our performance evaluation process.

• You will be eligible to participate in the INAP 2017 Short Term Incentive Plan (“Incentive Plan”). Any payments that may be made to you will be based on INAP's achievement of goals approved by the Board of Directors. Your initial bonus opportunity under the Incentive Plan will be 15% of your 2017 actual earned base salary, subject to the terms of the Incentive Plan.

• You will be eligible for an annual Stock Award at the discretion of the Compensation Committee. The Restricted Stock will be subject to a three-year vest; 50% of the grant will be subject to time, and 50% will be subject to performance as part of the Compensation Committee's approve metrics - TBD.

• All vesting is subject to you being an employee in good standing on each date of vesting. All shares are governed by the language in our incentive stock plan (a copy of which will be mailed to you separately) as well as the actual grant documents which define the specific terms of your grant. You will be subject to INAP's Insider Trading Policy.

• You will be eligible to participate in the benefits we offer generally to our employees. A benefit summary is included in your new hire packet.

Although we hope that your relationship with INAP will be a long and productive one, we are not requiring a commitment from you for a particular length of time. Your employment with INAP will be “at will” meaning that you may choose to resign at any time for any reason. and INAP may choose to end your employment at any time for any reason. This offer should not be construed as creating a contract of employment for a specific period of time and the at will nature of your employment can only be changed by a written employment agreement signed by you and INAP's Chief Executive Officer.

    1

INAP is required to verify the identity and employment authorization of all new hires. To comply with this legal obligation, we must complete an Employment Eligibility Verification Form I-9 within three days of your start date. Information about what you will need to bring to work with you to complete this form will be provided to you once you sign and return this offer letter. This offer is also contingent upon successful completion of a background check.

You must also sign the attached Employment Covenants Agreement and certify you have read and agree to be bound by the INAP Code of Conduct included in your new hire packet.

Christine, again, we look forward to working with you as part of the INAP team. Please sign and date this letter and return it to the Human Resources Department before your start date.

Sincerely,

/s/ Mark Weaver

Mark Weaver

Controller. Vice President

I accept the offer of employment contained in this letter and hereby agree that I have read and understand the statements contained in this letter including all attachments.

/s/ Christine A. HerrenChristine Herren    Date: 3/25/2017

EMPLOYMENT COVENANTS AGREEMENT

This Employment Covenants Agreement (the “Agreement”) is made this 10th day of April 2017 (the “Effective Date”). between Internap Corporation (the “Company”) and Christine Herren (“You or “Your”) (collectively, the “Parties”).

For and in consideration of the Company’s agreement to employ You, You agree to the following terms:

1.    Acknowledgments. You acknowledge and agree that the restrictions contained in this Agreement. including. but not limited to. the restrictive covenants set forth in Sections 2 through 5 below. are reasonable and necessary to protect the legitimate business interests of the Company. and they will not impair or infringe upon Your right to work or earn a living when Your employment with the Company ends for any reason, and:

(a)    You will (i) serve the Company as a Key Employee; and/or (ii) serve the Company as a Professional; and/or (iii) customarily and regularly solicit Customers and/or Prospective Customers for the Company; and/or (iv) customarily and regularly engage in making sales or obtaining orders or contracts for products or services to be provided or performed by others in the Company; and/or (v) (A) have a primary duty of managing a department or subdivision of the Company, (B) customarily and regularly direct the work of two or more other employees, and (C) have the authority to hire or fire other employees; and/or

(b)    Your position is a position of trust and responsibility with access to (i) Confidential Information. (ii) Trade Secrets, (iii) information concerning employees of the Company, (iv) information concerning Customers of the Company, and/or (v) information concerning Prospective Customers of the Company.

2.    Trade Secrets and Confidential Information.

(a)    You represent and warrant that: (i) You are not subject to any legal or contractual duty or agreement that would prevent or prohibit You from performing Your duties for the Company or complying with this Agreement, and (ii) You are not in breach of any legal or contractual duty or agreement, including any agreement concerning trade secrets or confidential information, owned by any other person or entity.

(b)    You shall not: (i) both during and after Your employment with the Company. use. disclose, reverse engineer, divulge, sell, exchange, furnish, give away, or transfer in any way the Trade Secrets or the Confidential Information for any purpose other than the Company’s Business, except as authorized in writing by the Company; (ii) during Your employment with the Company, use, disclose, reverse engineer, divulge, sell, exchange, furnish, give away, or transfer in any way (a) any confidential information or trade secrets of any former employer or third party, or (b) any works of authorship developed in whole or in part by You during any former employment or for any other party, unless authorized in writing by the former employer or third party; or (iii) upon the termination of Your employment for any reason, (a) retain any Trade Secrets or Confidential Information, including any copies existing in any form (including, electronic form) that are in Your possession or control, or (b) destroy, delete, or alter the Trade Secrets or Confidential Information without the Company’s prior written consent.

(c)    The obligations under this Agreement shall: (i) with regard to the Trade Secrets, remain in effect as long as the information constitutes a trade secret under applicable law; and (ii) with regard to the Confidential Information. remain in effect for so long as such information constitutes Confidential Information as defined in this Agreement.

(d)    The confidentiality, property, and proprietary rights protections available in this Agreement are in addition to, and not exclusive of, any and all other rights to which the Company is entitled under federal and state law, including. but not limited to. rights provided under copyright laws, trade secret and confidential information laws. and laws concerning fiduciary duties.

(e)    Notwithstanding the foregoing, nothing in this Agreement shall prohibit You from (i) exercising Your rights under federal. state or local law (including, but not limited to, Section 7 of the National Labor Relations Act or in acting as or cooperating with a whistleblower), (ii) cooperating in a government or administrative investigation, or (iii) revealing alleged criminal wrongdoing to law enforcement.

3.    Non-Solicitation of Customers. During the Restricted Period. You shall not, directly or indirectly, solicit any Customer of the Company for the purpose of selling or providing any products or services competitive with the Business. The restrictions set forth in this Section shall apply only to those Customers (a) with whom or which You dealt on behalf of the Company, (b) whose dealings with the Company were coordinated or supervised by You, (c) about whom You obtained Confidential Information in the ordinary course of business as a result of Your association with the Company, or (d) who receive products or services authorized by the Company, the sale or provision of which results or resulted in compensation, commissions, or earnings for You within two (2) years prior to the date of Your termination.

4.    Non-Solicitation or Prospective Customers. During the Restricted Period. You shall not, directly or indirectly, solicit any Prospective Customer of the Company for the purpose of selling or providing any products or services competitive with the Business. The restrictions set forth in this Section shall apply only to those Prospective Customers (a) with whom or which You dealt on behalf of the Company, (b) whose dealings with the Company were coordinated or supervised by You. or (c) about whom You obtained Confidential Information in the ordinary course of business as a result of Your association with the Company.

5.     Non-Recruit or Employees. During the Restricted Period, You shall not, directly or indirectly, solicit, recruit. or induce any Employee to (i) terminate his or her employment relationship with the Company, or (ii) work for any other person or entity engaged in the Business. The restrictions set forth in this Section shall apply only to Employees (a) with whom You had Material Interaction, or (b) You, directly or indirectly, supervised.

6.    Non-Disparagement.    During Your employment and following the termination of Your employment with the Company for any reason. You shall not make any disparaging or defamatory statements, whether written or oral, regarding the Company; provided, however, that nothing in this Agreement shall prohibit You from making truthful oral or written statements (a) in the exercise of Your rights under federal, state or local law (including, but not limited to, Section 7 of the National Labor Relations Act or in acting as or cooperating with a whistleblower), (b) in connection with Your cooperation in a government or administrative investigation, or (c) to reveal alleged criminal wrongdoing to law enforcement.

7.    Fiduciary Duty. You owe a duty of care and loyalty to the Company, as well as a duty to perform Your duties to the Company in a manner that is in the best interests of the Company. You owe such duties to the Company in addition to duties imposed upon You under applicable law.

8.    Assignment or Rights. You acknowledge and agree that, as between You and the Company, the Company shall own, and You hereby assign and, upon future creation, automatically assign to the Company. all right, title and interest, including. without limitation all Intellectual Property Rights, in and to any existing and future Work Product (whether created prior to, on or after the Effective Date) that (a) is or was created within the scope of Your employment, (b) is based on, results from, or is suggested by any work performed within the scope of Your employment and is related to the Business, (c) has been or will be paid for by the Company, or (d) was created or improved in whole or in part through use of the Company’s time, personnel, resources, data, facilities, or equipment All Work Product, to the extent permitted by applicable law, shall constitute work made for hire and shall be owned upon its creation exclusively by the Company.

You shall not take any actions inconsistent with the provisions of this Section, including but not limited to the execution of any agreements with any third panics that may affect the Company’s title in and to any Work Product. At the Company’s request, You agree to perform, during or after Your employment with the Company, any acts to transfer, perfect and defend the Company” s ownership of the Work Product, including, but not limited to: (i) executing all documents and instruments (including additional written assignments to the Company), whether for filing an application or registration for protection of the Work Product (an “Application”) or otherwise under any form of intellectual property laws whether in the United States or elsewhere in the world, (ii) explaining the nature and technical details of construction and operation of the Work Product to persons designated by the Company, (iii) reviewing and approving Applications and other related papers, or (iv) providing any other assistance reasonably required for the orderly prosecution of Applications. You agree to provide additional evidence to support the foregoing if such evidence is considered necessary by the Company, is in Your possession or control, and is reasonably available and retrievable.

You agree to disclose to the Company and provide the Company with a complete written description of any Work Product in which You are involved (solely or jointly with others) and the circumstances surrounding the creation of such Work Product, upon creation of any subject matter that may constitute Work Product, and upon request by the Company. Your failure to provide such a description to the Company. or the Company’s failure to request such a description from You. will not alter the rights of the Company to any Work Product under this Section or otherwise.

9.    License. During Your employment and after Your employment with the Company ends, You grant to the Company an irrevocable, nonexclusive, worldwide, royalty-free license to: (i) make, use, sell, copy, perform, display, distribute, or otherwise utilize copies of the Licensed Materials, (ii) prepare, use and distribute derivative works based upon the Licensed Materials, and (iii) authorize others to do the same. You shall notify the Company in writing of any Licensed Materials You deliver to the Company.

10.    Release. During Your employment and after Your employment with the Company ends, You consent to the Company’s use of Your image, likeness. voice. or other characteristics in the Company’s products, services, or marketing or informational materials. You release the Company from any cause of action which You have or may have arising out of the use, distribute ion, adaptation. reproduction, broadcast, or exhibition of such characteristics. You represent that You have obtained, for the benefit of the Company, the same release in writing from all third parties whose characteristics are included in the services, materials, computer programs and other deliverables that You provide to the Company.

11.    Post-Employment Di1elosure. During the Restricted Period, You shall provide a copy of this Agreement to persons and/or entities for whom You work or consult as an owner, partner, joint venture, employee or independent contractor. During the Restricted Period, You authorize the Company to provide a copy of this Agreement to persons and/or entities whom You work or consult as an owner, partner, joint venture, employee or independent contractor.

12.    Post-Employment Activities. You acknowledge and agree that, beginning on the date Your employment with the Company terminates for any reason, (i) You shall remove any reference to the Company as Your current employer from any source You control, either directly or indirectly, including. but not limited to, any Social Media such as LinkedIn, Facebook. Google +, and/or Myspace, and (ii) You are not permitted to represent Yourself as currently being employed by the Company to any person or entity, including. but not limited to, on any Social Media.

13.    Return or Company Property/Materials. Upon the termination of Your employment for any reason or upon the Company’s request at any time, You shall immediately return to the Company all of the Company’s property, including, but not limited to, mobile phone, personal digital assistant (PDA), keys. pass cards, credit cards. confidential or proprietary lists (including, but not limited to, customer, supplier, licensor, and client lists), rolodexes, tapes, laptop computer, electronic storage device, software, computer files, marketing and sales materials. and any other property, record. document, or piece of equipment belonging to the Company. You shall not (i) retain any copies of the Company’s property, including any copies existing in electronic form. which are in Your possession, custody or control, or (ii ) destroy, delete. or alter any Company property, including, but not limited to, any files stored electronically, without the Company’s prior written consent. The obligations contained in this Sect ion shall also apply to any property which belongs to a third party, including. but not limited to. (i)any entity which is affiliated or related to the Company, or (ii) the Company’s customers, licensors. or suppliers.

14.    Injunctive Relief. If You breach or threaten to breach any portion of this Agreement. You agree that: (a) the Company would suffer irreparable harm; (b) it would be difficult to determinate damages, and money damages alone would be an inadequate remedy for the injuries suffered by the Company; and (c) if the Company seeks injunctive relief to enforce this Agreement. You shall waive and shall not (i) assert any defense that the Company has an adequate remedy at law with respect to the breach, (ii) require that the Company submit proof of the economic value of any Trade Secret or Confidential Information, or ( iii ) require the Company to post a bond or any other security. Nothing contained in this Agreement shall limit the Company’s right to any other remedies at law or in equity.

15.    Independent Enforcement. Each of the covenants set forth in Sections 2 through 5 of this Agreement shall be construed as an agreement independent of (i) any other agreements, or (ii) any other provision in this Agreement. and the existence of any claim or cause of action by You against the Company, whether predicated on this Agreement or otherwise. regardless of who was at fault and regardless of any claims that either You or the Company may have against the other, shall not constitute a defense to the enforcement by the Company of any of the covenants set forth in Sections 2 through 5 of this Agreement. The Company shall not be barred from enforcing any of the covenants set forth in Sections 2 through 5 of this Agreement by reason of any breach of (i) any other part of this Agreement, or (ii) any other agreement with You.

16.    At-will Employment. This Agreement does not create a contract of employment or a contract for benefits. Your employment relationship with the Company is at-will. This means that at either Your option or the Company’s option, Your employment may be terminated at any time, with or without cause or notice.

17.    Attorneys’ Fees. In the event of litigation relating to this Agreement, the Company shall, if it is the prevailing party. be entitled to recover attorneys” fees and costs of litigation in addition to all other remedies available at law or in equity.

18.    Waiver. The Company’s failure to enforce any provision of this Agreement shall not act as a waiver of that or any other provision. The Company’s waiver of any breach of this Agreement shall not act as a waiver of any other breach.

19.    Severability. The provisions of this Agreement are severable. If any provision is determined to be invalid, illegal. or unenforceable, in whole or in part, then such provision shall be modified so as to be enforceable to the maximum extent permitted by law. If such provision cannot be modified to be enforceable, the provision shall be severed from this Agreement to the extent unenforceable. The remaining provisions and any partially enforceable provisions shall remain in full force and effect.

20.    Governing Law. The laws of the State of Georgia shall govern this Agreement. If Georgia’s conflict of law rules would apply another state’s laws, the Parties agree that Georgia law shall still govern.

21.    No Strict Construction. If thereis a dispute about the language of this Agreement. the fact that one Party drafted the Agreement shall not be used in its interpretation.

22.    Entire Agreement. This Agreement, including Exhibit A which is incorporated by reference, constitutes the entire agreement between the Parties concerning the subject matter of this Agreement. This Agreement supersedes any prior communications. agreements or understandings. whether oral or written. between the Parties relating to the subject matter of this Agreement.

23.    Amendment. As a condition of employment and a material term under this Agreement. You agree that. at any time during Your employment, if requested by the Company. You shall sign an amendment to this Agreement which would modify the Restrictive Covenants in Sections 2 through 5 of this Agreement (the “Amendment”) based on changes to Your duties, changes in the Compay’s Business, changes to Your Territory, or changes in the law regarding restrictive covenants. You agree that You shall not be entitled to any additional consideration to execute the Amendment. You agree that Your refusal to sign any such Amendment shall constitute a material breach of this Agreement. This Agreement may not otherwise be amended or modified except in writing signed by both Parties.

24.    Successors and Assigns. This Agreement shall be assignable to. and shall inure to the benefit of, the Company’s successors and assigns, including, without limitation. successors through merger, name change, consolidation, or sale of a majority of the Company’s stock or assets, and shall be binding upon You. You shall not have the right to assign Your rights or obligations under this Agreement. The covenants contained in this Agreement shall survive cessation of Your employment with the Company. regardless of who causes the cessation or the reason for the cessation.

25.    Execution. This Agreement may be executed in one or more counterparts, including, but not limited to. facsimiles and scanned images. Each counterpart shall for all purposes be deemed to be an original, and each counterpart shall constitute this Agreement.

26.    Consent to Jurisdiction and Venue. You agree that any and all claims arising out of or relating to this Agreement shall be brought in a state or federal court of competent jurisdiction in Georgia. You consent to the personal jurisdiction of the state and/or federal courts located in Georgia. You waive (a) any objection to jurisdiction or venue. or (b) any defense claiming lack of jurisdiction or improper venue, in any action brought in such courts.

27.    Affirmation. You acknowledge that You have carefully read this Agreement, You know and understand its terms and conditions, and You have had the opportunity to ask the Company any questions You may have had prior to signing this Agreement.

IN WITNESS WHEREOF, the Parties have signed this Agreement as of the Effective Date.

Internap Corporation By: /s/ Brenita Williams Name: Brenita Williams Title: HR Representative Address: One Ravinia Dr. #1300 Atlanta, GA 30346 Employee Signature: /s/ Christine A. Herren Printed Name: Christine A. Herren

EXHIBIT A DEFINITIONS

A.    “Business”· means (i) those activities, products. and services that are the same as or similar to the activities conducted and products and services offered and/or provided by the Company within two years prior to termination of Your employment with the Company, and (ii) the business of providing information technology (IT) infrastructure services that enable businesses to securely store. host. access, and deliver their online applications and media content through the Internet. Such services include, but are not limited to: (a) Internet connectivity and content delivery software, (b) collocation services, (c) managed hosting services, and (d) “Cloud” computing services.

B.    “Confidential Information” means (1) information of the Company, to the extent not considered a Trade Secret under applicable law, that (a) relates to the business of the Company, (b) was disclosed to You or of which You became aware of as a consequence of Your relationship with the Company, (c) possesses an element of value to the Company, and (d) is not gene rally known to the Company’s competitors, and (2) information of any third party provided to the Company which the Company is obligated to treat as confidential, including, but not limited to, information provided to the Company by its licensors, suppliers. or customers. Confidential Information includes, but is not limited to, (i) methods of operation, (ii) price lists, (iii) financial information and projections, (iv) personnel data, (v) future business plans, (vi) the composition, description, schematic or design of products, future products or equipment of the Company or any third party, (vii) the Work Product, (viii) advertising or marketing plans, and (ix) information regarding independent contractors, employees, clients, licensors, suppliers, Customers, Prospective Customers, or any third party, including, but not limited to, the names of Customers and Prospective Customers, Customer and Prospective Customer lists compiled by the Company, and Customer and Prospective Customer information compiled by the Company. Confidential Information shall not include any information that (x) is or becomes generally available to the public other than as a result of an unauthorized disclosure, (y) has been independently developed and disclosed by others without viola tin g this Agreement or the legal rights of any party, or (z) otherwise enters the public domain through lawful means. Notwithstanding the foregoing, Confidential Information does not include information related to the terms and conditions of Your employment with the Company.

C.    “Customer” means any person or entity to which the Company has sold its products or services.

D.    “Employee” means any person who (i) is employed by the Company at the time Your employment with the Company ends, or (ii) was employed by the Company during the last year of Your employment with the Company (or during Your employment if employed less than a year).

E.    “Intellectual Property Rights” are all: (a) patents and associated reissues, divisions. renewals, extensions, provisional, continuations and continuations in-part; (b) all inventions, whether patentable or not and whether or not reduced to practice; (c) registered and unregistered trademarks, service marks, certifications marks, trade dress, logos, trade names, brand names, corporate names, business and product names, internet domain names, internet uniform resource locators, and internet protocol addresses and all goodwill associated with these rights; (d) Trade Secrets, industrial rights, industrial designs; (e) registered and unregistered works of authorship, copyrights, moral rights and publicity rights; (I) all rights to computer software, computer software source code, proprietary databases and mask works and all documentation and developer tools associated with these; (g) proprietary rights that are similar in nature to those enumerated in (a) through (f) anywhere in the world, (h) all enhancements and improvements to and all derivations of any of the rights enumerated in (a) through (g); and (i) all applications, registrations and documentation associated with the rights described in (a) through (g).

F.    “Key Employee” means that, by reason of the Company’s investment of time, training. money, trust exposure to the public, or exposure to Customers, vendors, or other business relationships during the course of Your employment with the Company. You will gain a high level of notoriety, fame, reputation, or public persona as the Company’s representative or spokesperson, or will gain a high level of influence or credibility with the Company’s Customers, vendors, or other business relationships, or will be intimately involved in the planning for or direction of the business of the Company or a defined unit of the business of the Company. Such term also means that You will possess selective or specialized skills, learning, or abilities or customer contacts or customer information by reason of having worked for the Company.

G.    “Licensed Materials” means any materials that You utilize for the benefit of the Company, or deliver to the Company or the Company’s customers, which (i) do not constitute Work Product. (ii) are created by You or of which You are otherwise in lawful possession, and (iii ) You may lawfully utilize for the benefit of, or distribute to, the Company or the Company’s customers, regardless of whether they are resellers. distributors or end users.

H.    “Material Interaction” means any interaction with an Employee which relates or related, directly or indirectly, to the performance of Your duties or the Employee’s duties for the Company.

I.    “Professional” means an employee who has a primary duty the performance of work requiring knowledge of an advanced type in a field of science or teaming customarily acquired by a prolonged course of specialized intellectual instruction or requiring invention, imagination, originality, or talent in a recognized field of artistic or creative endeavor. Such term shall not include employees performing technician work using knowledge acquired through on-the-job and classroom training, rather than by acquiring the knowledge through prolonged academic study, such as might be performed, without limitation, by a mechanic, a manual laborer, or a ministerial employee.

J.     “Prospective Customer” means any person or entity to which the Company has solicited to purchase the Company’s products or services.

K.    “Restricted Period” means the time period during Your employment with the Company and for six (6) months after Your employment with the Company ends for any reason.

L.    “Social Media” means any form of electronic communication (such as Web sites for social networking and micro blogging) through which users create online communities to share information, ideas, personal messages. and other content, such as videos.

N.     “Trade Secrets” means information of the Company, and its licensors, suppliers. clients. and customers, without regard to form, including, but not limited to. technical or nontechnical data. a formula. a pattern, a compilation, a program, a device, a method, a technique, a drawing. a process. financial data. financial plans. product plans, a list of actual customers. clients, licensors, or suppliers, or a list of potential customers, clients, licensors, or suppliers which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

O.    “Work Product” means:

(a) any data. databases, materials, docJ,1mentation, computer programs, inventions (whether or not patentable), designs. trademarks, trade dress, and/or works of authorship. including but not limited to, discoveries, ideas, concepts. properties, formulas, compositions, methods, programs, procedures, systems, techniques, products, improvements, innovations. writings, pictures, audio, video, images, and artistic works, and any related application or registrations, and each and every original, interim and final version, copy, replica, prototype, or other original work of authorship thereof or in any way related thereto, any and all reproductions, distribution rights, ancillary rights, performances, displays. derivative works, amendments, versions, modifications, copies, or other permutations of the foregoing, regardless of the form or type and the renewals and extensions thereof;

(b) any subject matter (including but not limited to any new and useful process, machine, manufacture, composition, or matter, or any new and useful improvement thereof) protected or eligible for protection under patent, copyright, proprietary database, trademark, trade dress, Trade Secret, rights of publicity, confidential information. or other property rights, including all worldwide rights therein;

(c) any goodwill, commercial and economic benefits. relationship and contracts arising out of or resulting from Your employment; and any Intellectual Property Rights included within and associated with the items

    2

EX-10.10

May 29, 2019

Christine Herren

RE:    LETTER OF UNDERSTANDING

Dear Chrissy:

We are pleased to offer you the position of VP, Accounting & Controller effective June 1, 2019. Your salary will increase to $195,000 ($7,500.00 pay period) less payroll deductions and all required withholdings. In this position, you will report directly to me.

You will be eligible to participate in the 2019 Short Term Incentive Plan with a bonus opportunity of up to 35% of your actual earned base salary. Payment of the STIP award is based on achievement of measurable goals as well as certain company budgeted goals being achieved or exceed.

You will also be eligible for an annual grant in accordance with INAP’s 2019 Long Term Incentive Plan (“LTIP”) or equivalent, equal to 100% of your base salary at the discretion of the Compensation Committee and based on performance. The annual grant may be in the form of restricted stock and will be subject to a three-year vest; no less than 50% of the grant will be subject to time, and 50% will be subject to performance as part of the Compensation Committee’s approve metrics and the committee’s discretion.

All vesting is subject to you being an employee in good standing on each date vesting. All shares are governed by the language in our incentive stock plan (a copy of which will be mailed to you separately) as well as the actual grant documents which define the specific terms of your grant. You will be subject to INAP’s Insider Trading Policy.

Although we hope that your relationship with INAP will be a long and productive one, we are not requiring a commitment from you for a particular length of time. Your employment with INAP will be “at will” meaning that you may choose to resign at any time for any reason, and INAP may choose to end your employment at any time for any reason. This offer should not be construed as creating a contract of employment for a specific period of time and the at-will nature of your employment can only be changed by a written employment agreement signed by you and INAP’s Chief Executive Officer.

Please indicate your acceptance of this letter of understanding by signing and returning to the Human Resource Department.

Sincerely,

/s/ James Keeley

James Keeley

Chief Financial Officer

ACCEPTED: /s/ Christine Herren5/29/2019

Christine Herren             Date

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Peter D. Aquino, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Internap Corporation (the “registrant”);

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: November 12, 2019	/s/ Peter D. Aquino
	Peter D. Aquino
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Michael T. Sicoli, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Internap Corporation (the “registrant”);

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: November 12, 2019	/s/ Michael T. Sicoli
	Michael T. Sicoli
	President, Chief Financial Officer

EX-32.1

Exhibit 32.1

STATEMENT REQUIRED BY 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

This certificate is being delivered pursuant to the requirements of Section 1350 of Chapter 63 (Mail Fraud) of Title 18 (Crimes and Criminal Procedures) of the United States Code and shall not be relied on by any other person for any other purpose.

In connection with the Quarterly Report on Form 10-Q of Internap Corporation (the “Company”) for the quarter ended September 30, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Peter D. Aquino, Chief Executive Officer of the Company, certifies that

• the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

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

Date: November 12, 2019
	/s/ Peter D. Aquino
	Peter D. Aquino
	Chief Executive Officer

EX-32.2

Exhibit 32.2

STATEMENT REQUIRED BY 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

This certificate is being delivered pursuant to the requirements of Section 1350 of Chapter 63 (Mail Fraud) of Title 18 (Crimes and Criminal Procedures) of the United States Code and shall not be relied on by any other person for any other purpose.

In connection with the Quarterly Report on Form 10-Q of Internap Corporation (the “Company”) for the quarter ended September 30, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Michael T. Sicoli, President, Chief Financial Officer of the Company, certifies that

• the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

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

Date: November 12, 2019
	/s/ Michael T. Sicoli
	Michael T. Sicoli
	President, Chief Financial Officer

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NET LOSS PER SHARE (Tables)

9 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

Schedule of basic and diluted net loss per share

Basic and diluted net loss per share is calculated as follows (in thousands, except per share amounts):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net loss	$	(23,849	)	$	(15,454	)	$	(62,006	)	$	(43,971	)
Less net income attributable to non-controlling interests	21			25			63			75
Net loss attributable to shareholders	$	(23,870	)	$	(15,479	)	$	(62,069	)	$	(44,046	)
Weighted average shares outstanding, basic and diluted	23,671			20,206			23,703			19,968
Net loss per share, basic and diluted	$	(1.01	)	$	(0.77	)	$	(2.62	)	$	(2.21	)
Anti-dilutive securities excluded from diluted net loss per share calculation for stock-based compensation plans	1,920			1,065			1,920			1,065

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ACQUISITION (Tables)

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

Schedule of fair value of acquired assets

The following table summarizes the final fair values of the assets acquired and liabilities assumed at the acquisition date and includes purchase accounting adjustments subsequent to the acquisition date (in thousands):

	Final Valuation as of December 31, 2018
Cash	$	2,823
Prepaid expenses and other assets	2,227
Property, plant and equipment	14,253
Other long-term assets	576
Intangible assets:
Noncompete agreements	4,000
Trade names	1,700
Technology	15,100
Customer relationships	34,100
Goodwill	66,008
Total assets acquired	140,787
Accounts payable and accrued liabilities	2,819
Deferred revenue	2,434
Long term liabilities	534
Net assets acquired	$	135,000

Summary of unaudited pro forma financial information

The following unaudited pro forma financial information presents the combined results of operations of INAP and SingleHop as if the acquisition had occurred on January 1, 2017. The unaudited pro forma financial information is not intended to represent or be indicative of our consolidated results of operations that would have been reported had the INAP and SingleHop acquisition been completed as of January 1, 2017, and should not be taken as indicative of our future consolidated results of operations. The pro forma results are as follows (in thousands, except for per share amounts):

	Nine Months Ended September 30,
		2018
Net revenues		$	247,260
Net loss		(45,173		)
Basic and diluted net loss per share		(2.27		)
Weighted average shares outstanding used in computing basic and diluted net loss per share		19,968

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RECENT ACCOUNTING PRONOUNCEMENTS (Policies)

9 Months Ended

Sep. 30, 2019

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Basis of Presentation

We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information. These financial statements include all of our accounts and those of our wholly-owned subsidiaries. We have eliminated all intercompany transactions and balances in the accompanying financial statements. In the opinion of management, all adjustments necessary for a fair presentation of the interim results have been reflected therein. All such adjustments were of a normal and recurring nature with the exception of those related to the adoption of new accounting standards as discussed in Note 2, "Recent Accounting Pronouncements" and Note 4, "Leases."

We have condensed or omitted certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP. The accompanying financial statements reflect all adjustments, which consist of normal recurring adjustments unless otherwise disclosed, necessary for a fair statement of our financial position as of September 30, 2019 and our operating results and cash flows for the interim periods presented. The balance sheet at December 31, 2018 was derived from our audited financial statements, but does not include all disclosures required by GAAP. You should read the accompanying financial statements and the related notes in conjunction with our financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission ("SEC").

Use of Estimates

The preparation of financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Actual results may differ materially from these estimates. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the 2019 fiscal year or any future periods.

Recent Accounting Pronouncements

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842), which states that a lessee should recognize the assets and liabilities that arise from leases. The standard has since been modified with several ASUs (collectively, the "new lease standard"). The new lease standard is effective for annual and interim periods beginning after December 15, 2018. Earlier adoption is permitted. The Company adopted the new lease standard on January 1, 2019, the beginning of fiscal 2019. Prior periods presented in our condensed consolidated financial statements continue to be presented in accordance with the former lease standard, Topic 840, Leases.

The new lease standard provides entities two options for applying the modified retrospective approach (1) retrospectively to each prior reporting period presented in the financial statements with the cumulative-effect adjustment recognized at the beginning of the earliest comparative period presented or (2) retrospectively at the beginning of the period of adoption (January 1, 2019) through a cumulative-effect adjustment recognized then. The Company adopted the new lease standard by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application. The most significant impact relates to the recognition on the Company's balance sheet of right-of-use ("ROU") assets and lease liabilities for all operating leases. Consistent with current guidance, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily depends on its classification. For income statement purposes, operating leases will result in a straight-line expense while finance leases will result in a front-loaded expense pattern.

The Company elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs. The Company did not separately record lease components from non-lease components, and accounts for them together as a single lease component. INAP made an accounting policy election to not record leases with an initial term of 12 months or less on the balance sheet. The Company recognizes lease expense for these short-term leases on a straight-line basis over the lease term in the consolidated statements of operations and comprehensive loss. The Company has elected to not record a ROU asset or ROU liability for leases with an asset or liability balance that would be less than one thousand dollars ($1,000) on the adoption date on the basis of materiality. This threshold continues to be consistent with the Company’s Property and Equipment capitalization threshold.

As a result of our adoption of the new lease standard, we have implemented a new lease accounting system, accounting policies and processes which changed the Company's internal controls over financial reporting for lease accounting.

The Company has capital leases which have been recorded on the consolidated balance sheets and as of the January 1, 2019 transition date, the capital leases became finance leases establishing the ROU asset and liability. The ROU assets and liabilities for operating leases were $28.5 million and $31.0 million of total Company assets and liabilities, respectively, as of January 1, 2019.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires the measurement of all expected credit losses for financial assets including trade receivables, loans and held-to-maturity debt securities held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This will result in the earlier recognition of credit losses. For available-for-sale debt securities, entities will be required to recognize an allowance for credit losses rather than a reduction to the carrying value of the asset. If expected cash flows improve, an entity will reduce the allowance and reverse the expense through income. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Entities will have to make more disclosures, including disclosures by year of origination for certain financing receivables. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

In February 2018, the FASB issued ASU No. 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220). This standard provides an option to reclassify stranded tax effects within accumulated other comprehensive income (loss) (“AOCI”) to retained earnings due to the U.S. federal corporate income tax rate change in the Tax Cuts and Jobs Act of 2017. This standard was effective for interim and annual reporting periods beginning after December 15, 2018. We did not exercise the option to make this reclassification.

In June 2018, the FASB issued ASU 2018-07, Improvements to Non-employee Share-Based Payment Accounting. This standardbroadens the scope of FASB ASC Topic 718, Compensation — Stock Compensation, which currently covers only share-based payments to employees. The change substantially aligns the accounting for share-based payments for both employees and non-employees. The ASU supersedes Subtopic 505-50, Equity — Equity-Based Payments to Non-Employees. The measurement of equity-classified non-employee awards will be fixed at the grant date, and entities will measure the cost of awards subject to a performance condition using the outcome that is probable at the balance sheet date. Entities may use the expected term to measure non-employee options or elect to use the contractual term as the expected term, on an award-by-award basis. Entities will recognize a cumulative-effect adjustment to retained earnings for equity classified non-employee awards for which a measurement date has not been established and liability-classified non-employee awards that have not been settled. The guidance is effective for calendar-year public business entities in annual periods beginning after December 15, 2018, and interim periods within those years. The Company adopted this pronouncement in the first quarter of 2019 and it did not have a material impact on its condensed consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), relating to a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by a vendor (i.e., a service contract). Under the new guidance, a customer will apply the same criteria for capitalizing implementation costs as it would for an arrangement that has a software license. The new guidance also prescribes the balance sheet, income statement, and cash flow classification of the capitalized implementation costs and related amortization expense, and requires additional quantitative and qualitative disclosures. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application is permitted.  The Company can choose to adopt the new guidance (1) prospectively to eligible costs incurred on or after the date this guidance is first applied, or (2) retrospectively. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, which removes, adds and modifies certain disclosure requirements for fair value measurements in Topic 820. The Company will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the valuation processes of Level 3 fair value measurements. However, the Company will be required to additionally disclose the changes in unrealized gains and losses included in other comprehensive income for recurring Level 3 fair value measurements, and the range and weighted average of assumptions used to develop significant unobservable inputs for Level 3 fair value measurements. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.  The amendments relating to additional disclosure requirements will be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments will be applied retrospectively to all periods presented upon their effective date. The Company is permitted to early adopt either the entire ASU or only the provisions that eliminate or modify the requirements. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

Fair Value Measurements

We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

• Level 1: Quoted prices in active markets for identical assets or liabilities;

• Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

• Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Goodwill

The Company tests goodwill and intangible assets with indefinite lives for impairment annually as of August 1. Additionally, the Company may perform interim tests if an event occurs or circumstances change that could potentially reduce the fair value of a reporting unit or indefinite lived intangible asset below its carrying amount. The carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units.

The Company tests goodwill for impairment by either performing a qualitative evaluation or a quantitative test. The qualitative evaluation is an assessment of factors, including reporting unit specific operating results as well as industry, market and general economic conditions, to determine whether it is more likely than not that the fair values of a reporting unit is less than its carrying amount, including goodwill. The Company may elect to bypass this qualitative assessment for some or all of its reporting units and perform a quantitative test.

Goodwill is considered impaired if the carrying amount of the net assets exceeds the fair value of the reporting unit. Impairment, if any, would be recorded in operating income / (loss) and this could result in a material impact to net income / (loss) and income / (loss) per share.

Operating Segments

Each segment is managed as an operation with well-established strategic directions and performance requirements. Each segment is led by a separate General Manager who reports to the Chief Operating Officer. The Chief Operating Officer reports directly to the Company's CODM. The CODM evaluates segment performance using business unit contribution which is defined as business unit revenues less direct costs of sales and services, customer support, and sales and marketing, exclusive of depreciation and amortization.

Net Loss Per Share

We compute basic net loss per share by dividing net loss attributable to our common stockholders by the weighted average number of shares of common stock outstanding during the period. We exclude all outstanding options and unvested restricted stock as such securities are anti-dilutive for all periods presented.

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LEASES - Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Finance lease cost
Amortization of right-of-use assets	$ 3,861	$ 12,384
Interest on lease liabilities	7,445	22,124
Finance lease cost	11,306	34,508
Operating lease cost	2,269	5,964
Short-term lease cost	1,106	4,302
Total lease cost	$ 14,681	$ 44,774

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ACQUISITION - Schedule of Fair Value of Acquired Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Intangible assets:
Goodwill	$ 116,217	$ 116,217
SingleHop, LLC
Business Acquisition [Line Items]
Cash		2,823
Prepaid expenses and other assets		2,227
Property, plant and equipment		14,253
Other long-term assets		576
Intangible assets:
Goodwill		66,008
Total assets acquired		140,787
Accounts payable and accrued liabilities		2,819
Deferred revenue		2,434
Long term liabilities		534
Net assets acquired		135,000
SingleHop, LLC | Noncompete agreements
Intangible assets:
Finite lived intangible assets		4,000
SingleHop, LLC | Trade names
Intangible assets:
Finite lived intangible assets		1,700
SingleHop, LLC | Technology
Intangible assets:
Finite lived intangible assets		15,100
SingleHop, LLC | Customer relationships
Intangible assets:
Finite lived intangible assets		$ 34,100

XML

FAIR VALUE MEASUREMENTS - Summary of changes in Level 3 financial asset - Asset retirement obligation (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Available-for-sale securities	$ 2,386	$ 2,309
Asset retirement obligations
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of period	2,090
Accretion	202
Payments	0
Balance, end of period	$ 2,292

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OPERATING SEGMENTS - Summary of operating results for business segments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Revenues:
Total revenues	$ 72,878	$ 82,972	$ 219,576	$ 239,135
Cost of sales and services, customer support and sales and marketing:
Total costs of sales and services, customer support and sales and marketing	43,068	46,675	127,672	134,015
Segment profit:
Total segment profit	29,810	36,297	91,904	105,120
Exit activities, restructuring and impairments	3,792	2,347	5,439	3,140
Other operating expenses, including sales, general and administrative and depreciation and amortization expenses	29,954	31,253	91,885	95,404
(Loss) income from operations	(3,936)	2,697	(5,420)	6,576
Non-operating expenses	19,919	17,989	56,906	50,143
Loss before income taxes and equity in earnings of equity-method investment	(23,855)	(15,292)	(62,326)	(43,567)
INAP US
Revenues:
Total revenues	56,947	65,678	171,928	186,821
Cost of sales and services, customer support and sales and marketing:
Total costs of sales and services, customer support and sales and marketing	32,920	35,197	97,780	99,532
Segment profit:
Total segment profit	24,027	30,481	74,148	87,289
INAP INTL
Revenues:
Total revenues	15,931	17,294	47,648	52,314
Cost of sales and services, customer support and sales and marketing:
Total costs of sales and services, customer support and sales and marketing	10,148	11,478	29,892	34,483
Segment profit:
Total segment profit	$ 5,783	$ 5,816	$ 17,756	$ 17,831

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GOODWILL AND OTHER INTANGIBLE ASSETS (Narrative) (Details)	9 Months Ended
	Sep. 30, 2019 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill, impairment loss	$ 0

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RECENT ACCOUNTING PRONOUNCEMENTS

9 Months Ended

Sep. 30, 2019

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842), which states that a lessee should recognize the assets and liabilities that arise from leases. The standard has since been modified with several ASUs (collectively, the "new lease standard"). The new lease standard is effective for annual and interim periods beginning after December 15, 2018. Earlier adoption is permitted. The Company adopted the new lease standard on January 1, 2019, the beginning of fiscal 2019. Prior periods presented in our condensed consolidated financial statements continue to be presented in accordance with the former lease standard, Topic 840, Leases.

The new lease standard provides entities two options for applying the modified retrospective approach (1) retrospectively to each prior reporting period presented in the financial statements with the cumulative-effect adjustment recognized at the beginning of the earliest comparative period presented or (2) retrospectively at the beginning of the period of adoption (January 1, 2019) through a cumulative-effect adjustment recognized then. The Company adopted the new lease standard by recognizing and measuring leases at the adoption date with a cumulative effect of initially applying the guidance recognized at the date of initial application. The most significant impact relates to the recognition on the Company's balance sheet of right-of-use ("ROU") assets and lease liabilities for all operating leases. Consistent with current guidance, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily depends on its classification. For income statement purposes, operating leases will result in a straight-line expense while finance leases will result in a front-loaded expense pattern.

The Company elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs. The Company did not separately record lease components from non-lease components, and accounts for them together as a single lease component. INAP made an accounting policy election to not record leases with an initial term of 12 months or less on the balance sheet. The Company recognizes lease expense for these short-term leases on a straight-line basis over the lease term in the consolidated statements of operations and comprehensive loss. The Company has elected to not record a ROU asset or ROU liability for leases with an asset or liability balance that would be less than one thousand dollars ($1,000) on the adoption date on the basis of materiality. This threshold continues to be consistent with the Company’s Property and Equipment capitalization threshold.

As a result of our adoption of the new lease standard, we have implemented a new lease accounting system, accounting policies and processes which changed the Company's internal controls over financial reporting for lease accounting.

The Company has capital leases which have been recorded on the consolidated balance sheets and as of the January 1, 2019 transition date, the capital leases became finance leases establishing the ROU asset and liability. The ROU assets and liabilities for operating leases were $28.5 million and $31.0 million of total Company assets and liabilities, respectively, as of January 1, 2019.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires the measurement of all expected credit losses for financial assets including trade receivables, loans and held-to-maturity debt securities held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This will result in the earlier recognition of credit losses. For available-for-sale debt securities, entities will be required to recognize an allowance for credit losses rather than a reduction to the carrying value of the asset. If expected cash flows improve, an entity will reduce the allowance and reverse the expense through income. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Entities will have to make more disclosures, including disclosures by year of origination for certain financing receivables. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

In February 2018, the FASB issued ASU No. 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220). This standard provides an option to reclassify stranded tax effects within accumulated other comprehensive income (loss) (“AOCI”) to retained earnings due to the U.S. federal corporate income tax rate change in the Tax Cuts and Jobs Act of 2017. This standard was effective for interim and annual reporting periods beginning after December 15, 2018. We did not exercise the option to make this reclassification.

In June 2018, the FASB issued ASU 2018-07, Improvements to Non-employee Share-Based Payment Accounting. This standardbroadens the scope of FASB ASC Topic 718, Compensation — Stock Compensation, which currently covers only share-based payments to employees. The change substantially aligns the accounting for share-based payments for both employees and non-employees. The ASU supersedes Subtopic 505-50, Equity — Equity-Based Payments to Non-Employees. The measurement of equity-classified non-employee awards will be fixed at the grant date, and entities will measure the cost of awards subject to a performance condition using the outcome that is probable at the balance sheet date. Entities may use the expected term to measure non-employee options or elect to use the contractual term as the expected term, on an award-by-award basis. Entities will recognize a cumulative-effect adjustment to retained earnings for equity classified non-employee awards for which a measurement date has not been established and liability-classified non-employee awards that have not been settled. The guidance is effective for calendar-year public business entities in annual periods beginning after December 15, 2018, and interim periods within those years. The Company adopted this pronouncement in the first quarter of 2019 and it did not have a material impact on its condensed consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), relating to a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by a vendor (i.e., a service contract). Under the new guidance, a customer will apply the same criteria for capitalizing implementation costs as it would for an arrangement that has a software license. The new guidance also prescribes the balance sheet, income statement, and cash flow classification of the capitalized implementation costs and related amortization expense, and requires additional quantitative and qualitative disclosures. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application is permitted.  The Company can choose to adopt the new guidance (1) prospectively to eligible costs incurred on or after the date this guidance is first applied, or (2) retrospectively. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, which removes, adds and modifies certain disclosure requirements for fair value measurements in Topic 820. The Company will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the valuation processes of Level 3 fair value measurements. However, the Company will be required to additionally disclose the changes in unrealized gains and losses included in other comprehensive income for recurring Level 3 fair value measurements, and the range and weighted average of assumptions used to develop significant unobservable inputs for Level 3 fair value measurements. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.  The amendments relating to additional disclosure requirements will be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments will be applied retrospectively to all periods presented upon their effective date. The Company is permitted to early adopt either the entire ASU or only the provisions that eliminate or modify the requirements. The Company is evaluating the impact, if any, that this pronouncement will have on its condensed consolidated financial statements.

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OPERATING SEGMENTS

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

OPERATING SEGMENTS

OPERATING SEGMENTS

The Company has two reportable segments: INAP US and INAP INTL. These segments are comprised of strategic businesses that are defined by the location of the service offerings. Our INAP US segment consists of US Colocation, US Cloud, and US Network services based in the United States. Our INAP INTL segment consists of these same services based in countries other than the United States, and Ubersmith.

Each segment is managed as an operation with well-established strategic directions and performance requirements. Each segment is led by a separate General Manager who reports to the Chief Operating Officer. The Chief Operating Officer reports directly to the Company's CODM. The CODM evaluates segment performance using business unit contribution which is defined as business unit revenues less direct costs of sales and services, customer support, and sales and marketing, exclusive of depreciation and amortization.

Our services, which are included within both our reportable segments, are described as follows:

Colocation

Colocation involves providing conditioned power with back-up capacity and physical space within data centers along with associated services such as interconnection, remote hands, environmental controls, monitoring and security while allowing our customers to deploy and manage their servers, storage and other equipment in our secure data centers. We design the data center infrastructure, procure the capital equipment, deploy the infrastructure and are responsible for the operation and maintenance of the facility.

Cloud

Cloud services involve providing compute resources and storage services on demand via an integrated platform that includes our automated bare metal solutions. We offer our next generation cloud platforms in our high density colocation facilities and utilize the INAP Performance IP for low latency connectivity. 

Network

Network services includes our patented Performance IP™ service, content delivery network services, as well as our IP routing hardware and software platform. By intelligently routing traffic with redundant, high-speed connections over multiple, major Internet backbones, our IP connectivity provides high-performance and highly-reliable delivery of content, applications and communications to end users globally. We deliver our IP connectivity through 100 network POPs around the world.

The following table provides segment results (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
INAP US	$	56,947		$	65,678		$	171,928		$	186,821
INAP INTL	15,931			17,294			47,648			52,314
Net revenues	72,878			82,972			219,576			239,135
Cost of sales and services, customer support and sales and marketing:
INAP US	32,920			35,197			97,780			99,532
INAP INTL	10,148			11,478			29,892			34,483
Total costs of sales and services, customer support and sales and marketing	43,068			46,675			127,672			134,015
										.
Segment profit:
INAP US	24,027			30,481			74,148			87,289
INAP INTL	5,783			5,816			17,756			17,831
Total segment profit	29,810			36,297			91,904			105,120
Exit activities, restructuring and impairments	3,792			2,347			5,439			3,140
Other operating expenses, including sales, general and administrative and depreciation and amortization expenses	29,954			31,253			91,885			95,404
(Loss) income from operations	(3,936		)	2,697			(5,420		)	6,576
Non-operating expenses	19,919			17,989			56,906			50,143
Loss before income taxes and equity in earnings of equity-method investment	$	(23,855	)	$	(15,292	)	$	(62,326	)	$	(43,567	)

The CODM does not manage the operating segments based on asset allocations. Therefore, assets by operating segment have not been provided.

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GOODWILL AND OTHER INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

The Company tests goodwill and intangible assets with indefinite lives for impairment annually as of August 1. Additionally, the Company may perform interim tests if an event occurs or circumstances change that could potentially reduce the fair value of a reporting unit or indefinite lived intangible asset below its carrying amount. The carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units.

The Company tests goodwill for impairment by either performing a qualitative evaluation or a quantitative test. The qualitative evaluation is an assessment of factors, including reporting unit specific operating results as well as industry, market and general economic conditions, to determine whether it is more likely than not that the fair values of a reporting unit is less than its carrying amount, including goodwill. The Company may elect to bypass this qualitative assessment for some or all of its reporting units and perform a quantitative test.

Goodwill is considered impaired if the carrying amount of the net assets exceeds the fair value of the reporting unit. Impairment, if any, would be recorded in operating income / (loss) and this could result in a material impact to net income / (loss) and income / (loss) per share.

Annual Testing

2019

We performed our annual impairment review as of August 1, 2019. To determine the estimated fair value of our reporting units, we utilized the discounted cash flow and market methods. We have consistently utilized both methods in our goodwill impairment assessments and weighted both as appropriate based on relevant factors for each reporting unit. The discounted cash flow method is specific to our anticipated future results of the reporting unit, while the market method is based on our market sector including our competitors.

We determined the assumptions supporting the discounted cash flow method, including the discount rate, using our estimates as of the date of the impairment review. To determine the reasonableness of these assumptions, we considered our past performance and empirical trending of results, looked to market and industry expectations used in the discounted cash flow method, such as forecasted revenues and discount rate. We used reasonable judgment in developing our estimates and assumptions. The market method estimates fair value based on market multiples of revenue and earnings derived from comparable companies with similar operating and investment characteristics as the reporting unit.

The assumptions, inputs and judgments used in performing the valuation analysis are inherently subjective and reflect estimates based on known facts and circumstances at the time we perform the valuation. These estimates and assumptions primarily include, but are not limited to, discount rates; terminal growth rates; projected revenues and costs; earnings before interest, taxes, depreciation and amortization for expected cash flows; market comparables and capital expenditure forecasts. In performing this test as of August 1, 2019, the Company utilized a long-term growth rate for its reporting units of 2.0% in its estimation of fair value and discount rates ranging from 8.0% to 13.0% versus the prior year discount rates of 9.0% to 16.0% to reflect changes in market conditions. The assumptions used in evaluating goodwill for impairment are subject to change and are tracked against historical results by management. The use of different assumptions, inputs and judgments, or changes in circumstances, could materially affect the results of the valuation. Due to inherent uncertainty involved in making these estimates, actual results could differ from our estimates and could result in additional non-cash impairment charges in the future.

The Company determined, after performing the fair value analysis above, that all reporting units’ fair values were in excess of its carrying value. No impairment of goodwill has been identified for the nine months ended September 30, 2019.

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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 1,077	$ 1,547
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, shares outstanding (in shares)	26,486,000	25,455,000
Treasury stock, shares (in shares)	388,000	330,000
Term loan current, discount and prepaid costs	$ 4,909	$ 4,036
Term loan deferred, discount and prepaid costs	$ 7,587	$ 9,508

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION - Narrative (Details)	9 Months Ended
	Sep. 30, 2019 datacenter market point_of_presence
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of POPs | point_of_presence	100
Number of metropolitan markets | market	21
Number Of Datacenters | datacenter	14

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REVENUES - Narrative (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Capitalized Contract Cost [Line Items]
Capitalized contract cost, impairment loss	$ 0	$ 0	$ 0	$ 0
Fulfillment Costs And Commission Fees
Capitalized Contract Cost [Line Items]
Capitalized contract cost	24,200,000		24,200,000		$ 24,900,000
Amortization of capitalized contract costs	$ 2,500,000	$ 2,500,000	$ 7,300,000	$ 7,200,000

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REVENUES - Summary of Revenue by Geography (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
Net revenues	$ 72,878	$ 82,972	$ 219,576	$ 239,135
INAP US
Disaggregation of Revenue [Line Items]
Net revenues	56,947	65,678	171,928	186,821
INAP INTL
Disaggregation of Revenue [Line Items]
Net revenues	15,931	17,294	47,648	52,314
INAP US
Disaggregation of Revenue [Line Items]
Net revenues	57,939	66,752	174,964	190,071
INAP INTL
Disaggregation of Revenue [Line Items]
Net revenues	14,939	16,220	44,612	49,064
UNITED STATES | INAP US
Disaggregation of Revenue [Line Items]
Net revenues	57,939	66,752	174,964	190,071
UNITED STATES | INAP INTL
Disaggregation of Revenue [Line Items]
Net revenues	0	0	0	0
CANADA | INAP US
Disaggregation of Revenue [Line Items]
Net revenues	0	0	0	0
CANADA | INAP INTL
Disaggregation of Revenue [Line Items]
Net revenues	8,181	9,187	24,208	27,846
Other Non-Us | INAP US
Disaggregation of Revenue [Line Items]
Net revenues	0	0	0	0
Other Non-Us | INAP INTL
Disaggregation of Revenue [Line Items]
Net revenues	$ 6,758	$ 7,033	$ 20,404	$ 21,218

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OPERATING SEGMENTS - Narrative (Details)	9 Months Ended
	Sep. 30, 2019 point_of_presence segment
Segment Reporting [Abstract]
Number of reportable segments | segment	2
Segment Reporting Information [Line Items]
Number of POPs	100
Network services
Segment Reporting Information [Line Items]
Number of POPs	100

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FAIR VALUE MEASUREMENTS - Summary of fair value Level 2 debt (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Carrying Amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Term loan	$ 427,070	$ 429,143
Revolving credit facility	14,000	0
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Term loan	330,979	428,071
Revolving credit facility	$ 10,850	$ 0

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SUBSEQUENT EVENTS (Details)	Oct. 29, 2019 USD ($)	May 08, 2019 USD ($)	May 07, 2019 USD ($)
Sixth Amendment To Credit Agreement | Credit Agreement
Subsequent Event [Line Items]
Permitted asset dispositions		$ 50,000,000	$ 150,000,000
Maximum sales proceeds that may be reinvested		2,500,000
Sixth Amendment To Credit Agreement | Investment Basket
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity		$ 25,000,000.0
Basket rate		30.00%
Sixth Amendment To Credit Agreement | Incremental Facility
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity		$ 50,000,000.0
Sixth Amendment To Credit Agreement | Foreign Subsidiary Debt Basket
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity		$ 15,000,000.0
Basket rate		18.00%
Sixth Amendment To Credit Agreement | General Basket
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity		$ 50,000,000.0
Basket rate		61.00%
Subsequent Event | Seventh Amendment To Agreement | Credit Agreement
Subsequent Event [Line Items]
Permitted asset dispositions	$ 25,000,000.0
Maximum sales proceeds that may be reinvested	1,000,000.0
Subsequent Event | Seventh Amendment To Agreement | Investment Basket
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity	$ 12,500,000.0
Basket rate	15.00%
Subsequent Event | Seventh Amendment To Agreement | Incremental Facility
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity	$ 25,000,000.0
Subsequent Event | Seventh Amendment To Agreement | Foreign Subsidiary Debt Basket
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity	$ 5,000,000.0
Basket rate	6.00%
Subsequent Event | Seventh Amendment To Agreement | General Basket
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity	$ 25,000,000.0
Basket rate	30.00%
Subsequent Event | Seventh Amendment To Agreement | December 31, 2019 - December 31, 2020 | Credit Agreement
Subsequent Event [Line Items]
Maximum total leverage ratio	7.25
Minimum consolidated interest coverage ratio	1.60
Subsequent Event | Seventh Amendment To Agreement | March 31, 2021 | Credit Agreement
Subsequent Event [Line Items]
Maximum total leverage ratio	5.50
Minimum consolidated interest coverage ratio	2.00
Subsequent Event | Seventh Amendment To Agreement | June 30, 2021 | Credit Agreement
Subsequent Event [Line Items]
Maximum total leverage ratio	5.00
Subsequent Event | Seventh Amendment To Agreement | September 30, 2021 and thereafter | Credit Agreement
Subsequent Event [Line Items]
Maximum total leverage ratio	4.50

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Treasury Stock	Accumulated Deficit	Accumulated Items of Other Comprehensive Loss	Non-Controlling Interest
Balance (in shares) at Dec. 31, 2017		20,804,000
Balance at Dec. 31, 2017	$ (1,032)	$ 21	$ 1,327,084	$ (7,159)	$ (1,323,723)	$ (1,324)	$ 4,069
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(14,261)				(14,261)
Net income attributable to non-controlling interest					(27)		27
Foreign currency translation	61					61
Movement in non-controlling interest	(990)						(990)
Common stock issuance (in shares)		343,000
Employee taxes paid on withholding shares (in shares)		(20,000)
Employee taxes paid on withholding shares	(270)			(270)
Stock-based compensation	869		869
Proceeds from exercise of stock options, net (in shares)		4,000
Proceeds from exercise of stock options, net	32		32
Balance (in shares) at Mar. 31, 2018		21,131,000
Balance at Mar. 31, 2018	8,594	$ 21	1,327,985	(7,429)	(1,313,826)	(1,263)	3,106
Balance (in shares) at Dec. 31, 2017		20,804,000
Balance at Dec. 31, 2017	(1,032)	$ 21	1,327,084	(7,159)	(1,323,723)	(1,324)	4,069
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(43,971)
Net income attributable to non-controlling interest	75
Foreign currency translation	24
Balance (in shares) at Sep. 30, 2018		21,302,000
Balance at Sep. 30, 2018	(19,923)	$ 21	1,330,751	(7,645)	(1,344,566)	(1,300)	2,816
Balance (in shares) at Mar. 31, 2018		21,131,000
Balance at Mar. 31, 2018	8,594	$ 21	1,327,985	(7,429)	(1,313,826)	(1,263)	3,106
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(14,256)				(14,256)
Net income attributable to non-controlling interest					(23)		23
Foreign currency translation	61					61
Movement in non-controlling interest	(205)						(205)
Common stock issuance (in shares)		104,000
Employee taxes paid on withholding shares (in shares)		(16,000)
Employee taxes paid on withholding shares	(201)			(201)
Stock-based compensation	1,382		1,382
Proceeds from exercise of stock options, net	1		1
Balance (in shares) at Jun. 30, 2018		21,219,000
Balance at Jun. 30, 2018	(5,605)	$ 21	1,329,368	(7,630)	(1,329,086)	(1,202)	2,924
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(15,454)				(15,454)
Net income attributable to non-controlling interest	25				(25)		25
Foreign currency translation	(98)					(98)
Movement in non-controlling interest	(133)						(133)
Common stock issuance (in shares)		82,000
Employee taxes paid on withholding shares (in shares)		(1,000)
Employee taxes paid on withholding shares	(15)			(15)
Stock-based compensation	1,320		1,320
Proceeds from exercise of stock options, net (in shares)		2,000
Proceeds from exercise of stock options, net	63		63
Balance (in shares) at Sep. 30, 2018		21,302,000
Balance at Sep. 30, 2018	$ (19,923)	$ 21	1,330,751	(7,645)	(1,344,566)	(1,300)	2,816
Balance (in shares) at Dec. 31, 2018	25,455,000	25,455,000
Balance at Dec. 31, 2018	$ 57	$ 25	1,368,968	(7,646)	(1,363,019)	(1,065)	2,794
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(19,622)				(19,622)
Net income attributable to non-controlling interest					(22)		22
Foreign currency translation	197					197
Movement in non-controlling interest	(1,133)						(1,133)
Common stock issuance (in shares)		1,339,000
Common stock issuance, net	(41)	$ 2
Common stock issuance, net			(43)
Employee taxes paid on withholding shares (in shares)		(48,000)
Employee taxes paid on withholding shares	(268)			(268)
Stock-based compensation	890		890
Balance (in shares) at Mar. 31, 2019		26,746,000
Balance at Mar. 31, 2019	$ (19,972)	$ 27	1,369,815	(7,914)	(1,382,715)	(868)	1,683
Balance (in shares) at Dec. 31, 2018	25,455,000	25,455,000
Balance at Dec. 31, 2018	$ 57	$ 25	1,368,968	(7,646)	(1,363,019)	(1,065)	2,794
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(62,006)
Net income attributable to non-controlling interest	63
Foreign currency translation	$ 152
Balance (in shares) at Sep. 30, 2019	26,486,000	26,486,000
Balance at Sep. 30, 2019	$ (60,212)	$ 26	1,372,016	(7,958)	(1,425,140)	(913)	1,757
Balance (in shares) at Mar. 31, 2019		26,746,000
Balance at Mar. 31, 2019	(19,972)	$ 27	1,369,815	(7,914)	(1,382,715)	(868)	1,683
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(18,535)				(18,535)
Net income attributable to non-controlling interest					(20)		20
Foreign currency translation	(27)					(27)
Movement in non-controlling interest	23						23
Common stock issuance (in shares)		33,000
Employee taxes paid on withholding shares (in shares)		(9,000)
Employee taxes paid on withholding shares	(42)			(42)
Stock-based compensation	1,020		1,020
Balance (in shares) at Jun. 30, 2019		26,770,000
Balance at Jun. 30, 2019	(37,533)	$ 27	1,370,835	(7,956)	(1,401,270)	(895)	1,726
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(23,849)				(23,849)
Net income attributable to non-controlling interest	21				(21)		21
Foreign currency translation	(18)					(18)
Movement in non-controlling interest	10						10
Common stock issuance (in shares)		(283,000)
Common stock issuance, net	(1)	$ (1)
Employee taxes paid on withholding shares (in shares)		(1,000)
Employee taxes paid on withholding shares	(2)			(2)
Stock-based compensation	$ 1,181		1,181
Balance (in shares) at Sep. 30, 2019	26,486,000	26,486,000
Balance at Sep. 30, 2019	$ (60,212)	$ 26	$ 1,372,016	$ (7,958)	$ (1,425,140)	$ (913)	$ 1,757

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2019	Nov. 08, 2019
Document and Entity Information Abstract
Entity Registrant Name	Internap Corp
Entity Central Index Key	0001056386
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Document Type	10-Q
Document Period End Date	Sep. 30, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		26,621,105
Entity Current Reporting Status	Yes

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REVENUES

9 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Abstract]

REVENUES

REVENUES

We generate revenues primarily from the sale of data center services, including colocation, hosting and cloud, and IP services. Our revenues typically consist of monthly recurring revenues from contracts with terms of one year or more and we typically recognize the monthly minimum as revenue each month as our performance obligations are fulfilled. We record installation fees as deferred revenue and recognized the revenue ratably over the estimated customer life.

For our data center service revenues, we typically determine colocation revenues by occupied square feet and both allocated and variable-based usage, which includes both physical space for hosting customers' network and other equipment plus associated services such as power and network connectivity, environmental controls and security. We typically determine hosting revenues by the number of servers utilized (physical or virtual) and cloud revenues by the amount of processing and storage consumed. We typically determine IP services revenues on fixed-commitment or usage-based pricing. IP service contracts usually have fixed minimum commitments based on a certain level of bandwidth usage with additional charges for any usage over a specified limit. If a customer's usage of our services exceeds the monthly minimum, we recognize revenue for such excess in the period of the usage. We use contracts and sales or purchase orders as evidence of an arrangement. We test for availability or connectivity to verify delivery of our services.

We assess whether:

a. the parties to the contract have an approved contract;

b. the Company can identify each party's rights regarding the goods and services to be transferred;

c. the Company can identify the payment terms for the goods or services to be transferred;

d. the contract has commercial substance; and

e. it is probable that the Company will collect substantially all of the consideration to which it will be entitled in exchange for the goods and services that will be transferred to the customer.

The transaction price reflects INAP’s expectations about the consideration it will be entitled to receive from the customer. The Company considers the terms of the contract and its customary business practices to determine the transaction price. The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. After contract inception, the transaction price can change for various reasons, including the resolution of uncertain events or other changes in circumstances that change the amount of consideration to which INAP expects to be entitled in exchange for the promised goods or services. Once the separate performance obligations are identified and the transaction price has been determined, the Company allocates the transaction price to the performance obligations in proportion to their standalone selling price ("SSP"). When allocating on a relative SSP basis, any discount within the contract generally is allocated proportionately to all of the performance obligations in the contract.

To allocate the transaction price on a relative SSP basis, the Company first determines the SSP of the distinct good or service underlying each performance obligation. It is the price at which the Company would sell a good or service on a standalone (or separate) basis at contract inception. The observable price of a good or service sold separately provides the best evidence of SSP. If a SSP is not directly observable, the Company will estimate the SSP. The Company will be able to consider its facts and circumstances in order to determine how frequently it will need to update the estimates. If the information used to estimate the SSP for similar transactions has not changed, the Company will determine that it is reasonable to use the previously determined SSP.

Revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations.

The Company's contracts with customers often include performance obligations to transfer multiple products and services to a customer. Common performance obligations of the Company include delivery of services. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together requires significant judgment by the Company.

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC 606. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Total transaction price is estimated for impact of variable consideration, such as INAP's service level arrangements, additional usage and late fees, discounts and promotions, and customer care credits. The majority of contracts have multiple performance obligations, as the promise to transfer individual goods or services is separately identifiable from other promises in the contracts and, therefore, is distinct. For contracts with multiple performance obligations, the Company allocates the contract's transaction price to each performance obligation based on its relative SSP.

The SSP is determined based on observable price. In instances where the SSP is not directly observable, such as when the Company does not sell the product or service separately, INAP determines the SSP using information that may include market conditions and other observable inputs. The Company typically has more than one SSP for individual products and services due to the stratification of those products and services by customers and circumstances. In these instances, the Company may use information such as the size of the customer and geographic region in determining the SSP.

The most significant impact of the adoption of the new standard was the requirement for incremental costs to obtain a customer, such as commissions, which previously were expensed as incurred, to be deferred and amortized over the period of contract performance or a longer period if renewals are expected and the renewal commission does not equal the initial commission.

In addition, installation revenues are recognized over the initial contract life rather than over the estimated customer life, as installation revenues are not significant to the total contract and therefore do not represent a material right.

Most performance obligations, with the exception of occasional sales of equipment or hardware, are satisfied over time as the customer consumes the benefits as we perform. For equipment and hardware sales, the performance obligation is satisfied when control transfers to the customer.

In evaluating the treatment of certain contracts, the Company exercised heightened judgment in deferring installation revenue as well as expense fulfillment and commission costs over the appropriate life. With the exception of the revenues noted above, revenue recognition remains materially consistent with historical practice.

The Company routinely reviews the collectability of its accounts receivable and payment status of customers. If the Company determines that collection of revenue is uncertain, it does not recognize revenue until collection is reasonably assured. Additionally, the Company maintains an allowance for doubtful accounts resulting from the inability of the Company's customers to make required payments on accounts receivable. The allowance for doubtful accounts is based on historical write-offs as a percentage of revenues. The Company assesses the payment status of customers by reference to the terms under which it provides services or goods, with any payments not made on or before their due date considered past-due. Once all collection efforts have been exhausted, the uncollectible balance is written off against the allowance for doubtful accounts. The Company routinely performs credit checks for new and existing customers and requires deposits or prepayments for customers that are perceived as being a credit risk. In addition, the Company records a reserve amount for potential credits to be issued under service level agreements and other sales adjustments.

Management expects that commission fees paid to sales representatives as a result of obtaining service contracts and contract renewals are recoverable and therefore the Company deferred them as contract costs in the amount of $24.2 million and $24.9 million at September 30, 2019 and December 31, 2018, respectively. Capitalized commission fees are amortized on a straight-line basis over the determined life, which vary based on the customer segment. For the three months ended September 30, 2019 and September 30, 2018, amortization recognized was $2.5 million for both years. For the nine months ended September 30, 2019 and September 30, 2018, amortization recognized was $7.3 million and $7.2 million, respectively. There was no impairment loss recorded on capitalized contract costs for the three and nine months ended September 30, 2019 and September 30, 2018.

Applying the practical expedient pertaining to contract costs, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in "Sales, general and administrative" expenses in the accompanying condensed consolidated statements of operations and comprehensive loss. The Company includes only those incremental costs that would not have been incurred if the contracts had not been entered into as follows (in thousands):

	Current			Non-current
Balance at December 31, 2018	$	8,844		$	16,104
Deferred customer acquisition costs incurred in the period	1,345			5,274
Amounts recognized as expense in the period	(7,333		)	—
Transition between short-term and long-term	6,346			(6,346		)
Balance at September 30, 2019	$	9,202		$	15,032

The Company classifies its right to consideration in exchange for deliverables as either a receivable or a contract asset. A receivable is a right to consideration that is unconditional (i.e. only the passage of time is required before payment is due). For example, the Company recognizes a receivable for revenues related to its time and materials and transaction or volume-based contracts. The Company presents such receivables in "Accounts receivable, net" it its condensed consolidated balance sheets at their net estimated realizable value.

As of September 30, 2019, approximately $198.0 million of total revenues and deferred revenues are expected to be recognized in future periods with a weighted average life of 2.13 years for remaining performance obligations under the initial contract terms. The remaining performance obligations do not include variable consideration related to unsatisfied performance obligations such as the level of bandwidth usage, physical space for hosting customers’ network, and associated services for power and network connectivity.

Amounts collected in advance of services being provided are accounted for as contract liabilities, which are presented as "Deferred revenues" on the accompanying condensed consolidated balance sheets and are realized with the associated revenue recognized under the contract. Nearly all of the Company's contract liabilities balance is related to service revenue.

Significant changes in the deferred revenues balance (current and non-current) during the period are as follows (in thousands):

Balance at December 31, 2018	$	8,533
Revenue recognized that was included in the deferred revenue balance at December 31, 2018	(5,931		)
Increases due to cash received, excluding amounts recognized as revenue during the period	5,150
Balance at September 30, 2019	$	7,752

In accordance with ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASC 606"), the Company disaggregates revenue from contracts with customers based on the timing of revenue recognition. The Company determined that disaggregating revenue into these categories depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. As discussed in this note and Note 11, "Operating Segments," the Company business consists of INAP US and INAP INTL colocation, cloud and network services. The following table presents disaggregated revenues by category as follows (in thousands):

	Three Months Ended September 30, 2019				Three Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
Colocation	$	27,334	$	1,452	$	32,946	$	1,372
Network services	11,225		2,772		13,015		2,719
Cloud	18,388		11,707		19,717		13,203
	$	56,947	$	15,931	$	65,678	$	17,294

	Nine Months Ended September 30, 2019				Nine Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
Colocation	$	82,245	$	4,344	$	94,747	$	4,349
Network services	34,381		8,224		40,398		8,482
Cloud	55,302		35,080		51,676		39,483
	$	171,928	$	47,648	$	186,821	$	52,314

Revenue by geography is as follows (in thousands):

	Three Months Ended September 30, 2019				Three Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
United States	$	57,939	$	—	$	66,752	$	—
Canada	—		8,181		—		9,187
Other countries	—		6,758		—		7,033
	$	57,939	$	14,939	$	66,752	$	16,220

	Nine Months Ended September 30, 2019				Nine Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
United States	$	174,964	$	—	$	190,071	$	—
Canada	—		24,208		—		27,846
Other countries	—		20,404		—		21,218
	$	174,964	$	44,612	$	190,071	$	49,064

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COMMITMENTS, CONTINGENCIES AND LITIGATION

9 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS, CONTINGENCIES AND LITIGATION

COMMITMENTS, CONTINGENCIES AND LITIGATION

We are subject to legal proceedings, claims and litigation arising in the ordinary course of business. Although the outcome of these matters is currently not determinable, we do not expect that the ultimate costs to resolve these matters will have a material adverse impact on our financial condition, results of operations or cash flows.

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FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

• Level 1: Quoted prices in active markets for identical assets or liabilities;

• Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

• Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Assets and liabilities measured at fair value on a recurring basis are summarized as follows (in thousands):

	Level 1		Level 2		Level 3		Total
September 30, 2019
Available-for-sale securities	$	—	$	2,386	$	—	$	2,386
Asset retirement obligations(1)	—		—		2,292		2,292
December 31, 2018
Available-for-sale securities	$	—	$	2,309	$	—	$	2,309
Asset retirement obligations(1)	—		—		2,090		2,090

⁽¹⁾  We calculated the fair value of asset retirement obligations by discounting the estimated amount using the Treasury bill rate adjusted for our credit risk. At September 30, 2019 and December 31, 2018, the balances are included in "Other long-term liabilities," in the accompanying condensed consolidated balance sheets.

The following table provides a summary of changes in our Level 3 asset retirement obligations for the nine months ended September 30, 2019 (in thousands): 

	2019
Balance, January 1, 2019	$	2,090
Accretion	202
Payments	—
Balance, September 30, 2019	$	2,292

As of September 30, 2019, the Company held $2.4 million of available-for-sale debt securities which are reported at fair value on the Company's condensed consolidated balance sheets in "Deposits and other assets." A decline in the fair value of a marketable security below the Company's cost basis is determined to be other than temporary, such marketable security is written down to its estimated fair value as a new cost basis and the amount of the write-down is included in earnings as an impairment charge. The Company may sell certain of its marketable securities prior to their stated maturities for strategic reasons including, but not limited to, anticipation of credit deterioration and maturity management.

The fair values of our Level 2 available-for-sale debt securities, based upon quoted prices for similar items in active markets, are as follows (in thousands):

	September 30, 2019
	Cost		Unrealized Gain		Unrealized Loss			Fair Value
Japanese Corporate Bonds	$	2,221	$	189	$	(114	)	$	2,296
Japanese Government Bonds	88		7		(5		)	90
Total Bonds	$	2,309	$	196	$	(119	)	$	2,386
	December 31, 2018
	Cost		Unrealized Gain		Unrealized Loss			Fair Value
Japanese Corporate Bonds	$	2,184	$	144	$	(107	)	$	2,221
Japanese Government Bonds	87		5		(4		)	88
Total Bonds	$	2,271	$	149	$	(111	)	$	2,309

The fair values of our Level 2 debt liabilities, based upon quoted prices for similar items in active markets, are as follows (in thousands):

	September 30, 2019				December 31, 2018
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Term loan	$	427,070	$	330,979	$	429,143	$	428,071
Revolving credit facility	14,000		10,850		—		—

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LEASES - Narrative (Details)	9 Months Ended
	Sep. 30, 2019
Minimum
Lessee, Lease, Description [Line Items]
Remaining lease term	2 years
Renewal term	5 years
Termination period	4 months
Maximum
Lessee, Lease, Description [Line Items]
Remaining lease term	34 years
Renewal term	15 years
Termination period	120 months

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION - Adjustments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Costs of sales and services, exclusive of depreciation and amortization	$ 27,504	$ 28,221	$ 79,186	$ 80,160
Depreciation and amortization	21,582	23,553	65,715	67,422
Interest expense	19,913	17,794	56,578	50,138
Net loss attributable to INAP shareholders	(23,870)	(15,479)	(62,069)	(44,046)
Property and equipment, net	216,548	487,616	216,548	487,616			$ 478,061
Total assets	724,701	756,231	724,701	756,231			744,931
Capital lease obligations	0	263,676	0	263,676			9,080
Total liabilities	784,913	776,154	784,913	776,154			744,874
Accumulated deficit	(1,425,140)	(1,344,566)	(1,425,140)	(1,344,566)			(1,363,019)
Total stockholders’ (deficit) equity	$ (60,212)	(19,923)	$ (60,212)	(19,923)	$ (37,533)	$ (19,972)	$ 57	$ (5,605)	$ 8,594	$ (1,032)
As reported
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Costs of sales and services, exclusive of depreciation and amortization		28,866		81,880
Depreciation and amortization		23,431		67,097
Interest expense		16,898		47,786
Net loss attributable to INAP shareholders		(15,106)		(43,089)
Property and equipment, net		477,423		477,423
Total assets		746,038		746,038
Capital lease obligations		252,599		252,599
Total liabilities		765,004		765,004
Accumulated deficit		(1,343,609)		(1,343,609)
Total stockholders’ (deficit) equity		(18,966)		(18,966)
Adjustments | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Costs of sales and services, exclusive of depreciation and amortization		(645)		(1,720)
Depreciation and amortization		122		325
Interest expense		896		2,352
Net loss attributable to INAP shareholders		(373)		(957)
Property and equipment, net		10,193		10,193
Total assets		10,193		10,193
Capital lease obligations		11,077		11,077
Total liabilities		11,150		11,150
Accumulated deficit		(957)		(957)
Total stockholders’ (deficit) equity		$ (957)		$ (957)

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REVENUES - Rollforward of Contract Assets (Details) - USD ($) $ in Thousands		9 Months Ended
	Dec. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Change in Contract with Customer, Asset and Liability [Roll Forward]
Balance at March 31, 2019, current		$ 8,844
Balance at March 31, 2019, noncurrent		16,104
Amounts recognized as expense in the period		(7,333)
Balance at June 30, 2019, current	$ 8,844	9,202
Balance at June 30, 2019, noncurrent	16,104	15,032
Balance at December 31, 2018		8,533
Revenue recognized that was included in the deferred revenue balance at December 31, 2018	(5,931)
Increases due to cash received, excluding amounts recognized as revenue during the period		5,150
Balance at September 30, 2019	8,533	7,752
Current
Change in Contract with Customer, Asset and Liability [Roll Forward]
Balance at March 31, 2019, current		8,844
Deferred customer acquisition costs incurred in the period		1,345
Transition between short-term and long-term		6,346
Balance at June 30, 2019, current	8,844	9,202
Non-current
Change in Contract with Customer, Asset and Liability [Roll Forward]
Balance at March 31, 2019, noncurrent		16,104
Deferred customer acquisition costs incurred in the period			$ 5,274
Amounts recognized as expense in the period			0
Transition between short-term and long-term			$ (6,346)
Balance at June 30, 2019, noncurrent	$ 16,104	$ 15,032

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LEASES (Tables)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Schedule of lease related costs

The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2019 (in thousands):

Operating Leases
Operating cash paid to settle operating lease liabilities	$	5,913
Right-of-use assets obtained in exchange for lease liabilities	921
Finance Leases
Operating cash paid for interest	$	17,577
Right-of-use assets obtained in exchange for lease liabilities	1,639

Lease-related costs for the three and nine months ended September 30, 2019 are as follows (in thousands):

	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Finance lease cost
Amortization of right-of-use assets		$	3,861	$	12,384
Interest on lease liabilities		7,445		22,124
Finance lease cost		$	11,306	$	34,508
Operating lease cost		$	2,269	$	5,964
Short-term lease cost		1,106		4,302
Total lease cost		$	14,681	$	44,774

Other information related to leases as of September 30, 2019 is as follows (in thousands, except lease term and rate):

	Operating Leases			Finance Leases
Right-of-use assets	$	33,723		$	226,619
Lease liabilities	37,068			270,090
Weighted-average remaining lease term (years)	5.26			19.05
Weighted-average discount rate	7.25		%	13.80		%

Schedule of assets and liabilities leases

Other information related to leases as of September 30, 2019 is as follows (in thousands, except lease term and rate):

	Operating Leases			Finance Leases
Right-of-use assets	$	33,723		$	226,619
Lease liabilities	37,068			270,090
Weighted-average remaining lease term (years)	5.26			19.05
Weighted-average discount rate	7.25		%	13.80		%

Schedule of future minimum lease payments under non-cancellable leases

Future minimum lease payments under non-cancellable leases as of September 30, 2019 are as follows (in thousands):

	Operating Leases			Finance Leases
2019 (excluding the nine months ended September 30, 2019)		$	2,270		$	8,412
2020		9,073			33,406
2021		9,098			35,243
2022		8,519			33,995
2023		7,541			33,244
Thereafter		8,698			633,139
Total undiscounted lease payments		$	45,199		$	777,439
Less: Imputed interest		8,131			507,349
Total lease liabilities		$	37,068		$	270,090

Finance Lease, Liability, Maturity

Future minimum lease payments under non-cancellable leases as of September 30, 2019 are as follows (in thousands):

	Operating Leases			Finance Leases
2019 (excluding the nine months ended September 30, 2019)		$	2,270		$	8,412
2020		9,073			33,406
2021		9,098			35,243
2022		8,519			33,995
2023		7,541			33,244
Thereafter		8,698			633,139
Total undiscounted lease payments		$	45,199		$	777,439
Less: Imputed interest		8,131			507,349
Total lease liabilities		$	37,068		$	270,090

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SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2019

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

On October 29, 2019, the Company entered into the Seventh Amendment to 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the “Seventh  Amendment”). The Seventh Amendment (i) modified the maximum total net leverage ratio requirements and the minimum consolidated interest coverage ratio requirements under the 2017 Credit Agreement and (ii) effected certain other modifications, including changes to certain baskets.

The maximum total leverage ratio increases to 7.25 to 1 as of December 31, 2019 - December 31, 2020, 5.50 to 1 as of March 31, 2021, 5.00 to 1 as of June 30, 2021, 4.50 to 1 as of September 30, 2021 and thereafter.

The minimum consolidated interest coverage ratio decreases to 1.60 to 1 as of December 31, 2019 - December 31, 2020, 2.00 to 1.00 as of March 31, 2021 and thereafter.

The Seventh Amendment also made the following modifications:

• Reduced the disposition of property basket from $50.0 million to $25.0 million.

• Reduced reinvestment of net cash proceeds from asset sales from $2.5 million to $1.0 million.

• Reduced investment basket from greater of $25.0 million and 30% of EBITDA to greater of $12.5 million and 15% of EBITDA.

• Reduced incremental facility from $50.0 million to $25.0 million.

• Reduced foreign subsidiary debt basket from greater of $15.0 million and 18% of EBITDA to greater of $5.0 million and 6% of EBITDA.

• Reduced general basket from greater of $50.0 million and 61% of EBITDA to greater of $25.0 million and 30% of EBITDA.

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OPERATING SEGMENTS (Tables)

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Schedule of operating results for business segments, along with reconciliation from segment profit to loss before income taxes and equity in (earnings) of equity-method investment

The following table provides segment results (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
INAP US	$	56,947		$	65,678		$	171,928		$	186,821
INAP INTL	15,931			17,294			47,648			52,314
Net revenues	72,878			82,972			219,576			239,135
Cost of sales and services, customer support and sales and marketing:
INAP US	32,920			35,197			97,780			99,532
INAP INTL	10,148			11,478			29,892			34,483
Total costs of sales and services, customer support and sales and marketing	43,068			46,675			127,672			134,015
										.
Segment profit:
INAP US	24,027			30,481			74,148			87,289
INAP INTL	5,783			5,816			17,756			17,831
Total segment profit	29,810			36,297			91,904			105,120
Exit activities, restructuring and impairments	3,792			2,347			5,439			3,140
Other operating expenses, including sales, general and administrative and depreciation and amortization expenses	29,954			31,253			91,885			95,404
(Loss) income from operations	(3,936		)	2,697			(5,420		)	6,576
Non-operating expenses	19,919			17,989			56,906			50,143
Loss before income taxes and equity in earnings of equity-method investment	$	(23,855	)	$	(15,292	)	$	(62,326	)	$	(43,567	)

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FAIR VALUE MEASUREMENTS - Amortized cost vs fair value (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Cost	$ 2,309	$ 2,271
Unrealized Gain	196	149
Unrealized Loss	(119)	(111)
Fair Value	2,386	2,309
Japanese Corporate Bonds
Debt Securities, Available-for-sale [Line Items]
Cost	2,221	2,184
Unrealized Gain	189	144
Unrealized Loss	(114)	(107)
Fair Value	2,296	2,221
Japanese Government Bonds
Debt Securities, Available-for-sale [Line Items]
Cost	88	87
Unrealized Gain	7	5
Unrealized Loss	(5)	(4)
Fair Value	$ 90	$ 88

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LEASES - Other Information Related to Leases (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2019	Jan. 01, 2019	Dec. 31, 2018
Leases [Abstract]
Right-of-use assets, operating leases	$ 33,723	$ 28,500	$ 0
Right-of-use assets, finance leases	226,619		$ 0
Lease Liabilities, operating leases	37,068	$ 31,000
Lease Liabilities, finance leases	$ 270,090
Weighted-average remaining lease term, operating lease	5 years 3 months 4 days
Weighted-average remaining lease term, finance lease	19 years 18 days
Weighted-average discount rate, operating lease	7.25%
Weighted-average discount rate, finance lease	13.80%
Cash paid for amounts included in the measurement of lease liabilities
Operating cash paid to settle operating lease liabilities	$ 5,913
Right-of-use assets obtained in exchange for lease liabilities	921
Operating cash paid for interest	17,577
Right-of-use assets obtained in exchange for lease liabilities	$ 1,639

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ACQUISITION - Summary of Unaudited Proforma Financial Information (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018
Business Combinations [Abstract]
Net revenues	$ 82,972	$ 247,260
Net loss	$ (15,454)	$ (45,173)
Basic and diluted net loss per share (in dollars per share)	$ (0.77)	$ (2.27)
Weighted average shares outstanding used in computing basic and diluted net loss per share (in shares)	20,206	19,968

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NET LOSS PER SHARE - Schedule of basic and diluted net loss per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Earnings Per Share [Abstract]
Net loss	$ (23,849)	$ (18,535)	$ (19,622)	$ (15,454)	$ (14,256)	$ (14,261)	$ (62,006)	$ (43,971)
Less net income attributable to non-controlling interests	21			25			63	75
Net loss attributable to shareholders	$ (23,870)			$ (15,479)			$ (62,069)	$ (44,046)
Weighted average shares outstanding, basic and diluted (in shares)	23,671			20,206			23,703	19,968
Net loss per share, basic and diluted (in dollars per share)	$ (1.01)			$ (0.77)			$ (2.62)	$ (2.21)
Anti-dilutive securities excluded from diluted net loss per share calculation for stock-based compensation plans (in shares)	1,920			1,065			1,920	1,065

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DEBT - Narrative (Details)								9 Months Ended
	May 08, 2019 USD ($)	May 07, 2019 USD ($)	Aug. 28, 2018 USD ($)	Apr. 09, 2018 USD ($)	Feb. 28, 2018 USD ($)	Feb. 06, 2018 USD ($)	Apr. 06, 2017 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
Short-term Debt [Line Items]
Debt issuance costs								$ 2,815,000	$ 7,696,000
Term Loan | Base Rate
Short-term Debt [Line Items]
Interest rate during period for the credit agreement								4.75%
Term Loan | London Interbank Offered Rate (LIBOR)
Short-term Debt [Line Items]
Interest rate during period for the credit agreement								5.75%
Revolving credit facility
Short-term Debt [Line Items]
Debt issuance costs								$ 2,900,000
Revolving credit facility | Base Rate
Short-term Debt [Line Items]
Interest rate during period for the credit agreement								6.00%
Revolving credit facility | London Interbank Offered Rate (LIBOR)
Short-term Debt [Line Items]
Interest rate during period for the credit agreement								7.00%
2017 Credit Agreement | Line of Credit
Short-term Debt [Line Items]
Debt issuance costs							$ 5,700,000
2017 Credit Agreement | Term Loan
Short-term Debt [Line Items]
Total amount available under Credit Agreement							300,000,000.0
Debt issuance costs							3,300,000
Debt balance								$ 414,600,000
Interest rate at period end								8.31%
2017 Credit Agreement | Term Loan | Line of Credit
Short-term Debt [Line Items]
Loss on extinguishment and modification of debt							1,900,000
2017 Credit Agreement | Revolving credit facility
Short-term Debt [Line Items]
Total amount available under Credit Agreement							25,000,000.0
Debt issuance costs							400,000
Debt balance								$ 14,000,000
Interest rate at period end								11.00%
2017 Credit Agreement | Incremental Term Loan
Short-term Debt [Line Items]
Total amount available under Credit Agreement					$ 135,000,000.0	$ 135,000,000.0
Credit Agreement
Short-term Debt [Line Items]
Loss on extinguishment and modification of debt							$ 4,800,000
Credit Agreement | London Interbank Offered Rate (LIBOR)
Short-term Debt [Line Items]
Basis spread on variable rate								1.00%
Credit Agreement | Prime Rate
Short-term Debt [Line Items]
Basis spread on variable rate								2.00%
Credit Agreement | Federal Funds Effective Swap Rate
Short-term Debt [Line Items]
Basis spread on variable rate								0.50%
Second Amendment to 2017 Credit Agreement | Line of Credit
Short-term Debt [Line Items]
Debt issuance costs						1,000,000
Legal and professional expenses						200,000
Second Amendment to 2017 Credit Agreement | Term Loan | Line of Credit
Short-term Debt [Line Items]
Debt issuance costs						$ 800,000
Third Amendment To 2017 Credit Agreement | Line of Credit
Short-term Debt [Line Items]
Debt issuance costs					5,000,000
Legal and professional expenses					100,000
Third Amendment To 2017 Credit Agreement | Term Loan | Line of Credit
Short-term Debt [Line Items]
Debt issuance costs					$ 4,900,000
Fourth Amendment to Credit Agreement | Term Loan | Line of Credit
Short-term Debt [Line Items]
Debt issuance costs				$ 1,700,000
Debt issuance costs				1,600,000
Legal and professional expenses				$ 100,000
Reduction of interest rate margins				1.25%
Fifth Amendment To Credit Agreement | Revolving credit facility
Short-term Debt [Line Items]
Total amount available under Credit Agreement			$ 35,000,000.0
Credit facility increase			$ 10,000,000.0
Sixth Amendment To Credit Agreement | Revolving credit facility
Short-term Debt [Line Items]
In kind Interest Rate	0.75%
Permitted asset dispositions	$ 50,000,000	$ 150,000,000
Maximum sales proceeds that may be reinvested	2,500,000
Restricted payment	$ 1,000,000	$ 5,000,000
Sixth Amendment To Credit Agreement | Revolving credit facility | As of June 30 2019
Short-term Debt [Line Items]
Maximum total leverage ratio	6.80
Sixth Amendment To Credit Agreement | Revolving credit facility | September 30, 2019 - December 31, 2019
Short-term Debt [Line Items]
Maximum total leverage ratio	6.90
Sixth Amendment To Credit Agreement | Revolving credit facility | March 31, 2020
Short-term Debt [Line Items]
Maximum total leverage ratio	6.75
Sixth Amendment To Credit Agreement | Revolving credit facility | June 30, 2020
Short-term Debt [Line Items]
Maximum total leverage ratio	6.25
Sixth Amendment To Credit Agreement | Revolving credit facility | September 30, 2020
Short-term Debt [Line Items]
Maximum total leverage ratio	6.00
Sixth Amendment To Credit Agreement | Revolving credit facility | December 31, 2020
Short-term Debt [Line Items]
Maximum total leverage ratio	5.75
Sixth Amendment To Credit Agreement | Revolving credit facility | March 2021
Short-term Debt [Line Items]
Maximum total leverage ratio	5.50
Sixth Amendment To Credit Agreement | Revolving credit facility | June 30, 2021
Short-term Debt [Line Items]
Maximum total leverage ratio	5.00
Sixth Amendment To Credit Agreement | Revolving credit facility | June 30, 2021
Short-term Debt [Line Items]
Maximum total leverage ratio	4.50
Sixth Amendment To Credit Agreement | Revolving credit facility | June 30, 2019
Short-term Debt [Line Items]
Minimum consolidated interest coverage ratio	1.75
Sixth Amendment To Credit Agreement | Revolving credit facility | September 30, 2019 - March 31, 2020
Short-term Debt [Line Items]
Minimum consolidated interest coverage ratio	1.70
Sixth Amendment To Credit Agreement | Revolving credit facility | June 30, 2020
Short-term Debt [Line Items]
Minimum consolidated interest coverage ratio	1.80
Sixth Amendment To Credit Agreement | Revolving credit facility | September 2020
Short-term Debt [Line Items]
Minimum consolidated interest coverage ratio	1.85
Sixth Amendment To Credit Agreement | Revolving credit facility | December 31, 2020 and thereafter
Short-term Debt [Line Items]
Minimum consolidated interest coverage ratio	2.00
Sixth Amendment To Credit Agreement | Revolving credit facility | Base Rate
Short-term Debt [Line Items]
Basis spread on variable rate	5.25%	4.75%
Sixth Amendment To Credit Agreement | Revolving credit facility | Eurodollar
Short-term Debt [Line Items]
Basis spread on variable rate	6.25%	5.75%
Sixth Amendment To Credit Agreement | Capital Lease Obligations Basket
Short-term Debt [Line Items]
Total amount available under Credit Agreement	$ 500,000
Legal and Professional Fees | Revolving credit facility
Short-term Debt [Line Items]
Debt issuance costs								$ 100,000
Lender Fees | Revolving credit facility
Short-term Debt [Line Items]
Debt issuance costs								$ 2,800,000

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RECENT ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019	Dec. 31, 2018
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
ROU Assets, operating leases	$ 33,723	$ 28,500	$ 0
Lease Liabilities, operating leases	$ 37,068	$ 31,000

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REVENUES - Summary of Revenue by Source (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
Net revenues	$ 72,878	$ 82,972	$ 219,576	$ 239,135
INAP US
Disaggregation of Revenue [Line Items]
Net revenues	56,947	65,678	171,928	186,821
INAP US | Colocation Services
Disaggregation of Revenue [Line Items]
Net revenues	27,334	32,946	82,245	94,747
INAP US | Network services
Disaggregation of Revenue [Line Items]
Net revenues	11,225	13,015	34,381	40,398
INAP US | Cloud Services
Disaggregation of Revenue [Line Items]
Net revenues	18,388	19,717	55,302	51,676
INAP INTL
Disaggregation of Revenue [Line Items]
Net revenues	15,931	17,294	47,648	52,314
INAP INTL | Colocation Services
Disaggregation of Revenue [Line Items]
Net revenues	1,452	1,372	4,344	4,349
INAP INTL | Network services
Disaggregation of Revenue [Line Items]
Net revenues	2,772	2,719	8,224	8,482
INAP INTL | Cloud Services
Disaggregation of Revenue [Line Items]
Net revenues	$ 11,707	$ 13,203	$ 35,080	$ 39,483

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NET LOSS PER SHARE

9 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

NET LOSS PER SHARE

NET LOSS PER SHARE

We compute basic net loss per share by dividing net loss attributable to our common stockholders by the weighted average number of shares of common stock outstanding during the period. We exclude all outstanding options and unvested restricted stock as such securities are anti-dilutive for all periods presented.

Basic and diluted net loss per share is calculated as follows (in thousands, except per share amounts):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net loss	$	(23,849	)	$	(15,454	)	$	(62,006	)	$	(43,971	)
Less net income attributable to non-controlling interests	21			25			63			75
Net loss attributable to shareholders	$	(23,870	)	$	(15,479	)	$	(62,069	)	$	(44,046	)
Weighted average shares outstanding, basic and diluted	23,671			20,206			23,703			19,968
Net loss per share, basic and diluted	$	(1.01	)	$	(0.77	)	$	(2.62	)	$	(2.21	)
Anti-dilutive securities excluded from diluted net loss per share calculation for stock-based compensation plans	1,920			1,065			1,920			1,065

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NATURE OF OPERATIONS AND BASIS OF PRESENTATION

NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Internap Corporation ("we," "us," "our," "INAP," or "the Company") is a leading-edge provider of high-performance data center and cloud solutions with 100 network Points of Presence (“POP”) worldwide. INAP's full-spectrum portfolio of high-density colocation, managed cloud hosting and network solutions supports evolving IT infrastructure requirements for customers ranging from the Fortune 500 to emerging startups. INAP operates in 21 metropolitan markets, primarily in North America, with 14 INAP Data Center Flagships connected by a low-latency, high-capacity network. 

We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information. These financial statements include all of our accounts and those of our wholly-owned subsidiaries. We have eliminated all intercompany transactions and balances in the accompanying financial statements. In the opinion of management, all adjustments necessary for a fair presentation of the interim results have been reflected therein. All such adjustments were of a normal and recurring nature with the exception of those related to the adoption of new accounting standards as discussed in Note 2, "Recent Accounting Pronouncements" and Note 4, "Leases."

We have condensed or omitted certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP. The accompanying financial statements reflect all adjustments, which consist of normal recurring adjustments unless otherwise disclosed, necessary for a fair statement of our financial position as of September 30, 2019 and our operating results and cash flows for the interim periods presented. The balance sheet at December 31, 2018 was derived from our audited financial statements, but does not include all disclosures required by GAAP. You should read the accompanying financial statements and the related notes in conjunction with our financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission ("SEC").

The preparation of financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Actual results may differ materially from these estimates. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the 2019 fiscal year or any future periods.

Correction of Immaterial Error

The Company corrected an error in the consolidated statements of cash flows for all periods in 2017, 2018, the three months ended March 31, 2019 and the six months ended June 30, 2019. The Company had previously included only a portion of the additions to property and equipment that were outstanding in accounts payable in the supplemental disclosures of cash flow information, “Additions to property and equipment included in accounts payable,” and the related adjustments to "Accounts payable" and "Purchases of property and equipment" on the consolidated statements of cash flows. The correction had no impact on the consolidated statements of operations and comprehensive loss or the consolidated balance sheets. The Company has evaluated this correction in accordance with Accounting Standards Codification ("ASC") 250-10-S99, SEC Materials (formerly SEC Staff Accounting Bulletin 99, Materiality) and concluded that the correction was not material.

The adjustments to the Company’s previously issued consolidated statements of cash flows are as follows (in thousands):

	Three Months Ended March 31, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(2,247	)	$	(512	)	$	(2,759	)
Net cash provided by operating activities	7,264			(512		)	6,752
Purchases of property and equipment	(5,789		)	512			(5,277		)
Net cash used in investing activities	(5,989		)	512			(5,477		)
Additions to property and equipment included in accounts payable	$	1,247		$	2,744		$	3,991

	Six Months Ended June 30, 2017
	As reported			Adjustments			As restated
Accounts payable	$	477		$	(2,100	)	$	(1,623	)
Net cash provided by operating activities	24,634			(2,100		)	22,534
Purchases of property and equipment	(12,293		)	2,100			(10,193		)
Net cash used in investing activities	(12,737		)	2,100			(10,637		)
Additions to property and equipment included in accounts payable	$	1,269		$	4,331		$	5,600

	Nine Months Ended September 30, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(3,498	)	$	1,330		$	(2,168	)
Net cash provided by operating activities	27,940			1,330			29,270
Purchases of property and equipment	(23,198		)	(1,330		)	(24,528		)
Net cash used in investing activities	(19,789		)	(1,330		)	(21,119		)
Additions to property and equipment included in accounts payable	$	701		$	901		$	1,602

	Year Ended December 31, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(1,167	)	$	218		$	(949	)
Net cash provided by operating activities	41,748			218			41,966
Purchases of property and equipment	(35,714		)	(218		)	(35,932		)
Net cash used in investing activities	(32,209		)	(218		)	(32,427		)
Additions to property and equipment included in accounts payable	$	1,932		$	2,014		$	3,946

	Three Months Ended March 31, 2018
	As reported			Adjustments			As restated
Accounts payable	$	(636	)	$	(124	)	$	(760	)
Net cash provided by operating activities	3,697			(124		)	3,573
Purchases of property and equipment	(6,082		)	124			(5,958		)
Net cash used in investing activities	(138,065		)	124			(137,941		)
Additions to property and equipment included in accounts payable	$	2,287		$	2,138		$	4,425

	Six Months Ended June 30, 2018
	As reported			Adjustments			As restated
Accounts payable	$	6,939		$	(3,598	)	$	3,341
Net cash provided by operating activities	18,533			(3,598		)	14,935
Purchases of property and equipment	(16,102		)	3,598			(12,504		)
Net cash used in investing activities	(148,649		)	3,598			(145,051		)
Additions to property and equipment included in accounts payable	$	4,023		$	5,613		$	9,636

	Nine Months Ended September 30, 2018
	As reported			Adjustments			As restated
Accounts payable	$	9,372		$	(4,217	)	$	5,155
Net cash provided by operating activities	28,598			(4,217		)	24,381
Purchases of property and equipment	(27,317		)	4,217			(23,100		)
Net cash used in investing activities	(160,623		)	4,217			(156,406		)
Additions to property and equipment included in accounts payable	$	4,004		$	6,231		$	10,235

	Year Ended December 31, 2018
	As reported			Adjustments			As restated
Accounts payable	$	1,339		$	207		$	1,546
Net cash provided by operating activities	34,572			207			34,779
Purchases of property and equipment	(38,298		)	(207		)	(38,505		)
Net cash used in investing activities	(174,037		)	(207		)	(174,244		)
Additions to property and equipment included in accounts payable	$	2,459		$	1,807		$	4,266

	Three Months Ended March 31, 2019
	As reported			Adjustments			As restated
Accounts payable	$	763		$	(556	)	$	207
Net cash provided by operating activities	2,262			(556		)	1,706
Purchases of property and equipment	(8,094		)	556			(7,538		)
Net cash used in investing activities	(8,568		)	556			(8,012		)
Additions to property and equipment included in accounts payable	$	1,850		$	1,881		$	3,731

	Six Months Ended June 30, 2019
	As reported			Adjustments			As restated
Accounts payable	$	3,375		$	(944	)	$	2,431
Net cash provided by operating activities	14,081			(944		)	13,137
Purchases of property and equipment	(15,642		)	944			(14,698		)
Net cash used in investing activities	(16,359		)	944			(15,415		)
Additions to property and equipment included in accounts payable	$	1,268		$	2,751		$	4,019

Out of Period Adjustment

In connection with the preparation, review and audit of the Company's consolidated financial statements required to be included in the Annual Report on Form 10-K for the year ended December 31, 2018, management identified certain errors in the Company's historical financial statements, resulting in a conclusion that certain corrections need to be made to the Company's unaudited quarters during 2018. The Company has revised its prior period consolidated financial statements accordingly and included such revisions herein. Based on an analysis of quantitative and qualitative factors, the Company concluded that these errors were not material to the consolidated financial position, results of operations or cash flows as presented in the Company’s quarterly financial statements that have been previously filed in the Company’s Quarterly Reports on Form 10-Q. As a result, amendment of such reports was not required. The revisions to correct errors relate to the correction of accounting for an amendment to a capital lease executed in February 2018.

The adjustments to the Company’s previously issued quarterly financial statements for the three and nine months ended September 30, 2018 are as follows (in thousands):

	Three and Nine Months Ended September 30, 2018
	As reported			Adjustments			As adjusted
Costs of sales and services, exclusive of depreciation and amortization - QTD	$	28,866		$	(645	)	$	28,221
Costs of sales and services, exclusive of depreciation and amortization - YTD	81,880			(1,720		)	80,160
Depreciation and amortization - QTD	23,431			122			23,553
Depreciation and amortization - YTD	67,097			325			67,422
Interest expense - QTD	16,898			896			17,794
Interest expense - YTD	47,786			2,352			50,138
Net loss attributable to INAP shareholders - QTD	(15,106		)	(373		)	(15,479		)
Net loss attributable to INAP shareholders - YTD	(43,089		)	(957		)	(44,046		)
Property and equipment, net	477,423			10,193			487,616
Total assets	746,038			10,193			756,231
Capital lease obligations - non-current	252,599			11,077			263,676
Total liabilities	765,004			11,150			776,154
Accumulated deficit	(1,343,609		)	(957		)	(1,344,566		)
Total stockholders' (deficit) equity	$	(18,966	)	$	(957	)	$	(19,923	)

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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 10,895	$ 17,823
Accounts receivable, net of allowance for doubtful accounts of $1,077 and $1,547, respectively	17,948	20,054
Contract assets	9,202	8,844
Term loan, less discount and issuance costs of $4,909	552	0
Prepaid expenses and other assets	7,572	7,377
Total current assets	46,169	54,098
Property and equipment, net	216,548	478,061
Operating lease right-of-use assets	33,723	0
Finance lease right-of-use assets	226,619	0
Intangible assets, net	64,215	73,042
Goodwill	116,217	116,217
Contract assets	15,032	16,104
Deposits and other assets	6,178	7,409
Total assets	724,701	744,931
Current liabilities:
Accounts payable	25,287	23,435
Accrued liabilities	9,813	15,540
Deferred revenues	7,493	8,022
Capital lease obligations	0	9,080
Revolving credit facility	14,000	0
Term loan, less discount and issuance costs of $4,036	0	321
Exit activities and restructuring liability	550	2,526
Short-term operating lease liabilities	6,686	0
Short-term finance lease liabilities	5,867	0
Other current liabilities	70	1,063
Total current liabilities	69,766	59,987
Deferred revenues	259	511
Operating lease liabilities	30,382	0
Finance lease liabilities	264,223	0
Capital lease obligations	0	262,382
Term loan, less discount and issuance costs of $7,587 and $9,508, respectively	415,126	415,278
Deferred tax liability	1,443	2,211
Other long-term liabilities	3,714	4,505
Total liabilities	784,913	744,874
Commitments and contingencies (Refer to Note 10)
Stockholders’ (deficit) equity:
Preferred stock, $0.001 par value; 5,000 shares authorized; no shares issued or outstanding	0	0
Common stock, $0.001 par value; 50,000 shares authorized; 26,486 and 25,455 shares outstanding, respectively	26	25
Additional paid-in capital	1,372,016	1,368,968
Treasury stock, at cost, 388 and 330 shares, respectively	(7,958)	(7,646)
Accumulated deficit	(1,425,140)	(1,363,019)
Accumulated items of other comprehensive loss	(913)	(1,065)
Total INAP stockholders’ deficit	(61,969)	(2,737)
Non-controlling interests	1,757	2,794
Total stockholders’ (deficit) equity	(60,212)	57
Total liabilities and stockholders’ (deficit) equity	$ 724,701	$ 744,931

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DEBT

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

DEBT

DEBT

Credit Agreement

On April 6, 2017, we entered into a new credit agreement (the “2017 Credit Agreement”), which provided for a $300.0 million term loan facility ("2017 Term Loan") and a $25.0 million Revolving Credit Facility (the "2017 Revolving Credit Facility"). The proceeds of the 2017 Term Loan were used to refinance the Company’s existing credit facility and to pay costs and expenses associated with the 2017 Credit Agreement.

Certain portions of refinancing transaction were considered an extinguishment of debt and certain portions were considered a modification. A total of $5.7 million was paid for debt issuance costs related to the 2017 Credit Agreement. Of the $5.7 million in costs paid, $1.9 million was related to the exchange of debt and was expensed, $3.3 million related to 2017 Term Loan third party costs and will be amortized over the 2017 Term Loan and $0.4 million prepaid debt issuance costs related to the 2017 Revolving Credit Facility and will be amortized over the term of the 2017 Revolving Credit Facility. In addition, $4.8 million of debt discount and debt issuance costs related to the previous credit facility were expensed due to the extinguishment of that credit facility. The maturity date of the 2017 Term Loan is April 6, 2022 and the maturity date of the 2017 Revolving Credit Facility is October 6, 2021. As of September 30, 2019, the outstanding balance of the 2017 Term Loan and the 2017 Revolving Credit Facility was $414.6 million and $14.0 million, respectively. The interest rate on the 2017 Term Loan and the 2017 Revolving Credit Facility as of September 30, 2019 were 8.31% and 11.00%, respectively.

Borrowings under the 2017 Credit Agreement bear interest at a rate per annum equal to an applicable margin plus, at our option, a base rate or an adjusted LIBOR rate. The applicable margin for loans under the 2017 Revolving Credit Facility is 6.00% for loans bearing interest calculated using the base rate (“Base Rate Loans”) and 7.00% for loans bearing interest calculated using the adjusted LIBOR rate. The applicable margin for loans under the 2017 Term Loan is 4.75% for Base Rate Loans and 5.75% for adjusted LIBOR rate loans. The base rate is equal to the highest of (a) the adjusted U.S. Prime Lending Rate as published in the Wall Street Journal, (b) with respect to term loans issued on the closing date, 2.00%, (c) the federal funds effective rate from time to time, plus 0.50%, and (d) the adjusted LIBOR rate, as defined below, for a one-month interest period, plus 1.00%. The adjusted LIBOR rate is equal to the rate per annum (adjusted for statutory reserve requirements for Eurocurrency liabilities) at which Eurodollar deposits are offered in the interbank Eurodollar market for the applicable interest period (one, two, three or six months), as quoted on Reuters screen LIBOR (or any successor page or service). The financing commitments of the lenders extending the 2017 Revolving Credit Facility are subject to various conditions, as set forth in the 2017 Credit Agreement. As of September 30, 2019, the Company has been in compliance with all covenants.  

First Amendment

On June 28, 2017, the Company entered into an amendment to the 2017 Credit Agreement ("First Amendment"), by and among the Company, each of the Lenders party thereto, and Jefferies Finance LLC, as Administrative Agent. The First Amendment clarified that for all purposes of the 2017 Credit Agreement the Company's liabilities pursuant to any lease that was treated as rental and lease expense, and not as a capital lease obligation or indebtedness on the closing date of the 2017 Credit Agreement, would continue to be treated as a rental and lease expense, and not as a capital lease obligation or indebtedness notwithstanding any amendment of the lease that results in the treatment of such lease as a capital lease obligation or indebtedness for financial reporting purposes.

Second Amendment

On February 6, 2018, the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent, entered into a Second Amendment to Credit Agreement (the "Second Amendment") that amended the 2017 Credit Agreement.

The Second Amendment, among other things, amends the 2017 Credit Agreement to (i) permit the Company to incur incremental term loans under the 2017 Credit Agreement of up to $135.0 million to finance the Company's acquisition of SingleHop and to pay related fees, costs and expenses, and (ii) revises the maximum total net leverage ratio and minimum consolidated interest coverage ratio covenants.  The financial covenant amendments became effective upon the consummation of the SingleHop acquisition, while the other provisions of the Second Amendment became effective upon the execution and delivery of the Second Amendment. This transaction was considered a modification.

A total of $1.0 million was paid for debt issuance costs related to the Second Amendment. Of the $1.0 million in costs paid, $0.2 million related to the payment of legal and professional fees which were expensed, $0.8 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Third Amendment

On February 28, 2018, INAP entered into the Incremental and Third Amendment to the Credit Agreement among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the "Third Amendment"). The Third Amendment provides for a funding of the new incremental term loan facility under the 2017 Credit Agreement of $135.0 million (the "Incremental Term Loan"). The Incremental Term Loan has terms and conditions identical to the existing loans under the 2017 Credit Agreement, as amended.  Proceeds of the Incremental Term Loan were used to complete the acquisition of SingleHop and to pay fees, costs and expenses related to the acquisition, the Third Amendment and the Incremental Term Loan. This transaction was considered a modification. 

A total of $5.0 million was paid for debt issuance costs related to the Third Amendment. Of the $5.0 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $4.9 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Fourth Amendment

On April 9, 2018, the Company entered into the Fourth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the "Fourth Amendment"). The Fourth Amendment amends the 2017 Credit Agreement to lower the interest rate margins applicable to the outstanding term loans under the 2017 Credit Agreement by 1.25%. This transaction was considered a modification.

A total of $1.7 million was paid for debt issuance costs related to the Fourth Amendment. Of the $1.7 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $1.6 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

Fifth Amendment

On August 28, 2018, the Company entered into the Fifth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the “Fifth Amendment”). The Fifth Amendment amended the 2017 Credit Agreement by increasing the aggregate revolving commitment capacity by $10.0 million to $35.0 million.

Sixth Amendment

On May 8, 2019, the Company entered into the Sixth Amendment to the 2017 Credit Agreement, among the Company, the Lenders party thereto and Jefferies Finance LLC, as Administrative Agent (the “Sixth Amendment”). The Sixth Amendment (i) adjusted the applicable interest rates under the 2017 Credit Agreement, (ii) modified the maximum total net leverage ratio requirements and the minimum consolidated interest coverage ratio requirements and (iii) modified certain other covenants.

Pursuant to the Sixth Amendment, the applicable margin for the alternate base rate loan was increased from 4.75% per annum to 5.25% per annum and for the Eurodollar loan was increased from 5.75% per annum to 6.25% per annum, with such interest payable in cash, and in addition such term loans bear interest payable in kind at the rate of 0.75% per annum.

The Sixth Amendment also made the following modifications:

• Added an additional basket of $500,000 for finance lease obligations.

• The maximum amount of permitted asset dispositions was decreased from $150,000,000 to $50,000,000.

• The amount of net cash proceeds from asset sales that may be reinvested is limited to $2,500,000 in any fiscal year of the Company, with net cash proceeds that are not so reinvested used to prepay loans under the 2017 Credit Agreement.

• The restricted payment basket was decreased from $5,000,000 to $1,000,000.

The maximum total leverage ratio increases to 6.80 to 1 as of June 30, 2019, 6.90 to 1 as of September 30, 2019 - December 31, 2019, decreases to 6.75 to 1 as of March 31, 2020, 6.25 to 1 as of June 30, 2020, 6.00 to 1 as of September 30, 2020, 5.75 to 1 as of December 31, 2020, 5.50 to 1 as of March 2021, 5.00 to 1 as of June 30, 2021 and 4.50 to 1 as of September 30, 2021 and thereafter.

The minimum consolidated interest coverage ratio decreases to 1.75 to 1 as of June 30, 2019, 1.70 to 1 as of September 30, 2019 - March 31, 2020, increases to 1.80 to 1 as of June 30, 2020, 1.85 to 1 as of September 2020 and 2.00 to 1 as of December 31, 2020 and thereafter. This transaction was considered a modification.

A total of $2.9 million was paid for debt issuance costs related to the Sixth Amendment. Of the $2.9 million in costs paid, $0.1 million related to the payment of legal and professional fees which were expensed, $2.8 million related to term loan lender fees and will be amortized over the term of the 2017 Credit Agreement.

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LEASES

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

LEASES

LEASES

We have commitments under lease arrangements for data centers, office space, partner sites and equipment. Our leases have initial lease terms ranging from 2 years to 34 years, most of which include options to extend or renew the leases for 5 to 15 years, and some of which may include options to terminate the leases within 4 to 120 months.

At contract inception, we evaluate whether an arrangement is or contains a lease for which we are the lessee (that is, arrangements which provide us with the right to control a physical asset for a period of time). Operating leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Operating lease right-of-use assets" and lease liabilities recognized in "Short-term operating lease liabilities" and "Operating lease liabilities." Finance leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Finance lease right-of-use assets" and lease liabilities recognized in "Short-term finance lease liabilities" and "Finance lease liabilities."

All lease liabilities are measured at the present value of the unpaid lease payments, discounted using our incremental borrowing rate based on the information available at commencement date or modification date of the lease. ROU assets, for both operating and finance leases, are initially measured based on the lease liability, adjusted for initial direct costs, prepaid rent, and lease incentives received. The operating lease ROU assets are subsequently measured at the carrying amount of the lease liability adjusted for initial direct costs, prepaid or accrued lease payments and lease incentives. The finance lease ROU assets are subsequently amortized using the straight-line method.

Operating lease expenses are recognized on a straight-line basis over the lease term. With respect to finance leases, amortization of the ROU asset is presented separately from interest expense related to the finance lease liability.

We have elected to combine lease and non-lease components for all lease contracts where we are the lessee. Additionally, for arrangements with lease terms of 12 months or less, we do not recognize ROU assets and lease liabilities and lease payments are recognized on a straight-line basis over the lease term with variable lease payments recognized in the period in which the obligation is incurred.

Lease-related costs for the three and nine months ended September 30, 2019 are as follows (in thousands):

	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Finance lease cost
Amortization of right-of-use assets		$	3,861	$	12,384
Interest on lease liabilities		7,445		22,124
Finance lease cost		$	11,306	$	34,508
Operating lease cost		$	2,269	$	5,964
Short-term lease cost		1,106		4,302
Total lease cost		$	14,681	$	44,774

Other information related to leases as of September 30, 2019 is as follows (in thousands, except lease term and rate):

	Operating Leases			Finance Leases
Right-of-use assets	$	33,723		$	226,619
Lease liabilities	37,068			270,090
Weighted-average remaining lease term (years)	5.26			19.05
Weighted-average discount rate	7.25		%	13.80		%

The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2019 (in thousands):

Operating Leases
Operating cash paid to settle operating lease liabilities	$	5,913
Right-of-use assets obtained in exchange for lease liabilities	921
Finance Leases
Operating cash paid for interest	$	17,577
Right-of-use assets obtained in exchange for lease liabilities	1,639

Future minimum lease payments under non-cancellable leases as of September 30, 2019 are as follows (in thousands):

	Operating Leases			Finance Leases
2019 (excluding the nine months ended September 30, 2019)		$	2,270		$	8,412
2020		9,073			33,406
2021		9,098			35,243
2022		8,519			33,995
2023		7,541			33,244
Thereafter		8,698			633,139
Total undiscounted lease payments		$	45,199		$	777,439
Less: Imputed interest		8,131			507,349
Total lease liabilities		$	37,068		$	270,090

As of September 30, 2019, we did not have additional operating and finance leases that have not yet commenced.

LEASES

LEASES

We have commitments under lease arrangements for data centers, office space, partner sites and equipment. Our leases have initial lease terms ranging from 2 years to 34 years, most of which include options to extend or renew the leases for 5 to 15 years, and some of which may include options to terminate the leases within 4 to 120 months.

At contract inception, we evaluate whether an arrangement is or contains a lease for which we are the lessee (that is, arrangements which provide us with the right to control a physical asset for a period of time). Operating leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Operating lease right-of-use assets" and lease liabilities recognized in "Short-term operating lease liabilities" and "Operating lease liabilities." Finance leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Finance lease right-of-use assets" and lease liabilities recognized in "Short-term finance lease liabilities" and "Finance lease liabilities."

All lease liabilities are measured at the present value of the unpaid lease payments, discounted using our incremental borrowing rate based on the information available at commencement date or modification date of the lease. ROU assets, for both operating and finance leases, are initially measured based on the lease liability, adjusted for initial direct costs, prepaid rent, and lease incentives received. The operating lease ROU assets are subsequently measured at the carrying amount of the lease liability adjusted for initial direct costs, prepaid or accrued lease payments and lease incentives. The finance lease ROU assets are subsequently amortized using the straight-line method.

Operating lease expenses are recognized on a straight-line basis over the lease term. With respect to finance leases, amortization of the ROU asset is presented separately from interest expense related to the finance lease liability.

We have elected to combine lease and non-lease components for all lease contracts where we are the lessee. Additionally, for arrangements with lease terms of 12 months or less, we do not recognize ROU assets and lease liabilities and lease payments are recognized on a straight-line basis over the lease term with variable lease payments recognized in the period in which the obligation is incurred.

Lease-related costs for the three and nine months ended September 30, 2019 are as follows (in thousands):

	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Finance lease cost
Amortization of right-of-use assets		$	3,861	$	12,384
Interest on lease liabilities		7,445		22,124
Finance lease cost		$	11,306	$	34,508
Operating lease cost		$	2,269	$	5,964
Short-term lease cost		1,106		4,302
Total lease cost		$	14,681	$	44,774

Other information related to leases as of September 30, 2019 is as follows (in thousands, except lease term and rate):

	Operating Leases			Finance Leases
Right-of-use assets	$	33,723		$	226,619
Lease liabilities	37,068			270,090
Weighted-average remaining lease term (years)	5.26			19.05
Weighted-average discount rate	7.25		%	13.80		%

The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2019 (in thousands):

Operating Leases
Operating cash paid to settle operating lease liabilities	$	5,913
Right-of-use assets obtained in exchange for lease liabilities	921
Finance Leases
Operating cash paid for interest	$	17,577
Right-of-use assets obtained in exchange for lease liabilities	1,639

Future minimum lease payments under non-cancellable leases as of September 30, 2019 are as follows (in thousands):

	Operating Leases			Finance Leases
2019 (excluding the nine months ended September 30, 2019)		$	2,270		$	8,412
2020		9,073			33,406
2021		9,098			35,243
2022		8,519			33,995
2023		7,541			33,244
Thereafter		8,698			633,139
Total undiscounted lease payments		$	45,199		$	777,439
Less: Imputed interest		8,131			507,349
Total lease liabilities		$	37,068		$	270,090

As of September 30, 2019, we did not have additional operating and finance leases that have not yet commenced.

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FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Schedule of assets and liabilities measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis are summarized as follows (in thousands):

	Level 1		Level 2		Level 3		Total
September 30, 2019
Available-for-sale securities	$	—	$	2,386	$	—	$	2,386
Asset retirement obligations(1)	—		—		2,292		2,292
December 31, 2018
Available-for-sale securities	$	—	$	2,309	$	—	$	2,309
Asset retirement obligations(1)	—		—		2,090		2,090

⁽¹⁾  We calculated the fair value of asset retirement obligations by discounting the estimated amount using the Treasury bill rate adjusted for our credit risk. At September 30, 2019 and December 31, 2018, the balances are included in "Other long-term liabilities," in the accompanying condensed consolidated balance sheets.

Schedule of changes in asset retirement obligations

The following table provides a summary of changes in our Level 3 asset retirement obligations for the nine months ended September 30, 2019 (in thousands): 

	2019
Balance, January 1, 2019	$	2,090
Accretion	202
Payments	—
Balance, September 30, 2019	$	2,292

Schedule of fair values of our Level 2 available-for-sale debt securities

The fair values of our Level 2 available-for-sale debt securities, based upon quoted prices for similar items in active markets, are as follows (in thousands):

	September 30, 2019
	Cost		Unrealized Gain		Unrealized Loss			Fair Value
Japanese Corporate Bonds	$	2,221	$	189	$	(114	)	$	2,296
Japanese Government Bonds	88		7		(5		)	90
Total Bonds	$	2,309	$	196	$	(119	)	$	2,386
	December 31, 2018
	Cost		Unrealized Gain		Unrealized Loss			Fair Value
Japanese Corporate Bonds	$	2,184	$	144	$	(107	)	$	2,221
Japanese Government Bonds	87		5		(4		)	88
Total Bonds	$	2,271	$	149	$	(111	)	$	2,309

Schedule of fair value of term loan and revolving credit facility

The fair values of our Level 2 debt liabilities, based upon quoted prices for similar items in active markets, are as follows (in thousands):

	September 30, 2019				December 31, 2018
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Term loan	$	427,070	$	330,979	$	429,143	$	428,071
Revolving credit facility	14,000		10,850		—		—

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Tables)

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Error Corrections and Prior Period Adjustments

The adjustments to the Company’s previously issued quarterly financial statements for the three and nine months ended September 30, 2018 are as follows (in thousands):

	Three and Nine Months Ended September 30, 2018
	As reported			Adjustments			As adjusted
Costs of sales and services, exclusive of depreciation and amortization - QTD	$	28,866		$	(645	)	$	28,221
Costs of sales and services, exclusive of depreciation and amortization - YTD	81,880			(1,720		)	80,160
Depreciation and amortization - QTD	23,431			122			23,553
Depreciation and amortization - YTD	67,097			325			67,422
Interest expense - QTD	16,898			896			17,794
Interest expense - YTD	47,786			2,352			50,138
Net loss attributable to INAP shareholders - QTD	(15,106		)	(373		)	(15,479		)
Net loss attributable to INAP shareholders - YTD	(43,089		)	(957		)	(44,046		)
Property and equipment, net	477,423			10,193			487,616
Total assets	746,038			10,193			756,231
Capital lease obligations - non-current	252,599			11,077			263,676
Total liabilities	765,004			11,150			776,154
Accumulated deficit	(1,343,609		)	(957		)	(1,344,566		)
Total stockholders' (deficit) equity	$	(18,966	)	$	(957	)	$	(19,923	)

The adjustments to the Company’s previously issued consolidated statements of cash flows are as follows (in thousands):

	Three Months Ended March 31, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(2,247	)	$	(512	)	$	(2,759	)
Net cash provided by operating activities	7,264			(512		)	6,752
Purchases of property and equipment	(5,789		)	512			(5,277		)
Net cash used in investing activities	(5,989		)	512			(5,477		)
Additions to property and equipment included in accounts payable	$	1,247		$	2,744		$	3,991

	Six Months Ended June 30, 2017
	As reported			Adjustments			As restated
Accounts payable	$	477		$	(2,100	)	$	(1,623	)
Net cash provided by operating activities	24,634			(2,100		)	22,534
Purchases of property and equipment	(12,293		)	2,100			(10,193		)
Net cash used in investing activities	(12,737		)	2,100			(10,637		)
Additions to property and equipment included in accounts payable	$	1,269		$	4,331		$	5,600

	Nine Months Ended September 30, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(3,498	)	$	1,330		$	(2,168	)
Net cash provided by operating activities	27,940			1,330			29,270
Purchases of property and equipment	(23,198		)	(1,330		)	(24,528		)
Net cash used in investing activities	(19,789		)	(1,330		)	(21,119		)
Additions to property and equipment included in accounts payable	$	701		$	901		$	1,602

	Year Ended December 31, 2017
	As reported			Adjustments			As restated
Accounts payable	$	(1,167	)	$	218		$	(949	)
Net cash provided by operating activities	41,748			218			41,966
Purchases of property and equipment	(35,714		)	(218		)	(35,932		)
Net cash used in investing activities	(32,209		)	(218		)	(32,427		)
Additions to property and equipment included in accounts payable	$	1,932		$	2,014		$	3,946

	Three Months Ended March 31, 2018
	As reported			Adjustments			As restated
Accounts payable	$	(636	)	$	(124	)	$	(760	)
Net cash provided by operating activities	3,697			(124		)	3,573
Purchases of property and equipment	(6,082		)	124			(5,958		)
Net cash used in investing activities	(138,065		)	124			(137,941		)
Additions to property and equipment included in accounts payable	$	2,287		$	2,138		$	4,425

	Six Months Ended June 30, 2018
	As reported			Adjustments			As restated
Accounts payable	$	6,939		$	(3,598	)	$	3,341
Net cash provided by operating activities	18,533			(3,598		)	14,935
Purchases of property and equipment	(16,102		)	3,598			(12,504		)
Net cash used in investing activities	(148,649		)	3,598			(145,051		)
Additions to property and equipment included in accounts payable	$	4,023		$	5,613		$	9,636

	Nine Months Ended September 30, 2018
	As reported			Adjustments			As restated
Accounts payable	$	9,372		$	(4,217	)	$	5,155
Net cash provided by operating activities	28,598			(4,217		)	24,381
Purchases of property and equipment	(27,317		)	4,217			(23,100		)
Net cash used in investing activities	(160,623		)	4,217			(156,406		)
Additions to property and equipment included in accounts payable	$	4,004		$	6,231		$	10,235

	Year Ended December 31, 2018
	As reported			Adjustments			As restated
Accounts payable	$	1,339		$	207		$	1,546
Net cash provided by operating activities	34,572			207			34,779
Purchases of property and equipment	(38,298		)	(207		)	(38,505		)
Net cash used in investing activities	(174,037		)	(207		)	(174,244		)
Additions to property and equipment included in accounts payable	$	2,459		$	1,807		$	4,266

	Three Months Ended March 31, 2019
	As reported			Adjustments			As restated
Accounts payable	$	763		$	(556	)	$	207
Net cash provided by operating activities	2,262			(556		)	1,706
Purchases of property and equipment	(8,094		)	556			(7,538		)
Net cash used in investing activities	(8,568		)	556			(8,012		)
Additions to property and equipment included in accounts payable	$	1,850		$	1,881		$	3,731

	Six Months Ended June 30, 2019
	As reported			Adjustments			As restated
Accounts payable	$	3,375		$	(944	)	$	2,431
Net cash provided by operating activities	14,081			(944		)	13,137
Purchases of property and equipment	(15,642		)	944			(14,698		)
Net cash used in investing activities	(16,359		)	944			(15,415		)
Additions to property and equipment included in accounts payable	$	1,268		$	2,751		$	4,019

XML

Label	Element	Value
Accounting Standards Update 2016-16 [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (52,000)
Accounting Standards Update 2016-16 [Member] | Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	(52,000)
Accounting Standards Update 2014-09 [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	24,185,000
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	(981,000)
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	(1,000)
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	24,185,000
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	(981,000)
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (1,000)

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ACQUISITION - Narrative (Details) - SingleHop, LLC $ in Millions	Feb. 28, 2018 USD ($)
Business Acquisition [Line Items]
Payment to acquire business	$ 132.0
Working capital adjustment	$ 0.4
Customer relationships
Business Acquisition [Line Items]
Weighted Average	10 years
Noncompete agreements
Business Acquisition [Line Items]
Weighted Average	4 years
Trade names
Business Acquisition [Line Items]
Weighted Average	8 years
Technology
Business Acquisition [Line Items]
Weighted Average	7 years

XML

FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Fair Value Disclosures [Abstract]
Available-for-sale securities	$ 2,386	$ 2,309

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EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES (Tables)

9 Months Ended

Sep. 30, 2019

Restructuring and Related Activities [Abstract]

Schedule of transactions and balances for exit activities and restructuring charges

The following table displays the transactions and balances for exit activities and restructuring charges during the nine months ended September 30, 2019 and 2018 (in thousands). Our real estate and severance obligations are substantially related to our INAP US segment.

	Balance										Balance
	December 31, 2018		Initial Charges (1)		Plan Adjustments			Cash Payments			September 30, 2019
Activity for 2019 restructuring charge:
Real estate obligations	$	—	$	1,629	$	(115	)	$	(1,098	)	$	416
Activity for 2018 restructuring charge:
Real estate obligations	1,922		—		186			(2,108		)	—
Activity for 2017 restructuring charge:
Real estate obligations	100		—		(10		)	(90		)	—
Activity for 2016 restructuring charge:
Real estate obligations	125		—		16			(116		)	25
Activity for 2015 restructuring charge:
Real estate obligation	27		—		29			(49		)	7
Service contracts	221		—		30			(149		)	102
Activity for 2014 restructuring charge:
Real estate obligation	206		—		54			(260		)	—
	$	2,601	$	1,629	$	190		$	(3,870	)	$	550

^{(1) Additional expense related to the disposal of leasehold improvements of $3,345 was recorded for the three and nine months ended September 30, 2019 and not included in the table above.} 

	Balance									Balance
	December 31, 2017		Initial Charges		Plan Adjustments		Cash Payments			September 30, 2018
Activity for 2018 restructuring charge:
Real estate obligations	$	—	$	1,821	$	902	$	(961	)	$	1,762
Activity for 2017 restructuring charge:
Real estate obligations	3,380		—		220		(2,747		)	853
Activity for 2016 restructuring charge:
Severance	46		—		35		(35		)	46
Real estate obligations	247		—		29		(122		)	154
Activity for 2015 restructuring charge:
Real estate obligation	64		—		8		(36		)	36
Service contracts	388		—		22		(148		)	262
Activity for 2014 restructuring charge:
Real estate obligation	691		—		161		(548		)	304
	$	4,816	$	1,821	$	1,377	$	(4,597	)	$	3,417

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REVENUES (Tables)

9 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Abstract]

Schedule of contract with customer, asset and liability

The Company includes only those incremental costs that would not have been incurred if the contracts had not been entered into as follows (in thousands):

	Current			Non-current
Balance at December 31, 2018	$	8,844		$	16,104
Deferred customer acquisition costs incurred in the period	1,345			5,274
Amounts recognized as expense in the period	(7,333		)	—
Transition between short-term and long-term	6,346			(6,346		)
Balance at September 30, 2019	$	9,202		$	15,032

Significant changes in the deferred revenues balance (current and non-current) during the period are as follows (in thousands):

Balance at December 31, 2018	$	8,533
Revenue recognized that was included in the deferred revenue balance at December 31, 2018	(5,931		)
Increases due to cash received, excluding amounts recognized as revenue during the period	5,150
Balance at September 30, 2019	$	7,752

Summary of revenue by source

The following table presents disaggregated revenues by category as follows (in thousands):

	Three Months Ended September 30, 2019				Three Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
Colocation	$	27,334	$	1,452	$	32,946	$	1,372
Network services	11,225		2,772		13,015		2,719
Cloud	18,388		11,707		19,717		13,203
	$	56,947	$	15,931	$	65,678	$	17,294

	Nine Months Ended September 30, 2019				Nine Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
Colocation	$	82,245	$	4,344	$	94,747	$	4,349
Network services	34,381		8,224		40,398		8,482
Cloud	55,302		35,080		51,676		39,483
	$	171,928	$	47,648	$	186,821	$	52,314

Revenue by geography is as follows (in thousands):

	Three Months Ended September 30, 2019				Three Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
United States	$	57,939	$	—	$	66,752	$	—
Canada	—		8,181		—		9,187
Other countries	—		6,758		—		7,033
	$	57,939	$	14,939	$	66,752	$	16,220

	Nine Months Ended September 30, 2019				Nine Months Ended September 30, 2018
	INAP US		INAP INTL		INAP US		INAP INTL
United States	$	174,964	$	—	$	190,071	$	—
Canada	—		24,208		—		27,846
Other countries	—		20,404		—		21,218
	$	174,964	$	44,612	$	190,071	$	49,064

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LEASES - Maturity of Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019
Operating Leases, After Adoption of 842:
2019 (excluding the nine months ended September 30, 2019)	$ 2,270
2020	9,073
2021	9,098
2022	8,519
2023	7,541
Thereafter	8,698
Total undiscounted lease payments	45,199
Less: Imputed interest	8,131
Total lease liabilities	37,068	$ 31,000
Finance Leases, After Adoption of 842:
2019 (excluding the nine months ended September 30, 2019)	8,412
2020	33,406
2021	35,243
2022	33,995
2023	33,244
Thereafter	633,139
Total undiscounted lease payments	777,439
Less: Imputed interest	507,349
Total lease liabilities	$ 270,090

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FAIR VALUE MEASUREMENTS - Summary of Assets and liabilities measured at fair value on recurring basis (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	$ 2,386	$ 2,309
Recurring basis
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	2,386	2,309
Recurring basis | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Recurring basis | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	2,386	2,309
Recurring basis | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Recurring basis | Asset retirement obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset retirement obligations	2,292	2,090
Recurring basis | Asset retirement obligations | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset retirement obligations	0	0
Recurring basis | Asset retirement obligations | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset retirement obligations	0	0
Recurring basis | Asset retirement obligations | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset retirement obligations	$ 2,292	$ 2,090

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INVESTMENT IN AFFLIATES AND OTHER ENTITIES (Details) - USD ($) $ in Millions	Aug. 15, 2017	Sep. 30, 2019	Jan. 15, 2019
Schedule of Equity Method Investments [Line Items]
Equity method investments		$ 4.1
Recognition of assets and liabilities, fair value resulting in a gain	$ 1.1
NTT ME
Schedule of Equity Method Investments [Line Items]
Ownership percentage by noncontrolling owners			15.00%
INAP
Schedule of Equity Method Investments [Line Items]
Ownership percentage			85.00%
Put Option
Schedule of Equity Method Investments [Line Items]
Settlement alternatives, Cash at fair value			$ 1.0

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EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES - Exit activities and restructuring charges for Real estate obligations (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Restructuring Reserve [Roll Forward]
Balance, beginning of period	$ 2,601	$ 4,816
Initial Charges (1)	1,629	1,821
Plan Adjustments	190	1,377
Cash Payments	(3,870)	(4,597)
Balance, end of period	550	3,417
Activity for 2019 restructuring charge: | Real estate obligations
Restructuring Reserve [Roll Forward]
Balance, beginning of period	0
Initial Charges (1)	1,629
Plan Adjustments	(115)
Cash Payments	(1,098)
Balance, end of period	416
Activity for 2018 restructuring charge: | Real estate obligations
Restructuring Reserve [Roll Forward]
Balance, beginning of period	1,922	0
Initial Charges (1)	0	1,821
Plan Adjustments	186	902
Cash Payments	(2,108)	(961)
Balance, end of period	0	1,762
Activity for 2017 restructuring charge: | Real estate obligations
Restructuring Reserve [Roll Forward]
Balance, beginning of period	100	3,380
Initial Charges (1)	0	0
Plan Adjustments	(10)	220
Cash Payments	(90)	(2,747)
Balance, end of period	0	853
Activity for 2016 restructuring charge: | Real estate obligations
Restructuring Reserve [Roll Forward]
Balance, beginning of period	125	247
Initial Charges (1)	0	0
Plan Adjustments	16	29
Cash Payments	(116)	(122)
Balance, end of period	25	154
Activity for 2016 restructuring charge: | Severance
Restructuring Reserve [Roll Forward]
Balance, beginning of period		46
Initial Charges (1)		0
Plan Adjustments		35
Cash Payments		(35)
Balance, end of period		46
Activity for 2015 restructuring charge: | Real estate obligations
Restructuring Reserve [Roll Forward]
Balance, beginning of period	27	64
Initial Charges (1)	0	0
Plan Adjustments	29	8
Cash Payments	(49)	(36)
Balance, end of period	7	36
Activity for 2015 restructuring charge: | Service contracts
Restructuring Reserve [Roll Forward]
Balance, beginning of period	221	388
Initial Charges (1)	0	0
Plan Adjustments	30	22
Cash Payments	(149)	(148)
Balance, end of period	102	262
Activity for 2014 restructuring charge: | Real estate obligations
Restructuring Reserve [Roll Forward]
Balance, beginning of period	206	691
Initial Charges (1)	0	0
Plan Adjustments	54	161
Cash Payments	(260)	(548)
Balance, end of period	$ 0	$ 304

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION - Restatement to Cash Flow of Prior Periods (Details) - USD ($) $ in Thousands	3 Months Ended										9 Months Ended
	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts payable	$ 2,431	$ 207	$ 1,546	$ 5,155	$ 3,341	$ (760)	$ (949)	$ (2,168)	$ (1,623)	$ (2,759)	$ 756	$ 5,155
Net cash provided by operating activities	13,137	1,706	34,779	24,381	14,935	3,573	41,966	29,270	22,534	6,752	18,659	24,381
Purchases of property and equipment	(14,698)	(7,538)	(38,505)	(23,100)	(12,504)	(5,958)	(35,932)	(24,528)	(10,193)	(5,277)	(23,277)	(23,100)
Net cash used in investing activities	(15,415)	(8,012)	(174,244)	(156,406)	(145,051)	(137,941)	(32,427)	(21,119)	(10,637)	(5,477)	(23,886)	(156,406)
Additions to property and equipment included in accounts payable	4,019	3,731	4,266	10,235	9,636	4,425	3,946	1,602	5,600	3,991	$ 5,153	$ 10,235
As reported
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts payable	3,375	763	1,339	9,372	6,939	(636)	(1,167)	(3,498)	477	(2,247)
Net cash provided by operating activities	14,081	2,262	34,572	28,598	18,533	3,697	41,748	27,940	24,634	7,264
Purchases of property and equipment	(15,642)	(8,094)	(38,298)	(27,317)	(16,102)	(6,082)	(35,714)	(23,198)	(12,293)	(5,789)
Net cash used in investing activities	(16,359)	(8,568)	(174,037)	(160,623)	(148,649)	(138,065)	(32,209)	(19,789)	(12,737)	(5,989)
Additions to property and equipment included in accounts payable	1,268	1,850	2,459	4,004	4,023	2,287	1,932	701	1,269	1,247
Cash Flow Adjustment | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts payable	(944)	(556)	207	(4,217)	(3,598)	(124)	218	1,330	(2,100)	(512)
Net cash provided by operating activities	(944)	(556)	207	(4,217)	(3,598)	(124)	218	1,330	(2,100)	(512)
Purchases of property and equipment	944	556	(207)	4,217	3,598	124	(218)	(1,330)	2,100	512
Net cash used in investing activities	944	556	(207)	4,217	3,598	124	(218)	(1,330)	2,100	512
Additions to property and equipment included in accounts payable	$ 2,751	$ 1,881	$ 1,807	$ 6,231	$ 5,613	$ 2,138	$ 2,014	$ 901	$ 4,331	$ 2,744

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REVENUES (Performance Obligations) (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01 $ in Millions	9 Months Ended
	Sep. 30, 2019 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 198.0
Timing of satisfaction	2.13 years

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EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES

9 Months Ended

Sep. 30, 2019

Restructuring and Related Activities [Abstract]

EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES

EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES

During 2019 and 2018, we recorded exit activity charges due to ceasing use of office and data center space. We include initial charges and plan adjustments in "Exit activities, restructuring and impairments" in the accompanying condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2019 and 2018.

The following table displays the transactions and balances for exit activities and restructuring charges during the nine months ended September 30, 2019 and 2018 (in thousands). Our real estate and severance obligations are substantially related to our INAP US segment.

	Balance										Balance
	December 31, 2018		Initial Charges (1)		Plan Adjustments			Cash Payments			September 30, 2019
Activity for 2019 restructuring charge:
Real estate obligations	$	—	$	1,629	$	(115	)	$	(1,098	)	$	416
Activity for 2018 restructuring charge:
Real estate obligations	1,922		—		186			(2,108		)	—
Activity for 2017 restructuring charge:
Real estate obligations	100		—		(10		)	(90		)	—
Activity for 2016 restructuring charge:
Real estate obligations	125		—		16			(116		)	25
Activity for 2015 restructuring charge:
Real estate obligation	27		—		29			(49		)	7
Service contracts	221		—		30			(149		)	102
Activity for 2014 restructuring charge:
Real estate obligation	206		—		54			(260		)	—
	$	2,601	$	1,629	$	190		$	(3,870	)	$	550

^{(1) Additional expense related to the disposal of leasehold improvements of $3,345 was recorded for the three and nine months ended September 30, 2019 and not included in the table above.} 

	Balance									Balance
	December 31, 2017		Initial Charges		Plan Adjustments		Cash Payments			September 30, 2018
Activity for 2018 restructuring charge:
Real estate obligations	$	—	$	1,821	$	902	$	(961	)	$	1,762
Activity for 2017 restructuring charge:
Real estate obligations	3,380		—		220		(2,747		)	853
Activity for 2016 restructuring charge:
Severance	46		—		35		(35		)	46
Real estate obligations	247		—		29		(122		)	154
Activity for 2015 restructuring charge:
Real estate obligation	64		—		8		(36		)	36
Service contracts	388		—		22		(148		)	262
Activity for 2014 restructuring charge:
Real estate obligation	691		—		161		(548		)	304
	$	4,816	$	1,821	$	1,377	$	(4,597	)	$	3,417

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ACQUISITION

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

ACQUISITION

ACQUISITION

On February 28, 2018, the Company acquired SingleHop LLC ("SingleHop"), a provider of high-performance data center services including colocation, managed hosting, cloud and network services for $132.0 million net of working capital adjustments of approximately $0.4 million, liabilities assumed, and net of cash acquired. The transaction was funded with an incremental term loan and cash from the balance sheet. As part of the financing, INAP obtained amendments to its credit agreement to allow for the incremental term loan and to provide further operational flexibility under the credit agreement covenants. The amendments to the credit agreement are described in more detail in Note 8, "Debt."

The following table summarizes the final fair values of the assets acquired and liabilities assumed at the acquisition date and includes purchase accounting adjustments subsequent to the acquisition date (in thousands):

	Final Valuation as of December 31, 2018
Cash	$	2,823
Prepaid expenses and other assets	2,227
Property, plant and equipment	14,253
Other long-term assets	576
Intangible assets:
Noncompete agreements	4,000
Trade names	1,700
Technology	15,100
Customer relationships	34,100
Goodwill	66,008
Total assets acquired	140,787
Accounts payable and accrued liabilities	2,819
Deferred revenue	2,434
Long term liabilities	534
Net assets acquired	$	135,000

The fair value assigned to identifiable intangible assets acquired was based on estimates and assumptions made by management. The intangible assets are being amortized over periods which reflect the pattern in which economic benefits of the assets are expected to be realized. The customer relationships are being amortized on an accelerated basis over an estimated useful life of ten years and the noncompete agreements, trade names, and technology are being amortized on a straight-line basis over four, eight, and seven years, respectively.

Goodwill represents the excess of the consideration transferred over the aggregate fair values of assets acquired and liabilities assumed. The goodwill recorded in connection with this acquisition was based on operating synergies and other benefits expected to result from the combined operations and the assembled workforce acquired. The goodwill acquired is deductible for tax purposes.

Pro Forma Financial Information

The following unaudited pro forma financial information presents the combined results of operations of INAP and SingleHop as if the acquisition had occurred on January 1, 2017. The unaudited pro forma financial information is not intended to represent or be indicative of our consolidated results of operations that would have been reported had the INAP and SingleHop acquisition been completed as of January 1, 2017, and should not be taken as indicative of our future consolidated results of operations. The pro forma results are as follows (in thousands, except for per share amounts):

	Nine Months Ended September 30,
		2018
Net revenues		$	247,260
Net loss		(45,173		)
Basic and diluted net loss per share		(2.27		)
Weighted average shares outstanding used in computing basic and diluted net loss per share		19,968

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INVESTMENT IN AFFLIATES AND OTHER ENTITIES

9 Months Ended

Sep. 30, 2019

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENT IN AFFLIATES AND OTHER ENTITIES

INVESTMENT IN AFFLIATES AND OTHER ENTITIES

In the normal course of business, INAP enters into various types of investment arrangements, each having unique terms and conditions.

In previous years, INAP invested $4.1 million in Internap Japan Co., Ltd., ("INAP Japan") our joint venture with NTT-ME Corporation ("NTT-ME") and Nippon Telegraph and Telephone Corporation. Through August 15, 2017, we qualified and accounted for this investment using the equity method. We recorded our proportional share of the income and losses of INAP Japan one month in arrears on the accompanying consolidated balance sheets as a long-term investment and our share of INAP Japan's income and losses, net of taxes, as a separate caption in our accompanying consolidated statements of operations and comprehensive loss.

On August 15, 2017, INAP exercised certain rights to obtain a controlling interest in Internap Japan Co., Ltd. Upon obtaining control of the venture, we recognized INAP Japan's assets and liabilities at fair value resulting in a gain of $1.1 million. Once INAP obtained control of the Internap Japan Co., Ltd. venture, the investment was consolidated with INAP using the voting model.

On January 15, 2019, NTT-ME exercised its first put option that resulted in NTT-ME having an ownership of 15% and INAP of 85%. The put option was exercised at $1.0 million which represents the fair market value of the shares purchased.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash Flows from Operating Activities:
Net loss	$ (62,006)	$ (43,971)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	65,715	67,422
Loss (gain) on disposal of property and equipment	468	(98)
Amortization of debt discount and issuance costs	4,109	2,798
Stock-based compensation expense, net of capitalized amount	3,074	3,573
Provision for doubtful accounts	629	706
Non-cash change in finance lease liabilities	4,863	(241)
Non-cash change in exit activities and restructuring liability	5,164	3,198
Non-cash change in deferred rent	0	(778)
Deferred taxes	(787)	65
Accreted interest	1,194	0
Other, net	(78)	(6)
Changes in operating assets and liabilities:
Accounts receivable	1,593	(4,990)
Prepaid expenses, deposits and other assets	1,355	(3,531)
Operating lease right-of-use assets	(5,211)	0
Accounts payable	756	5,155
Accrued and other liabilities	(5,378)	(601)
Deferred revenues	(804)	617
Exit activities and restructuring liability	(3,870)	(4,597)
Short and long-term operating lease liabilities	7,614	0
Asset retirement obligation	202	(141)
Other liabilities	57	(199)
Net cash provided by operating activities	18,659	24,381
Cash Flows from Investing Activities:
Purchases of property and equipment	(23,277)	(23,100)
Proceeds from disposal of property and equipment	272	570
Business acquisition, net of cash acquired	0	(131,748)
Additions to acquired and developed technology	(881)	(2,128)
Net cash used in investing activities	(23,886)	(156,406)
Cash Flows from Financing Activities:
Proceeds from credit agreements	14,000	148,500
Principal payments on credit agreements	(3,268)	(3,267)
Debt issuance costs	(2,815)	(7,696)
Payments on finance lease liabilities	(8,212)	(6,643)
Acquisition of non-controlling interests	(973)	(1,130)
Proceeds from exercise of stock options	0	(210)
Acquisition of common stock for income tax withholdings	(311)	(487)
Other, net	50	175
Net cash (used in) provided by in financing activities	(1,529)	129,242
Effect of exchange rates on cash and cash equivalents	(172)	24
Net decrease in cash and cash equivalents	(6,928)	(2,759)
Cash and cash equivalents at beginning of period	17,823	14,603
Cash and cash equivalents at end of period	10,895	11,844
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	46,540	46,676
Additions to property and equipment included in accounts payable	$ 5,153	$ 10,235

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Statement [Abstract]
Net revenues	$ 72,878	$ 82,972	$ 219,576	$ 239,135
Operating costs and expenses:
Costs of sales and services, exclusive of depreciation and amortization	27,504	28,221	79,186	80,160
Costs of customer support	8,145	7,984	25,661	24,212
Sales, general and administrative	15,791	18,170	48,995	57,625
Depreciation and amortization	21,582	23,553	65,715	67,422
Exit activities, restructuring and impairments	3,792	2,347	5,439	3,140
Total operating costs and expenses	76,814	80,275	224,996	232,559
(Loss) income from operations	(3,936)	2,697	(5,420)	6,576
Interest expense	19,913	17,794	56,578	50,138
Loss on foreign currency, net	6	195	328	5
Total non-operating expenses	19,919	17,989	56,906	50,143
Loss before income taxes and equity in earnings of equity-method investment	(23,855)	(15,292)	(62,326)	(43,567)
(Benefit) provision for income taxes	(6)	162	(320)	404
Net loss	(23,849)	(15,454)	(62,006)	(43,971)
Less net income attributable to non-controlling interests	21	25	63	75
Net loss attributable to shareholders	(23,870)	(15,479)	(62,069)	(44,046)
Other comprehensive (loss) income:
Foreign currency translation adjustment	(18)	(98)	152	24
Total other comprehensive (loss) income	(18)	(98)	152	24
Comprehensive loss	$ (23,888)	$ (15,577)	$ (61,917)	$ (44,022)
Basic and diluted net loss per share (in dollars per share)	$ (1.01)	$ (0.77)	$ (2.62)	$ (2.21)
Weighted average shares outstanding used in computing basic and diluted net loss per share (in shares)	23,671	20,206	23,703	19,968