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Schedule I: Condensed Financial Information of Registrant
 12 Months Ended
Dec. 31, 2021
Condensed Financial Information Disclosure [Abstract]  
Schedule I: Condensed Financial Information of Registrant
Schedule I: Condensed Financial Information of Registrant

FUNKO, INC.
CONDENSED STATEMENTS OF INCOME
(PARENT COMPANY ONLY)

 Year Ended December 31,
202120202019
(in thousands)
Intercompany revenue$82 $307 $739 
Selling, general, and administrative expenses13,163 10,269 11,211 
Total operating expenses13,163 10,269 11,211 
Loss from operations(13,081)(9,962)(10,472)
Interest (expense) income, net3 (36)— 
Tax receivable agreement liability adjustment(1,590)(87)(152)
Equity in net income of subsidiaries72,916 13,674 24,525 
Income before income taxes58,248 3,589 13,901 
Income tax expense (benefit)14,348 (372)2,176 
Net income$43,900 $3,961 $11,725 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(PARENT COMPANY ONLY)

Year Ended December 31,
202120202019
(in thousands)
Net income$43,900 $3,961 $11,725 
Other comprehensive income:
Foreign currency translation (loss) gain, net of tax effect of $163, $(274) and $(282) for the years ended December 31, 2021, 2020 and 2019, respectively
(544)927 958 
Reclassification of foreign currency translation gain into net income$(96)$— $— 
Comprehensive income attributable to
Funko, Inc.		$43,260 $4,888 $12,683 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
CONDENSED BALANCE SHEETS
(PARENT COMPANY ONLY)
December 31,
20212020
(in thousands, except per share data)
Assets
Current assets:
Cash and cash equivalents$61,943 $34,568 
Income tax receivable— 294 
Total current assets61,943 34,862 
Intercompany receivable116,746 117,995 
Deferred tax asset74,464 54,734 
Investment in subsidiaries166,054 97,523 
Total assets$419,207 $305,114 
Liabilities and Stockholders' Equity
Current liabilities:
Tax payable$14,684 $— 
Current portion of liabilities under tax receivable agreement7,362 2,020 
Accrued expenses and other current liabilities— 40 
Total current liabilities22,046 2,060 
Liabilities under tax receivable agreement, net of current portion75,523 60,297 
Other long-term liabilities— 490 
Commitments and contingencies
Stockholders' equity:
Class A common stock, par value $0.0001 per share, 200,000 shares authorized; 40,088 shares and 35,657 shares issued and outstanding as of December 31, 2021 and 2020, respectively
4 4 
Class B common stock, par value $0.0001 per share, 50,000 shares authorized; 10,691 shares and 14,040 shares issued and outstanding as of December 31, 2021 and 2020, respectively
1 1 
Additional paid-in-capital252,505 216,141 
Accumulated other comprehensive income1,078 1,718 
Retained earnings68,050 24,403 
Total stockholders' equity321,638 242,267 
Total liabilities and stockholders' equity$419,207 $305,114 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(PARENT COMPANY ONLY)

Year Ended December 31,
202120202019
(in thousands)
Operating Activities
Net income$43,900 $3,961 $11,725 
Adjustments to reconcile net income to net cash provided by
operating activities:
Equity in net income of subsidiaries(72,916)(13,674)(24,525)
Equity-based compensation12,994 10,007 10,827 
Deferred tax expense (benefit)(203)2,792 (2,518)
Tax receivable liability adjustment1,590 87 152 
Changes in operating assets and liabilities:
Income tax receivable294 3,521 (3,816)
Due from related parties, net1,351 26,007 (19,182)
Prepaid expenses and other assets— — (2,336)
Income taxes payable14,684 — (3,497)
Accrued expenses and other liabilities(571)304 1,985 
Net cash provided by (used in) operating activities1,123 33,005 (31,185)
Financing Activities
Tax distribution received from FAH, LLC24,173 5,825 29,502 
Tax receivable agreement payments(1,715)(4,639)(173)
Proceeds from exercise of equity-based options3,794 41 2,148 
Net cash provided by financing activities26,252 1,227 31,477 
Net increase in cash and cash equivalents27,375 34,232 292 
Cash and cash equivalents at beginning of period34,568 336 44 
Cash and cash equivalents at end of period$61,943 $34,568 $336 
Supplemental Cash Flow Information
Income tax payments$23 $2,116 $11,969 
Establishment of liabilities under tax receivable agreement20,691 1,000 59,045 
Issuance of equity instruments for acquisitions— — 2,221 

See accompanying notes to condensed financial information
Schedule I: Condensed Financial Information of Registrant (continued)

FUNKO, INC.
NOTES TO CONDENSED FINANCIAL INFORMATION
(PARENT COMPANY ONLY)
December 31, 2021
1. Organization
Funko, Inc. (the “Parent Company”) was formed on April 21, 2017 as a Delaware corporation and is a holding company with no direct operations. The Parent Company's assets consist primarily of cash and cash equivalents, its equity interest in FAH, LLC, and certain deferred tax assets. The Parent Company also had three wholly owned subsidiaries with direct ownership interest in FAH, LLC until the subsidiaries were dissolved and liquidated on June 30, 2020.
The Parent Company's cash inflows are primarily from distributions and other transfers from FAH, LLC. The amounts available to the Parent Company to fulfill cash commitments are subject to certain restrictions in FAH, LLC’s Credit Facilities. See Note 10 to the Funko, Inc. consolidated financial statements, appearing elsewhere in this Form 10-K.
2. Basis of Presentation
These condensed Parent Company financial statements should be read in conjunction with the consolidated financial statements of Funko, Inc. and its subsidiaries and the accompanying notes thereto, included in this Form 10-K. For purposes of this condensed financial information, the Parent Company's interest in FAH, LLC is recorded based upon its proportionate share of FAH, LLC's net assets (similar to presenting them on the equity method).
The Parent Company is the sole managing member of FAH, LLC, and pursuant to the Amended and Restated LLC Agreement of FAH, LLC (the “LLC Agreement”), receives compensation in the form of reimbursements for all costs associated with being a public company. Intercompany revenue consists of these reimbursement payments and is recognized when the corresponding expense to which it relates is recognized.
Certain intercompany balances presented in these condensed Parent Company financial statements are eliminated in the consolidated financial statements. For the years ended December 31, 2021, 2020, and 2019, the full amounts of intercompany revenue and equity in net income of subsidiaries in the Parent Company Statements of Operations were eliminated in consolidation. An intercompany receivable was owed to the Parent Company by FAH, LLC of $116.7 million and $118.0 million as of December 31, 2021 and 2020, respectively. Related party amounts that were not eliminated in the consolidated financial statements include the Parent Company's liabilities under the tax receivable agreement, which totaled $82.9 million and $62.3 million as of December 31, 2021 and 2020, respectively.
3. Commitments and Contingencies
The Parent Company is party to a tax receivable agreement with certain holders of common units in FAH, LLC (the "Continuing Equity Owners") that provides for the payment by the Parent Company to the Continuing Equity Owners of 85% of the amount of any tax benefits that the Parent Company actually realizes, or in some cases is deemed to realize, as a result of certain transactions. See Note 13 to the Funko, Inc. consolidated financial statements, appearing elsewhere in this Form 10-K, for more information regarding the Parent Company's tax receivable agreement. As described in Note 13 to the Funko, Inc. consolidated financial statements, appearing elsewhere in the Form 10-K, amounts payable under the tax receivable agreement are contingent upon, among other things, (i) generation of future taxable income of Funko, Inc. over the term of the tax receivable agreement and (ii) future changes in tax laws. As of December 31, 2021 and 2020, liabilities under the tax receivable agreement totaled $82.9 million and $62.3 million, respectively.
See Note 14 to the Funko, Inc. consolidated financial statements, appearing elsewhere in this Form 10-K, for information regarding pending and threatened litigation. Pursuant to the LLC Agreement, the Parent Company receives reimbursements for all costs associated with being a public company, which includes costs of litigation.