Related Party Transactions

3 Months Ended

Mar. 31, 2022

Related Party Transactions

Related Party Transactions

Note 3. Related Party Transactions

The Company has various agreements with MVS, a Mexican media and television conglomerate, which has directors and stockholders in common with the Company as follows:

● MVS provides Cinelatino with satellite and support services including origination, uplinking and satellite delivery of two feeds of Cinelatino’s channel (for U.S. and Latin America), master control and monitoring, dubbing, subtitling and closed captioning, and other support services. Expenses incurred under this agreement are included in cost of revenues in the accompanying Condensed Consolidated Statements of Operations. Total expenses incurred were $0.6 million for each of the three months ended March 31, 2022 and 2021. Amounts due to MVS pursuant to the agreements noted above amounted to $0.9 million and $0.4 million as of March 31, 2022 and December 31, 2021, respectively.

● Dish Mexico (d/b/a Comercializadora de Frecuencias Satelitales, S. de R.L. de C.V.), an MVS affiliate that operates a subscription satellite television service throughout Mexico and distributes Cinelatino as part of its service. Total revenues recognized were $0.2 million and $0.3 million for the three months ended March 31, 2022 and 2021, respectively. Amounts due from Dish Mexico amounted to $0.2 million and $0.1 million as of March 31,2022 and December 31, 2021, respectively.

● MVS has the non-exclusive right to duplicate, distribute and exhibit Cinelatino’s service via cable, satellite or by any other means in Mexico. Cinelatino receives revenues net of MVS’s distribution fee, which is equal to 13.5% of all license fees collected from third party distributors managed but not owned by MVS. Total revenues recognized were $0.1 million and $0.2 million for the three months ended March 31, 2022 and 2021, respectively. Amounts due from MVS pursuant to the agreements noted above amounted to $0.1 million and $0.0 million as of March 31, 2022 and December 31, 2021, respectively.

The Company has various agreements with TelevisaUnivision (including its various divisions and affiliates), which has directors in common with the Company (who may hold a material financial interest in TelevisaUnivision).

● Pantaya has an agreement for the purchase of advertising on TelevisaUnivision’s television and radio properties. Expenses under this agreement are included in selling, general and administrative expenses in the accompanying Condensed Consolidated Statement of Operations. Total expenses incurred were $0 million for the three months ended March 31, 2022 and 2021. Amounts due to TelevisaUnivision pursuant to this agreement totaled $0 million and $0.1 million as of March 31, 2022 and December 31, 2021, respectively. The Company had remaining commitments of $4.0 million as of March 31, 2022 which is included in Note 13, “Commitments” of Notes to Condensed Consolidated Financial Statements.

● Pantaya has various content output agreements with Videocine, S.A. de C.V. (“Videocine”), a division of TelevisaUnivision pursuant to which Pantaya licenses content from Videocine or licenses content to Videocine. There were no revenues earned or expenses incurred under these agreements for the three months ended March 31, 2022 and 2021. Deferred revenue related to the agreements was $2.5 million as of March 31, 2022 and December 31, 2021. Amounts due from Videocine pursuant to the agreements noted above amounted to $0.3 million and $0.6 million as of March 31, 2022 and December 31, 2021, respectively. Amounts due to Videocine pursuant to the agreements noted above amounted to $1.2 million and $0.9 million as of March 31, 2022 and December 31, 2021, respectively.

● The Company has various licensing agreements with TelevisaUnivision (including its various divisions and affiliates) pursuant to which the Company licenses content from TelevisaUnivision or licenses content to TelevisaUnivision. Total revenues recognized were $0.0 million for each of the three months ended March 31, 2022 and 2021. Total expenses incurred were $0.0 million for each of the three months ended March 31, 2022 and 2021, respectively. Amounts due from TelevisaUnivision pursuant to the agreements noted above amounted to $0.9 million and $0 million as of March 31, 2022 and December 31, 2021. No amounts were due to TelevisaUnivision as of March 31, 2022 and December 31, 2021.

The Company entered into an amended and restated consulting agreement with James M. McNamara, a member of the Company’s board of directors, on August 13, 2019, to provide the development, production and maintenance of programming, affiliate relations, identification and negotiation of carriage opportunities, and the development, identification and negotiation of new business initiatives including sponsorship, new channels, direct-to-consumer programs and other interactive initiatives. Total expenses incurred under these agreements are included in selling, general and administrative expenses in the accompanying Condensed Consolidated Statements of Operations and amounted to $0.1 million for each of the three months ended March 31, 2022 and 2021. No amounts were due to this related party as of March 31, 2022 and December 31, 2021.