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 November 25, 2015, VelocityEHS acquired certain assets of WellNet Solutions, Inc. (“WellNet”) for initial cash consideration of $0.7 million. Additionally, during the nine months ended September 30, 2016, VelocityEHS paid $2.2 million of cash as contingent consideration in connection with the WellNet acquisition. As a result, intangible assets of $2.9 million were recorded in connection with the WellNet 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.

On September 16, 2016, VelocityEHS acquired certain assets of E3 Solutions Inc. ("E3 Solutions") for $3.0 million of cash consideration, $2.7 million of which was paid at the closing of the transaction, and $0.3 million of which will be paid in equal installments on the one-year and 18-month anniversaries of the closing.

On October 31, 2016, FolioDynamix acquired substantially all the assets of SAS Capital Management, LLC (“SAS”) for initial consideration, net of a working capital adjustment, of approximately $2.9 million and aggregate payments of approximately $1.0 million payable over the 15-month period following the closing. The SAS acquisition is also subject to an earnout based on achievement of revenue targets. The maximum consideration payable related to the SAS acquisition, including the initial consideration, is $25.0 million. SAS specializes in Registered Investment Advisor ("RIA")-specific technology, advisory consulting and overlay management, as well as, access to third-party managers and their own strategist portfolios. This acquisition will offer FolioDynamix's independent RIAs customers an improved advisor interface, a best-in-class execution desk and better operational support.

The allocations of the respective ErgoAdvocate, WellNet and E3 Solutions purchase prices to identified intangible assets and tangible assets and liabilities were as follows:



(in thousands)	ErgoAdvocate		WellNet		E3 Solutions
Goodwill	$	155	$	—	$	2,080
Customer lists (5-8 year life)	26		2,897		—
Trademarks, trade names and domain names (8 year life)	—		—		—
Technology (5-9 year life)	1,069		—		920
Other net assets (liabilities)	—		—		—
Total net assets acquired	$	1,250	$	2,897	$	3,000

Redeemable Noncontrolling Interests

In connection with GovDelivery's acquisitions of NuCivic, Inc. (“NuCivic”) and Textizen, Inc. ("Textizen"), certain GovDelivery stockholders had the ability to require GovDelivery to redeem a portion of their shares in 2017, 2018, 2019 and 2020 based on a fair value determination. In connection with the GovDelivery Merger Agreement, the vesting of the redeemable shares related to the NuCivic and Textizen acquisitions was accelerated. 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/or 2020 based on a mutually agreed upon fair value determination. Because any such redemptions would be 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 nine months ended September 30, 2016 and 2015:



(in thousands)
Balance at December 31, 2014	$	10,346
Redeemable noncontrolling interest portion of subsidiary net loss	(220)
Accretion to estimated redemption value	4,558
Equity transfer among owners⁽¹⁾	(3,339)
Impact of subsidiary equity transactions	(2,145)
Balance at September 30, 2015 ⁽³⁾	$	9,200



Balance at December 31, 2015	$	10,506
Redeemable noncontrolling interest portion of subsidiary net loss	(257		)
Accretion to estimated redemption value	4,360
Equity transfer among owners ⁽²⁾	(5,247		)
Balance at September 30, 2016 ⁽³⁾	$	9,362

____________________________

⁽¹⁾

This amount primarily relates to accretion value adjustments of $0.7 million that partially offset cash payments made during the nine months ended September 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 nine months ended September 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.


⁽³⁾	As of September 30, 2015 and 2016, GovDelivery represented $2.4 million and $4.3 million, respectively, of Actua's redeemable noncontrolling interests balance. These amounts will be excluded from this balance in future periods due to, among other things, the GovDelivery Merger Agreement; for more information, see Note 5, “Discontinued Operations."

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’s 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 nine months ended September 30, 2016, the “Impact of subsidiary equity transactions” line item as shown on Actua’s Consolidated Statements of Changes in Equity was $4.3 million, which was comprised of (1) $5.4 million paid by Actua in order to repurchase shares in its consolidated businesses and (2) $(1.1) 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 and the net loss per diluted share attributable to Actua for the relevant periods had it owned ErgoAdvocate, WellNet and E3 Solutions for the three-month and nine-month periods ended September 30, 2015. The effects of E3 Solutions on Actua's 2016 results were de minimis and therefore excluded from the table below.



(in thousands, except per share data)	Three Months Ended September 30, 2015			Nine Months Ended September 30, 2015
Revenue	$	25,174		$	73,638
Net loss attributable to Actua Corporation	$	(11,830	)	$	(37,734	)
Net loss per diluted share attributable to Actua Corporation	$	(0.32	)	$	(1.02	)