Equity Method Investments

12 Months Ended

Dec. 31, 2020

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments

Equity Method Investments

As of December 31, 2020 and 2019, the Company held two investments, SUPERNAP International and Planet3, Inc. (“Planet3”). As of December 31, 2020 and 2019, the Company determined that it continued to have a variable interest in both SUPERNAP International and Planet3 as the entity does not have sufficient equity at risk. However, the Company concluded that it is not the primary beneficiary of SUPERNAP International or of Planet3 as it does not have deemed control of either entity. As a result, it does not consolidate either entity into its consolidated financial statements.

As of December 31, 2020 and 2019, the Company held a 50% ownership interest in SUPERNAP International, the investment of which was accounted for under the equity method of accounting. As of March 31, 2018, the Company’s carrying value of its investment in SUPERNAP International was reduced to zero as a result of recording its share of the investee’s losses. Accordingly, as the Company does not have any guaranteed obligations and is not otherwise committed to provide further financial support to SUPERNAP International, the Company discontinued the equity method of accounting for its investment in SUPERNAP International as of March 31, 2018. The Company’s share of net loss recorded during the year ended December 31, 2018 amounted to $0.3 million. As of December 31, 2020 and 2019, the Company recorded amounts consisting primarily of royalty fees and reimbursable expenses due from SUPERNAP International of $0.1 million and $0.3 million, respectively, within accounts receivable on the consolidated balance sheets.

As of December 31, 2019, the Company held a 45% ownership interest in Planet3, the investment of which was accounted for under the equity method of accounting. As of December 31, 2016, the Company’s carrying value of its investment in Planet3 was reduced to zero as a result of recording its share of the investee’s losses as well as an other than temporary loss in value. As the Company did not have any guaranteed obligations and was not otherwise committed to provide further financial support to Planet3, the Company discontinued the equity method of accounting for its investment in Planet3 as of December 31, 2016. In June 2020, the Company and Planet3 entered into a share exchange and note cancellation agreement (“Share Exchange Agreement”); whereby, Planet3 agreed to transfer shares of its Class A Stock to the Company and entered into a royalty agreement with the Company in exchange for all shares of Planet3 common stock held by the Company prior to the Share Exchange Agreement, and the cancellation by the Company of all principal and interest outstanding for certain promissory notes issued as part a note purchase agreement entered into by the Company and Planet3 in May 2016. As a result of the Share Exchange Agreement, the Company’s ownership interest in Planet3 decreased to 5% and is no longer accounted for as an equity method investment as of December 31, 2020.