View Filing Data

Year Ending, December 31, (amounts in thousands)

Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Dec. 31, 2014	Mar. 12, 2015	Jun. 30, 2014
Document And Entity Information [Abstract]
Entity Registrant Name	SPARK NETWORKS INC
Entity Central Index Key	0001314475
Document Type	10-K
Document Period End Date	Dec. 31, 2014
Amendment Flag	false
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 135,603,011
Entity Common Stock, Shares Outstanding		24,730,101

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 11,696	$ 14,723
Restricted cash	1,056	1,296
Accounts receivable, net of allowance of $0	1,308	1,569
Deferred tax asset – current	11	10
Prepaid expenses and other	1,516	1,787
Total current assets	15,587	19,385
Property and equipment, net	4,072	3,901
Goodwill	8,575	9,305
Intangible assets, net	2,469	2,269
Deferred tax asset — non-current	68	186
Deposits and other assets	234	208
Total assets	31,005	35,254
Current liabilities:
Accounts payable	1,300	1,516
Accrued liabilities	3,948	5,761
Deferred revenue	7,092	8,830
Deferred tax liability — current portion	496	526
Total current liabilities	12,836	16,633
Deferred tax liability	1,607	1,781
Other liabilities	807	1,717
Total liabilities	15,250	20,131
Commitments and contingencies (Note 11)
Stockholders’ equity:
10,000,000 shares of Preferred Stock, $0.001 par value, 450,000 of which are designated as Series C Junior Participating Cumulative Preferred Stock, with no shares of Preferred Stock issued or outstanding
100,000,000 shares of Common Stock, $0.001 par value, with 24,556,182 and 24,001,937 shares of Common Stock issued and outstanding at December 31, 2014 and 2013, respectively, at stated value of:	25	24
Additional paid-in-capital	72,522	70,747
Accumulated other comprehensive income.	759	776
Accumulated deficit	(57,551)	(56,424)
Total stockholders’ equity	15,755	15,123
Total liabilities and stockholders’ equity	$ 31,005	$ 35,254

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Accounts receivable allowance	$ 0	$ 0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	24,556,182	24,001,937
Common stock, shares outstanding	24,556,182	24,001,937
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Designated as Series C Junior Participating Cumulative Preferred Stock
Preferred stock, shares authorized	450,000	450,000

Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Income Statement [Abstract]
Revenue	$ 61,645	$ 69,409	$ 61,743
Cost and expenses:
Cost of revenue (exclusive of depreciation shown separately below)	34,321	55,958	49,216
Sales and marketing	5,127	5,601	3,991
Customer service	3,038	2,902	2,534
Technical operations	1,130	1,167	1,363
Development	3,446	3,129	3,346
General and administrative	13,300	10,494	8,787
Depreciation	2,053	1,987	1,673
Amortization of intangible assets other than goodwill	40	20	13
Impairment of goodwill, long-lived assets and other assets	128	265
Total cost and expenses	62,583	81,523	70,923
Operating loss	(938)	(12,114)	(9,180)
Interest expense (income) and other, net	564	(229)	(238)
Loss before provision for income taxes	(1,502)	(11,885)	(8,942)
Provision for income taxes	(375)	495	6,047
Net loss	(1,127)	(12,380)	(14,989)
Other comprehensive loss, net of tax:
Foreign currency translation adjustments	(17)	64	40
Comprehensive loss	$ (1,144)	$ (12,316)	$ (14,949)
Net loss per share—basic and diluted	$ (0.05)	$ (0.54)	$ (0.72)
Weighted average shares outstanding—basic and diluted	24,064	22,795	20,781

Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income	Accumulated Deficit
Beginning balance at Dec. 31, 2011	$ 24,652	$ 21	$ 53,014	$ 672	$ (29,055)
Beginning balance, Shares at Dec. 31, 2011		20,595
Issuance of common stock upon exercise of stock options	1,053		1,053
Issuance of common stock upon exercise of stock options, Shares		350
Excess tax provisions from stock-based comp	(23)		(23)
Foreign currency translation adjustments	40			40
Stock-based compensation	813		813
Net loss	(14,989)				(14,989)
Ending balance at Dec. 31, 2012	11,546	$ 21	54,857	712	(44,044)
Ending balance, Shares at Dec. 31, 2012		20,945
Issuance of common stock upon exercise of stock options	$ 2,873	$ 1	2,872
Issuance of common stock upon exercise of stock options, Shares	951	916
Issuance of common stock in a public offering	$ 12,253	$ 2	12,251
Issuance of common stock in a public offering, Shares		2,141
Foreign currency translation adjustments	64			64
Stock-based compensation	767		767
Net loss	(12,380)				(12,380)
Ending balance at Dec. 31, 2013	15,123	$ 24	70,747	776	(56,424)
Ending balance, Shares at Dec. 31, 2013		24,002
Issuance of common stock upon exercise of stock options	$ 2,322	$ 1	2,321
Issuance of common stock upon exercise of stock options, Shares	759	737
Excess tax provisions from stock-based comp	$ 5,300
Issuance of restricted stock, Shares		88
Purchase of common stock for retirement	(1,492)		(1,492)
Purchase of common stock for retirement, Shares		(271)
Foreign currency translation adjustments	(17)			(17)
Stock-based compensation	946		946
Net loss	(1,127)				(1,127)
Ending balance at Dec. 31, 2014	$ 15,755	$ 25	$ 72,522	$ 759	$ (57,551)
Ending balance, Shares at Dec. 31, 2014		24,556

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Cash flows from operating activities:
Net loss	$ (1,127)	$ (12,380)	$ (14,989)
Adjustments to reconcile net loss to cash (used in) provided by operating activities:
Depreciation and amortization	2,093	2,007	1,686
Impairment of goodwill, long-lived assets and other assets	128	265
Stock-based compensation	946	767	813
Non-current taxes payable and other		12	(534)
Foreign exchange (gain) loss on intercompany loan	518	(297)	(124)
Income from asset received from legal judgment			(151)
Excess tax benefits (provisions) from stock-based compensation	0		23
Deferred taxes	103	454	5,897
Changes in operating assets and liabilities:
Accounts receivable, net	261	(59)	(364)
Restricted cash	240	(64)	(274)
Prepaid expenses and other assets	227	(258)	336
Accounts payable and accrued liabilities	(2,073)	782	1,414
Deferred revenue	(1,738)	702	2,405
Other liabilities	(897)	255
Net cash (used in) provided by operating activities	(1,319)	(7,814)	(3,862)
Cash flows from investing activities:
Sales of property and equipment			520
Purchases of property and equipment	(2,293)	(2,689)	(2,081)
Purchases of businesses and intangible assets	(244)	(358)	(255)
Net cash used in investing activities	(2,537)	(3,047)	(1,816)
Cash flows from financing activities:
Proceeds from issuance of stock in a public offering		12,253
Proceeds from issuance of stock from exercise of stock options	2,321	2,873	1,053
Purchase of common stock for retirement	(1,492)
Excess tax (provision) benefit from stock-based compensation			(23)
Net cash provided by financing activities	829	15,126	1,030
Net (decrease) increase in cash	(3,027)	4,265	(4,648)
Cash and cash equivalents at beginning of year	14,723	10,458	15,106
Cash and cash equivalents at end of year	11,696	14,723	10,458
Supplemental disclosure of cash flow information:
Cash paid for income taxes	$ 36	$ 61	$ 45

The Company and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2014

Accounting Policies [Abstract]

The Company and Summary of Significant Accounting Policies

Note 1. The Company and Summary of Significant Accounting Policies

The Company

Spark Networks, Inc. (the “Company”) is a leader in creating iconic, niche-focused brands and communities that help individuals make life-long relationships with others that share their interests and values. The Company’s core properties, ChristianMingle.com and JDate.com, are communities geared towards singles of the Christian and Jewish faiths. Through the Company’s websites and mobile applications, The Company helps members search for and communicate with other like-minded individuals.

Membership to the Company’s online and web services, which includes the posting of a personal profile and photos, and access to its database of profiles, is free. The Company charges a fee (typically, one, three, six and twelve month subscription fees) to members, allowing them to initiate communication with other members and subscribers using the Company’s onsite communication tools, including anonymous email, Instant Messenger, chat rooms and message boards. For most of the Company’s services, two-way communications through the Company’s email platform can only take place between paying members.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Spark Networks, Inc. and all of its majority-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.

Foreign Currency

The financial statements of the Company’s foreign subsidiaries are prepared using the local currency as the subsidiary’s functional currency. The Company translates the assets and liabilities into U.S. dollars using period-end rates of exchange, and revenue and expenses using average rates of exchange for the year. The resulting translation gain or loss is included in accumulated other comprehensive loss and is excluded from net loss.

The intercompany loan between the Company and its Israel subsidiary is classified as a loan as management expects settlement upon maturity in 2025. The loan is eliminated upon consolidation. The foreign exchange gains and losses related to this loan are recorded as part of net loss and excluded from accumulated other comprehensive loss. For the years ended December 31, 2014 and 2013, the Company recorded a foreign exchange loss of $518,000 and gain of $297,000, respectively, related to the intercompany loan.

Revenue Recognition and Deferred Revenue

Substantially all of the Company’s revenue is derived from subscription fees. Revenue is presented net of credits and credit card chargebacks. The Company recognizes revenue in accordance with accounting principles generally accepted in the United States. Revenue recognition occurs ratably over the subscription period, beginning when there is persuasive evidence of an arrangement, delivery has occurred (access has been granted), the fees are fixed or determinable, and collection is reasonably assured. Subscribers pay in advance, primarily by using a credit card, and, subject to certain conditions identified in our terms and conditions, all purchases are final and nonrefundable. Fees collected in advance for subscriptions are deferred and recognized as revenue using the straight line method over the term of the subscription.

The Company also earns a small amount of revenue from advertising sales and offline events. The Company records advertising revenue as it is earned and is included in the total revenue of each segment that generates advertising sales. Revenue and the related expenses associated with offline events are recognized at the conclusion of each event. As of the fourth quarter 2014, the Company has elected to minimize the amount of offline events that it hosts or sponsors.

Fair Value Measurement

Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, the Company applies a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2—Other inputs that are directly or indirectly observable in the marketplace for similar assets or liabilities.

Level 3—Unobservable inputs which are supported by little or no market activity.

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The Company has not elected the fair value option for any non-financial assets or liabilities that require remeasurement on a recurring basis.

Cash and Cash Equivalents

All highly liquid instruments with an original maturity of three months or less are considered cash and cash equivalents. Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of cash and cash equivalents. Cash and cash equivalents are maintained with financial institutions and are in excess of Federal Deposit Insurance Corporation insurance limits.

As of December 31, 2014, we held cash funds of approximately $265,000 USD denominated in the New Israeli Shekel. We did not hold any amounts of other foreign currencies.

Restricted Cash

The Company’s credit card processors regularly withhold deposits and maintain balances which the Company records as restricted cash. As of December 31, 2014 and 2013, the Company had $1.1 million and $1.3 million in restricted cash, respectively.

Accounts Receivable

Accounts receivable is primarily composed of credit card payments for subscription fees, less amounts withheld and presented as restricted cash, pending collection from the credit card processors and to a much smaller extent, receivables for advertising sales. The Company reviews its accounts receivable from advertisers on a monthly basis to determine if an allowance is necessary. An allowance was not necessary as of December 31, 2014 or 2013.

Prepaid Advertising Expenses

In certain circumstances, the Company pays in advance for advertising and expenses the prepaid amounts over the contract periods as the vendors deliver on their commitments. The Company evaluates the realization of prepaid amounts at each reporting period, and expenses prepaid amounts upon delivery of services or if it determines that a vendor will be unable to deliver on its commitment and is not willing or able to repay the undelivered prepaid amount.

Web Site and Software Development Costs

The Company capitalizes costs related to developing or obtaining internal-use software. Capitalization of costs begins after the preliminary project stage has been completed. Costs incurred in the preliminary project and post-implementation stages of an internal use software project are expensed as incurred and certain costs incurred in the application development stage of a project are capitalized into property and equipment.

The Company expenses costs related to the planning and post implementation phases of Web site development efforts. Direct costs incurred in the development phase are capitalized. Costs associated with minor enhancements and maintenance for a Web site are included in expenses in the accompanying Consolidated Statements of Operations And Comprehensive Loss.

Capitalized Web site and internal software development costs are recorded under property and equipment and amortized over the estimated useful life of the products, which is usually three years. The following table summarizes capitalized software development costs for the years ended December 31, (in thousands):

	2014			2013			2012
Beginning Balance	$	2,651		$	2,431		$	1,976
Capitalized		1,997			1,849			1,641
Expensed		(1,389	)		(1,364	)		(1,186	)
Impaired		(128	)		(265	)		—
Unamortized Balance	$	3,131		$	2,651		$	2,431

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation, which is provided using the straight-line method over the estimated useful life of the asset. Amortization of leasehold improvements is calculated using the straight-line method over the estimated useful life of the asset or remaining term of the lease, whichever is shorter. Useful lives for computer equipment, computer software, and furniture, fixtures and equipment is 3 years, and leasehold improvements have a useful life of 3-10 years. Upon the sale or retirement of property or equipment, the cost and related accumulated depreciation and amortization are removed from the Company’s Balance Sheet with the resulting gain or loss, if any, reflected in the Company’s Consolidated Statements of Operations and Comprehensive Loss.

Goodwill and Indefinite Lived Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired resulting from business acquisitions, specifically allocated to reporting units. Intangible assets resulting from the acquisitions of entities are recorded using the acquisition method of accounting and estimated by management based on the fair value of assets received. Identifiable intangible assets are comprised mainly of domain names and acquired technologies. Domain names were determined to have indefinite useful lives, thus, they are not amortized. Intangible assets with finite useful lives are amortized using the straight-line method over their estimated useful lives of 3 years. In addition to the recoverability assessment, management routinely reviews the remaining estimated useful lives of its amortizable intangible assets. If the Company reduces its estimate of the useful life assumption for any asset, the remaining unamortized balance would be amortized or depreciated over the revised estimated useful life. The Company determines its reporting units and operating segments through the use of the management approach. The management approach considers the internal organizational structure used by the Company’s chief operating decision maker for making operating decisions and assessing performance.

The Company reviews the potential of impairment of goodwill at least annually or more frequently if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable. Management has elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of its reporting units is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment. If management determines that it is more likely than not that its fair value of its reporting units is less than their respective carrying amount, then the two-step goodwill impairment test is performed. The first step, identifying a potential impairment, compares the fair value of the reporting unit with its carrying amount. If the carrying amount exceeds its fair value, the second step would need to be performed; otherwise, no further step is required. The second step, measuring the impairment loss, compares the implied fair value of the goodwill with the carrying amount of the goodwill. Any excess of the goodwill carrying amount over the applied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to the estimated fair value. Fair value is determined based on the present value of estimated expected future cash flows using a discount rate commensurate with the risk involved, quoted market prices or appraised values, depending on the nature of the assets. The valuation of goodwill and indefinite lived intangible assets incorporates significant Level 3 unobservable inputs and requires estimates, including the amount and timing of future cash flows. As of December 31, 2014, no impairment of goodwill or intangible assets had been identified. As of December 31, 2014 and 2013, the Company had unamortized goodwill of approximately $8.6 million and $9.3 million, respectively.

Impairment of Long-lived Assets

The Company assesses the impairment of assets, which include property and equipment and identifiable intangible assets, whenever events or changes in circumstances indicate that such assets might be impaired and the carrying value may not be recoverable. Events and circumstances that may indicate that an asset is impaired may include significant decreases in the market value of an asset or common stock, a significant decline in actual and projected revenue, a change in the extent or manner in which an asset is used, shifts in technology, loss of key management or personnel, changes in the Company’s operating model or strategy and competitive forces, as well as other factors.

If events and circumstances indicate that the carrying amount of an asset may not be recoverable and the expected undiscounted future cash flows attributable to the asset are less than the carrying amount of the asset, an impairment loss equal to the excess of the asset’s carrying value over its estimated fair value is recorded. Fair value is determined based on the present value of estimated expected future cash flows using a discount rate commensurate with the risk involved, quoted market prices or appraised values, depending on the nature of the assets. Fair value measurements utilized for assets under non-recurring measurements were measured with Level 3 unobservable inputs.

In 2014, the Company impaired capitalized software development costs of approximately $128,000 related to certain mobile projects and web-based products no longer in use. In 2013, the Company had an impairment expense of $265,000 representing the full unamortized balance of capitalized software development costs related to certain web-based products that failed to perform to Company standards. In 2012, no impairment charge was necessary.

Income Taxes

The Company accounts for income taxes under the asset and liability method. Accordingly, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred taxes to the amount expected to be realized.

In assessing the potential realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the Company’s tax loss carry-forwards remain deductible.

The Company operates in multiple taxing jurisdictions, both within the United States and outside the United States. The Company has filed tax returns with positions that may be challenged by Federal and State tax authorities. These positions relate to, among others, transfer pricing, the deductibility of certain expenses, intercompany transactions as well as other matters. Although the outcome of tax audits is uncertain, management regularly assesses its tax position for such matters and, in management’s opinion, adequate provisions for income taxes have been made for potential liabilities resulting from such matters. To the extent reserves are recorded, they will be utilized or reversed once the statute of limitations has expired and/or at the conclusion of the tax examination. The Company believes that the ultimate outcome of these matters will not have a material impact on its financial position or liquidity. The Company recognizes the tax effects from an uncertain tax position in our consolidated financial statements, only if the position is more-likely-than-not of being sustained on audit, based on the technical merits of the position. Tax positions that meet the recognition threshold are reported at the largest amount that is more-likely-than-not to be realized.

Cost of Revenue

Cost of revenue consists primarily of direct marketing costs, compensation and other employee-related costs (including stock-based compensation) for personnel dedicated to maintaining our data centers, data center expenses and credit card fees. Direct marketing costs are expensed in the period incurred and primarily represent online marketing, including payments to search engines and affiliates, and offline marketing, including radio, billboard, television and print advertising. For the years ended December 31, 2014, 2013 and 2012, the Company incurred direct marketing costs amounting to approximately $30.5 million, $52.1 million and $45.7 million, respectively.

Sales and Marketing

The Company’s sales and marketing expenses relate primarily to salaries for sales and marketing personnel and other associated costs such as business development, consulting, public relations and expenses related to the Company’s travel and events business.

Customer Service

The Company’s customer service expenses consist primarily of personnel costs associated with its customer service centers. The members of the Company’s customer service team primarily respond to billing questions, detect fraudulent activity and eliminate suspected fraudulent activity, as well as address site usage and dating questions from our members.

Technical Operations

The Company’s technical operations expenses consist primarily of the personnel and systems necessary to support its corporate technology requirements.

Development

The Company’s development expenses relate primarily to salaries and wages for personnel involved in the development, enhancement and maintenance of its Web sites and services.

General and Administrative

The Company’s general and administrative expenses relate primarily to salaries and wages for corporate personnel, professional fees, occupancy and other overhead costs.

Stock-based Compensation

Prior to 2005, the Company did not record tax benefits of deductions resulting from the exercise of share options due to the uncertainty surrounding the timing of realizing the benefits of its deferred tax assets in future tax returns. Cash flows resulting from tax benefits associated with tax deductions in excess of the compensation cost recognized for those options (excess tax benefits) is classified as cash flows from financing activities.

The following is a chart showing variables which were used in the Black-Scholes option-pricing model for the years of:

	2014		2013	2012
Expected life in years		4.56-4.75	4.56-4.75	4.27-5.77
Dividend per share		—	—	—
Volatility		40.0-41.0%	35.0-43.0%	35.0%
Risk-free interest rate		1.58-1.83%	1.0%	1.0-1.75%

The Company used historical and empirical data to assess different forfeiture rates for three different groups of employees. The Company must reassess forfeiture rates when deemed necessary and it must calibrate actual forfeiture behavior to what has already been recorded. For 2014, 2013 and 2012, there were three groups of employees whose behavior was significantly different from each other. Therefore, the Company estimated different forfeiture rates for each group.

The volatility rate was derived by examining historical stock price behavior and assessing management’s expectations of stock price behavior during the term of the option.

Due to the re-pricing of most options in 2009 and limited option exercise history, the Company is using the “simplified method” calculation, to determine the term of the options. The “simplified method” calculation derives the term by averaging the vesting term with the contractual terms. Option awards to date have generally vested and been expensed in equal annual installments over a four-year period. The “simplified method” allows companies that do not have sufficient historical experience to provide a reasonable basis for an estimate to instead estimate the expected term of a "plain vanilla" option by averaging the time to vesting and the full term of the option. ("Plain vanilla" options are options with the following characteristics: (1) the options are granted at-the-money; (2) exercisability is conditional only upon performing service through the vesting date; (3) if an employee terminates service prior to vesting, the employee would forfeit the options; (4) if an employee terminates service after vesting, the employee would have a limited time to exercise the options (typically 30 to 90 days); and (5) the options are nontransferable and non-hedgeable.) The Company periodically evaluates the applicability of using the simplified method with respect to the characteristics noted above with respect to the Company’s options and will continue to do so as the business continues to evolve.

The risk free interest rates are based on U.S Treasury zero-coupon bonds with similar terms for the periods in which the options were granted.

Comprehensive Loss

Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. For the Company, comprehensive loss consists of its reported net loss and foreign currency translation adjustments, net of tax, for the years 2014, 2013 and 2012.

Fair Value of Financial Instruments

The Company’s financial instruments, including cash and cash equivalents, restricted cash, accounts receivable, prepaid expenses and other, accounts payable and accrued liabilities are carried at cost, which approximates their fair value due to the short-term maturity of these instruments.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss available to common stockholders by the weighted average number of shares of common stock outstanding. Diluted net loss per share is the same as basic net loss per share, as the inclusion of dilutive securities would be anti-dilutive.

	For the Year Ended December 31
	(in thousands except per share amounts)
	2014			2013			2012
Net Loss Per Common Share — Basic and Diluted
Net loss applicable to common stock	$	(1,127	)	$	(12,380	)	$	(14,989	)
Weighted average shares outstanding- basic and diluted		24,064			22,795			20,781
Net Loss Per Share – Basic and Diluted	$	(0.05	)	$	(0.54	)	$	(0.72	)

Options to purchase 2.1 million, 3.0 million and 3.8 million shares for fiscal years 2014, 2013 and 2012, respectively, were not included in the computation of diluted net loss per share because the options were anti-dilutive.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Management estimates the amount of chargebacks that will occur in future periods to reduce current revenue. The Company’s revenue is collected through online credit card transactions. As such, the Company is subject to revenue reversals or “chargebacks” by consumers generally up to 90 days subsequent to the original sale date. The Company accrues chargebacks based on historical trends relative to sales levels by Web site. Fines are levied by the major credit card companies when chargeback expenses exceed certain thresholds. The Company estimates fines based on discussions with its merchant processing companies combined with standard fine schedules provided by the major credit card companies.

Recent Accounting Developments

In July 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists”. ASU No. 2013-11 provides that a liability related to an unrecognized tax benefit (“UTB”) should be offset against a deferred tax asset for a net operating loss carryforward, a similar tax loss or tax credit carryforward if such settlement is required or expected in the event that the UTB is disallowed. The Company adopted ASU No. 2013-11 on January 1, 2014. The effect of this adoption did not have a material impact on the Company’s consolidated financial position or results of operations.

In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360)—Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which includes amendments that change the requirements for reporting discontinued operations and require additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations that have, or will have, a major effect on the organization’s operations and financial results should be presented as discontinued operations. Additionally, ASU No. 2014-08 requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The amendments in ASU No. 2014-08 will be applied prospectively to annual periods beginning on or after December 15, 2014, and interim periods within those years, with early adoption permitted. The Company adopted ASU No. 2014-08 in the third quarter of 2014, which did not have a material impact on the Company’s interim or annual consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers. ASU No. 2014-09 provides for a single, principles-based model for revenue recognition that replaces the existing revenue recognition guidance. Under the new guidance, companies will be required to evaluate revenue recognition using a 5-step process. ASU No. 2014-09 is effective for annual and interim periods beginning on or after December 15, 2016 and will replace most existing revenue recognition guidance under U.S. GAAP when it becomes effective. It permits the use of either a retrospective or cumulative effect transition method and early adoption is not permitted. Management is currently assessing the impact the guidance will have upon adoption.

In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40) – Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which requires entities to evaluate their ability to continue as a going concern within one year after the date that the financial statements are issued. Disclosure is required if there is substantial doubt about an entity’s ability to continue as a going concern. The guidance in ASU No. 2014-15 is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter, with early application permitted. Management will evaluate the circumstances at the time of adoption for any additional disclosures.

Income Taxes

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Income Taxes

Note 2. Income Taxes

Loss before income taxes by jurisdiction:	Year Ended December 31,
(in thousands)	2014			2013			2012
U.S.	$	820		$	(11,597	)	$	(8,984	)
Foreign		(2,322	)		(288	)		42
	$	(1,502	)	$	(11,885	)	$	(8,942	)

Income tax expense:	Year Ended December 31,
(in thousands)	2014			2013			2012
Current
Federal	$	(395	)	$	2		$	(22	)
State		(129	)		100			143
Foreign		46			49			45
		(478	)		151			166
Deferred
Federal		846			(3,803	)		(3,121	)
State		131			(552	)		95
Foreign		(615	)		(25	)		5
		362			(4,380	)		(3,021	)
Change in valuation allowance		(259	)		4,724			8,902
	$	(375	)	$	495		$	6,047

Reconciliation of effective income tax rate:	Year Ended December 31,
	2014			2013			2012
Benefit on loss at federal statutory rate		(34.0	)%		(34.0	)%		(34.0	)%
State tax (benefit) provision, net of federal (benefit) provision		0.7			(0.8	)		(1.1	)
Nondeductible stock compensation		11.5			(0.3	)		—
Nondeductible expenses		0.3			—			—
Tax reserves		(0.6	)		0.5			2.2
Change in effective tax rates		(0.1	)		0.8			1.7
Foreign tax rate differential		14.5			0.3			0.3
Valuation allowance		(17.3	)		39.7			100.0
Other		—			(2.0	)		(1.1	)
Total provision for income taxes		(25.0	) %		4.2	%		68.0	%

With respect to the income of its foreign subsidiary, the Company takes the position that the earnings of the foreign subsidiary are permanently invested in that jurisdiction. As of the December 31, 2014, there are no earnings in our foreign subsidiary to repatriate.

The components of the deferred income tax asset (liability) for the periods presented are as follows:


(in thousands)	2014			2013
Deferred income tax assets
Net operating loss carry-forward	$	10,414		$	10,253
Depreciation and amortization		681			905
Compensation accruals		1,165			1,655
Credits		893			892
Other		864			840
Total before valuation allowance		14,016			14,545
Less: Valuation allowance		(13,939	)		(14,368	)
Total deferred income tax assets		78			177
Deferred income tax liabilities
Foreign intangible assets		(1,596	)		(1,772	)
Other		(507	)		(517	)
Total deferred income tax liabilities		(2,103	)		(2,289	)
Total net deferred income tax	$	(2,025	)	$	(2,112	)

As of December 31, 2014, the Company has a valuation allowance against its deferred tax assets of approximately $13.9 million. Companies are required to assess whether a valuation allowance should be recorded against their deferred tax assets (“DTAs”) based on the consideration of all available evidence, using a “more likely than not” realization standard. In accordance with ASC 740, cumulative losses in recent years, which the Company defines as the most recent three year period, is considered significant negative evidence in evaluating the realizability of DTAs, that is difficult to overcome. In light of the Company’s recent history of losses, it is not able to conclude that it is more likely than not that its DTAs will be realized and it recorded a valuation allowance against its DTAs, with a corresponding (benefit) charge to the income tax provision, of approximately $(0.3) million as of December 31, 2014.

At December 31, 2014, the Company has gross net operating loss carry-forwards for income tax purposes of approximately $35.2 million and $46.1 million available to reduce future federal and state taxable income, respectively, which expire beginning in the years 2020 for federal purposes and 2018 for state purposes. Under Section 382 of the Internal Revenue Code, the utilization of the net operating loss carry-forwards may be limited based on changes in the ownership of the Company.

At December 31, 2014, the Company also has net operating loss carryovers for Israeli tax purposes of approximately $5.8 million which do not expire.

At December 31, 2014, the Company has federal income tax credit carry-forwards for income tax purposes of approximately $0.9 million available to reduce future federal income tax which do not expire.

The Company recognizes excess tax benefits associated with the exercise of stock options directly to stockholders’ equity only when realized. Accordingly, deferred tax assets are not recognized for net operating losses resulting from excess tax benefits. As of December 31, 2014, deferred tax assets do not include approximately $5.3 million of these excess tax benefits from employee stock option exercises that are a component of the Company’s net operating loss carry forwards. Accordingly, additional paid-in-capital will be increased up to an additional $5.3 million if and when such excess tax benefits are realized. However, to the extent additional paid-in capital has been recognized for qualifying excess tax deductions from previous share-based payments, the write-off of the deferred tax asset when the tax deduction is less than recognized compensation cost is charged to additional paid-in capital, with any remainder charged to provision for income taxes. During 2014, $0 related to excess tax benefits were realized.

The following table summarizes the activity related to the Company’s unrecognized tax positions as of December 31,:

(in thousands)	2014		2013
Balance at beginning of year	$	1,225	$	1,225
Additions for tax positions of prior years		—		—
Reductions for tax positions of prior years		—		—
Balance at end of year	$	1,225	$	1,225

Included in the unrecognized tax benefits of $1.2 million at December 31, 2014 was $1.0 million of tax, which if recognized, would reduce the Company’s annual effective tax rate.

The Company’s policy is to recognize interest and penalties that would be assessed in relation to the settlement value of unrecognized tax benefits as a component of income tax (benefit) provision.

As of December 31, 2014 and 2013, the Company had recorded a $293,000 and $305,000 accrual for interest and penalties on unrecognized tax benefits, respectively. Interest expense (income) other, net of $(13,000), $89,000 and $51,000 were recognized in the years ended December 31, 2014, 2013 and 2012, respectively. It is reasonably possible that the unrecognized tax benefits decreases by approximately $594,000 over the next 12 months.

The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax in multiple state and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal income tax examinations for years before 2011; state and local income tax examinations before 2010; and foreign income tax examinations before 2010. However, to the extent allowed by law, the tax authorities may have the right to examine prior periods where net operating losses were generated and carried forward, and make adjustments up to the amount of the net operating loss carry forward amount.

Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2014

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Note 4. Goodwill and Other Intangible Assets

Goodwill

Goodwill as of December 31, 2014 and 2013 is related to the purchase of Pointmatch in January 2004, MingleMatch, Inc. in May 2005, and LDSSingles in May 2006. Jewish Networks, Christian Networks and Other Networks are the reporting units with goodwill balances. Jewish Networks goodwill balance at December 31, 2014 and 2013 was $6.7 million and $7.4 million, respectively. Christian Networks goodwill balance at December 31, 2014 and 2013 was $1.7 million. Other Networks goodwill balance at December 31, 2014 and 2013 was $232,000. The following table shows the activity and balances related to goodwill from January 1, 2013 to December 31, 2014:

(in thousands)	Gross Goodwill			Accumulated Impairments			Net Goodwill
Balance at January 1, 2013		22,595			(13,734	)		8,861
Foreign currency translation adjustments		444	⁽¹⁾		—			444	⁽¹⁾
Balance at December 31, 2013	$	23,039		$	(13,734	)	$	9,305
Foreign currency translation adjustments		(730	)⁽¹⁾		—			(730	)⁽¹⁾
Balance at December 31, 2014	$	22,309		$	(13,734	)	$	8,575

(1)	Foreign currency translation adjustments related to the Jewish Networks reporting unit.

In 2014, the Company performed its annual impairment analysis utilizing a quantitative assessment. The fair value of the reporting units was estimated based on the market approach and income approach. The income approach relies upon discounted future cash flows which are derived from various assumptions including: projected cash flows, discount rates, projected long-term growth rates and terminal values. The Company used a discount rate which reflects the risks and uncertainty related to each reporting unit. The market approach uses the guideline public companies method, where value is estimated by comparing the Company to similar companies with publicly traded ownership interests. The analysis concluded that the estimated reporting units’ fair values exceeded their carrying values. At the conclusion of the analysis, it was determined that impairment was not warranted.

In 2013 and 2012, the Company performed its annual impairment analysis utilizing the qualitative assessment option. Qualitative factors were assessed to determine whether it was necessary to perform the two-step test (quantitative assessment). The analysis concluded that it is more-likely-than-not that the fair values of the Jewish Networks, Christian Networks and Other Networks exceeded their carrying values. At the conclusion of the analysis, it was determined that impairment was not warranted for either year.

Other Intangibles

Finite-lived intangible assets consist of purchased technologies and non-compete agreements which are amortized over their expected periods of benefits (ranging from three to five years). Indefinite-lived intangible assets, consist of purchased domain names and are not amortized. Other intangible assets consist of the following:

	As of December 31, 2014					As of December 31, 2013
(in thousands)	Gross Amount		Accumulated Amortization			Gross Amount		Accumulated Amortization
Purchased technologies	$	1,200	$	(1,200	)	$	1,200	$	(1,200	)
Non-compete		120		(60	)		120		(20	)
Domain names		2,409		—			2,169		—
	$	3,729	$	(1,260	)	$	3,489	$	(1,220	)

Amortization expense for finite-lived intangible assets for the years ended December 31, 2014 and 2013 was $40,000 and $20,000, respectively. In 2014 and 2013, no impairment charge was necessary.

At December 31, 2014, amortization of intangible assets with definite lives for each of the two years and thereafter is estimated to be as follows:

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

Stockholders' Equity

12 Months Ended

Dec. 31, 2014

Equity [Abstract]

Stockholders' Equity

Note 8. Stockholders’ Equity

On December 12, 2013, the Company’s Board of Directors authorized the repurchase of up to $5.0 million of the Company’s common stock. The repurchases may be made from time to time in the open market, in privately negotiated transactions, or otherwise, including pursuant to a Rule 10b5-1 plan, at prices that the Company deems appropriate and subject to market conditions, applicable law, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended, and other factors deemed relevant in the Company’s sole discretion. The Company is not obligated to repurchase any dollar amount or any number of shares of common stock, and the program may be suspended, discontinued or modified at any time, for any reason and without notice.

During the three months ended March 31, 2014, the Company repurchased 271,117 shares of common stock at a weighted average price of $5.50. All stock repurchased has been retired.

On May 7, 2013, the Company issued 2,140,000 shares of its common stock at $6.25 per share in an underwritten public offering. The proceeds to the Company, net of $1.1 million of underwriting fees and offering expenses, were $12.3 million.

Employee Stock Option Plans

On July 9, 2007, pursuant to the completion of the Scheme of Arrangement, the Company adopted the Spark Networks, Inc. 2007 Omnibus Incentive Plan (the “2007 Plan”) authorizing and reserving 2.5 million options. In connection with the Company’s Scheme of Arrangement, the 2004 Share Option Plan was frozen; however, all outstanding options previously granted thereunder continue in full force and effect.

Awards under the 2007 Plan may include incentive stock options, nonqualified stock options, stock appreciation rights (“SARs”), restricted shares of common stock, restricted stock units, performance stock or unit awards, other stock-based awards and cash-based incentive awards.

The Compensation Committee may grant an award to a participant. The terms and conditions of the award, including the quantity, price, vesting periods and other conditions on exercise will be determined by the Compensation Committee.

The exercise price for stock options will be determined by the Compensation Committee in its discretion, but may not be less than 100% of the closing sale price of one share of the Company’s common stock on the NYSE MKT (or any other applicable exchange on which the stock is listed) on the date when the stock option is granted. Additionally, in the case of incentive stock options granted to a holder of more than 10% of the total combined voting power of all classes of stock of the Company on the date of grant, the exercise price may not be less than 110% of the closing sale price of one share of common stock on the date the stock option is granted.

As of December 31, 2014, total unrecognized compensation cost related to non-vested stock options was $0.6 million. This cost is expected to be recognized over a weighted-average period of 3 years. The following table describes option activity for the years ended December 31, 2014, 2013 and 2012:

	Years Ended December 31,
	2014		2013		2012
Granted, weighted average fair value per share	$	1.82	$	2.28	$	2.02
Exercised, weighted average intrinsic value per share	$	1.73	$	4.55	$	2.89
Aggregate intrinsic value of options outstanding and exercisable (in thousands)	$	726	$	6,093	$	12,614

Information relating to outstanding stock options is as follows (in thousands, except Weighted Average Price per Share):

	Number of Shares			Weighted Average Price per Share
Outstanding at December 31, 2012		3,829		$	3.88
Granted		152			7.32
Exercised		(951	)		3.30
Expired		(5	)		3.00
Forfeited		(73	)		7.63
Outstanding at December 31, 2013		2,952		$	4.19
Granted		490			4.97
Exercised		(759	)		3.16
Expired		(5	)		3.91
Forfeited		(532	)		6.04
Outstanding at December 31, 2014		2,146		$	4.30

Option Range Summary

As of December 31, 2014

	Options Outstanding						Options Exercisable
Range of Exercise Prices	Number of Shares		Weighted Average Remaining Life		Weighted Average Exercise Price		Number of Shares		Weighted Average Remaining Life		Weighted Average Exercise Price
$4.62 - $10.00		646		4.75	$	7.00		335		3.33	$	8.23
$3.10 - $4.61		605		1.72	$	3.35		554		1.24	$	3.33
$2.18 - $3.09		895		0.83	$	2.99		895		0.83	$	2.99
		2,146		2.26	$	4.30		1,784		1.43	$	4.08

Options granted prior to 2006, were priced in foreign currency, weighted average price per share calculations are impacted by foreign currency exchange fluctuations.

Restricted Stock Awards

Restricted shares awarded under the 2007 Plan entitle the shareholder the right to vote the restricted shares, the right to receive and retain cash dividends paid or distributed in respect of the restricted shares, and all other rights as a holder of outstanding shares of the Company’s common stock. The restriction period is determined by the Compensation Committee of the Board of Directors. In 2014, restricted stock awards have generally been granted with vesting periods of up to two years. Subject to employment agreements entered into with senior executives, all unvested restricted shares may be forfeited if the recipient of the restricted stock award no longer provides services, as defined, to the Company.

Non-vested performance-based awards

During the year ended December 31, 2014, we awarded performance-based restricted stock to an executive officer that generally vest over a period of two years. In order for these performance awards to vest, certain objectives and conditions must be met. Upon achieving the performance condition, the non-vested performance awards partially vest on the first anniversary as defined in the executive’s employment agreement and the remainder on the second anniversary as defined in the executive’s employment for a combined period of two years. The executive does not need to remain employed with the Company for the awards to vest.

The Company recognizes share-based compensation on a graded basis as the restricted stock is contingent on the achievement of performance metrics.

The following table summarizes the Company’s performance-based restricted stock activities for the year ended December 31, 2014 (in thousands, except Weighted Average Price per Share):

	Number of Shares			Weighted Average Price per Share		Aggregate Intrinsic Value
Prior year awards		—		$	—

Awards granted in 2014
Granted, at maximum		125		$	5.23
Vested		(30	)		5.41
Performance forfeited		—			—
Service forfeited		—			—
Total non-vested at December 31, 2014		95		$	5.17	$ 341

As of December 31, 2014, there was $149,000 of unrecognized compensation cost related to unvested restricted stock awards. The amount is expected to be recognized over a weighted-average period of 2 years.

Re-Pricing of Employees Options

In 2009, the Company offered to re-price options for certain employees. These employees could surrender their existing options in exchange for a like number of options with a new grant date, a lower exercise price, a lower number of vested options and a modified vesting schedule. The exchange of options was treated as a synthetic re-pricing, which includes a cancellation and replacement of equity instruments. The incremental expense was approximately $1.0 million and is being recognized over the four year vesting term of the newly issued options. The incremental expenses recognized for the years ended December 31, 2014, 2013 and 2012 were $0, $0 and $172,000, respectively.

Stockholder Rights Plan

In July 2007, the Company adopted a stockholder rights plan. The rights accompany each share of common stock of the Company and are evidenced by ownership of common stock. The rights are not exercisable except upon the occurrence of certain takeover-related events. Once triggered, the rights would entitle the stockholders, other than a person qualifying as an “Acquiring Person” pursuant to the rights plan, to purchase additional common stock at a 50% discount to their fair market value. The rights issued under the Rights Plan may be redeemed by the board of directors at a nominal redemption price of $0.001 per right, and the board of directors may amend the rights in any respect until the rights are triggered.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(d),(e))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB TOPIC 4.E)
-URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74512-122707

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.29-31)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 4
-Subparagraph (SAB TOPIC 4.C)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187143-122770

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 30
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph d
-Article 4

Reference 15: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 29, 30, 31
-Article 5

Reference 16: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section E

Reference 17: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Article 4

Reference 18: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section C

Reference 19: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 04
-Article 3

+ Details

Segment Information

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Segment Information

Note 10. Segment Information

Segment reporting requires the use of the management approach in determining the reportable operating segments. The management approach considers the internal organization and reporting used by our chief operating decision maker for making operating decisions and assessing performance. The Company’s financial reporting includes detailed data on four separate reportable segments. The Company’s four operating segments are: (1) Jewish Networks, which consists of JDate.com, JDate.co.uk, JDate.fr, JDate.co.il, Cupid.co.il, and their respective co-branded Web sites; (2) Christian Networks, which now consists of ChristianMingle.com, ChristianMingle.co.uk, ChristianMingle.com.au, Believe.com, ChristianCards.net, DailyBibleVerse.com and Faith.com; (3) Other Networks, which consists of Spark.com and related other general market Web sites as well as other properties which are primarily composed of sites targeted towards various religious, ethnic, geographic and special interest groups; and (4) Offline & Other Businesses, which consists of revenue generated from offline activities and HurryDate events and subscriptions. It should be noted that the Company is winding down HurryDate operations as of the fourth quarter of 2014.

	Years Ended December 31
(in thousands)	2014		2013			2012
Revenue
Jewish Networks	$	23,245	$	25,789		$	26,034
Christian Networks		35,875		40,245			31,574
Other Networks		2,217		2,972			3,765
Offline and Other Businesses		308		403			370
Total Revenue	$	61,645	$	69,409		$	61,743
Direct Marketing Expenses
Jewish Networks	$	3,120	$	3,340		$	3,111
Christian Networks		26,795		48,016			41,400
Other Networks		480		595			977
Offline and Other Businesses		76		123			165
Total Direct Marketing Expenses	$	30,471	$	52,074		$	45,653
Unallocated Operating Expense		32,112		29,449			25,270
Operating Loss	$	(938)	$	(12,114	)	$	(9,180	)

Due to the Company’s integrated business structure, cost and expenses, other than direct marketing expenses, are not allocated to the individual reporting segments. As such, the Company does not measure operating profit or loss by segment for internal reporting purposes. Assets are not allocated to the different business segments for internal reporting purposes.

The Company operates several international Web sites; however, many of them are operated and managed by the Company’s U.S. operations. Foreign revenue represents sales generated outside the U.S. where the Company has its principal operations. Revenue and identifiable long-lived assets (excluding deferred tax assets, goodwill and intangibles) by geographical area are as follows:

	Years Ended December 31
(in thousands)	2014		2013		2012
Revenue
United States	$	58,296	$	65,354	$	57,734
Israel		3,349		4,055		4,009
Total Revenue	$	61,645	$	69,409	$	61,743

	As of December 31,
	2014		2013
Long-Lived Assets
United States	$	4,153	$	3,961
Israel		153		148
Total Long-Lived Assets	$	4,306	$	4,109

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 33
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 26
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 35
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 29
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599

+ Details

Commitments and Contingencies

12 Months Ended

Dec. 31, 2014

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 11. Commitments and Contingencies

Operating Leases

The Company leases its office and data center facilities under operating lease agreements, providing for annual minimum lease payments as follows:

Year Ending December 31, (in thousands)
2015	$	788
2016		777
2017		722
2018		514
Total	$	2,801

On February 1, 2013, the Company entered into an office lease for its Los Angeles location, which expires on October 31, 2018. The Company relocated to the new office space during the second quarter of 2013.

Rental expense under non-cancelable operating leases with scheduled rent increases or free rent is accounted for on a straight-line basis over the lease term. Leasehold improvement incentives are recorded as deferred credits and are amortized on a straight-line basis as a reduction of rent expense over the lease term.

The Company recognized rent expense under operating leases of $0.9 million, $0.8 million and $1.0 million for the years ended December 31, 2014, 2013 and 2012, respectively.

Other Commitments and Obligations

The Company has other non-cancelable commitments and obligations consisting of contracts with software licensing, communications and marketing service providers. These amounts totaled $338,000 for less than one year and $0 between one and three years. Contracts with other service providers are for terms less than one year.

Year Ending December 31, (in thousands)
2015	$	338
2016		—
2017		—
Total	$	338

Legal Proceedings

ISYSTEMS v. Spark Networks, Inc. et al.

On July 11, 2008, ISystems initiated a lawsuit against Spark Networks, Inc. and Spark Networks Limited (collectively, “Spark Networks”) and other parties in the United States District Court, Northern District of Texas, Dallas Division. The lawsuit was filed in response to an arbitration award ordering the transfer of the domain name, JDATE.NET, to Spark Networks Limited from ISystems. Spark Networks was apprised of the lawsuit after ISystems unsuccessfully attempted to utilize the filing of the lawsuit to prevent the domain transfer to Spark Networks Limited. On September 4, 2012, Spark Networks filed its Answer to the Complaint. On January 22, 2014, the Court entered an Amended Scheduling Order continuing the commencement of the trial to July 21, 2014. The matter was tried before the Honorable David C. Godbey from July 21-22, 2014. On September 19, 2014, the Court issued a Final Judgment in favor of Spark Networks and that ISystems takes nothing by its claims which were dismissed with prejudice. On October 17, 2014, ISystems filed a Motion for a New Trial. By written order dated January 13, 2015, the Court denied ISystems’ Motion for a New Trial. On February 12, 2015, ISystems filed a Notice of Appeal for the Court’s Judgment in favor of Spark Networks.

Kirby, et al. v. Spark Networks USA, LLC

On October 16, 2012, Kristina Kirby, Christopher Wagner and Jamie Carper (collectively referred to as “Plaintiffs”), on behalf of themselves and all others similarly situated, filed a putative class action Complaint in the Superior Court for the State of California, County of Los Angeles alleging claims against Spark Networks USA, LLC for violations of California Business & Professions Code section 17529.5. Plaintiffs allege that certain e-mail communications advertising websites of Spark Networks USA, LLC and received by Plaintiffs violate a California statute prohibiting false and deceptive e-mail communications (namely, California Business & Professions Code section 17529.5). Plaintiffs generally allege that they seek damages in excess of 25,000. The e-mail publishers responsible for distributing the e-mails at issue in this litigation have agreed to furnish a complete defense to Spark, through counsel at their own expense, pursuant to contractual indemnification provisions. The parties reached a settlement to resolve the action on a classwide basis and the settlement agreement includes a full release of Spark and the publishers. The parties filed the necessary approval paperwork with the court, which granted final to the settlement on February 24, 2015. The court entered final judgment on March 2, 2015 regarding all claims pursuant to its final approval order.

Adconion v. Spark Networks USA, LLC

On December 18, 2013, Adconion Direct, Inc. (“Adconion”) filed a breach of contract lawsuit in the Superior Court of California of Los Angeles. Adconion alleges that it is a successor-in-interest to Frontline Direct Inc., with which Spark contracted for the placement of online advertisements. Adconion contends that it has performed all of its obligations pursuant to this contract, and that Spark failed to pay the January and February 2013 invoices, which total $437,729. Spark filed an answer to the complaint on February 3, 2014 along with a cross-complaint against Adconion for breach of contract, breach of the implied covenant of good faith and fair dealing, express contractual indemnity, fraudulent concealment and negligent interference with prospective economic advantage. The parties agreed to a confidential settlement to resolve their dispute for an amount less than the past due invoices, and the case (including all claims and cross-claims) was dismissed in its entirety on May 23, 2014.

Werner, et al. v. Spark Networks, Inc. and Spark Networks USA, LLC and Wright, et al. v. Spark Networks, Inc., Spark Networks USA, LLC, et al.

On July 19, 2013, Aaron Werner, on behalf of himself and all other similarly situated individuals, filed a putative Class Action Complaint (the “Werner Complaint”) in the Superior Court for the State of California, County of Los Angeles against Spark Networks, Inc. and Spark Networks USA, LLC (collectively “Spark Networks”). The Werner Complaint alleges that Spark Networks’ website ChristianMingle.com violates California’s Unruh Civil Rights Act (the “Unruh Act”) by allegedly discriminating on the basis of sexual orientation. The Werner Complaint requests the following relief: an injunction, statutory, general, compensatory, treble and punitive damages, attorneys’ fees and costs, pre-judgment interest, and an award for any other relief the Court deems just and appropriate. On December 23, 2013, Richard Wright, on behalf of himself and all other similarly situated individuals, filed a putative Class Action Complaint (the “Wright Complaint”) in the Superior Court for the State of California, County of San Francisco against Spark Networks, Inc. The Wright Complaint alleges that Spark Networks’ commercial dating services including ChristianMingle.com, LDSSingles.com, CatholicMingle.com, BlackSingles.com, MilitarySinglesConnection.com and AdventistSinglesConnection.com violate the Unruh Act by allegedly intentionally and arbitrarily discriminating on the basis of sexual orientation. The Wright Complaint requests the following relief: a declaratory judgment, a preliminary and permanent injunction, statutory penalties, reasonable attorneys’ fees and costs, pre-judgment interest, and an award for any other relief the Court deems just and appropriate.

Jane LV Doe v. Spark Networks, Inc., Sean Patrick Banks, and DOES 1 through 100

On November 20, 2014, Plaintiff filed an unverified complaint against the Company and Sean Patrick Banks in the Los Angeles County Superior Court for the State of California alleging several causes of action pertaining to being stalked and harassed by defendant Sean Patrick Banks from December 2012 to February 2013. Plaintiff alleges that prior to when she actively joined the site, the Company had information that Defendant could have been a sexual predator and that the Company had a duty to investigate defendant Sean Patrick Banks and warn Plaintiff. As permitted under California procedure in response to an unverified complaint, Spark filed an answer in the form of a general denial on January 16, 2015. Trial is tentatively set for May 20, 2016.

Israeli Consumer Actions
Ben-Jacob vs. Spark Networks (Israel) Ltd. and Gever vs. Spark Networks (Israel) Ltd. and Korland vs. Spark Networks (Israel) Ltd.

Three class action law suits have been filed in Israel alleging violations of the Israel Consumer Protection Law of 1981. Spark was served with a Statement of Claim and a Motion to Certify it as a Class Action in the Ben-Jacob action on January 14, 2014. The plaintiff alleges that Spark Networks (Israel) Ltd. (“Spark Networks”) refused to cancel her subscription and provide a refund for unused periods and claims that such a refusal is in violation of the Consumer Protection Law. Spark Networks was served with a Statement of Claim and a motion to Certify it as a Class Action in the Gever action on January 21, 2014. The plaintiff alleges that Spark Networks renewed his one month subscription without receiving his positive agreement in advance and claims that such renewal is prohibited under the Consumer Protection Law. Spark Networks was served with a Statement of Claim and a Motion to Certify it as a Class Action in the Korland action on February 12, 2014. The plaintiff alleges that Spark Networks refused to give her a full refund and charged her the price of a one month subscription to the JDate website in violation of the Consumer Protection Law. In each of these three cases, the plaintiff is seeking personal damages and damages on behalf of a defined group. On May 8, 2014, the Court granted Spark Networks’ motion to consolidate all three cases. All three cases are now consolidated and will be litigated jointly. Spark Networks’ combined response to their motions to certify the classes was filed November 1, 2014 and the plaintiffs responded to the combined response. The parties had a hearing before the judge on December 24, 2014. Following the hearing the judge ordered that the pleadings filed by the parties be transferred to the Israel Consumer Council (“ICC”) so that the ICC can provide its position as to the parties allegations within 90 days.

Management strongly disputes the merits of the claims asserted against it in each of these lawsuits and shall vigorously defend against them.

The Company has additional existing legal claims and may encounter future legal claims in the normal course of business. In the Company’s opinion, the resolutions of the existing legal claims are not expected to have a material impact on its financial position or results of operations. The Company believes it has accrued appropriate amounts, where necessary, in connection with the above litigation.

Quarterly Results of Operations (unaudited)

12 Months Ended

Dec. 31, 2014

Quarterly Financial Information Disclosure [Abstract]

Quarterly Results of Operations (unaudited)

Note 13. Quarterly Results of Operations (unaudited)

The following tables present the Company’s quarterly results of operations and should be read in conjunction with the consolidated financial statements and related notes. The Company has prepared the unaudited information on substantially the same basis as our audited consolidated financial statements which, in the opinion of management, includes all adjustments, consisting only of normal recurring adjustments, except as otherwise indicated, necessary for the presentation of the results of operations for such periods. Operating results for any quarter are not necessarily indicative of results for any future quarters or for a full year.

	Three Months Ended
(in thousands, except per share amount)	Dec. 31, 2014		Sept.30, 2014			June 30, 2014			March 31, 2014		Dec.31, 2013		Sept.30, 2013		June 30, 2013		March 31, 2013
(in thousands, except per share amount)	Dec. 31, 2014		Sept.30, 2014			June 30, 2014			March 31, 2014		Dec.31, 2013		Sept.30, 2013		June 30, 2013		March 31, 2013
Consolidated Statement of Operations Data:
Revenue	$	14,264	$	15,008		$	15,757		$	16,616	$	17,204	$	17,361	$	17,581	$	17,263
Cost of revenue		6,087		7,004			8,866			12,364		13,911		13,620		14,770		13,657
Sales and marketing		828		1,368			1,369			1,562		1,629		1,423		1,287		1,262
Customer service		749		738			763			788		765		746		688		703
Technical operations		213		276			300			341		280		288		267		332
Development		801		886			900			859		799		746		793		791
General and administrative		1,828		4,446			4,069			2,957		2,790		2,496		2,274		2,934
Depreciation		495		518			523			517		533		529		472		453
Amortization		10		10			10			10		10		10		—		—
Impairment of goodwill and other assets		25		103			—			—		—		—		265		—
Total cost and expenses		11,036		15,349			16,800			19,398		20,717		19,858		20,816		20,132
Income (loss) from operations		3,228		(341	)		(1,043	)		(2,782

Income on Possession of Assets	12 Months Ended
Income on Possession of Assets	Dec. 31, 2014
Income On Possession Of Assets [Abstract]
Income on Possession of Assets	Note 6. Income on Possession of Assets In 2011, the Company became the record title owner of real property purchased in a sheriff’s sale to partially satisfy the Company’s outstanding judgment against Will Knedlik. On June 15, 2012, the Company sold the real property. Based upon the net proceeds of the transaction, the Company realized a total gain of $398,000, with $247,000 of the gain being recognized in 2011 and $151,000 upon the sale of the real property in 2012.

Revolving Credit Facility	12 Months Ended
Revolving Credit Facility	Dec. 31, 2014
Debt Disclosure [Abstract]
Revolving Credit Facility	Note 7. Revolving Credit Facility The Company and its wholly-owned subsidiary, Spark Networks USA, LLC, have a $15.0 million revolving credit facility with Bank of America, which was entered into on February 14, 2008 with subsequent amendments (the “Credit Agreement”). The Credit Agreement matures on March 14, 2016. The per annum interest rate under the Credit Agreement is LIBOR, or the Eurodollar Rate (as defined in the Credit Agreement) under certain circumstances, plus 2.00%. In the event the Company elects to borrow under a base rate loan, the interest rate is increased to the prime rate plus 1.00%. The Company pays a 0.25% per annum commitment fee on all funds not utilized under the facility, measured on a daily basis. The Credit Agreement contains financial covenants regarding the requirement to maintain a minimum consolidated adjusted EBITDA, minimum consolidated net liquidity and maximum capital expenditures during different periods. The Credit Agreement also contains covenants regarding Jewish Networks minimum contribution and the Company’s ability to repurchase or redeem equity interests or issue dividends up to a specified amount, as well as other covenants, with exceptions, including restrictions on debt, liens, and investments. A default could cause any outstanding amounts to become immediately due and payable and prohibit the Company from obtaining further credit under the Credit Agreement. On February 13, 2014, the parties executed a Sixth Amendment to the Credit Agreement (the “Sixth Amendment”) changing the maturity date from February 14, 2014 to March 14, 2014. On March 11, 2014, the parties executed a Seventh Amendment to the Credit Agreement (the “Seventh Amendment”). The Seventh Amendment, among other things, changed the maturity date to March 14, 2016 and updated the financial covenants regarding the requirement to maintain a minimum consolidated adjusted EBITDA and minimum consolidated revenue during different periods. On July 2, 2014, there was a change in the majority of the members of the Company’s Board of Directors. Under the terms of the Credit Agreement, a change in the majority of the Company’s Board, constitutes a change in control, which is one of the enumerated events of default under the Credit Agreement. On July 15, 2014, the parties executed a Consent Agreement, pursuant to which the lenders consented to the changes in the Board. On January 28, 2015, the Company executed an Eighth Amendment to the Credit Agreement (the “Eighth Amendment”). Under the Eighth Amendment, for each quarter ending December 31, 2014, March 31, 2015, June 30, 2015 and September 30, 2015, the minimum consolidated adjusted EBITDA for each six month period shall not be less than $3.3 million, $3.8 million, $2.2 million and $2.3 million, respectively. For the quarter ending December 31, 2015 and each fiscal quarter ending thereafter, the minimum consolidated adjusted EBITDA for each six month period shall not be less than $1.8 million. The Eighth Amendment also imposes limitations on capital expenditures in the ordinary course of business not exceeding $3.0 million during each fiscal year, subject to certain exceptions; provided, that for fiscal 2015, the capital expenditure limitation shall be $3.5 million. The Eighth Amendment also provides that the Jewish Networks minimum contribution for each period of four consecutive fiscal quarters ending on the last day of each fiscal quarter shall not be less than $16 million. The Company was compliant with the Credit Agreement’s customary affirmative and negative covenants, as of December 31, 2014. As of December 31, 2014, there was no outstanding amount under the Credit Agreement. In connection with the original Credit Agreement and the first seven amendments thereto, the Company paid deferred financing costs of approximately $446,000 and $133,000, respectively. Costs associated with both the original Credit Agreement and the first seven amendments thereto were included in prepaid expenses and other, and other assets. The deferred financing costs are amortized to interest expense (income) other, net and in the Consolidated Statements of Operations and Comprehensive Loss over the full term of the Credit Agreement. Amortization expense for the deferred financing costs for the years ended December 31, 2014 and December 31, 2013 were $12,000 and $35,000, respectively. The unamortized balance of deferred financing costs was $13,000 and $3,000 at December 31, 2014 and 2013, respectively.

Employee Benefit Plan	12 Months Ended
Employee Benefit Plan	Dec. 31, 2014
Text Block [Abstract]
Employee Benefit Plan	Note 9. Employee Benefit Plan The Company has a defined contribution plan under Section 401(k) of the Internal Revenue Code covering all full-time employees, and providing for matching contributions by the Company, as defined in the plan. Participants in the plan may direct the investment of their personal accounts to a choice of mutual funds consisting of various portfolios of stocks, bonds or cash instruments. Contributions made by the Company to the plan for the years ended December 31, 2014, 2013 and 2012 were approximately $394,000, $378,000 and $349,000, respectively.

Related Party Transactions	12 Months Ended
Related Party Transactions	Dec. 31, 2014
Related Party Transactions [Abstract]
Related Party Transactions	Note 12. Related Party Transactions During the three months ended September 30, 2014, the Company reimbursed Osmium Partners, LLC and 402 Capital, LLC and paid certain of its vendors for costs incurred in connection with a proxy contest to take control over the Company’s Board of Directors in an amount totaling approximately $509,000. In January 2012, the Company entered into an agreement with Ultra Unlimited Corp., a software development firm, to develop and initially operate a Web site for the Company and to provide the Company with certain software. The Chief Executive Officer of Ultra Unlimited Corp. is the brother of Michael Kumin, a former director of the Company. Michael Kumin and Jonathan Bulkeley, also a director of the Company, have informed the Company that they are individual investors in Ultra Unlimited Corp. The Company paid Ultra Unlimited Corp. $0 and $18,000 for services rendered in 2014 and 2013, respectively.