t Y p e T Y P E T y P e Y P E T y P e t Y p e T P e t Y p e T Y P E T y e T Y P E T y P e t Y p T y P e t Y p e T Y P E Y p e T Y P E T y P e t 2016 Annual Report P E T y P e e t Y p e T Y P E T y P T Y P E T y P e t Y p e y P e t Y p e T Y P E T p e T Y P E T y P e t Y E T y P e t Y p e T Y P t Y p e T Y P E T y P e Y P E T y P e t Y p e T P e t Y p e T Y P E T y e T Y P E T y P e a A Letter to our Shareholders

Dear fellow shareholder:

2016 was a transformational year for Monotype.

Building on our strong foundation of type, technology and As The Brand Company, our goal is to work with brands to expertise, we continued to grow our business while executing on anticipate and address their design and marketing needs, even as our strategy to provide more value to customers. The heart of our the range of customer touchpoints expands to places like HTML5 value has historically been in enabling our customers to define, digital advertising, new devices and UGC, among others. The differentiate and express their brands through typography – combination of our foundation in type with new design assets whether for a corporate identity, consumer device or marketing means that we can help brands connect more authentically with campaign. But as our customers’ needs have evolved, so have we. their most passionate advocates. And with our analytics engines, we can help measure brand performance at a granular level – We began that evolution by embracing a new vision of whether through marketing campaigns, e-commerce channels Empowering Expression and Engagement. This vision drove or mobile messaging – to help brands turn marketing data into investments and acquisitions, like Olapic, that help us address a actionable business intelligence that improves program results substantially larger set of customer needs and expand our total and magnifies brand impact. addressable market. Customers are increasingly focused on creating consistent and engaging brand experiences across every We believe that serving this broader set of needs will make us touchpoint, all while measuring and maximizing their brand even more valued strategic partners to customers – whether performance. They are building those brand experiences they are Chief Marketing Officers at the Global 2000, or leading through a broader range of design assets – including typography, design agencies – and can help us accelerate our growth to user-generated content (UGC) and emoji – both to express deliver long-term, sustainable value. Our ultimate goal is to their brand and to engage with their customers. They’re help all brands reach the right consumer, at the right place, also increasingly laser-focused on measurement and ROI, with the right content, to create the most rewarding brand with the intention of turning marketing data into business and consumer interactions. intelligence that helps them refine and calibrate programs to optimize performance. Most importantly, as we transform Monotype, our business model remains defensible. Even as we continued to make The Brand Company deliberate investments to address new customer needs and forged paths to take advantage of bigger opportunities, we had Central to all of these expanded customer needs is the brand. a solid year in 2016 and provided significant value to our Whether it’s finding a new way to express themselves, engage shareholders. We returned $23.1 million through share with advocates or measure performance – the brand is at the repurchases and dividends, and as we enter 2017, the board heart of everything we do. To that end, in 2016 we repositioned has increased the dividend by three percent to 11.3 cents per Monotype as “The Brand Company,” to better describe the full diluted share. range of value that we can now deliver to our customers.

2016 Financial Highlights*:

* See our Annual Report on Form 10-K for the year ended December 31, 2016 for a reconciliation of all non-GAAP financial measures to the comparable GAAP $203.4m $59.8m financial measures. in revenue, an increase of six percent Non-GAAP net adjusted EBITDA was year over year. $59.8 million, or 29 percent of revenue. $102.4m $52.7m in Creative Professional revenue, Pro Forma non-GAAP net adjusted an increase of 16 percent year over year. EBITDA was $52.7 million, or 24 percent of Pro Forma non-GAAP revenue.

1 Accomplishments 2016 marked the first time in our history that Creative flexible contract model that encourages our printer customers Professional represented more than 50 percent of total revenue. to commit to an annual fee over multiple years, which in turn This was a result of continued momentum in our Enterprise allows them to deploy our IP uniformly across their product Sales channel, where revenue topped $40 million, capitalizing lines. We believe this is a win/win for both us and our customers. on new digital use case opportunities like HTML5 digital ads, mobile messaging, e-commerce and social media. Lastly, we continued investing in our people, as we added to our engineering, sales and marketing teams to establish the required Leveraging our strong heritage in type, we launched beautiful foundation for a successful 2017. new custom designs, like the Johnston100 for Transport for London and Noto. These help our Looking Ahead customers express their brands, while also allowing Monotype to In 2017, we’ll be focusing on executing against our operational showcase our unique engineering, research and design plan and bringing together the investments that we made, in a capabilities. We also introduced a number of new designs from meaningful way. We will continue to evolve our business to better the Monotype Studio, including the Between™, Posterama™ and serve the expanding needs of brands. We will continue to look for M Ying Hei™ typefaces. And we saw momentum with Olapic, new ways to deliver more holistic value to our customers, and which exited 2016 serving more than 450 brands, demonstrating make it even easier to do business with us. And we will continue that UGC is becoming an important part of brand expression to innovate ahead of the next evolution of customers’ needs. and engagement. On behalf of everyone at Monotype, including our board of In 2016, we took important steps to make our business less directors and our employees, I’d like to thank our customers, our susceptible to short-term printer shipment volatility and make partners and you, our shareholders, for your continued support. our OEM printer revenue more predictable. We now offer a On to 2017!

2 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Í ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2016 ‘ 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 001-33612 HOLDINGS INC. (Exact name of registrant as specified in its charter)

Delaware 20-3289482 (State of incorporation) (I.R.S. Employer Identification No.) 600 Unicorn Park Drive Woburn, Massachusetts 01801 (Address of principal executive offices) (Zip Code) Registrant’s telephone number, including area code: (781) 970-6000

Securities Registered Pursuant to Section 12(b) of the Act: Title of Each Class Name of Exchange on Which Registered Common Stock, $0.001 par value The NASDAQ Stock Market LLC Securities Registered Pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes Í No ‘ Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ‘ No Í Indicate by check mark whether the registrant (1) has filed all reports required