424B3

 

Filed Pursuant to Rule 424(b)(3)

Registration No. 333-260839

Prospectus Supplement No. 4

(to Prospectus dated May 12, 2023)

 

https://cdn.kscope.io/8e5a226e7e06ac336e40d33043a773d1-img57560559_0.jpg 

VIVID SEATS INC.

This prospectus supplement updates, amends and supplements the prospectus dated May 12, 2023 (the “Prospectus”), which forms a part of our Registration Statement on Form S-1 (Registration No. 333-260839). Capitalized terms used and not otherwise defined in this prospectus supplement have the meanings specified in the Prospectus.

This prospectus supplement is being filed to update, amend and supplement the Prospectus with the information contained in our Quarterly Report on Form 10-Q filed with the Securities Exchange Commission on August 8, 2023, which is set forth below.

This prospectus supplement is incomplete without the Prospectus. This prospectus supplement should be read together with the Prospectus, which is to be delivered with this prospectus supplement, and is qualified by reference thereto, except to the extent that the information in this prospectus supplement updates or supersedes the information contained in the Prospectus. Keep this prospectus supplement with the Prospectus for future reference.

Our Class A common stock is listed on the Nasdaq Global Select Market under the symbol “SEAT.” On August 7, 2023, the closing sale price of our Class A common stock was $7.64 per share. Our Vivid Seats Public IPO Warrants are listed on the Nasdaq Global Select Market under the symbol “SEATW.” On August 7, 2023, the closing sale price of our Vivid Seats Public IPO Warrants was $2.01 per warrant.

Investing in our Class A common stock or warrants involves risks that are described in the “Risk Factors” section beginning on page 6 of the Prospectus and under similar headings in the amendments and supplements to the Prospectus.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under the Prospectus or determined if this prospectus supplement or the Prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus supplement is August 8, 2023.

 

 

 


 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number: 001-40926

Vivid Seats Inc.

(Exact Name of Registrant as Specified in its Charter)

 

Delaware

86-3355184

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

24 E. Washington Street

Suite 900

Chicago, Illinois

 

 

60602

(Address of principal executive offices)

(Zip Code)

(312) 291-9966

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

 

 

Title of each class

Trading

Symbol(s)

 

Name of each exchange on which registered

 Class A common stock, par value $0.0001 per share

SEAT

The Nasdaq Stock Market LLC

Warrants to purchase one share of Class A common stock

 

SEATW

 

The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 31, 2023, the registrant had outstanding 96,384,194 shares of Class A common stock, $0.0001 par value per share, net of treasury shares, and 99,800,000 shares of Class B common stock, $0.0001 par value per share.

 

 


table of contents

 

Page

 

Forward-Looking Statements

1

 

 

 

PART I.

FINANCIAL INFORMATION

3

 

 

 

Item 1.

Financial Statements (Unaudited)

3

Condensed Consolidated Balance Sheets

3

Condensed Consolidated Statements of Operations

4

 

Condensed Consolidated Statements of Comprehensive Income

5

Condensed Consolidated Statements of Deficit

6

Condensed Consolidated Statements of Cash Flows

8

Notes to Condensed Consolidated Financial Statements

10

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

26

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

36

Item 4.

Controls and Procedures

36

 

PART II.

OTHER INFORMATION

37

 

Item 1.

Legal Proceedings

37

Item 1A.

Risk Factors

37

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

37

Item 3.

Defaults Upon Senior Securities

37

Item 4.

Mine Safety Disclosures

37

Item 5.

Other Information

38

Item 6.

Exhibits

39

 

 

Signatures

41

 

 


forward-looking statements

 

This Quarterly Report on Form 10-Q (this "Report") contains forward-looking statements regarding future events and the future results of Vivid Seats Inc. that are based on our current expectations, estimates, forecasts and projections about our business and the industries in which we operate and the beliefs and assumptions of our management. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Words such as “expect,” “anticipate,” “target,” “goal,” “project,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “likely,” “may,” “designed,” “would,” “future,” “can,” and “could,” as well as similar expressions which predict or indicate future events and trends or which do not relate to historical matters, are intended to identify such forward-looking statements.

For example, we may use forward-looking statements when addressing topics such as:

our ability to raise financing in the future;
our future financial performance;
our success in retaining or recruiting, or changes required in, our officers, key employees or directors;
our ability to pay dividends on our Class A common stock on the terms currently contemplated or at all; and
factors relating to our business, operations and financial performance, including, but not limited to:
o
our ability to compete in the ticketing industry;
o
our ability to maintain relationships with ticket buyers, sellers and distribution partners;
o
our ability to continue to improve our platform and maintain and enhance our brand;
o
the impact of extraordinary events or adverse economic conditions on discretionary consumer and corporate spending or on the supply and demand of live events;
o
our ability to identify suitable acquisition targets, and to complete and realize the expected benefits of planned acquisitions;
o
our ability to comply with applicable regulatory regimes;
o
our ability to successfully defend against litigation;
o
our ability to maintain the integrity of our information systems and infrastructure, and to mitigate possible cyber security risks;
o
our ability to generate sufficient cash flows or raise additional capital necessary to fund our operations;
o
the impact of pandemics on our business and the industries in which we operate; and
o
other factors detailed in the “Risk Factors” sections of this Report, our Form 10-K for the fiscal year ended December 31, 2022 (together with Amendment No. 1 thereto, our “2022 Form 10-K”) and our other filings with the Securities and Exchange Commission (the “SEC”).

We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements are not guarantees of future performance, conditions or results, and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, actual results may differ materially and adversely from those anticipated in any forward-looking statements. You are cautioned not to place undue reliance

1


 

on these forward-looking statements, which speak only as of the date of this Report or, in the case of statements incorporated herein by reference, as of the date of the incorporated document. While we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information.

Important factors that could cause or contribute to such differences include, but are not limited to, those discussed under the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of this Report and our 2022 Form 10-K, as well as in our press releases and other filings with the SEC.

Except as required by applicable law, we undertake no obligation to update or revise any forward-looking statements contained in this Report, whether as a result of new information, future events, or otherwise.

2


VIVID SEATS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data) (Unaudited)

 

 

 

 

June 30,

 

 

December 31,

 

 

 

2023

 

 

2022

 

Assets

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

306,202

 

 

$

251,542

 

Restricted cash

 

 

672

 

 

 

748

 

Accounts receivable – net

 

 

46,301

 

 

 

36,531

 

Inventory – net

 

 

28,010

 

 

 

12,783

 

Prepaid expenses and other current assets

 

 

46,608

 

 

 

29,912

 

Total current assets

 

 

427,793

 

 

 

331,516

 

Property and equipment – net

 

 

10,356

 

 

 

10,431

 

Right-of-use assets – net

 

 

7,564

 

 

 

7,859

 

Intangible assets – net

 

 

82,031

 

 

 

81,976

 

Goodwill

 

 

715,258

 

 

 

715,258

 

Deferred tax assets

 

 

79,275

 

 

 

1,853

 

Other non-current assets

 

 

2,407

 

 

 

2,538

 

Total assets

 

$

1,324,684

 

 

$

1,151,431

 

Liabilities and shareholders’ deficit

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

204,217

 

 

$

161,312

 

Accrued expenses and other current liabilities

 

 

192,038

 

 

 

181,970

 

Deferred revenue

 

 

30,070

 

 

 

31,983

 

Current maturities of long-term debt

 

 

2,750

 

 

 

2,750

 

Total current liabilities

 

 

429,075

 

 

 

378,015

 

Long-term debt – net

 

 

263,873

 

 

 

264,898

 

Long-term lease liabilities

 

 

14,808

 

 

 

14,911

 

Tax Receivable Agreement liability

 

 

98,977

 

 

 

 

Other non-current liabilities

 

 

20,868

 

 

 

13,445

 

Total long-term liabilities

 

 

398,526

 

 

 

293,254

 

Commitments and contingencies (Note 11)

 

 

 

 

 

 

Redeemable noncontrolling interests

 

 

790,416

 

 

 

862,860

 

 

 

 

 

 

 

 

Shareholders' deficit

 

 

 

 

 

 

Class A common stock, $0.0001 par value; 500,000,000 shares authorized at June 30, 2023 and December 31, 2022; 101,611,805 and 82,410,774 issued and outstanding at June 30, 2023 and December 31, 2022, respectively

 

 

11

 

 

 

8

 

Class B common stock, $0.0001 par value; 250,000,000 shares authorized, 99,800,000 and 118,200,000 issued and outstanding at June 30, 2023 and December 31, 2022, respectively

 

 

10

 

 

 

12

 

Additional paid-in capital

 

 

717,990

 

 

 

663,908

 

Treasury stock, at cost, 5,291,497 and 4,342,477 shares at June 30, 2023 and December 31, 2022, respectively

 

 

(40,106

)

 

 

(32,494

)

Accumulated deficit

 

 

(971,238

)

 

 

(1,014,132

)

Total Shareholders' deficit

 

 

(293,333

)

 

 

(382,698

)

Total liabilities, Redeemable noncontrolling interests, and Shareholders' deficit

 

$

1,324,684

 

 

$

1,151,431

 

The accompanying notes are an integral part of these financial statements.

3


VIVID SEATS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except for per share data) (Unaudited)

 

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Revenues

 

$

165,380

 

 

$

147,694

 

 

$

326,443

 

 

$

278,466

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues (exclusive of depreciation and amortization shown separately below)

 

 

42,616

 

 

 

32,422

 

 

 

80,376

 

 

 

64,586

 

Marketing and selling

 

 

65,192

 

 

 

59,412

 

 

 

119,964

 

 

 

113,640

 

General and administrative

 

 

38,307

 

 

 

36,207

 

 

 

70,696

 

 

 

65,482

 

Depreciation and amortization

 

 

2,704

 

 

 

1,726

 

 

 

5,302

 

 

 

3,111

 

Change in fair value of contingent consideration

 

 

(1,052

)

 

 

 

 

 

(1,018

)

 

 

 

Income from operations

 

 

17,613

 

 

 

17,927

 

 

 

51,123

 

 

 

31,647

 

Other (income) expense:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense – net

 

 

2,772

 

 

 

2,699

 

 

 

6,052

 

 

 

6,641

 

Loss on extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

4,285

 

Other (income) expense

 

 

1,000

 

 

 

(8,832

)

 

 

673

 

 

 

(6,553

)

Income before income taxes

 

 

13,841

 

 

 

24,060

 

 

 

44,398

 

 

 

27,274

 

Income tax expense (benefit)

 

 

(24,485

)

 

 

 

 

 

(24,200

)

 

 

76

 

Net income

 

 

38,326

 

 

 

24,060

 

 

 

68,598

 

 

 

27,198

 

Net income attributable to redeemable noncontrolling interests

 

 

7,614

 

 

 

14,405

 

 

 

25,704

 

 

 

16,284

 

Net income attributable to Class A Common Stockholders

 

$

30,712

 

 

$

9,655

 

 

$

42,894

 

 

$

10,914

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per Class A common stock:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.36

 

 

$

0.12

 

 

$

0.53

 

 

$

0.14

 

Diluted

 

$

0.20

 

 

$

0.12

 

 

$

0.35

 

 

$

0.14

 

Weighted average Class A common stock outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

85,269,196

 

 

 

79,256,354

 

 

 

81,319,369

 

 

 

79,204,430

 

Diluted

 

 

196,377,470

 

 

 

79,259,017

 

 

 

196,128,259

 

 

 

79,737,582

 

The accompanying notes are an integral part of these financial statements.

4


VIVID SEATS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands) (Unaudited)

 

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income

 

$

38,326

 

 

$

24,060

 

 

$

68,598

 

 

$

27,198

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income, net of taxes

 

$

38,326

 

 

$

24,060

 

 

$

68,598

 

 

$

27,198

 

Comprehensive income attributable to redeemable noncontrolling interests

 

 

7,614

 

 

 

14,405

 

 

 

25,704

 

 

 

16,284

 

Comprehensive income attributable to Class A Common Stockholders

 

$

30,712

 

 

$

9,655

 

 

$

42,894

 

 

$

10,914

 

The accompanying notes are an integral part of these financial statements.

5


VIVID SEATS INC.

CONDENSED CONSOLIDATED STATEMENTS OF DEFICIT

(in thousands, except for share data) (Unaudited)
 

 

 

 

 

 

 

Class A Common Stock

 

 

Class B Common Stock

 

 

 

 

 

Treasury Stock

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interests

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Additional paid-in capital

 

 

Shares

 

 

Amount

 

 

Accumulated deficit

 

 

Total shareholders' deficit

 

Balances at January 1, 2022

 

$

1,286,016

 

 

 

79,091,871

 

 

$

8

 

 

 

118,200,000

 

 

$

12

 

 

$

182,091

 

 

 

 

 

$

 

 

$

(1,042,794

)

 

$

(860,683

)

Net income

 

 

1,879

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,259

 

 

 

1,259

 

Issuance of shares

 

 

 

 

 

75,072

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deemed contribution from former parent

 

 

691

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

463

 

 

 

 

 

 

 

 

 

 

 

 

463

 

Equity-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,443

 

 

 

 

 

 

 

 

 

 

 

 

2,443

 

Subsequent remeasurement of Redeemable noncontrolling interests

 

 

18,706

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(18,706

)

 

 

 

 

 

 

 

 

 

 

 

(18,706

)

Balances at March 31, 2022

 

$

1,307,292

 

 

 

79,166,943

 

 

$

8

 

 

 

118,200,000

 

 

$

12

 

 

$

166,291

 

 

 

 

 

$

 

 

$

(1,041,535

)

 

$

(875,224

)

Net income

 

 

14,405

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9,655

 

 

 

9,655

 

Issuance of shares

 

 

 

 

 

74,089

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deemed contribution from former parent

 

 

699

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

468

 

 

 

 

 

 

 

 

 

 

 

 

468

 

Equity-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,145

 

 

 

 

 

 

 

 

 

 

 

 

4,145

 

Distributions to non-controlling interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(4,108

)

 

 

 

 

 

 

 

 

 

 

 

(4,108

)

Subsequent remeasurement of Redeemable noncontrolling interests

 

 

(439,442

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

439,442

 

 

 

 

 

 

 

 

 

 

 

 

439,442

 

Balances at June 30, 2022

 

$

882,954

 

 

 

79,241,032

 

 

$

8

 

 

 

118,200,000

 

 

$

12

 

 

$

606,238

 

 

 

 

 

$

 

 

$

(1,031,880

)

 

$

(425,622

)

 

6


VIVID SEATS INC.

CONDENSED CONSOLIDATED STATEMENTS OF DEFICIT

(in thousands, except for share data) (Unaudited)
 

 

 

 

 

 

Class A Common Stock

 

 

Class B Common Stock

 

 

 

 

 

Treasury Stock

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interests

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Additional paid-in capital

 

 

Shares

 

 

Amount

 

 

Accumulated deficit

 

 

Total shareholders' deficit

 

Balances at January 1, 2023

 

$

862,860

 

 

 

82,410,774

 

 

$

8

 

 

 

118,200,000

 

 

$

12

 

 

$

663,908

 

 

 

(4,342,477

)

 

$

(32,494

)

 

$

(1,014,132

)

 

$

(382,698

)

Net income

 

 

18,090

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

12,182

 

 

 

12,182

 

Issuance of shares

 

 

 

 

 

491,502

 

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

Deemed contribution from former parent

 

 

577

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

391

 

 

 

 

 

 

 

 

 

 

 

 

391

 

Equity-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,615

 

 

 

 

 

 

 

 

 

 

 

 

4,615

 

Repurchases of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(949,020

)

 

 

(7,612

)

 

 

 

 

 

(7,612

)

Distributions to non-controlling interest

 

 

(3,816

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subsequent remeasurement of Redeemable noncontrolling interests

 

 

24,155

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(24,155

)

 

 

 

 

 

 

 

 

 

 

 

(24,155

)

Balances at March 31, 2023

 

$

901,866

 

 

 

82,902,276

 

 

$

9

 

 

 

118,200,000

 

 

$

12

 

 

$

644,759

 

 

 

(5,291,497

)

 

$

(40,106

)

 

$

(1,001,950

)

 

$

(397,276

)

Net income

 

 

7,614

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30,712

 

 

 

30,712

 

Issuance of shares

 

 

 

 

 

309,529

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deemed contribution from former parent

 

 

544

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

431

 

 

 

 

 

 

 

 

 

 

 

 

431

 

Secondary Offering of Class A common stock

 

 

(145,064

)

 

 

18,400,000

 

 

 

2

 

 

 

(18,400,000

)

 

 

(2

)

 

 

145,064

 

 

 

 

 

 

 

 

 

 

 

 

145,064

 

Equity-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,524

 

 

 

 

 

 

 

 

 

 

 

 

6,524

 

Distributions to non-controlling interest