Consolidated Businesses

FolioDynamix Acquisition

On November 3, 2014, Actua acquired all of the issued and outstanding stock of FolioDynamix for approximately $201.7 million in cash, which included $0.7 million as a post-closing working capital adjustment that occurred in the first quarter of 2015, and $4.1 million of equity value related to stock options.

Other Acquisitions

On June 10, 2015, GovDelivery acquired certain assets of Talent Management in Government Inc. (“TMGov”) for $0.5 million of consideration consisting of $0.4 million at closing and $0.1 million to be paid upon achievement of certain milestones, as set forth in the purchase agreement. The $0.1 million was paid during 2015. The acquisition was accounted for under the acquisition method. GovDelivery has allocated the purchase price to the acquired identifiable intangible assets based upon their respective fair values as of the date of acquisition.

On July 13, 2015, GovDelivery acquired Vox Metropolis Inc. (d/b/a Textizen) (“Textizen”) for approximately $1.2 million of cash; $0.4 million of the $1.2 million cash consideration was retained by GovDelivery in order to satisfy potential indemnity claims until July 2016, when the $0.4 million was paid. The acquisition was accounted for under the acquisition method. GovDelivery has allocated the purchase price to the acquired identifiable intangible assets based upon their respective fair values as of the date of acquisition.

On November 25, 2015, VelocityEHS acquired certain assets of WellNet Solutions, Inc. (“WellNet”) for cash consideration of $0.7 million. Additionally, during the six months ended June 30, 2016, $2.2 million of cash was paid for contingent consideration in conjunction with further WellNet customer acquisitions. As a result, intangible assets of $2.9 million were recorded in connection with the acquisition.

On January 22, 2016, VelocityEHS acquired certain assets of ErgoAdvocate LLC (“ErgoAdvocate”) for $1.25 million of cash consideration, $1.0 million of which was paid at the closing of the transaction, and $0.25 million of which will be paid on the one-year anniversary of the closing, subject to reduction for any post-closing indemnification claims. The acquisition was accounted for under the acquisition method. VelocityEHS has allocated the purchase price to the acquired identifiable intangible assets and goodwill based upon their respective fair values as of the date of acquisition.

The allocations of the respective TMGov, Textizen, ErgoAdvocate and WellNet purchase prices to identified intangible assets and tangible assets and liabilities were as follows:



(in thousands)	TMGov		Textizen			ErgoAdvocate		WellNet
Goodwill	$	—	$	606		$	155	$	—
Customer lists (5-8 year life)	250		171			26		2,897
Trademarks, trade names and domain names (8 year life)	—		117			—		—
Technology (5-9 year life)	250		347			1,069		—
Other net assets (liabilities)	—		(41		)	—		—
Total net assets acquired	$	500	$	1,200		$	1,250	$	2,897

Redeemable Noncontrolling Interests

In connection with the NuCivic, Inc. (“NuCivic”) and Textizen acquisitions, certain GovDelivery stockholders have the ability to require GovDelivery to redeem a portion of their shares in 2017, 2018, 2019 and 2020 based on a fair value determination. Certain VelocityEHS stockholders have the ability to require VelocityEHS to redeem a portion of their shares in 2017 based on a mutually agreed upon fair value determination. Certain FolioDynamix shareholders have the ability to require FolioDynamix to redeem a portion of their shares in 2018, 2019 and 2020 based on a mutually agreed upon fair value determination. Because those redemptions are outside the control of the respective businesses, Actua has classified the noncontrolling interests outside of equity and will accrete to the estimated redemption values with an offset to additional paid-in capital. The noncontrolling interests are classified as “Redeemable noncontrolling interests” in Actua’s Consolidated Balance Sheets.

The following is a reconciliation of the activity related to Actua’s redeemable noncontrolling interest during the six months ended June 30, 2016 and 2015:



Balance at December 31, 2014	$	10,346
Redeemable noncontrolling interest portion of subsidiary net loss	(148)
Accretion to estimated redemption value	3,638
Equity transfer among owners⁽¹⁾	(3,339)
Impact of subsidiary equity transactions	(2,110)
Balance at June 30, 2015	$	8,387



Balance at December 31, 2015	$	10,506
Redeemable noncontrolling interest portion of subsidiary net loss	(129		)
Accretion to estimated redemption value	1,232
Equity transfer among owners ⁽²⁾	(5,247		)
Balance at June 30, 2016	$	6,362

____________________________

⁽¹⁾

This amount primarily relates to accretion value adjustments of $0.7 million that partially offset cash payments made during the six months ended June 30, 2015 of $4.0 million to acquire $1.9 million of redeemable noncontrolling interests associated with GovDelivery and $1.4 million of redeemable noncontrolling interests associated with VelocityEHS. These transactions increased Actua’s ownership in GovDelivery from 91% to 93% and its ownership in VelocityEHS from 96% to 98%.

⁽²⁾

This amount primarily relates to accretion value adjustments of $0.2 million that partially offset cash payments made during the six months ended June 30, 2016 of $5.4 million to acquire $2.5 million of redeemable noncontrolling interests associated with GovDelivery, $2.4 million of redeemable noncontrolling interests associated with VelocityEHS and $0.5 million of redeemable noncontrolling interests associated with FolioDynamix. These transactions increased Actua’s ownership in GovDelivery from 92% to 94% and its ownership in VelocityEHS from 98% to 99%. Its ownership in FolioDynamix did not significantly change as a result of this repurchase.

Other Consolidated Businesses Transactions

From time to time, Actua acquires additional equity ownership interests in its consolidated businesses. Purchasing equity ownership interests from a consolidated business’ existing shareholders results in an increase in Actua’s controlling interest in that business and a corresponding decrease in the noncontrolling interest ownership. Those transactions are accounted for as decreases to “Noncontrolling interests” and increases to “Additional paid-in capital” in Actua’s Consolidated Balance Sheets for the relevant periods. Actua may also acquire additional equity ownership interests in its consolidated businesses, either from existing holders or as a result of share issuances by one or more of those businesses, and Actua’s equity ownership interests may be diluted by any such share issuances to other parties. An issuance of equity securities by a consolidated business that results in a decrease in Actua’s equity ownership interests is accounted for in accordance with the policy for “Principles of Accounting for Ownership Interests” described in Note 2, “Significant Accounting Policies.” Other changes to Actua’s equity ownership interests in its consolidated businesses, as well as equity-based compensation award activity at those businesses, also result in adjustments to “Additional paid-in capital” and “Noncontrolling interests” in Actua’s Consolidated Balance Sheets. The impact of any equity-related transactions at Actua’s consolidated businesses is included in the line item “Impact of subsidiary equity transactions” in Actua’s Consolidated Statements of Changes in Equity. The impact of these changes to the noncontrolling interest are also included in the line item “Impact of subsidiary equity transactions” in Actua’s Consolidated Statements of Changes in Equity for the relevant period. During the six months ended June 30, 2016, the “Impact of subsidiary equity transactions” line item as shown on Actua’s Consolidated Statements of Changes in Equity was $1.5 million, which was comprised of (1) $5.4 million paid by Actua in order to buy back shares in its consolidated businesses and (2) $(3.9) million relating to Actua’s share of its consolidated businesses equity transactions.

Pro Forma Information (Unaudited)

The information in the following table represents the revenue, net loss attributable to Actua Corporation and the net loss per diluted share attributable to Actua Corporation for the relevant periods had it owned TMGov, Textizen, ErgoAdvocate and WellNet for the three-month and six-month periods ended June 30, 2015.



(in thousands, except per share data)	Three Months Ended June 30, 2015			Six Months Ended June 30, 2015
Revenue	$	33,972		$	64,902
Net loss attributable to Actua Corporation	$	(15,772	)	$	(30,982	)
Net loss per diluted share attributable to Actua Corporation	$	(0.42	)	$	(0.83	)