GODADDY INC., 10-Q filed on 11/5/2015
Quarterly Report
Document and Entity Information Document
9 Months Ended
Sep. 30, 2015
Oct. 30, 2015
Class A Common Stock
Oct. 30, 2015
Class B Common Stock
Document Information [Line Items]
 
 
 
Entity Registrant Name
GoDaddy Inc. 
 
 
Entity Central Index Key
0001609711 
 
 
Current Fiscal Year End Date
--12-31 
 
 
Entity Filer Category
Non-accelerated Filer 
 
 
Document Type
10-Q 
 
 
Document Period End Date
Sep. 30, 2015 
 
 
Document Fiscal Year Focus
2015 
 
 
Document Fiscal Period Focus
Q3 
 
 
Amendment Flag
false 
 
 
Entity Common Stock, Shares Outstanding
 
65,508,572 
90,398,474 
Condensed Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Current assets:
 
 
Cash and cash equivalents
$ 327.7 
$ 139.0 
Short-term investments
5.4 
3.0 
Accounts and other receivables
6.2 
3.5 
Registry deposits
21.2 
17.8 
Prepaid domain name registry fees
295.2 
272.8 
Prepaid expenses and other current assets
28.0 
24.8 
Total current assets
683.7 
460.9 
Property and equipment, net
221.5 
220.9 
Prepaid domain name registry fees, net of current portion
162.9 
152.8 
Goodwill
1,662.3 
1,661.2 
Intangible assets, net
728.2 
749.7 
Other assets
11.5 
19.3 
Total assets
3,470.1 
3,264.8 
Current liabilities:
 
 
Accounts payable
28.9 
31.9 
Accrued expenses
142.8 
114.5 
Current portion of payable to related parties pursuant to tax receivable agreements
3.0 
0 
Current portion of deferred revenue
934.0 
821.4 
Current portion of long-term debt
4.8 
5.0 
Total current liabilities
1,113.5 
972.8 
Deferred revenue, net of current portion
478.5 
429.2 
Long-term debt, net of current portion
1,043.2 
1,413.9 
Payable to related parties pursuant to tax receivable agreements, net of current portion
167.9 
0 
Other long-term liabilities
35.8 
38.5 
Commitments and contingencies
   
   
Stockholders'/members' equity:
 
 
Members' interest
0 
410.4 
Preferred stock, $0.001 par value - 50,000 shares authorized; none issued and outstanding
0 
0 
Additional paid-in capital
395.0 
0 
Accumulated other comprehensive income
0.9 
0 
Accumulated deficit
(32.3)
0 
Total stockholders' equity attributable to GoDaddy Inc./members' equity
363.8 
410.4 
Non-controlling interests
267.4 
0 
Total stockholders'/members’ equity
631.2 
410.4 
Total liabilities and stockholders'/members’ equity
3,470.1 
3,264.8 
Class A Common Stock
 
 
Stockholders'/members' equity:
 
 
Common stock
0.1 
0 
Class B Common Stock
 
 
Stockholders'/members' equity:
 
 
Common stock
$ 0.1 
$ 0 
Condensed Consolidated Balance Sheets Parenthetical (USD $)
Sep. 30, 2015
Preferred stock par value (in dollars per share)
$ 0.001 
Preferred stock shares authorized (in shares)
50,000,000 
Preferred stock shares issued (in shares)
0 
Preferred stock outstanding (in shares)
0 
Common stock outstanding (in shares)
155,661,000 
Class A Common Stock
 
Par value (in dollars per share)
$ 0.001 
Common stock shares authorized (in shares)
1,000,000,000 
Common stock shares issued (in shares)
65,263,000 
Common stock outstanding (in shares)
65,263,000 
Class B Common Stock
 
Par value (in dollars per share)
$ 0.001 
Common stock shares authorized (in shares)
500,000,000 
Common stock shares issued (in shares)
90,398,000 
Common stock outstanding (in shares)
90,398,000 
Condensed Consolidated Statements of Operations (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Technology and development
Sep. 30, 2014
Technology and development
Sep. 30, 2015
Technology and development
Sep. 30, 2014
Technology and development
Sep. 30, 2015
Marketing and advertising
Sep. 30, 2014
Marketing and advertising
Sep. 30, 2015
Marketing and advertising
Sep. 30, 2014
Marketing and advertising
Sep. 30, 2015
Customer care
Sep. 30, 2014
Customer care
Sep. 30, 2015
Customer care
Sep. 30, 2014
Customer care
Sep. 30, 2015
General and administrative
Sep. 30, 2014
General and administrative
Sep. 30, 2015
General and administrative
Sep. 30, 2014
General and administrative
Sep. 30, 2015
Domains
Sep. 30, 2014
Domains
Sep. 30, 2015
Domains
Sep. 30, 2014
Domains
Sep. 30, 2015
Hosting and presence
Sep. 30, 2014
Hosting and presence
Sep. 30, 2015
Hosting and presence
Sep. 30, 2014
Hosting and presence
Sep. 30, 2015
Business applications
Sep. 30, 2014
Business applications
Sep. 30, 2015
Business applications
Sep. 30, 2014
Business applications
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 411.1 
$ 356.9 
$ 1,181.9 
$ 1,015.6 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 215.0 
$ 194.6 
$ 622.7 
$ 564.1 
$ 150.8 
$ 131.5 
$ 436.5 
$ 369.9 
$ 45.3 
$ 30.8 
$ 122.7 
$ 81.6 
Costs and operating expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of revenue (excluding depreciation and amortization)
144.0 1
131.7 1
420.9 1
384.6 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Technology and development
67.5 1
62.4 1
202.8 1
187.4 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marketing and advertising
49.3 1
40.2 1
150.8 1
121.7 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Customer care
54.8 1
48.9 1
167.2 1
140.6 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
General and administrative
44.6 1
41.8 1
167.6 1
127.5 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
40.6 1
38.5 1
116.4 1
113.0 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total costs and operating expenses
400.8 
363.5 
1,225.7 
1,074.8 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating income (loss)
10.3 
(6.6)
(43.8)
(59.2)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense
(14.6)
(23.1)
(54.7)
(61.3)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss on debt extinguishment
0 
0 
(21.4)
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other income (expense), net
0 
1.1 
0.7 
1.0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss before income taxes
(4.3)
(28.6)
(119.2)
(119.5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit (provision) for income taxes
(0.9)
1.0 
(0.7)
3.0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss
(5.2)
(27.6)
(119.9)
(116.5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less: net loss attributable to non-controlling interests
(2.7)
0 
(44.2)
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss attributable to GoDaddy Inc.
(2.5)
(27.6)
(75.7)
(116.5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss per share—basic and diluted (in USD per share)
$ (0.04)2
$ (0.21)2
$ (0.82)2
$ (0.91)2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average shares outstanding—basic and diluted (in shares)
64,999 2
38,826 2
56,153 2
38,826 2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation expense
 
 
 
 
$ 4.4 
$ 2.7 
$ 12.5 
$ 7.2 
$ 1.5 
$ 3.4 
$ 4.5 
$ 5.1 
$ 0.9 
$ 0.2 
$ 2.1 
$ 0.5 
$ 3.2 
$ 3.1 
$ 9.4 
$ 9.4 
 
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidated Statement of Stockholders'/Members' Equity Statement (USD $)
In Millions, except Share data in Thousands
Total
USD ($)
Class A Common Stock
Class B Common Stock
Members' Equity
USD ($)
Common Stock
Class A Common Stock
USD ($)
Common Stock
Class B Common Stock
USD ($)
Additional Paid-in Capital
USD ($)
Accumulated Deficit
USD ($)
Accumulated Other Comprehensive Income
USD ($)
Non- Controlling Interest
USD ($)
Stockholders' and Members' Equity at Dec. 31, 2014
 
 
 
$ 410.4 
 
 
 
 
 
 
Net loss
 
 
 
(43.4)
 
 
 
 
 
 
Stockholders' and Members' Equity at Apr. 06, 2015
 
 
 
 
 
 
 
 
 
 
Stockholders' and Members' Equity at Dec. 31, 2014
410.4 
 
 
410.4 
 
 
 
 
 
 
Net loss
(119.9)
 
 
 
 
 
 
 
 
 
Equity-based compensation expense
19.8 
 
 
8.7 
 
 
19.8 
 
 
 
Effect of the Reorganization Transactions
375.9 
 
 
(375.9)
0.1 
0.1 
61.6 
 
 
314.1 
Effect of the Reorganization Transactions (in shares)
 
 
 
 
38,826 
90,425 
 
 
 
 
Issuance of Class A common stock in initial public offering, net of offering costs
480.6 
 
 
 
 
 
480.6 
 
 
 
Shares issued during IPO
 
 
 
 
26,000 
 
 
 
 
 
TRA liability from the Reorganization Transactions
(170.4)
 
 
 
 
 
(170.4)
 
 
 
Stock option exercises and other
0.9 
 
 
0.2 
0 
 
3.4 
 
 
(2.5)
Stock option exercises and other (in shares)
 
 
 
 
437 
(27)
 
 
 
 
Other comprehensive income
0.9 
 
 
 
 
 
 
 
0.9 
 
Stockholders' and Members' Equity at Sep. 30, 2015
631.2 
 
 
0 
0.1 
0.1 
395.0 
 
0.9 
267.4 
Common stock outstanding (in shares) at Sep. 30, 2015
155,661 
65,263 
90,398 
 
65,263 
90,398 
 
 
 
 
Stockholders' and Members' Equity at Apr. 06, 2015
 
 
 
 
 
 
 
 
 
 
Shares issued during IPO
 
26,000 
 
 
26,000 
 
 
 
 
 
Common stock outstanding (in shares) at Apr. 07, 2015
 
 
90,425 
 
 
 
 
 
 
 
Stockholders' and Members' Equity at Apr. 06, 2015
 
 
 
 
 
 
 
 
 
 
Net loss
(76.5)
 
 
 
 
 
 
(32.3)
 
(44.2)
Stockholders' and Members' Equity at Sep. 30, 2015
$ 631.2 
 
 
 
 
 
 
$ (32.3)
 
$ 267.4 
Common stock outstanding (in shares) at Sep. 30, 2015
155,661 
65,263 
90,398 
 
 
 
 
 
 
 
Condensed Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Statement of Cash Flows [Abstract]
 
 
Net loss
$ (119.9)
$ (116.5)
Adjustments to reconcile net loss to net cash provided by operating activities:
 
 
Depreciation and amortization
116.4 
113.0 
Equity-based compensation
28.5 
22.2 
Loss on debt extinguishment
21.4 
0 
Other
7.5 
8.2 
Changes in operating assets and liabilities, net of amounts acquired:
 
 
Registry deposits
(3.4)
(1.7)
Prepaid domain name registry fees
(32.5)
(24.8)
Deferred revenue
161.9 
157.3 
Other operating assets and liabilities
18.2 
(2.8)
Net cash provided by operating activities
198.1 
154.9 
Investing activities
 
 
Purchases of short-term investments
(7.3)
(6.0)
Maturities of short-term investments
4.9 
6.2 
Business acquisitions, net of cash acquired
(30.7)
(40.7)
Purchase of intangible assets
(22.5)
0 
Purchases of property and equipment, excluding improvements
(31.3)
(35.1)
Purchases of leasehold and building improvements
(3.0)
(6.3)
Other
1.1 
1.1 
Net cash used in investing activities
(88.8)
(80.8)
Financing activities
 
 
Proceeds from issuance of Class A common stock sold in initial public offering, net of offering costs
482.4 
(1.4)
Distributions paid to unit and option holders
0 
(349.0)
Proceeds from option exercises and other
1.2 
2.6 
Proceeds from term loan
0 
263.8 
Proceeds from revolving credit loan
0 
75.0 
Repayment of senior note
(300.0)
0 
Repayment of revolving credit loan
75.0 
0 
Repayment of term loan
(8.2)
(4.9)
Payment of financing-related costs
(13.5)
(8.4)
Repayment of other financing obligations
(7.4)
(2.2)
Net cash provided by (used in) financing activities
79.5 
(24.5)
Effect of exchange rate changes on cash and cash equivalents
(0.1)
0 
Net increase in cash and cash equivalents
188.7 
49.6 
Cash and cash equivalents, beginning of period
139.0 
95.4 
Cash and cash equivalents, end of period
327.7 
145.0 
Supplemental cash flow information:
 
 
Interest on long-term debt
47.3 
54.4 
Income taxes, net of refunds received
1.6 
1.7 
Supplemental information for non-cash investing and financing activities:
 
 
Fair value of contingent consideration in connection with business acquisitions
0.9 
2.3 
Accrued capital expenditures, excluding improvements, at period end
5.0 
8.3 
Accrued capital expenditures, leasehold and building improvements, at period end
0.6 
7.3 
Building acquired under lease financing obligation
$ 0 
$ 18.1 
Organization and Background
Organization and Background
Organization and Background
Description of Business
We are a leading technology provider to small businesses, web design professionals and individuals, delivering simple, easy-to-use cloud-based products and outcome-driven, personalized customer care. We operate the world’s largest domain marketplace and provide website building, hosting and security tools to help customers easily construct and protect their online presence and tackle the rapidly-changing technology landscape. As our customers grow, we provide applications helping them connect to their customers, manage and grow their businesses and get found online.
Initial Public Offering
We were incorporated on May 28, 2014 for the purpose of facilitating an initial public offering and other related transactions in order to operate the business of Desert Newco, LLC (Desert Newco) and its subsidiaries.
On April 7, 2015, we completed an initial public offering (IPO) and sold 26,000 shares of Class A common stock at a public offering price of $20.00 per share, including 2,500 shares purchased by affiliates of certain members of our board of directors (the Board). We received $491.8 million in proceeds, net of underwriting discounts and commissions, which we used to purchase newly-issued limited liability company units (LLC Units) from Desert Newco at a price per unit equal to the IPO price.
Organizational Transactions
In connection with the IPO, we completed a series of organizational transactions on April 7, 2015 (the Reorganization Transactions), including:
•
the amendment and restatement of Desert Newco's limited liability company agreement (the New LLC Agreement) to, among other things, appoint us as sole managing member and reclassify all LLC Units as non-voting units;
•
the issuance of shares of Class B common stock to each of Desert Newco's existing owners (the Continuing LLC Owners) on a one-to-one basis with the number of LLC Units owned; and
•
the acquisition, by merger, of four members of Desert Newco (the Reorganization Parties), for which we issued 38,826 shares of Class A common stock as consideration (the Investor Corp Mergers).
We are the sole managing member of Desert Newco. Although we have a minority economic interest, we have sole voting power in, and control the management of, Desert Newco. As a result, we consolidate Desert Newco's financial results and report a non-controlling interest related to the portion of Desert Newco not owned by us. As of September 30, 2015, we owned approximately 42% of Desert Newco.
The Reorganization Transactions were considered transactions between entities under common control. As a result, the financial statements for periods prior to the IPO and the Reorganization Transactions have been adjusted to combine the previously separate entities for presentation purposes.
Basis of Presentation
Our condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP), and include our accounts and the accounts of our subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
We had no significant components of other comprehensive income during any of the periods presented. As such, a consolidated statement of comprehensive loss is not presented.
Our interim condensed consolidated financial statements are unaudited. These financial statements have been prepared in accordance with GAAP, and in our opinion, include all adjustments of a normal recurring nature necessary for the fair presentation of the interim periods presented. The results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for any subsequent quarter or for the year ending December 31, 2015.
The accompanying financial statements should be read in conjunction with our audited consolidated financial statements and related notes included in our prospectus dated March 31, 2015, filed with the Securities and Exchange Commission (the SEC) in accordance with Rule 424(b) of the Securities Exchange Act of 1933, as amended (the Securities Act), on April 1, 2015.
Prior Period Reclassifications
Reclassifications of certain immaterial prior period amounts have been made to conform to the current period presentation.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions affecting amounts reported in our financial statements. Our more significant estimates include:
•
the determination of the best estimate of selling price of the deliverables included in multiple-deliverable revenue arrangements;
•the fair value of assets acquired and liabilities assumed in business combinations;
•
the assessment of recoverability of long-lived assets, including property and equipment, goodwill and intangible assets;
•the estimated reserve for refunds;
•the estimated useful lives of intangible and depreciable assets;
•the grant date fair value of equity-based awards;
•the recognition, measurement and valuation of current and deferred income taxes;
•the recognition and measurement of amounts payable under tax receivable agreements; and
•the recognition and measurement of loss contingencies, indirect tax liabilities and certain accrued liabilities.
We periodically evaluate these estimates and adjust prospectively, if necessary. We believe our estimates and assumptions are reasonable; however, actual results may differ from our estimates.
Segments and Reporting Units
Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker, or individuals who make up the chief operating decision maker function. Our chief operating decision maker function is comprised of the Chief Executive Officer and the Chief Operating Officer, who collectively review financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance for the entire company. Accordingly, we have a single operating segment and reporting unit structure.
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Other than as summarized below, there have been no material changes to our significant accounting policies from those disclosed in our prospectus dated March 31, 2015, filed with the SEC on April 1, 2015.
Derivative Financial Instruments
During the third quarter of 2015, we entered into foreign exchange forward contracts with financial institutions to hedge certain forecasted revenue transactions denominated in currencies other than the United States (U.S.) dollar. We designate these forward contracts as cash flow hedges, which are recognized as either assets or liabilities at fair value. We do not hold or issue derivative instruments for speculative or trading purposes. At September 30, 2015, the total notional amount of such contracts was $80.6 million, all having maturities of 12 months or less.
We reflect gains or losses on the effective portion of a cash flow hedge as a component of accumulated other comprehensive income and subsequently amortize the cumulative gains or losses to revenue as the underlying transactions are recognized. Any ineffective portion of gains or losses are recorded as other income (expense), net. At September 30, 2015, all such amounts were immaterial.
Income Taxes
We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events included in the financial statements. Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in our statement of operations in the period in which the enactment date occurs.
We recognize deferred tax assets to the extent we believe these assets are more-likely-than-not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations.
We record uncertain tax positions on the basis of a two-step process in which (1) we determine whether it is more-likely-than-not the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions meeting the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority.
Interest and penalties related to income taxes are included in benefit (provision) for income taxes. We have not incurred any significant interest or penalties related to income taxes in any of the periods presented.
Payable to Related Parties Pursuant to the TRAs
Concurrent with the completion of the IPO, we became a party to five Tax Receivable Agreements (TRAs). Four of the TRAs are between us and each of the four Reorganization Parties, with the fifth being between us and the Continuing LLC Owners. The TRAs provide for payment to the Reorganization Parties and the Continuing LLC Owners of approximately 85% of the amount of the calculated tax savings, if any, we will realize due to the Investor Corp Mergers and any future exchanges of LLC Units (together with the corresponding shares of Class B common stock) for Class A common stock.
In the Investor Corp Mergers, we received certain tax attributes, including the original basis adjustments (the OBAs), created when the Reorganization Parties acquired their original LLC Units. These OBAs entitle us to the depreciation and amortization previously allocable to the Reorganization Parties. To the extent this depreciation and amortization is used to reduce our taxable income, thereby resulting in actual tax savings, we will be required to pay the Reorganization Parties approximately 85% of such savings. The liability under the TRAs will be adjusted through general and administrative expenses each period based on changes in anticipated future taxable income.
Based on current projections of taxable income, we anticipate we will utilize a significant portion of the OBAs allocated to us in the form of additional depreciation and amortization deductions. These deductions are allowed prior to the utilization of any net operating loss or tax credit carryforward against income taxes. Accordingly, we have recorded a liability reflecting the portion of the calculated tax savings we expect to owe to the Reorganization Parties under the TRAs. Because we anticipate these additional depreciation and amortization deductions being greater than our taxable income, the excess deductions allocated to us will increase the amount of our net operating loss carryforwards, also increasing the deferred tax assets described above as these excess deductions are realized.
We expect to obtain an increase in our share of the tax basis of Desert Newco's assets when the Continuing LLC Owners exchange LLC Units (together with the corresponding shares of Class B common stock) for Class A common stock. When we acquire LLC Units from the Continuing LLC Owners, we expect both the OBAs and the anticipated basis adjustments will increase, for tax purposes, our depreciation and amortization deductions, reducing the amount of future income tax we would otherwise be required to pay. This increase in tax basis will create additional deferred tax assets and additional liability under the TRAs of approximately 85% of the calculated tax savings for the expected use of these additional deductions. The increase in tax basis may also decrease gains, or increase losses, on future dispositions of certain assets to the extent tax basis is allocated to those assets.
As a result of the Reorganization Transactions and the IPO, we acquired LLC Units and are required to recognize deferred tax assets and liabilities for the difference between the financial reporting and tax basis of our investment in Desert Newco at the investor level.
Recent Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board (FASB) issued a new standard on revenue recognition from contracts with customers. The new standard requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount reflecting the consideration to which the entity expects to be entitled to in exchange for those goods or services. In July 2015, the FASB approved a one year deferral of the effective date making the new standard effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted as of the original effective date. The new standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. We are currently evaluating the timing of our adoption and the impact of this new standard on our consolidated financial statements.
In February 2015, the FASB issued new guidance related to consolidations. The new standard amends the guidelines for determining whether certain legal entities should be consolidated. The new standard is effective for annual and interim reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.
In April 2015, the FASB issued new guidance regarding the presentation of debt issuance costs. This guidance requires debt issuance costs related to a recognized debt liability to be presented as a direct deduction of the carrying amount of the debt liability. The recognition and measurement guidance for debt issuance costs is not affected by this new guidance. We do not expect the adoption of this guidance, effective for us in the first quarter of 2016, to have a material impact on our consolidated financial statements, although it will require retrospective application, reducing the amount of debt and total assets reflected on our historical consolidated balance sheets.
In April 2015, the FASB issued new guidance related to accounting for fees paid in a cloud computing arrangement. The new standard provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new standard is effective for annual and interim reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.
In September 2015, the FASB issued new guidance simplifying the accounting for measurement period adjustments resulting from business combinations. The new standard requires an entity to recognize adjustments to provisional amounts in the period in which they are determined, rather than retrospectively adjusting previously reported amounts. The standard requires the acquiring entity to record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income, if any, resulting from the change to provisional amounts, calculated as if the accounting had been completed at the acquisition date. The new standard is effective for annual and interim reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.
Business Acquisitions
Business Acquisitions
Business Acquisitions
During the nine months ended September 30, 2015, we completed three acquisitions for total aggregate consideration consisting of cash of $29.2 million and additional earn-out payments subject to the achievement of certain revenue targets. We recognized a liability of $0.9 million representing the initial estimated fair value of the contingent consideration. These acquisitions are not material to our results of operations, and as a result, no proforma financial information is presented.
The aggregate purchase price was allocated to the assets acquired and liabilities assumed based upon our assessment of their fair values as of the respective acquisition dates with $26.5 million attributed to identified indefinite-lived intangible assets, $2.5 million to other identified finite-lived intangible assets, $1.1 million to goodwill, which is deductible for income tax purposes, and $0.9 million of net liabilities assumed. Identified intangible assets, which were valued using either income- or cost-based approaches, include an indefinite-lived domain portfolio and customer-related intangible assets, developed technology and branding having a total weighted-average amortization period of 1.7 years.
Goodwill and Intangible Assets
Goodwill and Intangible Assets
Goodwill and Intangible Assets
The following table summarizes changes in our goodwill balance:
Balance at December 31, 2014
$
1,661.2

Goodwill related to acquisitions
1.1

Balance at September 30, 2015
$
1,662.3



Intangible assets, net are summarized as follows:
 
September 30, 2015
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
26.5

 
 n/a

 
$
1.4

 
25.1

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
360.5

 
$
181.5

 
 n/a

 
179.0

Developed technology
210.1

 
138.0

 
 n/a

 
72.1

Trade names
11.2

 
4.6

 
 n/a

 
6.6

Other
1.1

 
0.7

 
 n/a

 
0.4

 
$
1,054.4

 
$
324.8

 
$
1.4

 
$
728.2

 
 
December 31, 2014
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
$
445.0

Finite-lived intangible assets:
 
 
 
 
 
Customer-related
336.9

 
$
143.1

 
193.8

Developed technology
209.5

 
107.4

 
102.1

Trade names
10.9

 
2.8

 
8.1

Other
1.1

 
0.4

 
0.7

 
$
1,003.4

 
$
253.7

 
$
749.7



During the nine months ended September 30, 2015, we purchased a customer-related intangible asset for $22.5 million in cash and additional earn-out payments of up to $16.7 million subject to the achievement of certain customer conversion milestones. The purchased intangible asset was valued at cost and will be amortized over 48 months based on expected customer attrition. Transaction costs were immaterial and were expensed as incurred. The asset will be increased by the value of the contingent consideration to the extent the related milestones are achieved.
Customer-related intangible assets, developed technology, trade names and other intangible assets have weighted-average useful lives from the date of purchase of 99 months, 64 months, 58 months and 36 months, respectively. Amortization expense was $24.6 million and $24.4 million for the three months ended September 30, 2015 and 2014, respectively. Amortization expense was $71.4 million and $72.3 million for the nine months ended September 30, 2015 and 2014, respectively. The weighted-average remaining amortization period for amortizable intangible assets was 49 months as of September 30, 2015.
As individual domains are sold, our indefinite-lived domain portfolio intangible asset is reduced by the allocated carrying cost of each domain, which is included in cost of revenue.
Based on the balance of finite-lived intangible assets at September 30, 2015, expected future amortization expense is as follows:
Year Ending December 31:
 
2015 (remainder of)
$
26.1

2016
88.8

2017
52.5

2018
44.4

2019
25.9

Thereafter
20.4

 
$
258.1

Stockholders' Equity
Stockholders' Equity
Stockholders’ Equity
Restatement of Certificate of Incorporation
Our Board approved an amended and restated certificate of incorporation (the Restated Certificate of Incorporation), which became effective on March 31, 2015 immediately prior to the effectiveness of the Registration Statement on Form S-1 (the Registration Statement) filed in connection with our IPO. The Restated Certificate of Incorporation authorized the issuance of up to 1,000,000 shares of Class A common stock, up to 500,000 shares of Class B common stock and up to 50,000 shares of undesignated preferred stock, each having a par value of $0.001 per share. Shares of Class A common stock have both economic and voting rights. Shares of Class B common stock have no economic rights, but do have voting rights. Holders of Class A and Class B common stock are entitled to one vote per share and, except as otherwise required, will vote together as a single class on all matters on which stockholders generally are entitled to vote.
We are required to, at all times, maintain (i) a one-to-one ratio between the number of shares of Class A common stock outstanding and the number of LLC Units owned by us and (ii) a one-to-one ratio between the number of shares of Class B common stock owned by the Continuing LLC Owners and the number of LLC Units owned by the Continuing LLC Owners. We may issue shares of Class B common stock only to the extent necessary to maintain these ratios. Shares of Class B common stock are transferable only together with an equal number of LLC Units if we, at the election of a Continuing LLC Owner, exchange LLC Units for shares of Class A common stock.
Desert Newco Recapitalization
Desert Newco's board of directors adopted the New LLC Agreement, which became effective on March 31, 2015 immediately following the effectiveness of the Registration Statement. The New LLC Agreement, among other things, appointed us as Desert Newco's sole managing member and reclassified all outstanding LLC Units as non-voting units. The New LLC Agreement also revised the tax rate applicable to the tax distributions we are required to make to the holders of LLC Units. These tax distributions will be computed based on an assumed income tax rate equal to the sum of (i) the maximum marginal federal income tax rate applicable to an individual and (ii) 7%, which represents an assumed blended state income tax rate. The assumed income tax rate currently totals 46.6%, which will increase to 50.4% in certain cases when the tax on net investment income is applicable.
Investor Corp Mergers
As described in Note 1, we acquired the Reorganization Parties, to which we issued an aggregate of 38,826 shares of Class A common stock as consideration for the 38,826 aggregate LLC Units held by such entities. Upon consummation of the Investor Corp Mergers, we recognized the acquired LLC Units at carrying value, as these transactions are considered to be between entities under common control.
We also acquired the tax attributes of the Reorganization Parties, which were recorded generally as deferred tax assets at the time of the Investor Corp Mergers. These attributes include net operating losses, tax credit carryforwards and OBAs arising from the original acquisition of LLC Units by the Reorganization Parties, as described in Note 10.
Initial Public Offering
As described in Note 1, on April 7, 2015, we completed an IPO and sold 26,000 shares of Class A common stock at a public offering price of $20.00 per share, receiving $491.8 million in proceeds, net of underwriting discounts and commissions, which we used to purchase newly-issued LLC Units from Desert Newco at a price per unit equal to the IPO price. In connection with the IPO, we issued 90,425 shares of Class B common stock to the Continuing LLC Owners.
We incurred $11.2 million, including amounts paid in 2014, of legal, accounting, printing and other professional fees related to the IPO, including $1.3 million and $0.1 million paid on behalf of the Sponsors and Bob Parsons, respectively. These amounts were charged against additional paid-in capital upon completion of the IPO.
We used the net proceeds from the IPO to: (i) make certain payments to the Sponsors and Bob Parsons as described in Note 13, (ii) repay the note payable to The Go Daddy Group, Inc. (Holdings), an entity owned by Bob Parsons, and all amounts drawn on our revolving credit loan as described in Note 8 and (iii) complete an acquisition.
Equity-Based Compensation Plans
Equity-Based Compensation Plans
Equity-Based Compensation Plans
Our Board adopted the 2015 Equity Incentive Plan (the 2015 Plan), which became effective on March 31, 2015 upon the effectiveness of the Registration Statement. We reserved a total of 6,050 shares of Class A common stock for issuance pursuant to the 2015 Plan. In addition, the shares reserved for issuance include 4,235 shares reserved but unissued under Desert Newco's 2011 Unit Incentive Plan (the 2011 Unit Incentive Plan) plus up to 28,133 shares rolled over from the 2011 Unit Incentive Plan and from certain other option plans assumed in connection with acquisitions. The number of shares reserved for issuance will be increased automatically on January 1st of each year, beginning in 2016, by a number equal to the least of (i) 20,571 shares, (ii) 4% of the total shares of all classes of common stock outstanding as of the last day of the preceding year or (iii) such other amount as may be determined by our Board.
Our Board adopted the 2015 Employee Stock Purchase Plan (the ESPP), which became effective on March 31, 2015 upon the effectiveness of the Registration Statement. We reserved a total of 2,000 shares of Class A common stock for issuance pursuant to the ESPP. The number of shares reserved for issuance will be increased automatically on January 1st of each year, beginning in 2016, by a number equal to the least of (i) 1,000 shares, (ii) 1% of the total shares of all classes of common stock outstanding as of the last day of the preceding year or (iii) such other amount as may be determined by our Board.
We grant options at exercise prices equal to the fair market value of our Class A common stock on the date of grant. We recognize the grant date fair value of equity-based awards as compensation expense over the required service period of each award, taking into account the probability of our achievement of associated predetermined performance targets. Equity-based award activity was as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Number of options granted
843

 
1,265

 
3,356

 
3,971

Weighted-average exercise price of options granted
$
25.87

 
$
18.00

 
$
22.37

 
$
16.20

Weighted-average grant date fair value of options granted
$
10.96

 
$
8.05

 
$
9.18

 
$
7.73

Number of RSUs granted
2

 
—

 
16

 
62

Weighted-average grant date fair value of RSUs granted
$
24.81

 
$
—

 
$
26.84

 
$
15.27


At September 30, 2015, total unrecognized compensation expense related to non-vested awards was $56.2 million with an expected remaining weighted-average recognition period of 2.4 years. We currently believe the performance targets related to the vesting of performance options will be achieved. If such targets are not achieved, or are subsequently determined to not be probable of being achieved, we will not recognize any equity-based compensation expense relating to performance options, and will reverse any previously recognized equity-based compensation expense.
The fair value of each ESPP share is estimated on the first day of each offering period using the Black-Scholes option pricing model, and is recognized as equity-based compensation expense on a straight-line basis over the term of each six-month offering period. As of September 30, 2015, $9.7 million has been withheld on behalf of employees for future purchases under the ESPP, which is included in accrued expenses. At September 30, 2015, total unrecognized compensation expense related to ESPP shares was $0.8 million, which will be recognized during the fourth quarter of 2015.
Deferred Revenue
Deferred Revenue
Deferred Revenue
Deferred revenue consists of the following:
 
September 30, 2015
 
December 31, 2014
Current:
 
 
 
Domains
$
501.5

 
$
462.9

Hosting and presence
327.4

 
283.4

Business applications
105.1

 
75.1

 
$
934.0

 
$
821.4

Noncurrent:
 
 
 
Domains
$
287.8

 
$
266.8

Hosting and presence
150.7

 
131.5

Business applications
40.0

 
30.9

 
$
478.5

 
$
429.2

Long-Term Debt
Long-Term Debt
Long-Term Debt
Long-term debt consists of the following:
 
September 30, 2015
 
December 31, 2014
Term Loan due May 13, 2021 (effective interest rate of 5.1% at September 30, 2015 and 5.2% at December 31, 2014)
$
1,086.3

 
$
1,094.5

9% Note payable to Holdings (Senior Note)
—

 
300.0

Revolving Credit Loan due May 13, 2019 (effective interest rate of 4.0% at December 31, 2014)
—

 
75.0

Total
1,086.3

 
1,469.5

Less unamortized original issue discounts on long-term debt(1)
(38.3
)
 
(50.6
)
Less current portion of long-term debt
(4.8
)
 
(5.0
)
 
$
1,043.2

 
$
1,413.9

 
 
(1)
Original issue discounts are amortized to interest expense over the life of the related debt instruments using the effective interest method.
Term Loan and Revolving Credit Loan
Our amended and restated secured credit agreement (the Credit Facility) consists of a $1,100.0 million original balance term loan maturing on May 13, 2021 (the Term Loan) and an available $150.0 million revolving credit loan maturing on May 13, 2019 (the Revolving Credit Loan). Borrowings under the Credit Facility bear interest at a rate equal to, at our option, either (a) LIBOR (not less than 1.0% for the Term Loan only) plus 3.25% per annum or (b) 2.25% per annum plus the highest of (i) the Federal Funds Rate plus 0.5%, (ii) the Prime Rate or (iii) one-month LIBOR plus 1.0%. The interest rate margins above reflect reductions of 0.25% following the IPO and an additional 0.25% due to our achievement of certain leverage criteria.
In April 2015, we made a payment of $75.0 million to repay all amounts drawn on the Revolving Credit Loan. At September 30, 2015, we have $150.0 million available for borrowing under the Revolving Credit Loan.
At September 30, 2015, we were not in violation of any covenants of the Credit Facility.
The estimated fair value of the Term Loan was $1,087.7 million at September 30, 2015 based on observable market prices for this loan, which is traded in a less active market and is therefore classified as a Level 2 fair value measurement.
Senior Note
In April 2015, we made a payment totaling $316.0 million to repay the Senior Note, consisting of principal of $300.0 million, prepayment premium of $13.5 million, which was recorded as a loss on debt extinguishment, and accrued interest of $2.5 million. Additionally, in connection with the repayment, $7.1 million of unamortized original issue discount and $0.8 million of deferred financing costs were recorded as a loss on debt extinguishment. Following this payment, the Senior Note was canceled.
Future Debt Maturities
Aggregate principal payments, exclusive of any unamortized original issue discounts, due on long-term debt as of September 30, 2015 are as follows:
Year Ending December 31:
 
2015 (remainder of)
$
2.8

2016
11.0

2017
11.0

2018
11.0

2019
11.0

Thereafter
1,039.5

 
$
1,086.3

Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies

Litigation
From time-to-time, we are a party to litigation and subject to claims incident to the ordinary course of business, including intellectual property claims, labor and employment claims, breach of contract claims and other asserted and unasserted claims. We investigate these claims as they arise and accrue estimates for resolution of legal and other contingencies when losses are probable and estimable. While the results of such normal course claims and legal proceedings cannot be predicted with certainty, we do not believe, based on current knowledge and the likely timing of resolution of various matters, any additional reasonably possible potential losses above the amount accrued for such matters would be material to our consolidated financial statements. Regardless of the outcome, legal proceedings may have an adverse effect on us because of defense costs, diversion of management resources and other factors.
Indemnifications
In the normal course of business, we have made indemnities under which we may be required to make payments in relation to certain transactions. These include indemnities to our directors and officers to the maximum extent permitted under applicable state laws and indemnifications related to certain lease agreements. In addition, certain advertiser and reseller partner agreements contain indemnification provisions, which are generally consistent with those prevalent in the industry. We have not incurred significant obligations under indemnification provisions historically, and do not expect to incur significant obligations in the future. Accordingly, we have not recorded any liabilities related to such indemnities as of September 30, 2015 and December 31, 2014.
We include service level commitments to our customers guaranteeing certain levels of uptime reliability and performance for our hosting and premium DNS products. These guarantees permit those customers to receive credits in the event we fail to meet those levels, with exceptions for certain service interruptions including but not limited to periodic maintenance. We have not incurred any material costs as a result of such commitments during any of the periods presented, and have not recorded any liabilities related to such obligations as of September 30, 2015 and December 31, 2014.
Indirect Taxes
We are subject to indirect taxation in some, but not all, of the various states and foreign jurisdictions in which we conduct business. Laws and regulations attempting to subject communications and commerce conducted over the Internet to various indirect taxes are becoming more prevalent, both in the U.S. and internationally, and may impose additional burdens on us in the future. Increased regulation could negatively affect our business directly, as well as the businesses of our customers. Taxing authorities may impose indirect taxes on the Internet-related revenue we generate based on regulations currently being applied to similar, but not directly comparable, industries. There are many transactions and calculations where the ultimate indirect tax determination is uncertain. In addition, domestic and international indirect taxation laws are complex and subject to change. We may be audited in the future, which could result in changes to our indirect tax estimates. We continually evaluate those jurisdictions in which nexus exists and believe we maintain adequate indirect tax accruals. Although we believe our indirect tax estimates and associated accruals are reasonable, the final determination of indirect tax audits and any related litigation could be different than the amounts established for indirect tax contingencies.
As of September 30, 2015 and December 31, 2014, our accrual for estimated indirect tax liabilities was $6.3 million and $5.9 million, respectively, which reflects our best estimate of the probable liability based on an analysis of our business activities, revenues subject to indirect taxes and applicable regulations in each jurisdiction. Due to the complexity and uncertainty surrounding indirect tax laws, we believe it is reasonably possible we have incurred additional liabilities related to indirect taxes; however, we are not currently able to estimate a range.
Income Taxes
Income Taxes
Income Taxes
We are subject to U.S. federal income taxes as well as state taxes. In addition, we may be subject to taxes in the foreign jurisdictions in which we operate. We are a controlling member in Desert Newco, which has been, and will continue to be, treated as a partnership for U.S. income tax purposes. As such, Desert Newco is considered a pass-through entity and generally does not pay income taxes on its taxable income in most jurisdictions. Instead, Desert Newco's members, of which we are one, are liable for U.S. federal and state income taxes based on their taxable income. Desert Newco is liable for income taxes in certain foreign jurisdictions, in those states not recognizing its pass-through status and for certain subsidiaries not taxed as pass-through entities. We have acquired the outstanding stock of various entities taxed as corporations, which are now wholly-owned by us or our subsidiaries and are treated as a consolidated group for federal income tax purposes. Where required, these subsidiaries also file as a consolidated group for state income tax purposes.
Our effective tax rate differs from statutory rates primarily due to Desert Newco's pass-through structure for U.S. income tax purposes, while being treated as taxable in certain states and various foreign jurisdictions as well as for certain subsidiaries. In all foreign jurisdictions where we conduct business, except Canada, we operate through legal entities disregarded for U.S. income tax purposes and are subject to income tax in both the local jurisdictions and the U.S. In addition, after evaluating our ability to recover deferred tax assets associated with net operating losses and other tax attributes received through the Reorganization Transactions and the IPO, we have determined it is more-likely-than-not these deferred tax assets will not be realized. Accordingly, we have recorded a valuation allowance against all of these deferred tax assets.
We determined a liability related to uncertain income tax positions does not exist during any of the periods presented. Although we believe the amounts reflected in our income tax returns substantially comply with applicable federal, state and foreign tax regulations, the respective taxing authorities may take contrary positions based on their interpretation of the law. A tax position successfully challenged by a taxing authority could result in an adjustment to the provision or benefit for income taxes in the period in which a final determination is made.
Payable to Related Parties Pursuant to the TRAs
Based on current projections of taxable income, and before deduction of any specially allocated depreciation and amortization, we anticipate having enough taxable income to utilize a significant portion of these specially allocated deductions related to the original OBAs. Accordingly, at the completion of the Reorganization Transactions and the IPO, we recorded an initial liability of $170.4 million payable to the Reorganization Parties under the TRAs, representing approximately 85% of the calculated tax savings based on the portion of the OBAs we anticipate being able to utilize in future years. During the three months ended September 30, 2015, we recorded $0.5 million as an increase to the TRA liability resulting from changes in anticipated taxable income, which is included in general and administrative expenses. As of September 30, 2015, $3.0 million of the TRA liability is expected to be paid within the next 12 months; therefore, this amount is included in current liabilities.
As a result of the Reorganization Transactions and the IPO, we acquired LLC Units and are required to recognize deferred tax assets and liabilities for the difference between the financial reporting and tax basis of our investment in Desert Newco at the investor level. Based on our limited operating history and future projections of taxable income, we believe there is significant uncertainty as to when we will be able to utilize the net operating loss carryforwards acquired in the Investor Corp Mergers. Therefore, after considering all available positive and negative evidence impacting the future realization of deferred tax assets, we have concluded it is more-likely-than-not these deferred tax assets will not be realized. Accordingly, a valuation allowance has been recorded against all of these deferred tax assets.
Loss Per Share
Loss Per Share
Loss Per Share
Basic loss per share is computed by dividing net loss attributable to GoDaddy Inc. by the weighted-average number of shares of Class A common stock outstanding during the period. Diluted loss per share is computed giving effect to all potentially dilutive shares, including outstanding options, RSUs and warrants. Diluted loss per share for all periods presented is the same as basic loss per share as the inclusion of potentially issuable shares would be antidilutive.
For purposes of calculating loss per share for periods prior to the IPO, including the nine months ended September 30, 2015 for which a portion of the period preceded the IPO, we treated the Reorganization Transactions as a merger of entities under common control. Therefore, we have retrospectively reflected loss per share as though these transactions had occurred as of the earliest period presented. For all periods prior to the IPO, we allocated our historical net loss between the Class A stockholders and the non-controlling interest based on their respective share ownership. For these allocations, the weighted average shares of Class A common stock outstanding was based upon the number of LLC Units held by the Reorganization Parties, while the weighted average shares of Class B common stock outstanding for the non-controlling interest was based upon the LLC Units held by the Continuing LLC Owners. These calculations do not consider the 26,000 shares of Class A common stock sold in our IPO.
A reconciliation of the numerator and denominator used in the calculation of basic and diluted net loss per share is as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Numerator:
 
 
 
 
 
 
 
Net loss
$
(5.2
)
 
$
(27.6
)
 
$
(119.9
)
 
$
(116.5
)
Less: net loss attributable to non-controlling interests
(2.7
)
 
(19.3
)
 
(74.0
)
 
(81.3
)
Net loss attributable to GoDaddy Inc.
$
(2.5
)
 
$
(8.3
)
 
$
(45.9
)
 
$
(35.2
)
 
 
 
 
 
 
 
 
Denominator:
 
 
 
 
 
 
 
Weighted-average shares of Class A common stock outstanding—basic
64,999

 
38,826

 
56,153

 
38,826

Effect of dilutive securities
—

 
—

 
—

 
—

Weighted-average shares of Class A Common stock outstanding—diluted
64,999

 
38,826

 
56,153

 
38,826

 
 
 
 
 
 
 
 
Net loss per share of Class A common stock—basic and diluted
$
(0.04
)
 
$
(0.21
)
 
$
(0.82
)
 
$
(0.91
)

The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted loss per share because the effect of including such shares would have been antidilutive:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Options, RSUs and warrants
15,731

 
11,250

 
14,693

 
10,162


Shares of Class B common stock do not share in our earnings and are not participating securities. Accordingly, separate presentation of loss per share of Class B common stock under the two-class method has not been presented. Each share of Class B common stock (together with a corresponding LLC Unit) is exchangeable for one share of Class A common stock. The shares of Class B common stock were determined to be antidilutive under the if-converted and two-class methods; therefore, they are not included in the computation of net loss per share. Total shares of common stock outstanding were as follows:
 
September 30, 2015
 
December 31, 2014(1)
Class A common stock
65,263

 
38,826

Class B common stock
90,398

 
90,177

 
155,661

 
129,003

 
 
(1)
Shares for December 31, 2014 have been retrospectively adjusted to give effect to the Reorganization Transactions.
Geographic Information
Geographic Information
Geographic Information
Revenue by geography is based on the customer's address, and was as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
U.S.
$
305.8

 
$
267.2

 
$
880.5

 
$
764.5

International
105.3

 
89.7

 
301.4

 
251.1

 
$
411.1

 
$
356.9

 
$
1,181.9

 
$
1,015.6


No individual international country represented more than 10% of total revenue in any period presented. Substantially all of our assets are located in the U.S.
Related Party Transactions
Related Party Transactions
Related Party Transactions
Sponsors
Amounts paid to affiliates of KKR related to their participation as lenders under our Credit Facility were as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Principal
$
0.1

 
$
0.1

 
$
5.2

 
$
0.1

Interest and other fees
0.3

 
0.6

 
1.1

 
1.1

Debt financing fees
—

 
—

 
—

 
0.7


As of September 30, 2015 and December 31, 2014, affiliates of KKR held $28.9 million and $29.1 million, respectively, of the outstanding principal balance of the Term Loan as participating lenders. Additionally, as of December 31, 2014, affiliates of KKR held $5.0 million of the outstanding principal balance of the Revolving Credit Loan as participating lenders, which was repaid in April 2015.
On December 16, 2011, we entered into a transaction and monitoring fee agreement with affiliates of certain of the Sponsors pursuant to which those entities provided management and advisory services. In April 2015, we made a final aggregate payment of $26.7 million upon the termination of this agreement following the completion of the IPO, which was charged to general and administrative expenses. This payment was equal to the present value of the management fees that would have been payable during the ten-year period following termination. Following this payment, we have no further obligations under this agreement. During the three months ended September 30, 2015 and 2014, we paid $0 and $0.6 million, respectively, under this arrangement. During the nine months ended September 30, 2015 and 2014, we paid $27.3 million and $1.8 million, respectively, under this arrangement.
Bob Parsons and Holdings
On December 16, 2011, we entered into a services agreement with Bob Parsons pursuant to which we were obligated to provide customary benefits and to reimburse up to $0.5 million of business expenses annually. In April 2015, we paid $3.0 million upon the termination of this agreement following the completion of the IPO, which was charged to general and administrative expenses. Following this payment, we have no further obligations under this agreement. We made no other significant payments under this arrangement during any of the periods presented.
During the three months ended September 30, 2015 and 2014, we paid $0 and $6.8 million, respectively, of interest to Holdings under the Senior Note. During the nine months ended September 30, 2015 and 2014, we paid $9.2 million and $20.3 million, respectively, of interest to Holdings under the Senior Note. In April 2015, we also paid a $13.5 million prepayment premium to Holdings in connection with our repayment of the Senior Note.
Holdings has indemnified us for certain taxes related to periods prior to December 16, 2011 and we have agreed to provide customary indemnification to Bob Parsons related to his service to us.
Other
In the ordinary course of business, we purchase and lease computer equipment, technology licensing and software maintenance and support from affiliates of Dell Inc. (Dell). Silver Lake and its affiliates have a significant ownership interest in Dell. During the three months ended September 30, 2015 and 2014, we paid $4.3 million and $5.8 million, respectively, to Dell. During the nine months ended September 30, 2015 and 2014, we paid $13.3 million and $14.2 million, respectively, to Dell.
Summary of Significant Accounting Policies (Policies)
Derivative Financial Instruments 
We reflect gains or losses on the effective portion of a cash flow hedge as a component of accumulated other comprehensive income and subsequently amortize the cumulative gains or losses to revenue as the underlying transactions are recognized. Any ineffective portion of gains or losses are recorded as other income (expense), net.
Derivative Financial Instruments
Basis of Presentation 
Basis of Presentation
Our condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP), and include our accounts and the accounts of our subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation
Prior Period Reclassifications 
Prior Period Reclassifications
Reclassifications of certain immaterial prior period amounts have been made to conform to the current period presentation.
Use of Estimates 
Use of Estimates
The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions affecting amounts reported in our financial statements. Our more significant estimates include:
•
the determination of the best estimate of selling price of the deliverables included in multiple-deliverable revenue arrangements;
•the fair value of assets acquired and liabilities assumed in business combinations;
•
the assessment of recoverability of long-lived assets, including property and equipment, goodwill and intangible assets;
•the estimated reserve for refunds;
•the estimated useful lives of intangible and depreciable assets;
•the grant date fair value of equity-based awards;
•the recognition, measurement and valuation of current and deferred income taxes;
•the recognition and measurement of amounts payable under tax receivable agreements; and
•the recognition and measurement of loss contingencies, indirect tax liabilities and certain accrued liabilities.
We periodically evaluate these estimates and adjust prospectively, if necessary. We believe our estimates and assumptions are reasonable; however, actual results may differ from our estimates.
Segments 
Segments and Reporting Units
Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker, or individuals who make up the chief operating decision maker function. Our chief operating decision maker function is comprised of the Chief Executive Officer and the Chief Operating Officer, who collectively review financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance for the entire company. Accordingly, we have a single operating segment and reporting unit structure.
Income Taxes 
Income Taxes
We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events included in the financial statements. Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in our statement of operations in the period in which the enactment date occurs.
We recognize deferred tax assets to the extent we believe these assets are more-likely-than-not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations.
We record uncertain tax positions on the basis of a two-step process in which (1) we determine whether it is more-likely-than-not the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions meeting the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority.
Interest and penalties related to income taxes are included in benefit (provision) for income taxes.
Recent Accounting Pronouncements 
Recent Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board (FASB) issued a new standard on revenue recognition from contracts with customers. The new standard requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount reflecting the consideration to which the entity expects to be entitled to in exchange for those goods or services. In July 2015, the FASB approved a one year deferral of the effective date making the new standard effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted as of the original effective date. The new standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. We are currently evaluating the timing of our adoption and the impact of this new standard on our consolidated financial statements.
In February 2015, the FASB issued new guidance related to consolidations. The new standard amends the guidelines for determining whether certain legal entities should be consolidated. The new standard is effective for annual and interim reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.
In April 2015, the FASB issued new guidance regarding the presentation of debt issuance costs. This guidance requires debt issuance costs related to a recognized debt liability to be presented as a direct deduction of the carrying amount of the debt liability. The recognition and measurement guidance for debt issuance costs is not affected by this new guidance. We do not expect the adoption of this guidance, effective for us in the first quarter of 2016, to have a material impact on our consolidated financial statements, although it will require retrospective application, reducing the amount of debt and total assets reflected on our historical consolidated balance sheets.
In April 2015, the FASB issued new guidance related to accounting for fees paid in a cloud computing arrangement. The new standard provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new standard is effective for annual and interim reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.
In September 2015, the FASB issued new guidance simplifying the accounting for measurement period adjustments resulting from business combinations. The new standard requires an entity to recognize adjustments to provisional amounts in the period in which they are determined, rather than retrospectively adjusting previously reported amounts. The standard requires the acquiring entity to record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income, if any, resulting from the change to provisional amounts, calculated as if the accounting had been completed at the acquisition date. The new standard is effective for annual and interim reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.
Goodwill and Intangible Assets (Tables)
Schedule of Goodwill 
The following table summarizes changes in our goodwill balance:
Balance at December 31, 2014
$
1,661.2

Goodwill related to acquisitions
1.1

Balance at September 30, 2015
$
1,662.3

Schedule of Indefinite-Lived Intangible Assets 
Intangible assets, net are summarized as follows:
 
September 30, 2015
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
26.5

 
 n/a

 
$
1.4

 
25.1

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
360.5

 
$
181.5

 
 n/a

 
179.0

Developed technology
210.1

 
138.0

 
 n/a

 
72.1

Trade names
11.2

 
4.6

 
 n/a

 
6.6

Other
1.1

 
0.7

 
 n/a

 
0.4

 
$
1,054.4

 
$
324.8

 
$
1.4

 
$
728.2

 
 
December 31, 2014
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
$
445.0

Finite-lived intangible assets:
 
 
 
 
 
Customer-related
336.9

 
$
143.1

 
193.8

Developed technology
209.5

 
107.4

 
102.1

Trade names
10.9

 
2.8

 
8.1

Other
1.1

 
0.4

 
0.7

 
$
1,003.4

 
$
253.7

 
$
749.7

Schedule of Finite-Lived Intangible Assets 
Intangible assets, net are summarized as follows:
 
September 30, 2015
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
26.5

 
 n/a

 
$
1.4

 
25.1

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
360.5

 
$
181.5

 
 n/a

 
179.0

Developed technology
210.1

 
138.0

 
 n/a

 
72.1

Trade names
11.2

 
4.6

 
 n/a

 
6.6

Other
1.1

 
0.7

 
 n/a

 
0.4

 
$
1,054.4

 
$
324.8

 
$
1.4

 
$
728.2

 
 
December 31, 2014
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
$
445.0

Finite-lived intangible assets:
 
 
 
 
 
Customer-related
336.9

 
$
143.1

 
193.8

Developed technology
209.5

 
107.4

 
102.1

Trade names
10.9

 
2.8

 
8.1

Other
1.1

 
0.4

 
0.7

 
$
1,003.4

 
$
253.7

 
$
749.7

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense 
Based on the balance of finite-lived intangible assets at September 30, 2015, expected future amortization expense is as follows:
Year Ending December 31:
 
2015 (remainder of)
$
26.1

2016
88.8

2017
52.5

2018
44.4

2019
25.9

Thereafter
20.4

 
$
258.1

Equity-Based Compensation Plans (Tables)
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award
Equity-based award activity was as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Number of options granted
843

 
1,265

 
3,356

 
3,971

Weighted-average exercise price of options granted
$
25.87

 
$
18.00

 
$
22.37

 
$
16.20

Weighted-average grant date fair value of options granted
$
10.96

 
$
8.05

 
$
9.18

 
$
7.73

Number of RSUs granted
2

 
—

 
16

 
62

Weighted-average grant date fair value of RSUs granted
$
24.81

 
$
—

 
$
26.84

 
$
15.27

Deferred Revenue (Tables)
Deferred Revenue, by Arrangement
Deferred revenue consists of the following:
 
September 30, 2015
 
December 31, 2014
Current:
 
 
 
Domains
$
501.5

 
$
462.9

Hosting and presence
327.4

 
283.4

Business applications
105.1

 
75.1

 
$
934.0

 
$
821.4

Noncurrent:
 
 
 
Domains
$
287.8

 
$
266.8

Hosting and presence
150.7

 
131.5

Business applications
40.0

 
30.9

 
$
478.5

 
$
429.2

Long-Term Debt (Tables)
Schedule of Long-term Debt Instruments 
Long-term debt consists of the following:
 
September 30, 2015
 
December 31, 2014
Term Loan due May 13, 2021 (effective interest rate of 5.1% at September 30, 2015 and 5.2% at December 31, 2014)
$
1,086.3

 
$
1,094.5

9% Note payable to Holdings (Senior Note)
—

 
300.0

Revolving Credit Loan due May 13, 2019 (effective interest rate of 4.0% at December 31, 2014)
—

 
75.0

Total
1,086.3

 
1,469.5

Less unamortized original issue discounts on long-term debt(1)
(38.3
)
 
(50.6
)
Less current portion of long-term debt
(4.8
)
 
(5.0
)
 
$
1,043.2

 
$
1,413.9

 
 
(1)
Original issue discounts are amortized to interest expense over the life of the related debt instruments using the effective interest method.
Schedule of Maturities of Long-term Debt 
Aggregate principal payments, exclusive of any unamortized original issue discounts, due on long-term debt as of September 30, 2015 are as follows:
Year Ending December 31:
 
2015 (remainder of)
$
2.8

2016
11.0

2017
11.0

2018
11.0

2019
11.0

Thereafter
1,039.5

 
$
1,086.3

Loss Per Share (Tables)
Schedule of Earnings Per Share, Basic and Diluted 
A reconciliation of the numerator and denominator used in the calculation of basic and diluted net loss per share is as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Numerator:
 
 
 
 
 
 
 
Net loss
$
(5.2
)
 
$
(27.6
)
 
$
(119.9
)
 
$
(116.5
)
Less: net loss attributable to non-controlling interests
(2.7
)
 
(19.3
)
 
(74.0
)
 
(81.3
)
Net loss attributable to GoDaddy Inc.
$
(2.5
)
 
$
(8.3
)
 
$
(45.9
)
 
$
(35.2
)
 
 
 
 
 
 
 
 
Denominator:
 
 
 
 
 
 
 
Weighted-average shares of Class A common stock outstanding—basic
64,999

 
38,826

 
56,153

 
38,826

Effect of dilutive securities
—

 
—

 
—

 
—

Weighted-average shares of Class A Common stock outstanding—diluted
64,999

 
38,826

 
56,153

 
38,826

 
 
 
 
 
 
 
 
Net loss per share of Class A common stock—basic and diluted
$
(0.04
)
 
$
(0.21
)
 
$
(0.82
)
 
$
(0.91
)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share 
The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted loss per share because the effect of including such shares would have been antidilutive:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Options, RSUs and warrants
15,731

 
11,250

 
14,693

 
10,162

Schedule of Stock by Class 
Total shares of common stock outstanding were as follows:
 
September 30, 2015
 
December 31, 2014(1)
Class A common stock
65,263

 
38,826

Class B common stock
90,398

 
90,177

 
155,661

 
129,003

 
 
(1)
Shares for December 31, 2014 have been retrospectively adjusted to give effect to the Reorganization Transactions.
Geographic Information (Tables)
Revenue from External Customers by Geographic Areas
Revenue by geography is based on the customer's address, and was as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
U.S.
$
305.8

 
$
267.2

 
$
880.5

 
$
764.5

International
105.3

 
89.7

 
301.4

 
251.1

 
$
411.1

 
$
356.9

 
$
1,181.9

 
$
1,015.6

Related Party Transactions (Tables)
Schedule of Related Party Transactions
Amounts paid to affiliates of KKR related to their participation as lenders under our Credit Facility were as follows:
 
Three Months Ended   September 30,
 
Nine Months Ended   September 30,
 
2015
 
2014
 
2015
 
2014
Principal
$
0.1

 
$
0.1

 
$
5.2

 
$
0.1

Interest and other fees
0.3

 
0.6

 
1.1

 
1.1

Debt financing fees
—

 
—

 
—

 
0.7

Organization and Background (Details) (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
9 Months Ended 0 Months Ended 0 Months Ended
Sep. 30, 2015
segment
Sep. 30, 2014
Apr. 7, 2015
Investor Corp Mergers
member
Sep. 30, 2015
Desert Newco, LLC
Apr. 7, 2015
Class A Common Stock
Apr. 7, 2015
Class A Common Stock
Apr. 7, 2015
Class A Common Stock
Investor Corp Mergers
Private Placement
Apr. 7, 2015
Class A Common Stock
Unidentified Affiliated Shareholders
Affiliated Entity
Apr. 7, 2015
LLC Units
Desert Newco, LLC
Investor Corp Mergers
Class of Stock [Line Items]
 
 
 
 
 
 
 
 
 
Shares issued during IPO
 
 
 
 
26,000 
 
38,826 
2,500 
38,826 
Share price (in USD per share)
 
 
 
 
 
$ 20.00 
 
 
 
Proceeds from issuance of IPO
$ 482.4 
$ (1.4)
 
 
$ 491.8 
 
 
 
 
Number of members acquired
 
 
4 
 
 
 
 
 
 
LLC units held (as a percent)
 
 
 
42.00% 
 
 
 
 
 
Number of reporting units
1 
 
 
 
 
 
 
 
 
Number of operating segments
1 
 
 
 
 
 
 
 
 
Summary of Significant Accounting Policies (Details) (USD $)
In Millions, unless otherwise specified
0 Months Ended
Apr. 7, 2015
Reorganization Parties
Investor
Tax Receivable Agreement
party
agreement
Apr. 7, 2015
Reorganization Parties and Continuing LLC Owners
Investor
Tax Receivable Agreement
agreement
Apr. 7, 2015
Reorganization Parties and Continuing LLC Owners
Investor
Tax Receivable Agreement
Sep. 30, 2015
Cash Flow Hedging
Designated as Hedging Instrument
Foreign Exchange Forward Contract
Entity Information [Line Items]
 
 
 
 
Derivative notional amount
 
 
 
$ 80.6 
Number of tax receivable agreements
4 
5 
 
 
Number of reorganization parties
4 
 
 
 
Percent of tax benefits owed under tax receivable agreement
 
 
85.00% 
 
Business Acquisitions (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Business Acquisition [Line Items]
 
 
 
Aggregate consideration transferred
$ 30.7 
$ 40.7 
 
Goodwill
1,662.3 
 
1,661.2 
Series of Individually Immaterial Business Acquisitions
 
 
 
Business Acquisition [Line Items]
 
 
 
Contingent liability
0.9 
 
 
Number of businesses acquired
3 
 
 
Aggregate consideration transferred
29.2 
 
 
Identified indefinite-lived intangible assets acquired
26.5 
 
 
Other identified intangible assets acquired
2.5 
 
 
Goodwill
1.1 
 
 
Net liabilities assumed
$ 0.9 
 
 
Weighted average useful life
1 year 8 months 12 days 
 
 
Goodwill and Intangible Assets - Goodwill (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
 
Balance at December 31, 2014
$ 1,661.2 
Goodwill related to acquisitions
1.1 
Balance at September 30, 2015
$ 1,662.3 
Goodwill and Intangible Assets - Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, accumulated amortization
$ 324.8 
$ 253.7 
Finite-lived intangible assets, net
258.1 
 
Indefinite-lived Intangible Assets [Line Items]
 
 
Domains sold
1.4 
 
Intangible assets, gross (excluding goodwill)
1,054.4 
1,003.4 
Trade names and branding
 
 
Indefinite-lived Intangible Assets [Line Items]
 
 
Indefinite-lived intangible assets (excluding goodwill)
445.0 
445.0 
Domain Portfolio
 
 
Indefinite-lived Intangible Assets [Line Items]
 
 
Indefinite-lived intangible assets (excluding goodwill)
25.1 
 
Indefinite-lived intangible assets (excluding goodwill), gross
26.5 
 
Domains sold
1.4 
 
Customer-related
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
360.5 
336.9 
Finite-lived intangible assets, accumulated amortization
181.5 
143.1 
Finite-lived intangible assets, net
179.0 
193.8 
Developed technology
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
210.1 
209.5 
Finite-lived intangible assets, accumulated amortization
138.0 
107.4 
Finite-lived intangible assets, net
72.1 
102.1 
Trade names
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
11.2 
10.9 
Finite-lived intangible assets, accumulated amortization
4.6 
2.8 
Finite-lived intangible assets, net
6.6 
8.1 
Other
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
1.1 
1.1 
Finite-lived intangible assets, accumulated amortization
0.7 
0.4 
Finite-lived intangible assets, net
$ 0.4 
$ 0.7 
Goodwill and Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
Intangible assets purchased
 
 
$ 22.5 
$ 0 
Amortization expense
24.6 
24.4 
71.4 
72.3 
Weighted Average
 
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
Weighted average remaining amortization period
 
 
49 months 
 
Customer-related
 
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
Intangible assets purchased
 
 
22.5 
 
Intangible assets purchased, contingent consideration
$ 16.7 
 
$ 16.7 
 
Useful life
 
 
48 months 
 
Customer-related |
Weighted Average
 
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
Useful life
 
 
99 months 
 
Developed technology |
Weighted Average
 
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
Useful life
 
 
64 months 
 
Trade names |
Weighted Average
 
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
Useful life
 
 
58 months 
 
Other |
Weighted Average
 
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
Useful life
 
 
36 months 
 
Goodwill and Intangible Assets - Future Amortization of Finite Lived Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
 
2015 (remainder of)
$ 26.1 
2016
88.8 
2017
52.5 
2018
44.4 
2019
25.9 
Thereafter
20.4 
Finite-lived intangible assets, net
$ 258.1 
Stockholders' Equity (Details) (USD $)
In Millions, except Share data, unless otherwise specified
0 Months Ended 9 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended
Apr. 7, 2015
Sep. 30, 2015
Sep. 30, 2014
Mar. 31, 2015
Dec. 31, 2014
Apr. 7, 2015
Affiliated Entity
Expense Reimbursement With Related Parties
Sponsors
Apr. 7, 2015
Board of Directors Chairman
Expense Reimbursement With Related Parties
Bob Parsons
Mar. 31, 2015
Desert Newco, LLC
Apr. 7, 2015
Class A Common Stock
Sep. 30, 2015
Class A Common Stock
Apr. 7, 2015
Class A Common Stock
Mar. 31, 2015
Class A Common Stock
Dec. 31, 2014
Class A Common Stock
Apr. 7, 2015
Class A Common Stock
Investor Corp Mergers
Private Placement
Sep. 30, 2015
Class B Common Stock
Apr. 7, 2015
Class B Common Stock
Mar. 31, 2015
Class B Common Stock
Dec. 31, 2014
Class B Common Stock
Apr. 7, 2015
LLC Units
Desert Newco, LLC
Investor Corp Mergers
Class of Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock shares authorized
 
 
 
 
 
 
 
 
 
1,000,000,000 
 
1,000,000,000 
 
 
500,000,000 
 
500,000,000 
 
 
Preferred stock shares authorized
 
50,000,000 
 
50,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Par value (in dollars per share)
 
 
 
 
 
 
 
 
 
$ 0.001 
 
$ 0.001 
 
 
$ 0.001 
 
$ 0.001 
 
 
Preferred stock par value (in dollars per share)
 
$ 0.001 
 
$ 0.001 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assumed blended state income tax rate
 
 
 
 
 
 
 
7.00% 
 
 
 
 
 
 
 
 
 
 
 
Assumed income tax rate
 
 
 
 
 
 
 
46.60% 
 
 
 
 
 
 
 
 
 
 
 
Assumed income tax rate including tax on net investment income
 
 
 
 
 
 
 
50.40% 
 
 
 
 
 
 
 
 
 
 
 
Shares issued
 
 
 
 
 
 
 
 
26,000,000 
 
 
 
 
38,826,000 
 
 
 
 
38,826,000 
Share price (in USD per share)
 
 
 
 
 
 
 
 
 
 
$ 20.00 
 
 
 
 
 
 
 
 
Proceeds from issuance of IPO
 
$ 482.4 
$ (1.4)
 
 
 
 
 
$ 491.8 
 
 
 
 
 
 
 
 
 
 
Common stock outstanding (in shares)
 
155,661,000 
 
 
129,003,000 
 
 
 
 
65,263,000 
 
 
38,826,000 
 
90,398,000 
90,425,000 
 
90,177,000 
 
Payments of stock issuance costs
$ 11.2 
 
 
 
 
$ 1.3 
$ 0.1 
 
 
 
 
 
 
 
 
 
 
 
 
Equity-Based Compensation Plans (Details) (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2015
Employee Stock
Mar. 31, 2015
2015 Equity Incentive Plan
Stock Compensation Plan
Class A Common Stock
Mar. 31, 2015
2011 Unit Incentive Plan
Stock Compensation Plan
Class A Common Stock
Mar. 31, 2015
2011 Unit Incentive Plan and Other Unidentified Plan
Stock Compensation Plan
Class A Common Stock
Mar. 31, 2015
2015 Employee Stock Purchase Plan
Employee Stock
Class A Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
Shares reserved for future issuance
 
 
6,050 
4,235 
 
2,000 
Shares rolled over
 
 
 
 
28,133 
 
Annual increase in shares reserved for issuance under equity incentive plan
 
 
20,571 
 
 
1,000 
Annual increase in shares reserved for issuance under equity incentive plan, percent
 
 
4.00% 
 
 
1.00% 
Unrecognized compensation costs
$ 56.2 
$ 0.8 
 
 
 
 
Weighted average recognition period
2 years 4 months 24 days 
 
 
 
 
 
Funds withheld on behalf of employees for future purchases under the ESPP
 
$ 9.7 
 
 
 
 
Equity-Based Compensation Plans Equity-based Award Activity (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Employee Stock Option
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Number of options granted
843 
1,265 
3,356 
3,971 
Weighted-average exercise price of options granted (in dollars per share)
$ 25.87 
$ 18.00 
$ 22.37 
$ 16.20 
Weighted-average grant date fair value of options granted (in dollars per share)
$ 10.96 
$ 8.05 
$ 9.18 
$ 7.73 
Restricted Stock Units (RSUs)
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Number of RSUs granted
2 
0 
16 
62 
Weighted-average grant date fair value of RSUs granted (in dollar per share)
$ 24.81 
$ 0.00 
$ 26.84 
$ 15.27 
Deferred Revenue (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
$ 934.0 
$ 821.4 
Deferred revenue, noncurrent
478.5 
429.2 
Domains
 
 
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
501.5 
462.9 
Deferred revenue, noncurrent
287.8 
266.8 
Hosting and presence
 
 
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
327.4 
283.4 
Deferred revenue, noncurrent
150.7 
131.5 
Business applications
 
 
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
105.1 
75.1 
Deferred revenue, noncurrent
$ 40.0 
$ 30.9 
Long-Term Debt - Schedule of Long Term Debt (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Debt Instrument [Line Items]
 
 
Long-term Debt
$ 1,086.3 
$ 1,469.5 
Less unamortized original issue discounts on long-term debt
(38.3)
(50.6)
Less current portion of long-term debt
(4.8)
(5.0)
Long-term debt, net of current portion
1,043.2 
1,413.9 
Term Loan |
Term Loan Due May 2021
 
 
Debt Instrument [Line Items]
 
 
Long-term Debt
1,086.3 
1,094.5 
Effective interest rate
5.10% 
5.20% 
Senior Notes |
Note Payable Due December 2019
 
 
Debt Instrument [Line Items]
 
 
Interest rate
9.00% 
9.00% 
Senior Notes |
Note Payable Due December 2019 |
GoDaddy Inc |
Loans Held by Related Parties |
Affiliated Entity
 
 
Debt Instrument [Line Items]
 
 
Long-term Debt
0 
300.0 
Line of Credit |
Revolving Credit Loan Due May 2019
 
 
Debt Instrument [Line Items]
 
 
Effective interest rate
 
4.00% 
Line of Credit |
Revolving Credit Loan Due May 2019 |
Revolving Credit Facility
 
 
Debt Instrument [Line Items]
 
 
Long-term Debt
$ 0 
$ 75.0 
Long-Term Debt (Details) (USD $)
9 Months Ended 1 Months Ended 1 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Credit Facility
Sep. 30, 2015
Credit Facility
London Interbank Offered Rate (LIBOR)
Sep. 30, 2015
Credit Facility
Federal Funds Rate
Sep. 30, 2015
Credit Facility
One-Month LIBOR
Apr. 30, 2015
Note Payable Due December 2019
GoDaddy Inc
Affiliated Entity
Loans Held by Related Parties
Senior Notes
Sep. 30, 2015
Term Loan
Term Loan Due May 2021
Sep. 30, 2015
Term Loan
Term Loan Due May 2021
Level 2
Apr. 30, 2015
Line of Credit
Revolving Credit Loan Due May 2019
Revolving Credit Facility
Sep. 30, 2015
Line of Credit
Revolving Credit Loan Due May 2019
Revolving Credit Facility
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt
 
 
 
 
 
 
 
$ 1,100,000,000.0 
 
 
 
Maximum borrowing capacity
 
 
 
 
 
 
 
 
 
 
150,000,000.0 
Base rate
 
 
 
1.00% 
2.25% 
 
 
 
 
 
 
Basis spread on variable rate
 
 
 
3.25% 
0.50% 
1.00% 
 
 
 
 
 
Reduction in interest rate margins following IPO
 
 
0.25% 
 
 
 
 
 
 
 
 
Reduction in interest rate margins due to leverage covenant being met
 
 
0.25% 
 
 
 
 
 
 
 
 
Repayment of revolving credit loan
8,200,000 
4,900,000 
 
 
 
 
 
 
 
75,000,000 
 
Available borrowing capacity
 
 
 
 
 
 
 
 
 
 
150,000,000 
Debt, fair value
 
 
 
 
 
 
 
 
1,087,700,000 
 
 
Repayments of related party debt
 
 
 
 
 
 
316,000,000 
 
 
 
 
Prepayment of senior note in April 2015
 
 
 
 
 
 
300,000,000 
 
 
 
 
Payments of debt extinguishment costs
 
 
 
 
 
 
13,500,000 
 
 
 
 
Interest on long-term debt
47,300,000 
54,400,000 
 
 
 
 
2,500,000 
 
 
 
 
Unamortized debt discount recorded as loss on debt extinguishment
 
 
 
 
 
 
7,100,000 
 
 
 
 
Write off of deferred financing costs
 
 
 
 
 
 
$ 800,000 
 
 
 
 
Long-Term Debt - Schedule of Debt Maturities (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Debt Disclosure [Abstract]
 
 
2015 (remainder of)
$ 2.8 
 
2016
11.0 
 
2017
11.0 
 
2018
11.0 
 
2019
11.0 
 
Thereafter
1,039.5 
 
Long-term Debt
$ 1,086.3 
$ 1,469.5 
Commitments and Contingencies (Details) (Indirect Taxation, USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Indirect Taxation
 
 
Loss Contingencies [Line Items]
 
 
Estimated tax liability
$ 6.3 
$ 5.9 
Income Taxes (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2015
Tax Receivable Agreement
Reorganization Parties and Continuing LLC Owners
Investor
Apr. 7, 2015
Tax Receivable Agreement
Reorganization Parties and Continuing LLC Owners
Investor
Sep. 30, 2015
Tax Receivable Agreement
Reorganization Parties and Continuing LLC Owners
Investor
General and administrative
Entity Information [Line Items]
 
 
 
 
 
Payable to related parties pursuant to tax receivable agreements
 
 
 
$ 170.4 
 
Percent of tax benefits owed under tax receivable agreement
 
 
 
85.00% 
 
Adjustment to tax receivable agreement liability
 
 
 
 
0.5 
Current portion of payable to related parties pursuant to tax receivable agreements
$ 3.0 
$ 0 
$ 3.0 
 
 
Loss Per Share (Details) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 0 Months Ended 0 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2014
Pro Forma
Sep. 30, 2015
Pro Forma
Sep. 30, 2014
Pro Forma
Apr. 7, 2015
Class A Common Stock
Sep. 30, 2015
Class B Common Stock
Apr. 7, 2015
Common Stock
Class A Common Stock
Sep. 30, 2015
Common Stock
Class A Common Stock
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Shares issued during IPO
 
 
 
 
 
 
 
 
26,000,000 
 
26,000,000 
26,000,000 
Net loss
$ (5.2)
$ (27.6)
$ (76.5)
$ (119.9)
$ (116.5)
$ (27.6)
$ (119.9)
$ (116.5)
 
 
 
 
Less: net loss attributable to non-controlling interests
(2.7)
0 
 
(44.2)
0 
(19.3)
(74.0)
(81.3)
 
 
 
 
Net loss
$ (2.5)
$ (27.6)
 
$ (75.7)
$ (116.5)
$ (8.3)
$ (45.9)
$ (35.2)
 
 
 
 
Weighted-average shares of Class A common stock outstanding—basic
64,999,000 
 
 
 
 
38,826,000 
56,153,000 
38,826,000 
 
 
 
 
Effect of dilutive securities
0 
 
 
 
 
0 
0 
0 
 
 
 
 
Weighted-average shares of Class A Common stock outstanding—diluted
64,999,000 1
 
 
 
 
38,826,000 1
56,153,000 1
38,826,000 
 
 
 
 
Net loss per share—basic and diluted (in USD per share)
$ (0.04)1
$ (0.21)1
 
$ (0.82)1
$ (0.91)1
$ (0.21)1
$ (0.82)1
$ (0.91)1
 
 
 
 
Conversion feature of Class B common stock, number of Class A common shares
 
 
 
 
 
 
 
 
 
1 
 
 
Loss Per Share Weighted Average Shares Excluded (Details)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Earnings Per Share [Abstract]
 
 
 
 
Antidilutive securities excluded from diluted loss per unit calculation (in shares)
15,731 
11,250 
14,693 
10,162 
Loss Per Share Schedule of Shares Outstanding (Details)
In Thousands, unless otherwise specified
Sep. 30, 2015
Apr. 7, 2015
Dec. 31, 2014
Class of Stock [Line Items]
 
 
 
Common stock outstanding (in shares)
155,661 
 
129,003 
Class A Common Stock
 
 
 
Class of Stock [Line Items]
 
 
 
Common stock outstanding (in shares)
65,263 
 
38,826 
Class B Common Stock
 
 
 
Class of Stock [Line Items]
 
 
 
Common stock outstanding (in shares)
90,398 
90,425 
90,177 
Geographic Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
Revenue
$ 411.1 
$ 356.9 
$ 1,181.9 
$ 1,015.6 
U.S.
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
Revenue
305.8 
267.2 
880.5 
764.5 
International
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
Revenue
$ 105.3 
$ 89.7 
$ 301.4 
$ 251.1 
Related Party Transactions (Details) (USD $)
3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Apr. 30, 2015
Sponsors
Affiliated Entity
Transaction and Fee Monitoring Agreement
Sep. 30, 2015
Sponsors
Affiliated Entity
Transaction and Fee Monitoring Agreement
Sep. 30, 2014
Sponsors
Affiliated Entity
Transaction and Fee Monitoring Agreement
Sep. 30, 2015
Sponsors
Affiliated Entity
Transaction and Fee Monitoring Agreement
Sep. 30, 2014
Sponsors
Affiliated Entity
Transaction and Fee Monitoring Agreement
Dec. 16, 2011
Bob Parsons
Board of Directors Chairman
Expense Reimbursement With Related Parties
Maximum
Apr. 30, 2015
Bob Parsons
Board of Directors Chairman
Special Termination Benefits
Sep. 30, 2015
Dell Inc
Affiliated Entity
Purchase and Lease of Computer Equipment, Technology Licensing, Maintenance and Support
Sep. 30, 2014
Dell Inc
Affiliated Entity
Purchase and Lease of Computer Equipment, Technology Licensing, Maintenance and Support
Sep. 30, 2015
Dell Inc
Affiliated Entity
Purchase and Lease of Computer Equipment, Technology Licensing, Maintenance and Support
Sep. 30, 2014
Dell Inc
Affiliated Entity
Purchase and Lease of Computer Equipment, Technology Licensing, Maintenance and Support
Sep. 30, 2015
Credit Facility
Affiliates of KKR
Affiliated Entity
Loans Held by Related Parties
Sep. 30, 2014
Credit Facility
Affiliates of KKR
Affiliated Entity
Loans Held by Related Parties
Sep. 30, 2015
Credit Facility
Affiliates of KKR
Affiliated Entity
Loans Held by Related Parties
Sep. 30, 2014
Credit Facility
Affiliates of KKR
Affiliated Entity
Loans Held by Related Parties
Sep. 30, 2015
Term Loan Due May 2021
Term Loan
Dec. 31, 2014
Term Loan Due May 2021
Term Loan
Sep. 30, 2015
Term Loan Due May 2021
Affiliates of KKR
Affiliated Entity
Term Loan
Loans Held by Related Parties
Dec. 31, 2014
Term Loan Due May 2021
Affiliates of KKR
Affiliated Entity
Term Loan
Loans Held by Related Parties
Dec. 31, 2014
Revolving Credit Loan Due May 2019
Affiliates of KKR
Affiliated Entity
Line of Credit
Loans Held by Related Parties
Apr. 30, 2015
Note Payable Due December 2019
GoDaddy Inc
Affiliated Entity
Loans Held by Related Parties
Senior Notes
Sep. 30, 2015
Note Payable Due December 2019
GoDaddy Inc
Affiliated Entity
Senior Notes
Loans Held by Related Parties
Sep. 30, 2014
Note Payable Due December 2019
GoDaddy Inc
Affiliated Entity
Senior Notes
Loans Held by Related Parties
Sep. 30, 2015
Note Payable Due December 2019
GoDaddy Inc
Affiliated Entity
Senior Notes
Loans Held by Related Parties
Sep. 30, 2014
Note Payable Due December 2019
GoDaddy Inc
Affiliated Entity
Senior Notes
Loans Held by Related Parties
Dec. 31, 2014
Note Payable Due December 2019
GoDaddy Inc
Affiliated Entity
Senior Notes
Loans Held by Related Parties
Related Party Transaction [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Repayments of principal
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 100,000 
$ 100,000 
$ 5,200,000 
$ 100,000 
 
 
 
 
 
 
 
 
 
 
 
Interest and other fees
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
300,000 
600,000 
1,100,000 
1,100,000 
 
 
 
 
 
 
 
 
 
 
 
Debt financing fees
 
 
13,500,000 
8,400,000 
 
 
 
 
 
 
 
 
 
 
 
 
0 
0 
0 
700,000 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt
1,086,300,000 
 
1,086,300,000 
 
1,469,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,086,300,000 
1,094,500,000 
28,900,000 
29,100,000 
5,000,000 
 
0 
 
0 
 
300,000,000 
Transaction and monitoring fees
44,600,000 1
41,800,000 1
167,600,000 1
127,500,000 1
 
26,700,000 
0 
600,000 
27,300,000 
1,800,000 
 
3,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Annual expense reimbursement
 
 
 
 
 
 
 
 
 
 
500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest on long-term debt
 
 
47,300,000 
54,400,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,500,000 
0 
6,800,000 
9,200,000 
20,300,000 
 
Prepayment penalties
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
13,500,000 
 
 
 
 
 
Purchases from related party
 
 
 
 
 
 
 
 
 
 
 
 
$ 4,300,000 
$ 5,800,000 
$ 13,300,000 
$ 14,200,000