Form 8-K/A - Current report: [Amend]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K/A

(Amendment No. 2)

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) April 20, 2023

Bright Mountain Media, Inc.

(Exact name of registrant as specified in its charter)

Florida

000-54887

27-2977890

(State or other jurisdiction
of incorporation)

(Commission
File Number)

(IRS Employer
Identification No.)

6400 Congress Avenue, Suite 2050

Boca Raton, Florida

33487

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: 561-998-2440

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


☐			Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐			Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act: None

Title of Each Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Indicate by check mark whether the registrant is an emerging growth company as defined in in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

EXPLANATORY NOTE

This Amendment No. 2 to Form 8-K is being filed to provide the financial statements and pro forma financial statements required pursuant to Item 9.01 of Form 8-K.

Item 1.01. Entry into a Material Definitive Agreement.

The disclosure included in Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.

Item 2.01. Completion of Acquisition or Disposition of Assets.

As previously disclosed in its Current Report on Form 8-K filed with the Securities Exchange Commission on April 13, 2023 (the “Form 8-K”), Bright Mountain Media, Inc. (the “Company”) entered into a definitive asset purchase agreement, dated April 10, 2023, with Big Village Insights, Inc., a Delaware corporation f/k/a Engine International, Inc., Big Village Agency LLC, a Delaware limited liability company f/k/a Engine USA LLC, Big Village Group Inc., a Delaware corporation f/k/a Engine Group Inc., Deep Focus, Inc., a New York corporation, EMX Digital Inc., a Delaware corporation, Balihoo, Inc., a Delaware corporation, and Big Village Media LLC, a Delaware limited liability company f/k/a Engine Media LLC in the Bankruptcy Case (collectively, the “Sellers”) to acquire the assets of the Seller’s Agency Business and Insights Business (the “Acquisition”). On April 20, 2023, the Company completed the Acquisition for approximately $20 million, plus assumed liabilities, in an all-cash transaction.

Also, as previously disclosed in the Form 8-K, the Company entered into a commitment letter with Centre Lane Solutions Partners, LP (any designated lender(s) pursuant thereto, collectively, the “CLP Lenders”), pursuant to which CLP Lenders would provide financing in the form of a senior secured credit facility for the Acquisition. On April 20, 2023, the Company and its subsidiaries CL Media Holdings LLC, Bright Mountain LLC, MediaHouse, Inc., Big-Village Agency LLC, and BV Insights LLC, entered into the Seventeenth Amendment to Amended and Restated Senior Secured Credit Agreement (the “Agreement”). The Company and its subsidiaries are parties to a credit agreement between itself, the lenders party thereto and Centre Lane Partners Master Credit Fund II, L.P., as Administrative Agent and Collateral Agent dated June 5, 2020, as amended (the “Credit Agreement”). The Credit Agreement was amended, as provided in the Agreement, to provide for an additional term loan amount of $26,315,789.47 to, among other things, finance the Acquisition. This term loan matures on April 20, 2026. Also, in connection with the Agreement, on April 20, 2023, the Company issued 21,401,993 shares of common stock of the Company to BV Agency, LLC, an entity beneficially owned by CLP Lenders. The issuance of the shares of common stock were not registered under the Securities Act of 1933, as amended (“Securities Act”), in accordance with Section 4(a)(2) of the Securities Act as a transaction by an issuer not involving a public offering. As of April 20, 2023, BV Agency, LLC and Centre Lane Partners Master Credit Fund II, L.P. own approximately 12.4% and 8.8% of the Company’s outstanding common stock, respectively.

The terms and conditions of this Agreement and Annex A to the Credit Agreement are qualified in its entirety by reference to the amendment, a copy of which are attached to this Current Report on Form 8-K as Exhibit 10.1 and Exhibit 10.2 which are incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The disclosure included in Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.

Item 3.02. Unregistered Sales of Equity Securities.

The disclosure included in Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(a) Financial statements of business to be acquired.

The audited combined financial statements of Big Village Agency and Big Village Insights as of and for the years ended December 31, 2022 and 2021 are attached to this Current Report on Form 8-K as Exhibit 99.1 and incorporated herein by reference.

The unaudited combined financial statements of Big Village Agency and Big Village Insights as of and for the three months ended March 31, 2023 and 2022 are attached to this Current Report on Form 8-K as Exhibit 99.2 and incorporated herein by reference.

(b) Pro forma financial information.

The unaudited pro forma financial statements for the Company reflecting the Acquisition are attached to this Current Report on Form 8-K as Exhibit 99.3 and incorporated herein by reference.

(d) Exhibits


Exhibit No.						Description
10.1						Seventeenth Amendment to Amended and Restated Senior Secured Credit Agreement, dated April 20, 2023 (incorporated by reference to the Current Report on 8-K/A filed with the Securities and Exchange Commission on April 26, 2023).
10.2						Annex A to the Credit Agreement dated April 20, 2023 (incorporated by reference to the Current Report on 8-K/A filed with the Securities and Exchange Commission on April 26, 2023).
23.1						Consent of Turner Stone & Company, L.L.P. *
99.1						The audited combined financial statements of Big Village Agency, LLC and Big Village Insights, Inc, (the "Big Village Entities") for the years ended December 31, 2022 and 2021.*
99.2						The unaudited combined financial statements of Big Village Agency, LLC and Big Village Insights, Inc, (the "Big Village Entities") for the three months ended March 31, 2023 and 2022.*
99.3						Unaudited Pro Forma Condensed Combined Financial Information as of March 31, 2023 and for the three months ended March 31, 2023.*
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

July 6, 2023

Bright Mountain Media, Inc.


(Registrant)

By:			/s/ Miriam Martinez
			Miriam Martinez
			Chief Financial Officer

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the Registration Statements on Form S-8 (Reg. No. 333-204882 and 333-268039) of Bright Mountain Media, Inc. of our report dated June 29, 2023, relating to the combined financial statements of Big Village Agency, LLC and Big Village Insights, Inc, as of and for the years ended December 31, 2022 and 2021, which report is included in this Current Report on Form 8-K of Bright Mountain Media, Inc. dated July 6, 2023.

/s/ Turner, Stone & Company, L.L.P.

Dallas, Texas

July 6, 2023

Exhibit 99.1

Big Village Agency, LLC and Big Village Insights, Inc

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Audited Financial Statements

December 31, 2022 and 2021

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Table of Contents


			Page No.
Independent Auditor ’s Report			2
Financial Statements:
Combined Balance Sheets as of December 31, 2022 and 2021			4
Combined Statements of Operations for the Years Ended December 31, 2022 and 2021			5
Combined Statements of Changes in Members’ Equity for the Years Ended December 31, 2022 and 2021			6
Combined Statements of Cash Flows for the Years Ended December 31, 2022 and 2021			7
Notes to Combined Financial Statements			8

Independent Auditor’s Report

To the Members of

Big Village Agency, LLC and

Big Village Insights, Inc

Report on the Audit of the Financial Statements

Opinion

We have audited the combined financial statements of Big Village Agency, LLC and Big Village Insights, Inc, (the “Company”) which comprise the combined balance sheets as of December 31, 2022 and 2021, and the related combined statements of operations, members’ equity, and cash flows for the years then ended, and the related notes to the combined financial statements (the “financial statements”).

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Substantial Doubt About the Entity’s Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company subsequent to the date of the financial statements entered into a plan of liquidation and has stated that substantial doubt exists about the Company’s ability to continue as a going concern. Management’s evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for one year after the date that the financial statements are issued.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that

an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:

a.Exercise professional judgment and maintain professional skepticism throughout the audit.

b.Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

c.Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, no such opinion is expressed.

d.Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

e.Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit.

/s/ Turner, Stone & Company, L.L.P.

Dallas, Texas

June 29, 2023

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Balance Sheets


	December 31, 2022		December 31, 2021
ASSETS
Current Assets
Cash and cash equivalents	$	5,711,939	$	9,130,554
Accounts receivable, net	15,682,256		15,315,578
Prepaid expenses and other current assets	279,997		95,976
Total Current Assets	21,674,192		24,542,108
Property and equipment, net	265,537		523,967
Total Assets	$	21,939,729	$	25,066,075

LIABILITIES AND MEMBERS' EQUITY
Current Liabilities
Accounts payable and accrued expenses	$	10,713,132	$	9,278,805
Other liabilities	4,994,402		4,191,076
Deferred revenue	3,824,782		7,402,817

Total Liabilities	19,532,316		20,872,698



Members equity’	2,407,413		4,193,377

Total liabilities and members' equity	$	21,939,729	$	25,066,075

See accompanying notes to audited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Statements of Operations

Years Ended December 31, 2022 and 2021


	2022		2021
Revenue	$	56,367,693	$	53,029,003
Cost of revenue	40,290,585		36,522,454
Gross margin	16,077,108		16,506,549







General and administrative expense	12,997,351		13,044,360
Net income	$	3,079,757	$	3,462,189

See accompanying notes to audited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Statements of Changes in Members’ Equity

Years Ended December 31, 2022 and 2021


Balance, December 31, 2020	$	18,515,486
Net parent transfer	(17,784,298)
Net income	3,462,189
Balance, December 31, 2021	$	4,193,377
Net parent transfer	(4,865,721)
Net income	3,079,757
Balance, December 31, 2022	$	2,407,413

See accompanying notes to audited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Statements of Cash Flows

Years Ended December 31, 2022 and 2021


	2022		2021
Cash flows from operating activities:
Net income	$	3,079,757	$	3,462,189
Adjustments to reconcile net income to net cash provided by operations:
Depreciation	318,457		565,836
Recovery of doubtful debts	(16,866)		(60,447)
Loss on disposal of fixed assets	—		11,620
Changes in operating assets and liabilities:
Accounts receivable, net	(349,812)		(5,182,599)
Prepaid expense and other assets	(184,020)		(2,829,838)
Accounts payable and accrued expenses	1,434,327		2,755,439
Deferred revenue	(3,578,035)		2,951,235
Other liabilities	803,326		3,893,304
Net cash provided by operating activities	$	1,507,134	$	5,566,739

Cash flows from investing activities:
Purchase of fixed assets	(88,472)		(294,668)
Net cash used in investing activities	(88,472)		(294,668)

Cash flows from financing activities:
Net parent transfer	(4,837,277)		(19,300,184)
Net cash used in financing activities	(4,837,277)		(19,300,184)

Decrease in cash and cash equivalents	(3,418,615)		(14,028,113)
Cash and cash equivalents at beginning of year	9,130,554		23,158,667
Cash and cash equivalents at end of year	$	5,711,939	$	9,130,554

See accompanying notes to audited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Years Ended December 31, 2022 and 2021

NOTE 1 – DESCRIPTION OF BUSINESS AND DEVELOPMENT

The combined financials statements represents the financial statements of Big Village Insights, Inc, and Big Village Agency, LLC, (the “Big Village Entities” or the “Company”). The Big Village Entities are wholly-owned subsidiaries of Big Village Holdings, LLC (“Parent”).

Big Village Insights, Inc, was incorporated on May 31, 1991, in the state of Delaware and is a global business intelligence firm providing primary research, secondary research, competitive intelligence and expert insight to address customer's strategic issues.

Big Village Agency, LLC, was incorporated on December 16, 2009, in the state of Delaware and is a digital marking service company, providing advertising technology serving advertisers and agencies by providing access to premium inventory, leveraging data to optimize programmatic campaigns.

Voluntary Petitions for Relief Under Chapter 11

On February 8, 2023, Big Village Holding LLC and ten affiliated debtors, including Big Village Insights, Inc, and Big Village Agency, LLC (collectively, the “Debtors”) each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware, jointly-administered under case No. 23-10174 (the “Bankruptcy Case”).

Sale of Assets

In accordance with Bidding Procedures, on April 4, 2023, Big Village Holdings, LLC conducted an auction among qualified bidders for sale of certain divisions inclusive of certain assets of Big Village Insights, Inc, and Big Village Agency, LLC. Bright Mountain Media, Inc (“Bright Mountain”) was declared the winning bidder with a bid of $20.0 million for certain assets and assumed liabilities of the Big Village Entities. On April 20, 2023 the asset acquisition was completed, in addition to the assets, Bright Mountain assumed all prepetition and post-petiton liabilities for all assumed vendors.

Plan of Liquidation

On June 10, 2023, the Debtors filed their combined Disclosure Statement and Joint Chapter 11 Plan of Liquidation (the “Combined Disclosure Statement and Plan”). On June 12, 2023, the Debtors filed a motion (the "Motion") for entry of an order, substantially approving the Combined Disclosure Statement and Plan. A hearing to consider approval of the Motion is scheduled for July 10, 2023.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Big Village Entities has historically operated as part of Big Village Holdings, LLC and not as a standalone companies. Financial statements representing the historical operations of the Big Village Entities have been derived from their Parent’s historical accounting records and are presented on a carve-out basis. All revenues and costs as well as assets and liabilities directly associated with the business activity of the Big Village Entities are included in the financial statements. The financial statements have been adjusted to exclude assets that were not part of the sale of the Big Village Entities, including goodwill, intangibles, deferred income taxes, income tax payable, sales tax payable and intercompany transaction with the Parent and other subsidiaries of the Parent.

Net parent investment represents Parent’s interest in the recorded net assets of the Company. All significant transactions between the Big Village Entities and the Parent have been included in the accompanying financial statements. Transactions with the Parent are reflected in the accompanying combined statements of changes in member’s equity as “net parent transfer” and in the accompanying combined balance sheets within “net parent investment.”

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Years Ended December 31, 2022 and 2021

All significant intercompany accounts and transactions between the Big Village Entities and the Parent have been eliminated in the accompanying combined financial statements.

Going Concern

Considering the subsequent sale of assets to Bright Mountain and the filing of the Debtors’ Chapter 11 Plan of Liquidation, such matters create a substantial doubt regarding the Company’s ability to meet its financial needs and continue as a going concern.

The accompanying consolidated financial statements are prepared on a going concern basis and do not include any adjustments that might result from uncertainty about the Company’s ability to continue as a going concern.

Cash and Cash Equivalents

The Entities considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. The Company has substantially all of its cash and cash equivalents deposited with one financial institution. Balances on deposit are insured by the Federal Deposit Insurance Corporation (“FDIC”). However, from time to time, the Company’s balances may exceed the FDIC insurable amount at its bank.

As of December, 2022 and 2021, the Big Village Entities had cash balances with a single financial institution in excess of the FDIC insured limits by amounts of $5,484,863 and $8,883,479, respectively.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in existing accounts receivable. The Company reviews the allowance for doubtful accounts on a periodic basis. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. Account balances are charged off against the allowance when it is probable that the receivable will not be recovered. Recoveries of receivables previously charged off are recorded when received.

Unbilled receivables are the results of timing differences between billings to clients and is included in accounts receivable.

Property and Equipment, net

Property and equipment are recorded at cost. The Company provides for depreciation of property and equipment over the estimated useful life of three to seven years, using the straight-line method. When assets are sold or retired, the applicable cost and accumulated depreciation or amortization are removed from the accounts. The resulting gains or losses are reflected in the combined statements of operations.

The Company incurs costs to develop software for internal use. The Company capitalizes costs during the application development stage of the project. Costs incurred for enhancements that are expected to result in additional material functionality are capitalized. The capitalized costs amounted to $88,472 and $294,668 for the years ended December 31, 2022 and 2021, respectively, and are included in property and equipment, net on the balance sheets. Amortization commences when the software for internal use is ready for its intended use. Capitalized internal use software is amortized using the straight-line method over a three year period.

Revenue Recognition

The Company recognizes revenue upon fulfillment of its performance obligation to a customer, subject to a contract existing with the client and a fixed or determinable transaction price. Performance obligations for all transactions are satisfied, and the corresponding revenue is recognized, either over time or at a distinct point in time; the Company has no arrangements with multiple performance obligations. The Company considers the following when determining if a contract exists (i) contract approval by all parties, (ii) identification of each party’s rights

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Years Ended December 31, 2022 and 2021

regarding the goods or services to be transferred, (iii) specified payment terms, (iv) commercial substance of the contract, and (v) collectability of substantially all of the consideration is probable.

Revenue is recognized on a gross or net basis based on the determination as to whether the Company functions as the principal or agent in the transaction. The Company evaluates certain indicators and determines whether revenue is recognized on a gross or net basis.

Payment terms are specified in agreements between the Company and customers. The Company bills customers by the terms stipulated in the contracts. Payments are typically due from customers within 90 days or less.

Deferred Revenue

The Company records deferred revenue when cash payments are received in advance of performance obligations. The Company expects to recognize the deferred revenue in the following period when it transfers its services and, therefore, satisfies its performance obligation to the customers.

Cost of Revenue

Cost of revenues include the direct costs incurred in the creation and delivery of the Company’s products and services. These costs primarily include personnel costs, technology and data related costs, and other third-party costs.

General, and Administrative Expenses

General and administrative expenses consist primarily of (i) personnel and related costs for our executive, finance and accounting, human resources, and, administrative personnel, including salaries, benefits and bonuses, (ii) legal, accounting and other professional service fees; (iii) other corporate expenses; (iv) information technology costs; and (v) facility costs.

Use of Estimates

The preparation of these combined financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the combined financial statements and accompanying notes. Actual results could differ from those estimates.

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentration of credit risk consist principally of cash and cash equivalents and accounts receivable. We place our cash and cash equivalents with high credit-quality financial institutions. Such deposits may be in excess of federally insured limits. We perform periodic evaluations of the relative credit standing of the financial institutions.

We perform credit evaluations of our customers’ financial condition and require no collateral from our customers. We maintain an allowance for doubtful accounts receivable based upon the expected collectability of accounts receivable balances.

The following table provides information about concentration that exceed 10% of revenue at December 31, 2022 and 2021.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Years Ended December 31, 2022 and 2021


	2022		2021
Revenue Concentration
Customers exceeding 10% of revenue	2		2
% of overall revenue
Customer 1	12	%	10	%
Customer 2	17	%	15	%
Total % of revenue	29	%	25	%

Recent Accounting Pronouncements

In June 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-13 (amended by ASU 2019-10), Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, regarding the measurement of credit losses for certain financial instruments. which replaces the incurred loss model with a current expected credit loss (“CECL”) model. The CECL model is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. The Company is required to adopt the new guidance on January 1, 2023. The Company does not anticipate adopting this guidance will have a material impact on its combined financial statements.

NOTE 3 – ACCOUNTS RECEIVABLE

Accounts receivable, net consisted of the following:


	December, 31
	2022		2021
Accounts receivable	$	15,003,592	$	14,200,580
Unbilled receivables (A)	678,664		1,257,614
	15,682,256		15,458,194
Less: allowance for doubtful accounts	—		(142,616)
Accounts receivable, net	$	15,682,256	$	15,315,578

(A) - Unbilled receivables represent amounts for services rendered at the end of the period pending generation of invoice to the customer.

Recovery of doubtful debts was an income of $16,866, and $60,447 for the years ended December 31, 2022 and 2021, respectively.

NOTE 4 – PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Years Ended December 31, 2022 and 2021


	December, 31
	2022		2021
Computer hardware and software	$	2,466,403	$	4,259,230


Less: accumulated depreciation	(2,200,866)		(3,735,263)
Property and equipment, net	$	265,537	$	523,967

Depreciation expense was $318,457, and $565,836 for the years ended December, 31, 2022 and 2021, respectively and is included in general and administrative expenses on the combined statements of operations.

NOTE 5 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consisted of the following:


	December, 31
	2022		2021
Accounts payable	$	7,544,034	$	5,842,905
Accrued wages, commissions and bonus	1,370,270		1,854,780
Other accrued expenses	1,798,828		1,581,120
Total accounts payable and accrued expenses	$	10,713,132	$	9,278,805

NOTE 6 – REVENUE RECOGNITION

Big Village Insights’ revenues are primarily derived from providing a single integrated service for research. Insights performs the various activities outlined in a given contract and integrates the resulting goods/services to meet contract requirements specified by the customer. The resulting deliverables are considered outputs of the overall service, but the nature of the Insights’ promise is to execute and oversee the overall project by integrating the various activities and inputs. The customer directs the Insights’ performance of services, but certain specifications of deliverables are unknown at contract inception and determined over the course of the Insights’ performance under the contract. Insights satisfies the single performance obligation over time, by applying the input method on a cost-to-cost basis to measure progress toward satisfaction of the performance obligation. Insights recognizes revenue on a gross basis primarily based on the determination that it has the primary responsibility to provide services to their customers.

Big Village Agency’s revenues are primarily derived from the planning and execution of creative and media marketing campaigns. Agency performs various activities outlined in a given contract and integrate the resulting goods/services to meet contract requirements specified by the customer. The nature of the Company’s performance obligation is to execute and oversee the overall project by integrating the various activities and inputs. Revenue is recognized net of pass-through expenses charged to clients, such as production costs and media buys. This is based on the determination that certain key indicators of gross reporting have not been fulfilled, including limitations in supplier selection and control in establishing prices for production costs and media buys.

The Company has elected the practical expedient that permits an entity not to recognize a significant financing component if the time between the transfer of a good or service and payment is one year or less. The Company does not enter into contracts in which the period between payment by the customer and the transfer of the promised goods or services to the customer is greater than 12 months.

Revenue totaling $56,367,693 and $53,029,003 for the years ended December 31, 2022 and 2021, respectively, are recognized by the company over time.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Years Ended December 31, 2022 and 2021

Geographic Information

Revenue by geographical region consist of the following:


	2022
	US		Europe		APAC		Other		Total
Insights	$	41,284,012	$	53,348	$	13,319	$	159,172	$	41,509,851
Agency	14,786,443		—		71,399		—		14,857,842
Total	$	56,070,455	$	53,348	$	84,718	$	159,172	$	56,367,693


	2021
	US		Europe		APAC		Other		Total
Insights	$	40,815,440	$	23,914	$	96,966	$	279,636	$	41,215,956
Agency	11,813,047		—		—		—		11,813,047
Total	$	52,628,487	$	23,914	$	96,966	$	279,636	$	53,029,003

Revenue by geography is generally based on the location of the Company’s customers. Total United States revenue was approximately 99% of total revenue for the years ended December 31, 2022 and 2021, respectively.

Deferred Revenue

Deferred revenue totaling $3,824,782 and $7,402,817 for the years ended December 31, 2022 and 2021, respectively, are recognized by the company when earned.

NOTE 7 – RELATED PARTY TRANSACTIONS

The Company is affiliated with several companies through common ownership and control and has entered into transactions for revenue, cost of revenue as well as general services allocated from its Parent.

Related party transactions for the years ended December 31, 2022 and 2021 are as follows:


	2022	2021
Revenue	997,096	1,398,525

Cost of revenue	267,057	319,997

General and administration expenses	8,326,349	8,060,253

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Years Ended December 31, 2022 and 2021

NOTE 8 - COMMITMENTS AND CONTINGENCIES

In the ordinary course of its business, the Company may become subject to claims or proceedings from time to time arising in the normal course of its business. In the opinion of management, the Company’s liability, if any, under any pending litigation or administrative proceedings, even if determined adversely, would not materially affect its financial condition, results of operations or cash flows.

NOTE 9 – SUBSEQUENT EVENTS

The Company has evaluated events and transactions that occurred during the period from the balance sheet date through June 29, 2023, the date the Company’s financial statements are available to be issued.

Voluntary Petitions for Relief Under Chapter 11

Sale of Assets

Plan of Liquidation

Exhibit 99.2

Big Village Agency, LLC and Big Village Insights, Inc

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Interim Financial Statements

March 31, 2023 and 2022

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Table of Contents


			Page No.

Financial Statements:
Combined Balance Sheets as of March 31, 2023 and December 31, 2022			2
Combined Statements of Operations for the Three Months Ended March 31, 2023 and 2022			3
Combined Statements of Changes in Members’ Equity for the Three Months Ended March 31, 2023 and 2022			4
Combined Statements of Cash Flows for the Three Months Ended March 31, 2023 and 2022			5
Notes to Combined Financial Statements			6

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Balance Sheets


	March 31, 2023		December 31 2022
ASSETS
Current Assets
Cash and cash equivalents	$	8,594,966	$	5,711,939
Accounts receivable, net	12,542,271		15,682,256
Prepaid expenses and other current assets	586,294		279,997
Total Current Assets	21,723,531		21,674,192
Property and equipment, net	215,675		265,537
Total Assets	$	21,939,206	$	21,939,729

LIABILITIES AND MEMBERS' EQUITY
Current Liabilities
Accounts payable and accrued expenses	$	14,127,882	$	10,713,132
Other liabilities	2,237,740		4,994,402
Deferred revenue	4,641,665		3,824,782

Total Liabilities	21,007,287		19,532,316



Members equity	931,919		2,407,413

Total liabilities and members' equity	$	21,939,206	$	21,939,729

See accompanying notes to the unaudited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Statements of Operations

Three Months Ended March 31, 2023 and 2022


	2023		2022
Revenue	$	11,681,869	$	14,061,300
Cost of revenue	9,693,402		9,638,416
Gross margin	1,988,467		4,422,884







General and administrative expense	3,164,707		3,322,994
Net (loss) income	$	(1,176,240)	$	1,099,890

See accompanying notes to the unaudited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Statements of Changes in Members’ Equity

Three Months Ended March 31, 2023 and 2022


Balance, December 31, 2022	$	2,407,413
Net parent transfer	(299,254)
Net income	(1,176,240)
Balance, March 31, 2023	$	931,919


Balance, December 31, 2021	$	4,193,377
Net parent transfer	(2,270,626)
Net income	1,099,890
Balance, March 31, 2022	$	3,022,641

See accompanying notes to the unaudited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Combined Statements of Cash Flows

Three Months Ended March 31, 2023 and 2022


	2023		2022
Cash flows from operating activities:
Net (loss) income	$	(1,176,240)	$	1,099,890
Adjustments to reconcile net (loss) income to net cash provided by operations:
Depreciation	49,862		100,989
Bad debt expense	5,730		—
Changes in operating assets and liabilities:
Accounts receivable, net	3,134,255		2,326,702
Prepaid expense and other assets	(306,297)		(506,341)
Accounts payable and accrued expenses	3,414,749		102,809
Deferred revenue	816,883		(578,543)
Other liabilities	(2,756,661)		11,118
Net cash provided by operating activities	$	3,182,281	$	2,556,624





Cash flows from financing activities:
Net parent transfer	(299,254)		(2,242,180)
Net cash used in financing activities	(299,254)		(2,242,180)

Increase in cash and cash equivalents	2,883,027		314,444
Cash and cash equivalents at beginning of period	5,711,939		9,130,554
Cash and cash equivalents at end of period	$	8,594,966	$	9,444,998

See accompanying notes to the unaudited combined financial statements.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Three Months Ended March 31, 2023 and 2022

NOTE 1 – DESCRIPTION OF BUSINESS AND DEVELOPMENTS

The combined financials statements represents the financial statements of Big Village Insights, Inc, and Big Village Agency, LLC, (the “Big Village Entities” , “we”or the “Company”). The Big Village Entities are wholly-owned subsidiaries of Big Village Holdings, LLC (“Parent”).

Voluntary Petitions for Relief Under Chapter 11

On February 8, 2023, Big Village Holding LLC and ten affiliated debtors, including Big Village Insights, Inc, and Big Village Agency, LLC (collectively, the "Debtors") each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware, jointly-administered under case No. 23-10174 (the “Bankruptcy Case”).

Sale of Assets

Plan of Liquidation

On June 10, 2023, the Debtors filed their combined Disclosure Statement and Joint Chapter 11 Plan of Liquidation (the "Combined Disclosure Statement and Plan"). On June 12, 2023, the Debtors filed a motion (the "Motion") for entry of an order, substantially approving the Combined Disclosure Statement and Plan. A hearing to consider approval of the Motion is scheduled for July 10, 2023.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Net parent investment represents Parent’s interest in the recorded net assets of the Company. All significant transactions between the Big Village Entities and the Parent have been included in the accompanying combined financial statements. Transactions with the Parent are reflected in the accompanying combined statements of changes in member’s equity as “net parent transfers” and in the accompanying combined balance sheets within “net parent investment.”

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Three Months Ended March 31, 2023 and 2022

All significant intercompany accounts and transactions between the Big Village Entities and the Parent have been eliminated in the accompanying combined financial statements.

Going Concern

Cash and Cash Equivalents

As of March 31, 2023 and December 31, 2022, the Big Village Entities had cash balances with a single financial institution in excess of the FDIC insured limits by amounts of $8,344,966 and $5,461,939, respectively.

Accounts Receivable and Allowance for Doubtful Accounts

Unbilled receivables are the results of timing differences between billings to clients and is included in accounts receivable.

Property and Equipment, net

The Company incurs costs to develop software for internal use. The Company capitalizes costs during the application development stage of the project. Costs incurred for enhancements that are expected to result in additional material functionality are capitalized. Amortization commences when the software for internal use is ready for its intended use. Capitalized internal use software is amortized using the straight-line method over a three year period. There were $0 and $88,472 capitalized cost for the three months ended March 31, 2023 and the year ended December 2022, respectively.

Revenue Recognition

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Three Months Ended March 31, 2023 and 2022

Deferred Revenue

Cost of Revenue

General, and Administrative Expenses

Use of Estimates

Concentrations of Credit Risk

The following table provides information about concentration that exceed 10% of revenue at March 31, 2023 and 2022.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Three Months Ended March 31, 2023 and 2022


	2023		2022
Revenue Concentration
Customers exceeding 10% of revenue	1		2
% of overall revenue
Customer 1	—	%	12	%
Customer 2	21	%	16	%
Total % of revenue	21	%	28	%

Recent Accounting Pronouncements

NOTE 3 – ACCOUNTS RECEIVABLE

Accounts receivable, net consisted of the following:



	March 31, 2023		December 31, 2022
Accounts receivable	$	11,484,389	$	15,003,592
Unbilled receivables (A)	1,057,882		678,664


Accounts receivable, net	$	12,542,271	$	15,682,256

(A) - Unbilled receivables represent amounts for services rendered at the end of the period pending generation of invoice to the customer.

Bad debt expense was $5,730, and $0 for the three months ended March 31, 2023, and 2022, respectively.

NOTE 4 – PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:


	March 31, 2023		December 31, 2022
Computer hardware and software	$	2,466,403	$	2,466,403


Less: accumulated depreciation	(2,250,728)		(2,200,866)
Property and equipment, net	$	215,675	$	265,537

Depreciation expense was $49,862, and $100,989 for the three months ending March 31, 2023, and 2022, respectively and is included in general and administrative expenses on the combined statements of operations.

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Three Months Ended March 31, 2023 and 2022

NOTE 5 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consisted of the following:


	March 31, 2023		December 31, 2022
Accounts payable	$	10,895,053	$	7,544,034
Accrued wages, commissions and bonus	1,618,655		1,370,270
Other accrued expenses	1,614,174		1,798,828
Total accounts payable and accrued expenses	$	14,127,882	$	10,713,132

NOTE 6 – REVENUE RECOGNITION

Revenue totaling $11,681,869 and $14,061,300 for the three months ended March 31, 2023 and 2022, respectively, are recognized by the company over time.

Geographic Information

Revenue by geographical region consist of the following:

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Three Months Ended March 31, 2023 and 2022


	2023
	US		Europe		APAC		Other		Total
Insights	$	8,982,006	$	1,216	$	—	$	62,675	$	9,045,897
Agency	2,635,972		—		—		—		2,635,972
Total	$	11,617,978	$	1,216	$	—	$	62,675	$	11,681,869


	2022
	US		Europe		APAC		Other		Total
Insights	$	10,407,750	$	—	$	5,408	$	77,022	$	10,490,180
Agency	3,548,568		—		22,552		—		3,571,120
Total	$	13,956,318	$	—	$	27,960	$	77,022	$	14,061,300

Revenue by geography is generally based on the location of the Company’s customers. Total United States revenue was approximately 99% of total revenue for the three months ended March 31, 2023 and 2022, respectively.

Deferred Revenue

Deferred revenue totaling $4,641,665 and $3,824,782 for the three months ended March 31, 2023 and the year ended December 31, 2022, respectively, are recognized by the company when earned.

NOTE 7 – RELATED PARTY TRANSACTIONS

Related party transactions for the three months ended March 31, 2023 and 2022 are as follows:


	2023	2022
Revenue	150,982	359,906
Cost of revenue	99,310	9,940
General and administration expenses	1,996,974	2,013,303

NOTE 8 - COMMITMENTS AND CONTINGENCIES

NOTE 9 – SUBSEQUENT EVENTS

Big Village Entities

(Wholly-Owned Subsidiaries of Big Village Holdings, LLC)

Notes to the Combined Financial Statements

Three Months Ended March 31, 2023 and 2022

Voluntary Petitions for Relief Under Chapter 11

Sale of Assets

Plan of Liquidation

EXHIBIT 99.3

BRIGHT MOUNTAIN MEDIA, INC.

Notes to Unaudited Pro Forma

Condensed Combined Financial Statements

Description of Business Combination

Asset Purchase Agreement

On April 3, 2023, in accordance with certain procedures (the “Bidding Procedures”) adopted by the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) in In re Big Village Holding LLC, et al., jointly-administered under case No. 23-10174 (the “Bankruptcy Case”), the Company submitted a bid (the “Bid”) for the acquisition of certain assets of Big Village Insights, Inc., a Delaware corporation f/k/a Engine International, Inc., Big Village Agency LLC, a Delaware limited liability company f/k/a Engine USA LLC, Big Village Group Inc., a Delaware corporation f/k/a Engine Group Inc., Deep Focus, Inc., a New York corporation, EMX Digital Inc., a Delaware corporation, Balihoo, Inc., a Delaware corporation, and Big Village Media LLC, a Delaware limited liability company f/k/a Engine Media LLC in the Bankruptcy Case (collectively, the “Sellers”) related to the Sellers’ Agency Business and Insights Business, (as defined in the APA) (collectively, the “Business”). The Bid contemplated the payment of a deposit, a cash payment at Closing (as defined in the APA) and the assumption of certain of Sellers’ liabilities (the “Assumed Liabilities”), all as set forth in a definitive asset purchase agreement among the Sellers and the Company (the “APA”) and described below.

In accordance with the Bidding Procedures, on April 4, 2023, the Sellers conducted an auction among qualified bidders, including the Company (the “Auction”). At the Auction, following certain negotiated modifications to the APA, the Company was declared the winning bidder with a bid of $20.0 million plus the Assumed Liabilities, in accordance with the modified APA. The Company delivered the deposit of $2.0 million to the escrow agent effective as of April 3, 2023.

On April 10, 2023, the Bankruptcy Court entered an order approving the sale of all of the Sellers’ right, title and interest in, to, and under the assets, rights, and properties of every nature (whether now existing or hereafter acquired and whether or not reflected on the books or financial records of Sellers) primarily used in or related to the operation or conduct of the Business (the “Acquired Assets,” and the acquisition of the Acquired Assets, the "Acquisition") to the Company in accordance with the APA, as modified at the Auction (the “Sale Order”). The APA was executed on April 10, 2023 and upon the Sale Order became a binding agreement among the parties.

On April 20, 2023, the Company completed the Acquisition acquiring the assets of two business units of Big Village ( Big Village Agency, LLC and Big Village Insights, LLC (the “Big Village Entities”) for approximately $20.0 million, plus assumed liabilities, in an all-cash transaction funded by a senior secured credit facility.

Centre Lane Senior Secure Credit Facility

On April 20, 2023, in anticipation of the completion of the Acquisition, the Company and its subsidiaries CL Media Holdings LLC, Bright Mountain LLC, MediaHouse, Inc., Big-Village Agency LLC, and BV Insights LLC, entered into the Seventeenth Amendment to the Credit Agreement. The Credit Agreement was amended, as provided in the Seventeenth Amendment, to provide for an additional term loan amount of $26.3 million to, among other things, finance the Acquisition and changed the maturity date of all existing loans, including this term loan matures on April 20, 2026.

Also, in connection with the Seventeenth Amendment, on April 20, 2023, the Company issued 21,401,993 shares of common stock of the Company to BV Agency, LLC. The issuance of the shares of common stock were not registered under the Securities Act, in accordance with Section 4(a)(2) of the Securities Act as a transaction by an issuer not involving a public offering. As of April 20, 2023, BV Agency, LLC and Centre Lane Partners Master Credit Fund II, L.P. own approximately 12.4% and 8.8% of the Company’s outstanding common stock, respectively.

The unaudited pro forma consolidated balance sheet as of March 31, 2023 combines the historical unaudited balance sheet of Bright Mountain Media, Inc. as of March 31, 2023 and the historical unaudited consolidated balance sheet of the Big Village Entities as of March 31, 2023 on a pro forma basis to give effect to these transactions as if the transactions had been consummated on March 31, 2023.

EXHIBIT 99.3

BRIGHT MOUNTAIN MEDIA, INC.

Notes to Unaudited Pro Forma

Condensed Combined Financial Statements

The unaudited pro forma consolidated statement of operations for the three months ended of March 31, 2023 combines the historical unaudited consolidated statement of operations of Bright Mountain Media, Inc for the three months ended March 31, 2023 and historical unaudited combined statement of operations of the Big Village Entities for the three months ended March 31, 2023 on a pro forma basis as if the transaction as summarized below, had been consummated on January 1, 2022, the beginning of the earliest period presented.

The unaudited pro forma consolidated statement of operations for the year ended of December 31, 2022 combines the historical audited consolidated statement of operations of Bright Mountain Media, Inc for the year ended December 31, 2022 and historical audited statement of operations of the Big Village Entities for the year ended December 31, 2022 on a pro forma basis as if the transaction, as summarized below, had been consummated on January 1, 2022, the beginning of the earliest period presented.

The unaudited proforma combined financial information is provided for informational purpose only and is not intended to represent or be indicative of the consolidated results of operations or financial position that the Company would have reported had the Acquisition closed on the dates indicated and should not be taken as representative of our future consolidated results operations or financial position.

The proforma adjustments related to the transaction are described in the note to the unaudited proforma consolidated financial information and principally include the following:

•Proforma adjustments to eliminate the Big Village Entities balances not acquired; and

•Proforma adjustment to record the asset acquisition of the Big Village Entities

The adjustments to fair value and the other estimates reflected in the accompanying unaudited proforma condensed consolidated financial statements may be materially different from those reflected in the combined company’s consolidated financial statements subsequent to the acquisition. In addition, the unaudited proforma condensed combined financial statements do not purport to project the future financial position or results of operations of the combined companies. Reclassifications and adjustments may be required if changes to the Big Village Entities financial presentation are needed to conform the Big Village Entities accounting policies to Bright Mountain’s accounting policies.

These unaudited proforma condensed combined financial statements do not give effect to any anticipated synergies, operating efficiencies or cost savings that may be associated with the transaction. These financial statements also do not include any integration cost the company may incur related to the transaction as part of combining the operations of the companies.

BRIGHT MOUNTAIN MEDIA, INC.

Proforma Condensed Combined Balance Sheets

As of March 31, 2023


	Bright Mountain		Big Village Entities		Accounting Adjustments		Pro Forma Combined		Note 4
ASSETS
Current Assets
Cash and cash equivalents	$	784	$	8,595	$	(3,468)	$	5,911	A,C
Accounts receivable, net	1,264		12,542		—		13,806
Prepaid expenses and other current assets	408		586		—		994
Total Current Assets	2,456		21,723		(3,468)		20,711
Property and equipment, net	38		216				254
Intangible assets, net	4,124		3,583		22,629		30,336		A,B
Goodwill	19,645		4,297		(2,972)		20,970		A,B
Deferred income tax	—		7,604		(7,604)		—		A
Operating lease right-of-use asset	352		—		—		352
Other assets	187		75		(75)		187		A
Total Assets	$	26,802	$	37,498	$	8,510	$	72,810

LIABILITIES AND SHAREHOLDERS' DEFICIT
Current Liabilities
Accounts payable and accrued expenses	$	8,835	$	14,128	$	1,594	$	24,557
Other liabilities	1,758		2,240		(2)		3,996		A
Interest Payable – 10% Convertible Promissory Notes, related party	33		—		—		33
Interest payable – Centre Lane Senior Secured Credit Facility – related party	72		—		—		72
Deferred revenue	974		4,642		—		5,616
Note payable – 10% Convertible Promissory Notes, net of discount, related party	71		—		—		71
Note payable – Centre Lane Senior Secured Credit Facility – related party	7,696		—		—		7,696
Total Current Liabilities	19,439		21,010		1,592		42,041
Note payable – Centre Lane Senior Secured Credit Facility – net of discount, related party	24,856		—		23,074		47,930		C
Operating lease liability	304		—		—		304
Total Liabilities	44,599		21,010		24,666		90,275

Shareholders' Deficit





Common stock, par value $0.01	1,506		—		214		1,720		C
Treasury stock	(220)		—		—		(220)
Owner's Equity	—		16,488		(16,488)		—		A
Additional paid-in capital	98,851		—		1,712		100,563		C
Accumulated deficit	(118,065)		—		(1,594)		(119,659)		D
Accumulated other comprehensive income	131		—		—		131
Total shareholder's deficit	(17,797)		16,488		(16,156)		(17,465)

Total liabilities and shareholders’ deficit	$	26,802	$	37,498	$	8,510	$	72,810

BRIGHT MOUNTAIN MEDIA, INC.

Proforma Condensed Combined Statement of Operations

Three Months Ended March 31, 2023


	Bright Mountain		Big Village Entities		Accounting Adjustments		Proforma Combined		Note 4
Revenue	$	1,498	$	11,682	$	—	$	13,180
Cost of revenue	970		9,693		—		10,663
Gross margin	528		1,989		—		2,517
General and administrative expenses	3,428		4,210		550		8,188		D
Loss from operations	(2,900)		(2,221)		(550)		(5,671)
Financing income (expense)
Other income (expense)	278		—		—		278
Interest expense – Centre Lane Senior Secured Credit Facility – related party	(1,163)		—		—		(1,163)
Interest expense - Convertible Promissory notes - related party	(5)		—		—		(5)
Other interest expense	(6)		—		—		(6)
Total financing income (expense)	(896)		—		—		(896)
Net loss before income taxes	(3,796)		(2,221)		(550)		(6,567)
Income tax provision (benefit)	—		—		—		—


Net loss attributable to common shareholders	$	(3,796)	$	(2,221)	$	(550)	$	(6,567)
Foreign currency translation	14		—		—		14
Comprehensive loss	$	(3,782)	$	(2,221)	$	(550)	$	(6,553)
Net loss per common share:
Basic and diluted	$	(0.03)	—		$	(0.01)	(0.04)
Weighted average shares outstanding
Basic and diluted	149,708,905		—		21,401,993		171,110,898		C

BRIGHT MOUNTAIN MEDIA, INC.

Proforma Condensed Combined Statement of Operations

For the Year Ended December 31, 2022


	Bright Mountain		Big Village Entities		Accounting Adjustments		Proforma Combined		Note 4
Revenue	$	19,580	$	56,368	$	—	$	75,948
Cost of revenue	10,493		40,291		—		50,784
Gross margin	9,087		16,077		—		25,164
General and administrative expenses	14,249		22,191		(7,599)		28,841		D
Loss from operations	(5,162)		(6,114)		7,599		(3,677)
Financing income (expense)
Gain on forgiveness of PPP loan	1,137		—		—		1,137
Other income (expense)	163		—		—		163
Interest expense – Centre Lane Senior Secured Credit Facility- related party	(4,227)		—		—		(4,227)
Interest expense – Convertible Promissory notes - related party	(22)		—		—		(22)
Other interest expense	(12)		—		—		(14)
Total financing income (expense)	(2,963)		—		—		(2,963)
Net loss before income taxes	(8,125)		(6,114)		7,599		(6,640)
Income tax provision (benefit)	—		—		—		—
Net loss	(8,125)		(6,114)		7,599		(6,640)

Preferred stock	(5)		—		—		(5)

Net loss attributable to common shareholders	(8,130)		(6,114)		7,599		(6,645)
Foreign currency translation	105		—		—		105
Comprehensive loss	$	(8,025)	$	(6,114)	$	7,599	$	(6,540)

Net loss per common share:
Basic and diluted	$	(0.05)	—		$	(0.01)	(0.05)
Weighted average shares outstanding
Basic and diluted	149,191,057		—		21,401,993		170,593,050		C

BRIGHT MOUNTAIN MEDIA, INC.

Note to Proforma Condensed Combined Financial Statement

Note 1 - Basis of Preparation

The audited and unaudited historical and interim consolidated financial statements have been adjusted in the pro forma condensed combined financial statements to give effect to pro forma events that are (1) directly attributable to the business combination, (2) factually supportable and (3) with respect to the pro forma condensed combined statements of operations, expected to have a continuing impact on the combined results following the business combination.

The business combination was accounted for under the acquisition method of accounting in accordance with ASC Topic 805, Business Combinations. As the acquirer for accounting purposes, the Company has estimated the fair value of Big Village Entities’ assets acquired and liabilities assumed and conformed the accounting policies of Big Village to its own accounting policies.

The unaudited pro forma condensed combined financial statements are based on our audited and unaudited interim historical consolidated financial statements and the Big Village Entities’ audited and unaudited interim historical combined financial statements as adjusted to give effect to the Company’s acquisition of the Big Village Entities’ assets. The Unaudited Pro Forma Condensed Combined Balance Sheets as of March 31, 2023 gives effect to these transactions as if they occurred on March 31, 2023. The Unaudited Pro Forma Condensed Combined Statements of Operations for the three months ended March 31, 2023 and twelve months ended December 31, 2022 give effect to these transactions as if they occurred on January 1, 2022.

The allocation of the purchase price used in the unaudited pro forma financial statements is based upon management estimates. The final estimate of the fair values of the assets and liabilities will be finalized subsequent to the filing of this proforma condensed combined financial statements. Additionally, the assessment of the changes made to the Centre Lane Senior Secured Credit Facility is pending the appropriate assessment under ASC 470, debt.

The unaudited pro forma condensed combined financial statements are provided for informational purpose only and are not necessarily indicative of what the combined company’s financial position and results of operations would have actually been had the transactions been completed on the dates used to prepare these pro forma financial statements. The adjustments to fair value and the other estimates reflected in the accompanying unaudited pro forma condensed combined financial statements may be materially different from those reflected in the combined company’s consolidated financial statements subsequent to the transactions. In addition, the unaudited proforma condensed combined financial statements do not purport to project the future financial position or results of operations of the combined companies.

These unaudited pro forma condensed combined financial statements do not give effect to any anticipated synergies, operating efficiencies or cost savings that may be associated with the transactions. These financial statements also do not include any integration costs the companies may incur related to the transactions as part of combining the operations of the companies.

Note 2 - Significant Accounting Policies

The unaudited pro forma condensed combined financial statements have been prepared in a manner consistent with the accounting policies adopted by the Company. The accounting policies followed for financial reporting on a pro forma basis are the same as those disclosed in the Company’s 2022 Annual Report on Form 10-K and for the Big Village Entities, the accounting policies followed for financial reporting on a pro forma basis are the same as those disclosed in the audited financial statements included in this Form 8-K. The unaudited pro forma condensed combined financial statements do not assume any differences in accounting policies among the Company and the Big Village Entities. The Company is reviewing the accounting policies of the Big Village Entities to ensure conformity of such accounting policies to those of the Company and, as a result of that review, the Company may identify differences among the accounting policies of the companies, that when confirmed, could have a material impact on the consolidated financial statements. However, at this time, the Company is not aware of any difference that would have a material impact on the unaudited proforma condensed combined financial statements.

Note 3 - Purchase price Allocation

The following table summarizes the preliminary allocation of the purchase price based on the estimated fair value of the acquired assets and assumed liabilities as of March 31, 2023:


Purchase price consideration
Centre Lane Senior Secured Credit Facility	$	19,874

Estimate fair value of assets
Accounts receivable	$	12,542
Prepaid and other assets	586
Property and equipment	216
	13,344
Estimated fair value of liabilities assumed
Accounts payable and accrued expenses	$	14,128
Deferred Revenue	4,642
Other current liabilities	2,238
	21,008

Net tangible liabilities	$	(7,663)
Intangibles	26,212
Goodwill	1,325

Total consideration	$	19,874

This preliminary purchase price allocation has been used to prepare pro forma adjustments in the pro forma balance sheet and statement of operations. The final purchase price allocation will be determined when the Company has completed the detailed valuations and necessary calculations. The final allocation could differ materially from the preliminary allocation used in the pro forma adjustments. The final allocation may include (1) changes in fair values of property, plant and equipment, (2) changes in allocations to intangible assets such as trade names and technology, as well as goodwill and (3) other changes to assets and liabilities.

For purposes of the pro forma condensed combined financial statements, for, accounts receivable, property and equipment, leases, other assets, note payable and liabilities, the Company used the carrying value as reported in its unaudited interim financial statement as reported on Form 10-Q for the quarter ended March 31, 2023, and as reported in the unaudited interim financial statements for the Big Village Entities that have been included in this Form 8-K. The final allocation could differ materially from the preliminary allocation used in the pro forma adjustments.

Note 4 - Proforma Accounting Adjustments

The pro forma transaction accounting adjustments are based on our preliminary estimates and assumptions that are subject to change. The following transaction accounting adjustments have been reflected in the unaudited pro forma condensed combined financial information:

A. Assets and Liabilities Not Assumed

The schedule below summarizes items that were not acquired nor assumed by the company for this transaction.


	March 31, 2023
Assets
Cash and cash equivalents	$	8,595
Intangibles	3,583
Goodwill	4,297


Total assets	16,475

Liabilities
Deferred income tax	7,604
Other	2
Total liabilities	7,606

Equity
Retained earnings	$	(156,157)
Additional paid in capital	169,240
Other comprehensive income	(1,636)
Related party transactions	6,086
	$	17,533

Adjustments of $1.0 million was made to the statement of operations representing amortization of intangibles of $981,000 and intercompany interest of $64,000.

B. Goodwill and Intangibles Acquired

As part of the preliminary valuation analysis, the Company separately identified certain intangible assets with an estimate of $27.5 million. Since all the information required to perform a detailed valuation analysis of Big Village Entities’ assets were not fully available, for the purpose of these unaudited proforma condensed combined financial statements we used management’s estimate. Additionally, the Company recognized goodwill totaling $1.3 million.

C. Centre Lane Senior Secured Facility

On April 20, 2023, the Company and its subsidiaries CL Media Holdings LLC, Bright Mountain LLC, MediaHouse, Inc., Big-Village Agency LLC, and BV Insights LLC, entered into the Seventeenth Amendment to the Credit Agreement. The Credit Agreement was amended, as provided in the Seventeenth Amendment, to provide for an additional term loan amount of $26.3 million to, among other things, finance the Acquisition. This term loan, which was provided by BV Agency, LLC, matures on April 20, 2026 and was issued at a discount of 5% or

$1.3 million. Interest of 15% payable under the note payable-in-kind in lieu of cash payment up to April 30, 2024, then 5% payable quarterly in cash and 10% payable-in-kind in lieu of cash payment until maturity of April 20, 2026.

As part of the amendment, the Company is required to pay an amendment fee of 2% of the principal amount of the existing First Out and Last Out Terms Loans, totaling $704,000, additionally, an exit fee of $18,000 of the loan to finance the Acquisition. The outstanding principal on these at April 20, 2023 was $30.9 million and $4.3 million, respectively. These fees totals $723,000 and are due on payable at maturity. Additionally, the maturity dates were extended to April 20, 2026.

Also, in connection with the Agreement, on April 20, 2023, the Company issued 21,401,993 shares of common stock of the Company to BV Agency, LLC, valued $1.9 million, based on a per share price of $0.09, which was the closing price of the Company’s common stock at close of market on April 19, 2023.

The transaction is summarized as follow:


Summary of loan
Paid to Big Village Group, LLC (seller) - purchase price	$	19,874
Cash received by Company	5,126
Total proceeds	25,000
Loan discount (5%)	1,316
Gross loan	$	26,316
Fees capitalized	723
	$	27,039


Summary of Shares Issued
Common stock issued	21,401,993
Price	0.09
Value	$	1,926

Amounts of $1.3 million for loan discount, fees of $723,000 and $1.9 million for value of shares issued, totaling $4.0 million are offset against the outstanding principal in our accounting records resulting in outstanding loan net of discount of approximately $23.1 million.

Consistent with FASB ASC Topic 470 Debt, (“ASC 470”), the Company is required to perform an analysis of the change in each amendment to determine whether the change is a modification or an extinguishment of debt. Under a modification, no gain or loss is recorded, and a new effective interest rate is established based on the carrying value of the debt and revised cash flow. If the debt is extinguished, the old debt is derecognized and the new debt is recorded as fair value, which becomes the new carrying value. A gain or loss is recorded for the difference between the net carrying value or the original debt and the fair value of the new debt. Interest expense is recorded based on the effective interest rate of the new debt. A debt is considered extinguished if the present value of the new cash flows under the term of the new debt is at least 10% different from the present value of the remaining cash flows under the terms of the old debt.

The impact of this evaluation is not included in the unaudited proforma condensed combined financial statements.

Centre Lane Senior Secured Credit Facility has been determined to qualify as a related party transaction as shares were issued to Centre Lane Partners along with as part of the transaction. A related party is a party that can exercise significant influence over the Company in making financial and/or operating decisions. As of April 20,

2023, BV Agency, LLC and Centre Lane Partners Master Credit Fund II, L.P. own approximately 12.4% and 8.8% of the Company’s outstanding common stock, respectively.

D. Centre Lane Senior Secured Facility

This adjustment of $1.6 million, reflects the accrual of the Company’s estimated total transaction cost for legal and other professional fees and expenses offset by adjustments of $1.0 million representing amortization of intangibles of $981,000 and intercompany interest of $64,000.

Note 5 - Combined Adjusted EBITDA

Adjusted EBITDA is a non-GAAP financial measure and should not be considered as an alternative to operating income (loss) or net income (loss) as a measure of operating performance or cash flows or as a measure of liquidity. Non-GAAP financial measures are not necessarily calculated the same way by different companies and should not be considered a substitute for or superior to U.S. GAAP.

Combined Adjusted EBITDA Before Pro Forma Adjustments is defined as net income (loss) adjusted to add back interest expense including depreciation and amortization, and certain charges and expenses, such as stock-based compensation, as these charges and expenses are not considered a part of our core business operations and are not an indicator of ongoing, future company performance.

Adjusted EBITDA is one of the primary metrics used by management to evaluate the financial performance of our business. We present Adjusted EBITDA because we believe it is frequently used by analysts, investors and other interested parties to evaluate companies in our industry. Further, we believe it is helpful in highlighting trends in our operating results, because it excludes, among other things, certain results of decisions that are outside the control of management, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure and capital investments.

The following tables reconcile Combined Adjusted EBITDA After Pro Forma Adjustments to net income (loss) based on the Company’s audited Consolidated Statement of Operations for the three months ended March 31, 2023 and year ended December 31, 2022 and Big Village’ unaudited Statements of Operations for the three months ended March 31, 2023 and audited Statements of Operations for the year ended December 31, 2022, as reported in this Form 8-K:


	Three Months Ended March 31, 2023
	Bright Mountain		Big Village Entities		Accounting Adjustments		Proforma Combined
Net loss before tax plus:	$	(3,796)	$	(2,221)	$	(550)	(6,567)
Depreciation expense	7		—		—		7
Amortization expense	386		—		—		386
Amortization of debt discount	305		—		—		305
Other interest expense	6		—		—		6
Interest expense - Centre Lane Senior Secured Credit Facility and Convertible Promissory Notes- related party	864		—		—		864
EBITDA	(2,228)		(2,221)		(550)		(4,999)
Stock compensation expense	25		—		—		25


Non-restructuring severance expense	122		—		—		122
Adjusted EBITDA	$	(2,080)	$	(2,221)	$	(550)	$	(4,852)


	Year Ended December 31, 2022
	Bright Mountain		Big Village Entities		Accounting Adjustments		Proforma Combined
Net loss before tax plus:	$	(8,125)	$	(6,114)	$	7,599	$	(6,640)
Depreciation expense	38		—		—		38
Amortization expense	1,558		—		—		1,558
Amortization of debt discount	1,199		—		—		1,199
Other interest expense	13		—		—		13
Interest expense - Centre Lane Senior Secured Credit Facility and Convertible Promissory Notes- related party	3,051		—		—		3,051
EBITDA	(2,265)		(6,114)		7,599		(781)
Stock compensation expense	232		—		—		233
Nonrecurring professional fees	657		—		—		657
Gain on forgiveness of PPP loan	(1,137)		—		—		(1,137)
Non-restructuring severance expense	50		—		—		50
Adjusted EBITDA	$	(2,463)	$	(6,114)	$	7,599	$	(978)

Cover	Jun. 20, 2023
Cover [Abstract]
Document Type	8-K/A
Document Period End Date	Apr. 20, 2023
Entity Registrant Name	Bright Mountain Media, Inc.
Entity Incorporation, State or Country Code	FL
Entity File Number	000-54887
Entity Tax Identification Number	27-2977890
Entity Address, Address Line One	6400 Congress Avenue,
Entity Address, Address Line Two	Suite 2050
Entity Address, City or Town	Boca Raton,
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33487
City Area Code	561
Local Phone Number	998-2440
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Central Index Key	0001568385
Amendment Flag	false

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