10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2013

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

For the transition period from                      to                     

000-50327

(Commission File Number)

iPass Inc.

(Exact name of Registrant as specified in its charter)

Delaware	93-1214598
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

3800 Bridge Parkway

Redwood Shores, California 94065

(Address of principal executive offices, including zip code)

(650) 232-4100

(Registrant’s telephone number, including area code)

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  x    No  ¨

Indicate by check mark whether the registrant submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files.    Yes  x    No  ¨

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

Large Accelerated filer	¨	Accelerated filer	x
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

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

The number of shares outstanding of the Registrant’s Common Stock, $0.001 par value, as of October 31, 2013 was 64,307,424.

IPASS INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2013

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements	3
a) Condensed Consolidated Balance Sheets as of September 30, 2013 and December 31, 2012 (Unaudited)	3
b) Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September  30, 2013 and 2012 (Unaudited)	4
c) Condensed Consolidated Statements of Cash Flows for the nine months ended September  30, 2013 and 2012 (Unaudited)	5
d) Notes to Condensed Consolidated Financial Statements (Unaudited)	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3. Quantitative and Qualitative Disclosures About Market Risk	22
Item 4. Controls and Procedures	23
PART II. OTHER INFORMATION:
Item 1A. Risk Factors	24
Item 6. Exhibits	24
SIGNATURE	25
INDEX TO EXHIBITS	26

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

IPASS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

	September 30, 2013			December 31, 2012
ASSETS
Current assets:
Cash and cash equivalents	$	25,201		$	26,822
Accounts receivable, net of allowance for doubtful accounts of $1,124 and $1,173, respectively		16,655			17,260
Prepaid expenses and other current assets		4,803			5,058
Total current assets		46,659			49,140
Property and equipment, net		6,420			6,549
Other assets		3,106			4,435
Total assets	$	56,185		$	60,124
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	9,082		$	7,496
Accrued liabilities		8,295			8,631
Deferred revenue, short-term		3,476			3,787
Total current liabilities		20,853			19,914
Deferred revenue, long-term		2,217			2,834
Other long-term liabilities		308			475
Total liabilities	$	23,378		$	23,223
Stockholders’ equity:
Common stock		64			61
Additional paid-in capital		217,160			213,454
Accumulated deficit		(184,417	)		(176,614	)
Total stockholders’ equity		32,807			36,901
Total liabilities and stockholders’ equity	$	56,185		$	60,124

See Accompanying Notes to Condensed Consolidated Financial Statements

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IPASS INC.

CONDENSED CONSOLIDATED STATEMENTS OF

COMPREHENSIVE LOSS

(Unaudited)

(In thousands, except shares and per share amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Revenue	$	26,869		$	30,818		$	85,163		$	96,356
Cost of revenues and operating expenses:
Network access costs		12,062			12,574			37,203			41,049
Network operations		4,717			5,126			14,284			15,932
Research and development		3,171			3,300			10,199			10,447
Sales and marketing		4,368			4,547			13,658			14,981
General and administrative		4,886			5,645			16,323			16,147
Restructuring charges and related adjustments		13			10			639			16
Amortization of intangible assets		—			50			—			169
Total cost of revenue and operating expenses		29,217			31,252			92,306			98,741
Operating loss		(2,348	)		(434	)		(7,143	)		(2,385	)
Interest income		2			4			9			10
Foreign exchange losses, net		(155	)		(66	)		(342	)		(129	)
Loss before income taxes		(2,501	)		(496	)		(7,476	)		(2,504	)
Provision for income taxes		341			275			327			422
Net loss	$	(2,842	)	$	(771	)	$	(7,803	)	$	(2,926	)
Comprehensive loss	$	(2,842	)	$	(771	)	$	(7,803	)	$	(2,926	)
Basic and diluted net loss per share	$	(0.04	)	$	(0.01	)	$	(0.12	)	$	(0.05	)
Number of shares used in per share calculations:
Basic and diluted		64,143,389			61,094,346			63,008,098			60,450,920

See Accompanying Notes to the Condensed Consolidated Financial Statements

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IPASS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	Nine Months Ended September 30,
	2013			2012
Cash flows from operating activities:
Net loss	$	(7,803	)	$	(2,926	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Stock-based compensation		2,472			1,781
Amortization of intangible assets		—			169
Depreciation and amortization		1,867			1,660
Loss on disposal of property and equipment		2			3
Provision for (recovery of) doubtful accounts		53			(203	)
Changes in operating assets and liabilities:
Accounts receivable		552			2,115
Prepaid expenses and other current assets		254			787
Other assets		609			569
Accounts payable		1,600			(681	)
Accrued liabilities		(336	)		354
Deferred revenue		(928	)		(128	)
Other liabilities		(167	)		62
Net cash provided by (used in) operating activities		(1,825	)		3,562
Cash flows from investing activities:
Purchases of property and equipment		(1,753	)		(4,096	)
Change in restricted cash pledged for letter of credit		720			471
Net cash used in investing activities		(1,033	)		(3,625	)
Cash flows from financing activities:
Proceeds from issuance of common stock		1,237			1,194
Stock repurchase		—			(70	)
Net cash provided by financing activities		1,237			1,124
Net increase (decrease) in cash and cash equivalents		(1,621	)		1,061
Cash and cash equivalents at beginning of period		26,822			25,439
Cash and cash equivalents at end of period	$	25,201		$	26,500
Supplemental disclosures of cash flow information:
Net cash paid for taxes	$	176		$	310
Accrued amounts for acquisition of property and equipment	$	308		$	458

See Accompanying Notes to Condensed Consolidated Financial Statements

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IPASS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Basis of Presentation

The condensed consolidated financial statements include the accounts of iPass Inc. (the “Company”) and its wholly owned subsidiaries. The condensed consolidated financial statements that accompany these notes have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) consistent in all material respects with those applied in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. The Condensed Consolidated Financial Statements for December 31, 2012, were derived from audited financial statements but do not include all disclosures required by GAAP. The interim financial information is unaudited but reflects all normal adjustments that are, in the opinion of management, necessary to provide a fair presentation for the interim periods presented. This interim financial information should be read in conjunction with the Consolidated Financial Statements and the Notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. The results of operations for the three and nine months ended September 30, 2013, are not necessarily indicative of the operating results for the full fiscal year or any future periods.

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results that the Company experiences may differ materially from those estimates. Estimates are used for, but not limited to the valuation of accounts receivables, other long-lived assets, network access costs, stock-based compensation, legal contingencies, and income taxes.

The Company reports comprehensive loss in a single continuous financial statement within the Condensed Consolidated Statements of Comprehensive Loss. The Company’s comprehensive loss is equivalent to its net loss because the Company does not have any transactions that are recorded through other comprehensive income (loss).

Note 2. Fair Value

Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction in the principal or most advantageous market between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers assumptions that market participants would use when pricing the asset or liability.

Fair Value Hierarchy

The three levels of inputs that may be used to measure fair value are as follows:

• Level 1—Quoted prices in active markets for identical assets or liabilities;

• Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

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The recurring fair value measurements of these financial assets (excluding cash) and financial liabilities were determined using the following inputs at September 30, 2013, and December 31, 2012, respectively:

	As of September 30, 2013								As of December 31, 2012
	Fair Value Measured Using						Total Balance		Fair Value Measured Using						Total Balance
	Level 1		Level 2		Level 3				Level 1		Level 2		Level 3
	(In thousands)
Financial assets
Money market funds(1)	$	18,303	$	—	$	—	$	18,303	$	18,298	$	—	$	—	$	18,298
Total financial assets	$	18,303	$	—	$	—	$	18,303	$	18,298	$	—	$	—	$	18,298
Financial liabilities
Lease liabilities incurred in connection with the restructuring plan(2)	$	—	$	—	$	351	$	351	$	—	$	—	$	483	$	483
Total financial liabilities	$	—	$	—	$	351	$	351	$	—	$	—	$	483	$	483

(1) Held in cash and cash equivalents on the Company’s condensed consolidated balance sheets.

(2) Lease liabilities are recorded at fair value and are included as liabilities in the Company’s condensed consolidated balance sheets. The lease liabilities were recorded in connection with lease abandonment plans implemented in 2009. Management made assumptions in determining the fair value of the lease liabilities. The discounted cash flow valuation technique used to determine fair value included inputs, such as the future rent payment schedule, the discount rate and sublease income based on the executed sublease agreement through the end of the lease terms.

There were no transfers between Levels 1, 2, and 3 from December 31, 2012, through September 30, 2013.

As of September 30, 2013, and December 31, 2012, the carrying amounts of accounts receivable, accounts payable and accrued liabilities, approximated fair value due to their short maturities.

Note 3. Property and Equipment, net

Property and equipment, net, consisted of the following:

	September 30, 2013			December 31, 2012
	(In thousands)
Equipment	$	15,439		$	14,292
Furniture and fixtures		2,217			2,214
Computer software		10,283			6,891
Capital work-in-progress		252			3,356
Leasehold improvements		1,372			1,578
		29,563			28,331
Less: Accumulated depreciation and amortization		(23,143	)		(21,782	)
Property and equipment, net	$	6,420		$	6,549

Depreciation expense was approximately $0.6 million and $1.9 million for the three and nine months ended September 30, 2013, respectively, and $0.5 million and $1.7 million for the three and nine months ended September 30, 2012, respectively. The Company did not retire any property and equipment during the three months ended September 30, 2013 and 2012. During the nine months ended September 30, 2013 and 2012, the Company retired approximately $0.3 million and $2.7 million, respectively, of gross property and equipment, nearly all of which were fully depreciated.

During January 2013, the Company went “live” with a new enterprise resource planning (ERP) system. Accordingly, approximately $3.4 million of capitalized costs related to the ERP implementation was reclassified from capital work-in-progress to computer software.

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Note 4. Other Assets

Other assets consisted of the following:

	September 30, 2013		December 31, 2012
	(In thousands)
Prepaid lease obligations	$	97	$	236
Deferred installation costs		1,746		2,180
Deposits		818		854
Long-term deferred tax assets, net		195		195
Restricted cash		250		970
	$	3,106	$	4,435

Note 5. Accrued Liabilities

Accrued liabilities consisted of the following:

	September 30, 2013		December 31, 2012
	(In thousands)
Accrued sales tax liabilities	$	1,084	$	1,080
Accrued restructuring liabilities – current(1)		224		203
Accrued bonus, commissions and other employee benefits		2,671		2,550
Amounts due to customers		877		1,061
Other accrued liabilities		3,439		3,737
	$	8,295	$	8,631

(1) See Note 6. Accrued Restructuring.

Note 6. Accrued Restructuring

During the year ended December 31, 2009, the Company announced restructuring plans (the “2009 Plans”) to reduce operating costs and focus resources on key strategic priorities, which resulted in a workforce reduction of 146 positions across all functional areas and abandonment of certain facilities and termination of a contract obligation. As of September 30, 2013, the Company had remaining cash payments of approximately $0.4 million.

In the first quarter of 2013, the Company announced a restructuring plan (the “Q1 2013 Plan”) to re-align its cost structure to focus investments, resources and operating expenses on the Company’s growing Open Mobile business, which resulted in a workforce reduction of 16 positions across all functional areas and termination of a lease contract. The Company recorded a restructuring charge of approximately $0.6 million during the first quarter of 2013, which included severance, facility exit costs and other associated costs. The Company has paid approximately $0.6 million during the nine months period ending September 30, 2013.

The following is a rollforward of restructuring liability for the Q1 2013 and 2009 Plans:

	Three Months Ended September 30,
	2013			2012
	(In thousands)
Beginning balance	$	448		$	633
Restructuring charges and related adjustments		13			10
Payments		(91	)		(118	)
Ending balance	$	370		$	525

	Nine Months Ended  September 30,
	2013			2012
	(In thousands)
Beginning balance	$	483		$	736
Restructuring charges and related adjustments		639			16
Payments		(752	)		(227	)
Ending balance	$	370		$	525

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As of September 30, 2013, approximately $0.2 million of the restructuring liability is included in accrued liabilities, and the remaining restructuring liability of approximately $0.2 million is included in other long-term liabilities.

Note 7. Commitments and Contingencies

Lease and Purchase Commitments

The Company leases facilities under operating leases that expire at various dates through June 2017. Future minimum lease payments under these operating leases, including approximately $0.4 million of future payments on leases accounted for under the Company’s restructuring plans, as of September 30, 2013, are as follows:

Year	Operating Leases
	(In thousands)
Remaining 2013	$	781
2014		3,012
2015		1,288
2016		538
2017		266
	$	5,885

The Company has contracts with certain network service providers, mobile data providers and other vendors which have minimum purchase commitments that expire on various dates through July 2016. Future minimum purchase commitments as of September 30, 2013 under all agreements are as follows:

Year	Minimum Purchase Commitments
	(In thousands)
Remaining 2013	$	607
2014		1,086
2015		30
2016		111
	$	1,834

Subsequent to September 30, 2013, the Company entered into a future minimum purchase commitment to acquire enterprise database software and infrastructure hardware of approximately $4.0 million to be paid over the next three years.

Legal Proceedings

The Company is involved in legal proceedings and claims arising in the ordinary course of business. While there can be no assurances as to the ultimate outcome of any litigation involving the Company, management does not believe any such pending legal proceeding or claim will result in a judgment or settlement that would have a material adverse effect on the Company’s financial position, results of operations or cash flows.

In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to customers, business partners, and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by the Company, or from intellectual property infringement claims made by third-parties. Certain indemnification agreements may not be subject to maximum loss clauses. If the potential loss from any indemnification claim is considered probable and the amount or the range of the loss can be estimated, the Company accrues a liability for the estimated loss. To date, claims under such indemnification provisions have not been significant.

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Note 8. Net Loss Per Common Share

Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding plus dilutive potential common shares as determined using the treasury stock method for outstanding stock options, restricted stock-based awards and shares issuable under the employee stock purchase plan, unless the result of adding such shares would be anti-dilutive. Unvested participating securities are included in the weighted daily average number of shares outstanding used in the calculation of diluted net income per common share, but are excluded from the calculation of diluted net loss per share. In a net loss position, basic and diluted net loss per common share are equal, since the weighted average number of shares used to compute diluted net loss per common share excludes anti-dilutive securities, including participating securities. As a result of the Company’s net loss for the three and nine months ended September 30, 2013, and for the three and nine months ended September 30, 2012, the Company has excluded all potential shares of common stock from the diluted net loss per share calculation as their inclusion would have had an anti-dilutive effect.

The following table sets forth the computation of basic and diluted net loss per share:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands, except share and per share amounts)
Numerator:
Net loss	$	(2,842	)	$	(771	)	$	(7,803	)	$	(2,926	)
Denominator:
Basic and diluted net loss per common share – Weighted average shares outstanding		64,143,389			61,094,346			63,008,098			60,450,920
Basic and diluted net loss per common share	$	(0.04	)	$	(0.01	)	$	(0.12	)	$	(0.05	)

The following weighted average potential shares of common stock have been excluded from the computation of diluted net loss per share because the effect of including these shares would have been anti-dilutive:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Options to purchase common stock		3,063,652		2,756,280		2,822,823		2,398,451
Restricted stock awards, including participating securities		2,974,414		1,973,888		2,519,276		1,801,444
Total		6,038,066		4,730,168		5,342,099		4,199,895

Note 9. Segment and Geographical Information

The Company’s two reportable operating segments are: Mobility Services and iPass Unity Network Services (“iPass Unity”; formerly known as Managed Network Services). The Mobility Services segment includes services that help enterprises manage the networks, connections and devices used by their mobile workforce. The iPass Unity segment provides customers with Wi-Fi and Wide Area Network solutions. The Company’s Chief Operating Decision Maker (the “CODM”) is the Company’s President and Chief Executive Officer. The CODM allocates resources to and assesses the performance of each operating segment, using information about its revenue, segment income or loss from operations before income taxes, excluding amortization of intangibles, and restructuring.

The accounting policies of the reportable operating segments are substantially the same as those the Company uses for its condensed consolidated financial statements. All direct costs are allocated to the respective operating segments. In addition to direct costs, certain indirect costs are allocated to each operating segment including costs relating to shared services in management, finance, legal, human resources, facilities, and information technology. Indirect costs are allocated based on headcount, salaries and operating

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segment revenue. The total pool of operating costs and network access costs allocated to the reportable operating segments were $29.2 million and $31.2 million for the three months ended September 30, 2013 and 2012, respectively, and $91.7 million and $98.6 million for the nine months ended September 30, 2013 and 2012, respectively. Costs related to amortization of intangibles, and restructuring activities are not allocated to operating segments. By definition, operating segment operating income (loss) also excludes interest income, foreign exchange gains and losses, and income taxes.

Revenue and operating loss for each reportable operating segment for the three and nine months ended September 30, 2013 and 2012, were as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	Net Revenue		Total Segment Operating Income (Loss)			Net Revenue		Total Segment Operating Income (Loss)
	(In thousands)
2013
Mobility Services	$	18,573	$	(2,660	)	$	59,842	$	(6,987	)
iPass Unity		8,296		325			25,321		473
Total Segment	$	26,869	$	(2,335	)	$	85,163	$	(6,514	)
2012
Mobility Services	$	22,372	$	(251	)	$	71,479	$	(1,768	)
iPass Unity		8,446		(132	)		24,877		(440	)
Total Segment	$	30,818	$	(383	)	$	96,356	$	(2,208	)

Substantially all of the Company’s long-lived assets are located in the United States. The CODM does not evaluate operating segments using discrete asset information. Accordingly, no segment assets have been reported.

There were no material intersegment sales or transfers for the three and nine months ended September 30, 2013 and 2012, to arrive at net segment revenue.

Reconciliations of total segment operating loss to total operating loss and total loss before income taxes for the three and nine months ended September 30, 2013 and 2012, are as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands)
Total segment operating loss	$	(2,335	)	$	(383	)	$	(6,514	)	$	(2,208	)
Amortization of intangibles		—			(50	)		—			(169	)
Restructuring charges and related adjustments		(13	)		(10	)		(639	)		(16	)
Certain state sales tax and federal tax items		—			9			10			8
Total operating loss		(2,348	)		(434	)		(7,143	)		(2,385	)
Interest income		2			4			9			10
Foreign exchange losses, net		(155	)		(66	)		(342	)		(129	)
Total loss before income taxes	$	(2,501	)	$	(496	)	$	(7,476	)	$	(2,504	)

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The following table summarizes total Company revenue by country or by geographical region for the periods presented:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
United States		56	%		59	%		57	%		59	%
EMEA		33	%		31	%		33	%		31	%
Asia Pacific		10	%		10	%		9	%		10	%
Rest of the World		1	%		—			1	%		—

No individual country, except for the United States, represented 10% or more of total revenue for the three and nine months ended September 30, 2013 and 2012. No individual customer represented 10% or more of total revenue for the three and nine months ended September 30, 2013 and 2012.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s Discussion and Analysis of Financial Condition and Results of Operations (or “MD&A”) is provided in addition to the condensed consolidated financial statements and notes, included elsewhere in this report, to assist readers in understanding our results of operations, financial condition, and cash flows. The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and notes thereto included in Item 1 of this Quarterly Report on Form 10-Q and with the MD&A in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2012.

This MD&A is organized as follows:

Overview	Discussion of our business
Significant Trends and Events	Operating, financial and other material trends and events that affect our company and may reflect our performance
Key Operating Metrics	Discussion of key metrics and measures that we use to evaluate our operating performance
Critical Accounting Policies and Estimates	Accounting policies and estimates that we believe are most important to understanding the assumptions and judgments incorporated in our reported financial results
Results of Operations	An analysis of our financial results comparing the three and nine months ended September 30, 2013, and September 30, 2012
Liquidity and Capital Resources	An analysis of changes in our balance sheet and cash flows, and discussion of our financial condition and potential sources of liquidity

The various sections of this MD&A contain forward-looking statements regarding future events and our future results that are based on current expectations, estimates, forecasts, and projections about the industries in which we operate and the beliefs and assumptions of our management. Words such as “expects,” “will,” “anticipates,” “projects,” “intends,” “believes,” “estimates,” “potential,” variations of such words, and similar expressions are intended to identify such forward-looking statements. In addition, any statements which refer to projections of our future financial performance, our anticipated growth and trends in our business, and other characterizations of future events or circumstances, are forward-looking statements. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. Readers are directed to risks and uncertainties identified in “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2012, for factors that may cause actual results to be different from those expressed in these forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and except as required by law, we undertake no obligation to revise or update publicly any forward-looking statements for any reason.

Investors and others should note that we announce material financial information to our investors using our investor relations website, SEC filings, press releases, public conference calls and webcasts. We also use social media to communicate with our customers and the public about our company, our products and services and other matters relating to our business and market. It is possible that the information we post on social media could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our company to review the information we post on the U.S. social media channels including the iPass Twitter Feed, the iPass LinkedIn Feed, the iPass Google+ Feed, the iPass Facebook Page, the iPass Blog, the iPass Instagram, the iPass Pinterest and Evan Kaplan’s Twitter Feed. These social media channels may be updated from time to time.

Overview

iPass is a global Wi-Fi roaming leader for enterprises and telecom service providers and their consumer subscribers. We knit the world’s commercial Wi-Fi networks together to create a single global Wi-Fi network. With the acceleration of the broader Wi-Fi industry, where an ever increasing number of mobile phone, tablet and laptop are Wi-Fi enabled, and where Wi-Fi has become the preferred connectivity option for billions of devices, we believe that we are uniquely positioned to take advantage of expanding global demand for Wi-Fi. iPass was incorporated in California in July 1996 and reincorporated in Delaware in June 2000. Our corporate headquarters are located in Redwood Shores, California. We are publicly traded on NASDAQ under symbol IPAS.

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We provide global enterprises and telecommunications carriers with cloud-based mobility management and Wi-Fi connectivity services. Through our proprietary technology platform and global Wi-Fi network, we offer enterprises cross-device, cross-network seamless Wi-Fi connectivity services along with cost control, reporting and policy compliance management tools. We also offer global telecommunications carriers Wi-Fi enablement services that allow them to monetize their Wi-Fi networks and enable data roaming solutions for their subscribers. In addition, we design, deliver and manage tailored Wi-Fi and Wide Area Network solutions to customers in the retail, finance, healthcare, and carrier operator space throughout North America.

Strategic Mobility Assets

We believe iPass has a unique set of mobility assets that provides us with competitive advantages. We see our three core assets as follows:

Advanced Open Mobile Platform: Our Open Mobile (OM) platform is a cloud-based mobility management platform that securely manages network connectivity and subscribers across a wide variety of computing and mobile devices and provider networks. We believe this scalable subscriber management, billing and reporting platform is unique in the industry and would be time consuming and expensive to replicate.

Integrated Authentication Fabric: We have a global authentication fabric of integrated servers and software that is interconnected with approximately 140 global Wi-Fi network service providers. This infrastructure allows us to provide secure, highly-available and seamless four party global authentication, clearing and settlement of Wi-Fi users for our partners and customers.

Global Wi-Fi Footprint: We have a Wi-Fi network footprint and supply chain that consists of approximately 1.5 million commercial Wi-Fi hotspots, with hotspots in over 130 countries globally and across leading Wi-Fi venues, including major airports, convention centers, airplanes, hotels, restaurants, retail and small business locations. Our technology integration across multiple global network providers forms the basis of our network services and we believe creates a unique cost advantage for our customers.

Business Portfolio and Our Strategy

Our business consists of two operating segments: (i) Mobility Services and (ii) iPass Unity Network Services (“iPass Unity”; formerly known as Managed Network Services). Our Mobility Services segment comprises two service offerings: (1) our Open Mobile Enterprise Services, and (2) our Open Mobile Exchange.

Mobility Services

Open Mobile Enterprise Services (“iPass OME” or “OME”): iPass OME delivers enhanced network mobility services, addressing large enterprises’ needs to manage their mobility economics, high speed network connectivity requirements and proliferation of mobile devices, including the “bring-your-own-device” trend. Our growth strategy for OME consists of focusing on accelerating smartphone and tablet user adoption of the Open Mobile platform, completing the migration of our legacy-customer installed base to the OM platform, improving the end user experience on our OM platform, and enhancing our sales efforts with large multi-national customers.

Open Mobile Exchange (“iPass OMX” or “OMX”): iPass OMX service offerings extend and enhance global telecommunications carriers and service provider’s core mobility and internet offerings by integrating our Open Mobile Platform technology and our worldwide Wi-Fi Network, allowing them to connect their customers and subscribers seamlessly to preferred global Wi-Fi networks. While our OMX revenue is still significantly less than our mobility service revenue, we continue to focus on adding new global telecommunications carriers and service provider partners as customers to further grow our OMX services.

iPass Unity

iPass Unity provides customers throughout North America with accelerated Wi-Fi and Wide Area Network solutions in the retail, finance, healthcare, and carrier operator space. Based on expected demand for our managed Wi-Fi service offerings, we are focused on growing iPass Unity Network Services by providing our customers additional services that leverage synergies with our Wi-Fi mobility expertise.

For a detailed discussion regarding our business, including our strategy and our service offerings, see “Item 1. Business” included in our Annual Report on Form 10-K for the year ended December 31, 2012.

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Significant Trends and Events

The following describes significant trends and events of our business during the third quarter of 2013:

Continued Focus on our Open Mobile Enterprise Business

We continued to show solid progress against three key metrics for our OME business: (i) increasing the number of Open Mobile Wi-Fi Network users; (ii) growing Open Mobile revenue; and (iii) increasing the number of active Open Mobile Platform users. We grew our percentage of Open Mobile Wi-Fi Network users as a percentage of total Wi-Fi network users from 33% in the third quarter of 2012 to 74% in the third quarter of 2013. In addition, our total Open Mobile Enterprise revenue grew from $17.6 million for the nine months ending September 30, 2012, to $33.5 million for the nine months ending September 30, 2013. We also increased our percentage of Open Mobile Platform users as a percentage of total platform users from 46% in the third quarter of 2012 to 79% in the third quarter of 2013. We believe the key to our future revenue growth is based on our ability to grow Open Mobile platform and Wi-Fi network users, primarily through the continued focus on the deployment of our Open Mobile platform on smartphone and tablet devices, growth of Open Mobile usage within existing customers, and new customer acquisition. See “Key Operating Metrics” below for a full discussion of our user metrics.

Adding Partners for our Open Mobile Exchange Business

We continue to develop our OMX business. During the third quarter of 2013, we signed two strategic partners. We are continuing to focus on expanding the number of carrier partners and the total number of potential end user customers for our Wi-Fi roaming and exchange services. For the nine months ended September 30, 2013, OMX revenue more than tripled as new partners were added and deployments continue to ramp.

Continued Decline in our Legacy Revenues

Our legacy revenue includes Dial-up and 3G network revenue, and iPC related network and platform revenue. With our announcement to fully end-of-life the iPC platform effective July 1, 2012, we continue to experience anticipated revenue declines in our legacy revenue streams. Legacy revenues declined from $53.4 million for the nine months ending September 30, 2012, to $24.8 million for the nine months ending September 30, 2013. For the quarter ended September 30, 2013, legacy revenue represents less than one third of our Mobility Services total revenue. We expect our legacy revenue streams to represent a smaller percentage of our total revenue during the remainder of 2013 as customers migrate or terminate iPC contracts.

Key Operating Metrics

Described below are key metrics that we use to evaluate our operating performance and our success in transforming our business and driving future growth.

OM Wi-Fi Network Users

OM Wi-Fi Network Users is the number of our OM platform users each month in a given quarter that paid for Wi-Fi network services from iPass.

OM Platform Active Users

OM Platform Active Users is the number of users who were billed Open Mobile platform fees and who have used or deployed Open Mobile.

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The following table summarizes our key operating metrics in relation to the Average Monthly Monetized Users⁽¹⁾ (in thousands):

	For the Quarter Ended
	September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			September 30, 2012
Open Mobile Users:
Wi-Fi Network Users(2)		59			56			46			35			27
Platform Users:
Active		574			517			444			355			270
Gross(3)		1,019			1,019			955			822			689
Legacy Users:
Wi-Fi Network Users(2)		21			31			40			46			54
Other Network Users(4)		20			23			26			28			31
Platform Users(5)		151			201			246			286			320
Total Users:
Total Network Users		100			110			112			109			112
Open Mobile as a Percentage of Total Wi-Fi Network Users		74	%		64	%		53	%		43	%		33	%
Open Mobile as Percentage of Total Network Users		59	%		51	%		41	%		32	%		24	%
Total Platform Users		725			718			690			641			590
Open Mobile as Percentage of Total Platform Users		79	%		72	%		64	%		55	%		46	%

⁽¹⁾  We have presented Average Monthly Monetized Users (referred to as “AMMU”) as a metric that we use to track and evaluate the operating performance of our overall Mobility business. The AMMU metric is based on the number of active users of our network and platform services across both our Open Mobile Enterprise offering and legacy iPC offerings. Network users are billed for their use of our Wi-Fi, Dial-up or 3G network services. Platform users are billed for their use of our legacy iPC client or our Open Mobile client. AMMU is defined as the average number of users per month, during a given quarter, for which a fee was billed by us to a customer for such users.

⁽²⁾  Wi-Fi Network Users represent unique users of the iPass Wi-Fi network. Starting from the first quarter of 2013, OM Wi-Fi Network Users include In-Flight Wi-Fi users.

⁽³⁾  Open Mobile Platform Gross Users is the total number of unique Active users and the Paying-Undeployed users on the OM platform.

⁽⁴⁾  Other Network Users represents unique users of Dial-up and 3G network.

⁽⁵⁾  Legacy Platform Users represents unique users of the legacy iPC platform.

Smartphone and Tablet Users

Smartphone and Tablet Users mean users who have deployed Open Mobile on their smartphone or tablet devices and used those devices to access Wi-Fi network services from iPass. Our focus is to increase the adoption of OM on smartphones and tablets to drive additional Wi-Fi network users and network usage.

As we continue to focus on accelerating the adoption of Smartphone and Tablet Users on our Open Mobile platform, we expect users of these devices to become an increasing percentage of our network users. Open Mobile Smartphone and Tablet Wi-Fi Network Users grew as a percentage of total OM Wi-Fi Network Users from 20% in the third quarter of 2012 to 32% in the third quarter of 2013.

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

Adjusted EBITDA is used by our management as a measure of operating efficiency, financial performance and as a benchmark against our peers and competitors. In addition, we also use this metric to determine a portion of our incentive compensation payouts. Management also believes that Adjusted EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties to understand our performance excluding the impact of items which may obscure trends in our core operating performance. Furthermore, the use of Adjusted EBITDA facilitates comparisons with other companies in our industry which may use similar financial measures to supplement their GAAP results. We define Adjusted EBITDA as net loss adjusted for: interest income, income taxes, depreciation and amortization, stock-based compensation, restructuring charges, and certain state sales and federal tax charges. We adjust for these excluded items because we believe that, in general, these items possess one or more of the

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following characteristics: their magnitude and timing is largely outside of our control; they are unrelated to the ongoing operation of the business in the ordinary course; they are unusual or infrequent and we do not expect them to occur in the ordinary course of business; or non-cash expenses involving stock option grants. Adjusted EBITDA is not a measure determined in accordance with GAAP and should not be considered in isolation or as a substitute for operating income (loss), net income (loss) or any other measure determined in accordance with GAAP.

The following table reconciles Adjusted EBITDA to GAAP net loss:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands)
Adjusted EBITDA	$	(991	)	$	693		$	(2,517	)	$	1,104
Interest income		2			4			9			10
Income tax expense		(341	)		(275	)		(327	)		(422	)
Depreciation of property and equipment		(612	)		(505	)		(1,867	)		(1,660	)
Amortization of intangible assets		—			(50	)		—			(169	)
Stock-based compensation		(887	)		(637	)		(2,472	)		(1,781	)
Restructuring charges and related adjustments		(13	)		(10	)		(639	)		(16	)
Certain state sales and federal tax items		—			9			10			8
GAAP Net loss	$	(2,842	)	$	(771	)	$	(7,803	)	$	(2,926	)

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations is based upon our condensed consolidated financial statements which have been prepared in accordance with the accounting principles generally accepted in the United States (“GAAP”). The preparation of these condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We base our estimates and judgments on our historical experience, knowledge of current conditions and our belief of what could occur in the future considering available information, including assumptions that we believe to be reasonable under the circumstances. By their nature, these estimates and judgments are subject to an inherent degree of uncertainty and actual results could differ materially from the amounts reported based on these policies. On an ongoing basis, we evaluate our estimates and judgments.

There have been no significant changes in our critical accounting policies and estimates during the three and nine months ended September 30, 2013, as compared to the critical accounting policies and estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2012.

Recently Issued Accounting Standards

In July 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 requires an entity to present an unrecognized tax benefit as a reduction of a deferred tax asset for a net operating loss carryforward, or similar tax loss or tax credit carryforward, rather than as a liability when (1) the uncertain tax position would reduce the Net Operating Loss or other carryforward under the tax law of the applicable jurisdiction and (2) the entity intends to use the deferred tax asset for that purpose. This ASU is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company will adopt ASU 2013-11 for its fiscal years, and interim periods within those years ending December 31, 2014. We do not expect that this guidance will materially impact our Condensed Consolidated Financial Statements.

Results of Operations

Sources of Revenues

From a broad perspective, we report and analyze revenue under two primary offerings reflecting our operating segments: Mobility Services and iPass Unity. Within Mobility Services, we differentiate and analyze our Open Mobile and legacy generated revenues separately.

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Open Mobile generated revenues include:

• Network—Wi-Fi and minimum customer commitments based on the number of network users sourced from the Open Mobile platform.

• Platform—Fees based on the number of Active Open Mobile monetized platform users and fees for fully dedicated Open Mobile carrier arrangements.

• Other Fees and Revenue—Fees specific to providing additional value add services to Open Mobile customers.

• Open Mobile Exchange—Revenues generated from our OMX customers.

Legacy generated revenues include:

• Network—Wi-Fi and minimum customer commitments based on the number of network users sourced from the legacy iPC platform. In addition, network revenues derived from our 3G and Dial-up products are categorized as legacy network revenues.

• Platform—Fees based on the number of legacy iPC monetized platform users and fees related to legacy add-on platform products and related services.

• Other Fees and Revenue—Fees specific to providing additional value add service to legacy iPC customers.

	Three Months Ended September 30, (in thousands)						Nine Months Ended September 30, (in thousands)
	2013			2012			2013			2012
Mobility Services	$	18,573		$	22,372		$	59,842		$	71,479
Segment Operating Loss		(2,660	)		(251	)		(6,987	)		(1,768	)
Open Mobile Enterprise		11,963			7,442			33,456			17,570
Network		7,867			4,087			21,401			8,888
Platform		3,881			3,133			11,403			8,035
Other Fees		215			222			652			647
Open Mobile Exchange		633			200			1,615			502
Legacy iPC		5,977			14,730			24,771			53,407
Network		4,520			11,742			18,484			43,874
Platform		804			2,095			3,331			7,961
Other Fees		653			893			2,956			1,572
iPass Unity Network Services		8,296			8,446			25,321			24,877
Segment Operating Income (Loss)		325			(132	)		473			(440	)
Total Revenue		26,869			30,818			85,163			96,356
Service Offering Revenue as a Percentage of Total Revenue:
Mobility Services		69	%		73	%		70	%		74	%
Open Mobile Enterprise		45	%		24	%		39	%		18	%
Open Mobile Exchange		2	%		1	%		2	%		1	%
Legacy iPC		22	%		48	%		29	%		55	%
iPass Unity Network Services		31	%		27	%		30	%		26	%
Total Revenue		100	%		100	%		100	%		100	%

Mobility Services Revenue

For the three months ended September 30, 2013, Mobility Services revenue decreased $3.8 million or 17% over the same period in 2012. Open Mobile revenue grew $5.0 million or 65% while legacy iPC revenue declined $8.8 million or 59%. Growth in Open Mobile revenue was primarily driven by new customer additions and customer migrations from our legacy iPC product as well as smartphone and tablet user adoption. Declines in legacy iPC revenue were driven by customer migrations to Open Mobile, anticipated usage erosion in our 3G and Dial-up services, and customer terminations after our July 1, 2012 end-of-life announcement.

For the nine months ended September 30, 2013, Mobility Services revenue decreased $11.6 million or 16% over the same period in 2012. Open Mobile revenue grew $17.0 million or 94% while legacy iPC revenue declined $28.6 million or 54%. Drivers of the year over year change for the nine months were materially consistent with the drivers for the year over year change for the three months noted above.

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Mobility Services Operating Loss

For the three months and nine months ended September 30, 2013, Mobility Services operating loss increased by $2.4 million and $5.2 million, respectively, compared to the same period in 2012, primarily due to lower gross profit of approximately $3.5 million and $8.0 million, respectively, driven by the decrease in legacy revenues and the adverse impacts from higher usage by customers on a flat rate price plans. These lower gross profits were partially offset by a decrease in operating expense, after adjusting restructuring activities that are not allocated to operating segments, of approximately $1.2 million and $3.0 million, respectively, due to ongoing cost management efforts.

iPass Unity Network Services Revenue

For the three months ended September 30, 2013, iPass Unity revenue decreased by $0.2 million or 2% over the same period in 2012, primarily due to a net decline in installed endpoints resulting from termination of customer contracts.

For the nine months ended September 30, 2013, compared to the same period in 2012, iPass Unity revenue increased by approximately $0.4 million or 2% mainly due to the increase in revenue per end point of approximately 6%, partially offset by termination of customer contracts.

iPass Unity Network Services Operating Income and Loss

The iPass Unity operating income for the three and nine months ended September 30, 2013, increased $0.5 million and $0.9 million respectively compared to the same periods in 2012 mainly due to ongoing cost reduction initiatives and improved gross margin.

Network Gross Margin

We use network gross margin as a metric to assist us in assessing the profitability of our various network services. Our overall network gross margin is defined as (Mobility Services Network revenue plus iPass Unity revenue less network access costs divided by Mobility Services Network revenue plus iPass Unity revenue).

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Network Gross Margin (%)		43.0	%		48.6	%		43.9	%		47.5	%

For the three and nine months ending September 30, 2013 compared to the same period in 2012, network gross margin decreased by 5.6 and 3.6 percentage points, respectively, primarily due to decreases in higher margin revenue streams such as monthly minimum commitment revenue, and Dial-up revenue, and the impacts from higher usage by customers on flat rate price plans.

Operating Expenses

Network Access Costs (NAC)

NAC consist of charges for network access which we pay to our network service providers and other direct cost of sales.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(in thousands, except percentages)						(in thousands, except percentages)
Network access costs	$	12,062		$	12,574		$	37,203		$	41,049
As a percentage of total revenue		44.9	%		40.8	%		43.7	%		42.6	%

For the three and nine months ended September 30, 2013, compared to the same period in 2012, network access costs decreased approximately $0.5 million or 4% and $3.8 million or 9%, respectively, primarily due to a decrease in Mobility Service NAC by $0.2 million and $3.6 million for each period, respectively, primarily driven by legacy customer termination.

Network Operations

Network operations expenses consist of compensation and benefits for our network engineering, customer support and network access quality personnel, outside consultants, transaction center fees, network equipment depreciation, costs of 3G data cards and allocated overhead costs.

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	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(in thousands, except percentages)						(in thousands, except percentages)
Network operations expense	$	4,717		$	5,126		$	14,284		$	15,932
As a percentage of total revenue		17.6	%		16.6	%		16.8	%		16.5	%

Network operations expense for the three months ended September 30, 2013, decreased by approximately $0.4 million or 8% compared to the same period in 2012, primarily due to lower headcount of $0.2 million, and a decrease in severance expense of approximately $0.2 million.

Network operations expense for the nine months ended September 30, 2013, decreased by approximately $1.6 million or 10% compared to the same period in 2012, primarily due to lower headcount and consulting related costs of $0.8 million, a decrease in legacy 3G mobile data cards subsidized expense of $0.4 million, depreciation and facility related expense of $0.2 million and severance expense of $0.2 million.

Research and Development

Research and development expenses consist of compensation and benefits for our research and development personnel, consulting, and allocated overhead costs.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(in thousands, except percentages)						(in thousands, except percentages)
Research and development expenses	$	3,171		$	3,300		$	10,199		$	10,447
As a percentage of total revenue		11.8	%		10.7	%		12.0	%		10.8	%

Research and development expenses were relatively consistent for the three months ended September 30, 2013, compared to the same period in 2012. For the nine months ended September 30, 2013, research and development expense decreased by approximately $0.3 million or 2% compared to the same period in 2012, mainly due to the decrease in headcount expense of $0.3 million.

Sales and Marketing

Sales and marketing expenses consist of compensation, benefits, advertising and promotion costs, and allocated overhead costs.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(in thousands, except percentages)						(in thousands, except percentages)
Sales and marketing expenses	$	4,368		$	4,547		$	13,658		$	14,981
As a percentage of total revenue		16.3	%		14.8	%		16.0	%		15.5	%

Sales and marketing expenses for the three months ended September 30, 2013, decreased by approximately $0.2 million or 4% compared to the same period in 2012, primarily due to a lower headcount related cost of $0.2 million.

Sales and marketing expenses for the nine months ended September 30, 2013, decreased by approximately $1.3 million or 9% compared to the same period in 2012, primarily due to lower headcount and consulting related costs of $1.1 million, and severance expense of $0.2 million.

General and Administrative

General and administrative expenses consist primarily of compensation and benefits for general and administrative personnel, legal and accounting expenses.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands, except percentages)						(In thousands, except percentages)
General and administrative expenses	$	4,886		$	5,645		$	16,323		$	16,147
As a percent of total revenue		18.2	%		18.3	%		19.2	%		16.8	%

General and administrative expenses for the three months ended September 30, 2013, decreased by approximately $0.8 million or 13% compared to the same period in 2012, primarily due to a decrease in headcount related cost of $0.5 million, and lower rent expense of $0.1 million.

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The increase in general and administrative expenses of approximately $0.2 million or 1% for the nine months ended September 30, 2013, compared to the same period in 2012 was mainly due to an increase in expenses related to our going “live” with our new ERP system in January 2013 of $0.7 million, partially offset by a decrease in headcount related expense of approximately $0.1 million, and a lower rent of $0.4 million.

Restructuring Charges

During the first quarter of 2013, we announced a restructuring plan to reduce 16 positions in order to re-align our resources and operating expenses with the company’s Open Mobile initiatives and recorded approximately $0.6 million of restructuring charges, which included severance, facility exit cost and other associated costs. We made cash payments of less than $0.1 million and approximately $0.6 million for the three and nine months ended September 30, 2013. For further information, see Note 6, “Accrued Restructuring”, in the Notes to Condensed Consolidated Financial Statements of this Form 10-Q.

Other Income and Expenses

Foreign Exchange Gains and Losses

Foreign exchange gains and losses primarily include realized and unrealized gains and losses on foreign currency transactions. Foreign currency exchange rate fluctuations impact the re-measurement of certain assets and liabilities denominated in currencies other than the U.S. Dollar and generate unrealized foreign exchange gains or losses. In addition, some of our network access costs are invoiced in currencies other than the U.S. Dollar. The transactional settlement of these outstanding invoices and other cross-currency transactions generate realized foreign exchange gains or losses depending on the fluctuation of exchange rates between the date of invoicing and the date of payment.

For the three and nine months ended September 30, 2013 and 2012, we did not enter into any hedging contracts. Foreign exchange losses for the three and nine months ended September 30, 2013 were approximately $0.2 million and $0.3 million respectively, primarily due to weakening of the U.S. dollar against Euro and British pound at the time we settled certain non-U.S. Dollar denominated network access costs as well as the unfavorable re-measurement of foreign currency denominated assets and liabilities. Foreign exchange losses for the three and nine months ended September 30, 2012 were less than $0.1 million and $0.1 million.

Provision for Income Taxes

Income tax expense for the three and nine months ended September 30, 2013 was approximately $0.3 million and $0.3 million, respectively, and $0.3 million and $0.4 million for the three and nine months ended September 30, 2012. The income tax expense recorded in the three and nine months ended September 30, 2013 and 2012, primarily related to foreign taxes on expected profits in the foreign jurisdictions.

Liquidity and Capital Resources

We had cash and cash equivalents of $25.2 million at September 30, 2013, compared to $26.8 million at December 31, 2012.

	Nine months ended September 30,
	2013			2012
	(In thousands)
Cash Flows
Net cash provided by (used in) operating activities	$	(1,825	)	$	3,562
Net cash used in investing activities		(1,033	)		(3,625	)
Net cash provided by financing activities		1,237			1,124
Net (decrease) increase in cash and cash equivalents	$	(1,621	)	$	1,061

Operating Activities

Net cash used in operating activities was $1.8 million for the nine months ended September 30, 2013, compared to net cash provided by operating activities of $3.6 million for the same period in 2012 mainly due to an increase in net loss.

Investing Activities

Net cash used in investing activities was $1.0 million for the nine months ended September 30, 2013, compared to net cash used in investing activities of $3.6 million for the same period in 2012 mainly due to investment in our new ERP system in 2012 that went “live” in January 2013.

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Financing Activities

During the nine months ended September 30, 2013 and 2012, net cash provided by financing activities was $1.2 million and $1.1 million, respectively, due to proceeds from the exercise of stock options and purchases of stock under our employee stock purchase plan.

Sources of Cash and Future Cash Requirements

We have historically relied on existing cash and cash equivalents and cash flow from operations for our liquidity needs. We use a professional investment management firm to manage a large portion of our cash which is invested primarily in money market accounts. We believe that based on our current business plan and revenue prospects and our anticipated cash flows from operations, our existing cash balances will be sufficient to meet our working capital and operating resource expenditure requirements for at least the next twelve months.

The amount of cash and cash equivalents held by our foreign subsidiaries as of September 30, 2013, and December 31, 2012, was $0.8 million and $1.4 million, respectively. We currently do not intend to distribute any of our cumulative earnings by our foreign subsidiaries to the parent company in the U.S.

Primary Uses of Cash

Our principal use of cash during the nine months ended September 30, 2013, was for network access costs, payroll related expenses and general operating expenses including marketing, office rent, capital expenditures, and settlement of remaining restructuring obligations.

Contractual Commitments

The following are our contractual commitments as of September 30, 2013:

	Total		Less Than 1 Year		1-3 Years
	(In thousands)
Operating Lease Obligations	$	5,885	$	3,049	$	2,836
Network Service Commitments(1)		1,834		1,659		175
Total Contractual Obligations	$	7,719	$	4,708	$	3,011

⁽¹⁾  In the normal course of our business, we have signed contracts with certain network service providers under which we have minimum purchase commitments. These commitments expire on various dates through July 2016.

Subsequent to September 30, 2013, the Company entered into a future minimum purchase commitment to acquire enterprise database software and infrastructure hardware of approximately $4.0 million to be paid over the next three years.

For information on our contractual commitments at December 31, 2012, see “Commitments” in Part 7, Management’s Discussion and Analysis of Financial Conditions and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2012. Contractual commitments at December 31, 2012, were $11.5 million.

Off-Balance Sheet Arrangements

As part of our ongoing business, we do not participate in transactions that generate material relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or for other contractually narrow or limited purposes. We did not have any off-balance sheet arrangements at September 30, 2013, and December 31, 2012, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Exchange Rate Risk

We are exposed to foreign currency exchange rate risk inherent in conducting business globally in numerous currencies, of which the most significant to our operations for the three and nine months ended September 30, 2013, were the Euro, the British Pound, and the Indian Rupee. We are primarily exposed to foreign currency fluctuations related to network access costs and other operating expenses denominated in currencies other than the U.S. Dollar. As such, we benefit from a stronger U.S. Dollar and may be adversely affected by a weaker U.S. Dollar relative to each foreign currency. Currently, we do not enter into currency forward

22

exchange or option contracts to hedge foreign currency exposures. The impact of foreign currency fluctuations is also discussed in “Foreign Exchange Gains and Losses” under Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Interest Rate Risk

As of September 30, 2013, we had cash and cash equivalents of $25.2 million, restricted cash of $0.3 million and no short-term investments. As of December 31, 2012, we had cash and cash equivalents of $26.8 million, restricted cash of $1.0 million and no short-term investments. Our cash balances are held primarily in bank deposits and money market accounts with a remaining maturity of three months or less at the time of purchase. As a result, we do not believe we are exposed to material interest rate risk.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

As of the end of the period covered by this report, management of iPass conducted an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined in Securities Exchange Act Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the Exchange Act). Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective at a reasonable assurance level, as of the end of the period covered by this report, to ensure that information required to be disclosed was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and to provide reasonable assurance that information required to be disclosed by us in such reports is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

During the quarter ended September 30, 2013, there have been no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations of Disclosure Control and Procedures and Internal Control over Financial Reporting

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within iPass have been detected.

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PART II. OTHER INFORMATION

Item 1A. Risk Factors

The risk factors set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2012, as filed with the SEC on March 15, 2013, have not substantively changed.

Item 6. Exhibits

See the Exhibit Index which follows the signature page of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.

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SIGNATURE

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, thereunto duly authorized.

	iPass Inc.
Date: November 7, 2013	/s/ KAREN WILLEM
	Karen Willem
	Senior Vice President and Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)

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INDEX TO EXHIBITS

Exhibit Number	Description
3.1	Amended and Restated Certificate of Incorporation (1)
3.2	Certificate of Amendment to Amended and Restated Certificate of Incorporation (2)
3.3	Certificate of Change to Amended and Restated Certificate of Incorporation (3)
3.4	Amended and Restated Bylaws
4.1	Reference is made to Exhibits 3.1, 3.2, 3.3 and 3.4
4.2	Specimen stock certificate (4)
31.1	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of the Chief Executive Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of the Chief Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

(1) Filed as Exhibit 3.1 to our Form 10-Q, filed November 13, 2003 (Registration No. 000-50327), and incorporated herein by reference.

(2) Filed as Exhibit 3.2 to our Form 10-Q, filed August 7, 2009 (Registration No. 000-50327), and incorporated herein by reference.

(3) Filed as Exhibit 3.1 to our Form 8-K, filed February 3, 2010 (Registration No. 000-50327), and incorporated herein by reference.

(4) Filed as an exhibit to our Form S-1/A, filed July 1, 2003 (No. 333-102715), and incorporated herein by reference.

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EX-3.4

Exhibit 3.4

BYLAWS

OF

IPASS INC.

(A DELAWARE CORPORATION)

BYLAWS

OF

IPASS INC.

(A DELAWARE CORPORATION)

ARTICLE I

OFFICES

Section 1. Registered Office. The registered office of the corporation in the State of Delaware shall be in the City of Dover, County of Kent.

Section 2. Other Offices. The corporation shall also have and maintain an office or principal place of business at such place as may be fixed by the Board of Directors, and may also have offices at such other places, both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the corporation may require.

ARTICLE II

CORPORATE SEAL

Section 3. Corporate Seal. The Board of Directors may adopt a corporate seal. The corporate seal shall consist of a die bearing the name of the corporation and the inscription, “Corporate Seal-Delaware.” Said seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

ARTICLE III

STOCKHOLDERS’ MEETINGS

Section 4. Place Of Meetings. Meetings of the stockholders of the corporation may be held at such place, either within or without the State of Delaware, as may be determined from time to time by the Board of Directors. The Board of Directors may, in its sole discretion, determine that the meeting shall not be held at any place, but may instead be held solely by means of remote communication as provided under the Delaware General Corporation Law (“DGCL”).

Section 5. Annual Meetings.

(a) The annual meeting of the stockholders of the corporation, for the purpose of election of directors and for such other business as may lawfully come before it, shall be held on such date and at such time as may be designated from time to time by the Board of Directors. Nominations of persons for election to the Board of Directors of the corporation and the proposal of business to be considered by the stockholders may be made at an annual meeting of

1.

stockholders: (i) pursuant to the corporation’s notice of meeting of stockholders; (ii) by or at the direction of the Board of Directors; or (iii) by any stockholder of the corporation who was a stockholder of record at the time of giving the stockholder’s notice provided for in the following paragraph, who is entitled to vote at the meeting and who complied with the notice procedures set forth in Section 5.

(b) At an annual meeting of the stockholders, only such business shall be conducted as shall have been properly brought before the meeting. For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to clause (iii) of Section 5(a) of these Bylaws, (i) the stockholder must have given timely notice thereof in writing to the Secretary of the corporation, (ii) such other business must be a proper matter for stockholder action under DGCL, (iii) if the stockholder, or the beneficial owner on whose behalf any such proposal or nomination is made, has provided the corporation with a Solicitation Notice (as defined in clause (iii) of the last sentence of this Section 5(b)), such stockholder or beneficial owner must, in the case of a proposal, have delivered a proxy statement and form of proxy to holders of at least the percentage of the corporation’s voting shares required under applicable law to carry any such proposal, or, in the case of a nomination or nominations, have delivered a proxy statement and form of proxy to holders of a percentage of the corporation’s voting shares reasonably believed by such stockholder or beneficial owner to be sufficient to elect the nominee or nominees proposed to be nominated by such stockholder, and must, in either case, have included in such materials the Solicitation Notice, and (iv) if no Solicitation Notice relating thereto has been timely provided pursuant to this section, the stockholder or beneficial owner proposing such business or nomination must not have solicited a number of proxies sufficient to have required the delivery of such a Solicitation Notice under this Section 5. To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the ninetieth (90^th) day nor earlier than the close of business on the one hundred twentieth (120^th) day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is advanced more than thirty (30) days prior to or delayed by more than thirty (30) days after the anniversary of the preceding year’s annual meeting, notice by the stockholder to be timely must be so delivered not earlier than the close of business on the one hundred twentieth (120^th) day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90^th) day prior to such annual meeting or the tenth (10^th) day following the day on which public announcement of the date of such meeting is first made. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for the giving of a stockholder’s notice as described above. Such stockholder’s notice shall set forth: (A) as to each person whom the stockholder proposed to nominate for election or reelection as a director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the “1934 Act”) and Rule 14a-4(d) thereunder (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected); (B) as to any other business that the stockholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made; and (C) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (i)

2.

the name and address of such stockholder, as they appear on the corporation’s books, and of such beneficial owner, (ii) the class and number of shares of the corporation which are owned beneficially and of record by such stockholder and such beneficial owner, and (iii) whether either such stockholder or beneficial owner intends to deliver a proxy statement and form of proxy to holders of, in the case of the proposal, at least the percentage of the corporation’s voting shares required under applicable law to carry the proposal or, in the case of a nomination or nominations, a sufficient number of holders of the corporation’s voting shares to elect such nominee or nominees (an affirmative statement of such intent, a “Solicitation Notice”).

(c) Notwithstanding anything in the third sentence of Section 5(b) of these Bylaws to the contrary, in the event that the number of directors to be elected to the Board of Directors of the Corporation is increased and there is no public announcement naming all of the nominees for director or specifying the size of the increased Board of Directors made by the corporation at least one hundred (100) days prior to the first anniversary of the preceding year’s annual meeting, a stockholder’s notice required by this Section 5 shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the corporation not later than the close of business on the tenth (10^th) day following the day on which such public announcement is first made by the corporation.

(d) Only such persons who are nominated in accordance with the procedures set forth in this Section 5 shall be eligible to serve as directors and only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 5. Except as otherwise provided by law, the chairman of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made, or proposed, as the case may be, in accordance with the procedures set forth in these Bylaws and, if any proposed nomination or business is not in compliance with these Bylaws, to declare that such defective proposal or nomination shall not be presented for stockholder action at the meeting and shall be disregarded.

(e) Notwithstanding the foregoing provisions of this Section 5, in order to include information with respect to a stockholder proposal in the proxy statement and form of proxy for a stockholders’ meeting, stockholders must provide notice as required by the regulations promulgated under the 1934 Act. Nothing in these Bylaws shall be deemed to affect any rights of stockholders to request inclusion of proposals in the corporation proxy statement pursuant to Rule 14a-8 under the 1934 Act.

(f) For purposes of this Section 5, “public announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the 1934 Act.

Section 6. Special Meetings.

(a) Special meetings of the stockholders of the corporation may be called, for any purpose or purposes, by (i) the Chairman of the Board of Directors, (ii) the Chief Executive Officer, or (iii) the Board of Directors pursuant to a resolution adopted by a majority of the total

3.

number of authorized directors (whether or not there exist any vacancies in previously authorized directorships at the time any such resolution is presented to the Board of Directors for adoption). At any time or times that the corporation is subject to Section 2115(b) of the California General Corporation Law (“CGCL”), stockholders holding five percent (5%) or more of the outstanding shares shall have the right to call a meeting of stockholders only as set forth in Section 18(c) herein.

(b) If a special meeting is properly called by any person or persons other than the Board of Directors, the request shall be in writing, specifying the general nature of the business proposed to be transacted, and shall be delivered personally or sent by certified or registered mail, return receipt requested, to the Chairman of the Board of Directors, the Chief Executive Officer, or the Secretary of the corporation. No business may be transacted at such special meeting otherwise than specified in such notice. The Board of Directors shall determine the time and place of such special meeting, which shall be held not less than thirty-five (35) nor more than one hundred twenty (120) days after the date of the receipt of the request. Upon determination of the time and place of the meeting, the officer receiving the request shall cause notice to be given to the stockholders entitled to vote, in accordance with the provisions of Section 7 of these Bylaws. If the notice is not given within one hundred (100) days after the receipt of the request, the person or persons properly requesting the meeting may set the time and place of the meeting and give the notice. Nothing contained in this paragraph (b) shall be construed as limiting, fixing, or affecting the time when a meeting of stockholders called by action of the Board of Directors may be held.

(c) Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to the corporation’s notice of meeting (i) by or at the direction of the Board of Directors or (ii) by any stockholder of the corporation who is a stockholder of record at the time of giving notice provided for in these Bylaws who shall be entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 6(c). In the event the corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the Board of Directors, any such stockholder may nominate a person or persons (as the case may be), for election to such position(s) as specified in the corporation’s notice of meeting, if the stockholder’s notice required by Section 5(b) of these Bylaws shall be delivered to the Secretary at the principal executive offices of the corporation not earlier than the close of business on the one hundred twentieth (120^th) day prior to such special meeting and not later than the close of business on the later of the ninetieth (90^th) day prior to such meeting or the tenth (10^th) day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall the public announcement of an adjournment of a special meeting commence a new time period for the giving of a stockholder’s notice as described above.

(d) Nothing in these Bylaws shall be deemed to affect any rights of stockholders to request inclusion of proposals in the corporation proxy statement pursuant to Rule 14a-8 under the 1934 Act.

Section 7. Notice Of Meetings. Except as otherwise provided by law, notice, given in writing or by electronic transmission, of each meeting of stockholders shall be given not less

4.

than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting, such notice to specify the place, if any, date and hour, in the case of special meetings, the purpose or purposes of the meeting, and the means of remote communications, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at any such meeting. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at such stockholder’s address as it appears on the records of the corporation. Notice of the time, place, if any, and purpose of any meeting of stockholders may be waived in writing, signed by the person entitled to notice thereof, or by electronic transmission by such person, either before or after such meeting, and will be waived by any stockholder by his attendance thereat in person, by remote communication, if applicable, or by proxy, except when the stockholder attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Any stockholder so waiving notice of such meeting shall be bound by the proceedings of any such meeting in all respects as if due notice thereof had been given.

Section 8. Quorum.

(a) At all meetings of stockholders, except where otherwise provided by statute or by the Certificate of Incorporation, or by these Bylaws, the presence, in person, by remote communication, if applicable, or by proxy duly authorized, of the holders of a majority of the outstanding shares of stock entitled to vote shall constitute a quorum for the transaction of business. In the absence of a quorum, any meeting of stockholders may be adjourned, from time to time, either by the chairman of the meeting or by vote of the holders of a majority of the shares represented thereat, but no other business shall be transacted at such meeting. The stockholders present at a duly called or convened meeting, at which a quorum is present, may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum. Except as otherwise provided by statute or by applicable stock exchange or Nasdaq rules, or by the Certificate of Incorporation or these Bylaws, in all matters other than the election of directors, the affirmative vote of the majority of shares present in person, by remote communication, if applicable, or represented by proxy at the meeting and entitled to vote generally on the subject matter shall be the act of the stockholders.

(b) Except as otherwise provided by statute, the Certificate of Incorporation or these Bylaws, (i) in a contested election of directors (i.e. an election in which there are more nominees for director than there are open positions for directors), directors shall be elected by a plurality of the votes of the shares present in person, by remote communication, if applicable, or represented by proxy at the meeting and entitled to vote generally on the election of directors, and (ii) in any uncontested election of directors, directors shall be elected if they shall receive more “for” votes than “withheld” votes of the shares present in person, by remote communication, if applicable, or represented by proxy at the meeting and entitled to vote generally on the election of directors. The Board of Directors (or any committee thereof) shall nominate for re-election as director in an uncontested election of directors only those candidates who have tendered an irrevocable resignation as a director, which resignation shall be conditioned upon both (A) such director failing to have received more “for” votes than “withheld” votes in an election and (B) acceptance by the Board of Directors of such resignation. Where a separate vote by a class or classes or series is required, except where otherwise provided

5.

by the statute or by the Certificate of Incorporation or these Bylaws, a majority of the outstanding shares of such class or classes or series, present in person, by remote communication, if applicable, or represented by proxy duly authorized, shall constitute a quorum entitled to take action with respect to that vote on that matter. Except where otherwise provided by statute or by the Certificate of Incorporation or these Bylaws, the affirmative vote of the majority (except in the case of the election of directors, which is as provided above) of shares of such class or classes or series present in person, by remote communication, if applicable, or represented by proxy at the meeting shall be the act of such class or classes or series.

Section 9. Adjournment And Notice Of Adjourned Meetings. Any meeting of stockholders, whether annual or special, may be adjourned from time to time either by the chairman of the meeting or by the vote of a majority of the shares present in person, by remote communication, if applicable, or represented by proxy at the meeting. When a meeting is adjourned to another time or place, if any, notice need not be given of the adjourned meeting if the time and place, if any, thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting, the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

Section 10. Voting Rights. For the purpose of determining those stockholders entitled to vote at any meeting of the stockholders, except as otherwise provided by law, only persons in whose names shares stand on the stock records of the corporation on the record date, as provided in Section 12 of these Bylaws, shall be entitled to vote at any meeting of stockholders. Every person entitled to vote shall have the right to do so either in person, by remote communication, if applicable, or by an agent or agents authorized by a proxy granted in accordance with Delaware law. An agent so appointed need not be a stockholder. No proxy shall be voted after three (3) years from its date of creation unless the proxy provides for a longer period.

Section 11. Joint Owners Of Stock. If shares or other securities having voting power stand of record in the names of two (2) or more persons, whether fiduciaries, members of a partnership, joint tenants, tenants in common, tenants by the entirety, or otherwise, or if two (2) or more persons have the same fiduciary relationship respecting the same shares, unless the Secretary is given written notice to the contrary and is furnished with a copy of the instrument or order appointing them or creating the relationship wherein it is so provided, their acts with respect to voting shall have the following effect: (a) if only one (1) votes, his act binds all; (b) if more than one (1) votes, the act of the majority so voting binds all; (c) if more than one (1) votes, but the vote is evenly split on any particular matter, each faction may vote the securities in question proportionally, or may apply to the Delaware Court of Chancery for relief as provided in the DGCL, Section 217(b). If the instrument filed with the Secretary shows that any such tenancy is held in unequal interests, a majority or even-split for the purpose of subsection (c) shall be a majority or even-split in interest.

Section 12. List Of Stockholders. The Secretary shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at said meeting, arranged in alphabetical order, showing the address of each stockholder and

6.

the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, (a) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (b) during ordinary business hours, at the principal place of business of the corporation. In the event that the corporation determines to make the list available on an electronic network, the corporation may take reasonable steps to ensure that such information is available only to stockholders of the corporation. The list shall be open to examination of any stockholder during the time of the meeting as provided by law.

Section 13. Action Without Meeting.

(a) Unless otherwise provided in the Certificate of Incorporation, any action required by statute to be taken at any annual or special meeting of the stockholders, or any action which may be taken at any annual or special meeting of the stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.

(b) Every written consent shall bear the date of signature of each stockholder who signs the consent, and no written consent shall be effective to take the corporate action referred to therein unless, within sixty (60) days of the earliest dated consent delivered to the corporation in the manner herein required, written consents signed by a sufficient number of stockholders to take action are delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business or an officer or agent of the corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to a corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.

(c) Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of stockholders to take action were delivered to the corporation as provided in Section 228(c) of the DGCL. If the action which is consented to is such as would have required the filing of a certificate under any section of the DGCL if such action had been voted on by stockholders at a meeting thereof, then the certificate filed under such section shall state, in lieu of any statement required by such section concerning any vote of stockholders, that written consent has been given in accordance with Section 228 of the DGCL.

Notwithstanding the foregoing, no such action by written consent or electronic transmission may be taken following the closing of the initial public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “1933 Act”), covering the offer and sale of Common Stock of the corporation (the “Initial Public Offering”).

7.

Section 14. Organization.

(a) At every meeting of stockholders, either the Chairman of the Board of Directors or the President, or, if the Chairman of the Board of Directors and the President are absent, a chairman of the meeting chosen by a majority in interest of the stockholders entitled to vote, present in person or by proxy, shall act as chairman. The Secretary, or, in his absence, an Assistant Secretary directed to do so by the chairman of the meeting, shall act as secretary of the meeting.

(b) The Board of Directors of the corporation shall be entitled to make such rules or regulations for the conduct of meetings of stockholders as it shall deem necessary, appropriate or convenient. Subject to such rules and regulations of the Board of Directors, if any, the chairman of the meeting shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are necessary, appropriate or convenient for the proper conduct of the meeting, including, without limitation, establishing an agenda or order of business for the meeting, rules and procedures for maintaining order at the meeting and the safety of those present, limitations on participation in such meeting to stockholders of record of the corporation and their duly authorized and constituted proxies and such other persons as the chairman shall permit, restrictions on entry to the meeting after the time fixed for the commencement thereof, limitations on the time allotted to questions or comments by participants and regulation of the opening and closing of the polls for balloting on matters which are to be voted on by ballot. The date and time of the opening and closing of the polls for each matter upon which the stockholders will vote at the meeting shall be announced at the meeting. Unless and to the extent determined by the Board of Directors or the chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with rules of parliamentary procedure.

ARTICLE IV

DIRECTORS

Section 15. Number And Term Of Office. The authorized number of directors of the corporation shall be fixed in accordance with the Certificate of Incorporation. Directors need not be stockholders unless so required by the Certificate of Incorporation. If for any cause, the directors shall not have been elected at an annual meeting, they may be elected as soon thereafter as convenient at a special meeting of the stockholders called for that purpose in the manner provided in these Bylaws.

Section 16. Powers. The powers of the corporation shall be exercised, its business conducted and its property controlled by the Board of Directors, except as may be otherwise provided by statute or by the Certificate of Incorporation.

Section 17. Board of Directors.

(a) All directors elected prior to or at the Corporation’s 2009 Annual Meeting and in office as of the date of the filing hereof were elected for three year terms, expiring at the third annual meeting following their election. All directors elected after the Corporation’s 2009 Annual Meeting shall be elected at each annual meeting of stockholders for a term expiring at the next annual meeting of stockholders following their election.

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(b) No stockholder entitled to vote at an election for directors may cumulate votes to which such stockholder is entitled, unless, at the time of the election, the corporation (i) is subject to §2115(b) of the CGCL and (ii) is not or ceases to be a “listed” corporation under Section 301.5 of the CGCL. During this time, every stockholder entitled to vote at an election for directors may cumulate such stockholder’s votes and give one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which such stockholder’s shares are otherwise entitled, or distribute the stockholder’s votes on the same principle among as many candidates as such stockholder thinks fit. No stockholder, however, shall be entitled to so cumulate such stockholder’s votes unless (i) the names of such candidate or candidates have been placed in nomination prior to the voting and (ii) the stockholder has given notice at the meeting, prior to the voting, of such stockholder’s intention to cumulate such stockholder’s votes. If any stockholder has given proper notice to cumulate votes, all stockholders may cumulate their votes for any candidates who have been properly placed in nomination. Under cumulative voting, the candidates receiving the highest number of votes, up to the number of directors to be elected, are elected.

Notwithstanding the foregoing provisions of this section, each director shall serve until his successor is duly elected and qualified or until his death, resignation or removal. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director.

Section 18. Vacancies.

(a) Unless otherwise provided in the Certificate of Incorporation and subject to the rights of the holders of any series of Preferred Stock, any vacancies on the Board of Directors resulting from death, resignation, disqualification, removal or other causes and any newly created directorships resulting from any increase in the number of directors shall, unless the Board of Directors determines by resolution that any such vacancies or newly created directorships shall be filled by stockholders, be filled only by the affirmative vote of a majority of the directors then in office, even though less than a quorum of the Board of Directors. Any director elected in accordance with the preceding sentence shall hold office for the remainder of the full term of the director for which the vacancy was created or occurred and until such director’s successor shall have been elected and qualified. A vacancy in the Board of Directors shall be deemed to exist under this Section 18 in the case of the death, removal or resignation of any director.

(b) If at the time of filling any vacancy or any newly created directorship, the directors then in office shall constitute less than a majority of the whole board (as constituted immediately prior to any such increase), the Delaware Court of Chancery may, upon application of any stockholder or stockholders holding at least ten percent (10%) of the total number of the shares at the time outstanding having the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in offices as aforesaid, which election shall be governed by Section 211 of the DGCL.

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(c) At any time or times that the corporation is subject to Section 2115(b) of the CGCL, if, after the filling of any vacancy, the directors then in office who have been elected by stockholders shall constitute less than a majority of the directors then in office, then

(1) Any holder or holders of an aggregate of five percent (5%) or more of the total number of shares at the time outstanding having the right to vote for those directors may call a special meeting of stockholders; or

(2) The Superior Court of the proper county shall, upon application of such stockholder or stockholders, summarily order a special meeting of stockholders, to be held to elect the entire board, all in accordance with Section 305(c) of the CGCL. The term of office of any director shall terminate upon that election of a successor.

Section 19. Resignation. Any director may resign at any time by delivering his or her notice in writing or by electronic transmission to the Secretary, such resignation to specify whether it will be effective at a particular time, upon receipt by the Secretary or at the pleasure of the Board of Directors. If no such specification is made, it shall be deemed effective at the pleasure of the Board of Directors. When one or more directors shall resign from the Board of Directors, effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each Director so chosen shall hold office for the unexpired portion of the term of the Director whose place shall be vacated and until his successor shall have been duly elected and qualified.

Section 20. Removal.

(a) During such time or times that the corporation is subject to Section 2115(b) of the CGCL, the Board of Directors or any individual director may be removed from office at any time without cause by the affirmative vote of the holders of at least a majority of the outstanding shares entitled to vote on such removal; provided, however, that unless the entire Board is removed, no individual director may be removed when the votes cast against such director’s removal, or not consenting in writing to such removal, would be sufficient to elect that director if voted cumulatively at an election which the same total number of votes were cast (or, if such action is taken by written consent, all shares entitled to vote were voted) and the entire number of directors authorized at the time of such director’s most recent election were then being elected.

(b) Following any date on which the corporation is no longer subject to Section 2115(b) of the CGCL and subject to any limitations imposed by law, the Board of Directors or any individual director may be removed from office at any time without cause by the affirmative vote of the holders of at least a majority of the outstanding shares entitled to vote on such removal.

Section 21. Meetings.

(a) Regular Meetings. Unless otherwise restricted by the Certificate of Incorporation, regular meetings of the Board of Directors may be held at any time or date and at any place within or without the State of Delaware which has been designated by the Board of

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Directors and publicized among all directors, either orally or in writing, by telephone, including a voice-messaging system or other system designed to record and communicate messages, facsimile, telegraph or telex, or by electronic mail or other electronic means. No further notice shall be required for regular meetings of the Board of Directors.

(b) Special Meetings. Unless otherwise restricted by the Certificate of Incorporation, special meetings of the Board of Directors may be held at any time and place within or without the State of Delaware whenever called by the Chairman of the Board of Directors, the President or a majority of the authorized number of directors.

(c) Meetings by Electronic Communications Equipment. Any member of the Board of Directors, or of any committee thereof, may participate in a meeting by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting by such means shall constitute presence in person at such meeting.

(d) Notice of Special Meetings. Notice of the time and place of all special meetings of the Board of Directors shall be orally or in writing, by telephone, including a voice messaging system or other system or technology designed to record and communicate messages, facsimile, telegraph or telex, or by electronic mail or other electronic means, during normal business hours, at least twenty-four (24) hours before the date and time of the meeting. If notice is sent by US mail, it shall be sent by first class mail, charges prepaid, at least three (3) days before the date of the meeting. Notice of any meeting may be waived in writing, or by electronic transmission, at any time before or after the meeting and will be waived by any director by attendance thereat, except when the director attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.

(e) Waiver of Notice. The transaction of all business at any meeting of the Board of Directors, or any committee thereof, however called or noticed, or wherever held, shall be as valid as though had at a meeting duly held after regular call and notice, if a quorum be present and if, either before or after the meeting, each of the directors not present who did not receive notice shall sign a written waiver of notice or shall waive notice by electronic transmission. All such waivers shall be filed with the corporate records or made a part of the minutes of the meeting.

Section 22. Quorum And Voting.

(a) Unless the Certificate of Incorporation requires a greater number and except with respect to indemnification questions arising under Section 43 hereof, for which a quorum shall be one-third of the exact number of directors fixed from time to time in accordance with the Certificate of Incorporation, a quorum of the Board of Directors shall consist of a majority of the exact number of directors fixed from time to time by the Board of Directors in accordance with the Certificate of Incorporation; provided, however, at any meeting whether a quorum be present or otherwise, a majority of the directors present may adjourn from time to time until the time fixed for the next regular meeting of the Board of Directors, without notice other than by announcement at the meeting.

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(b) At each meeting of the Board of Directors at which a quorum is present, all questions and business shall be determined by the affirmative vote of a majority of the directors present, unless a different vote be required by law, the Certificate of Incorporation or these Bylaws.

Section 23. Action Without Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board of Directors or committee, as the case may be, consent thereto in writing or by electronic transmission, and such writing or writings or transmission or transmissions are filed with the minutes of proceedings of the Board of Directors or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

Section 24. Fees And Compensation. Directors shall be entitled to such compensation for their services as may be approved by the Board of Directors, including, if so approved, by resolution of the Board of Directors, a fixed sum and expenses of attendance, if any, for attendance at each regular or special meeting of the Board of Directors and at any meeting of a committee of the Board of Directors. Nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity as an officer, agent, employee, or otherwise and receiving compensation therefor.

Section 25. Committees.

(a) Executive Committee. The Board of Directors may appoint an Executive Committee to consist of one (1) or more members of the Board of Directors. The Executive Committee, to the extent permitted by law and provided in the resolution of the Board of Directors shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to (i) approving or adopting, or recommending to the stockholders, any action or matter expressly required by the DGCL to be submitted to stockholders for approval, or (ii) adopting, amending or repealing any bylaw of the corporation.

(b) Other Committees. The Board of Directors may, from time to time, appoint such other committees as may be permitted by law. Such other committees appointed by the Board of Directors shall consist of one (1) or more members of the Board of Directors and shall have such powers and perform such duties as may be prescribed by the resolution or resolutions creating such committees, but in no event shall any such committee have the powers denied to the Executive Committee in these Bylaws.

(c) Term. The Board of Directors, subject to any requirements of any outstanding series of Preferred Stock and the provisions of subsections (a) or (b) of this Bylaw, may at any time increase or decrease the number of members of a committee or terminate the existence of a committee. The membership of a committee member shall terminate on the date of his death or voluntary resignation from the committee or from the Board of Directors. The Board of Directors may at any time for any reason remove any individual committee member

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and the Board of Directors may fill any committee vacancy created by death, resignation, removal or increase in the number of members of the committee. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee, and, in addition, in the absence or disqualification of any member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member.

(d) Meetings. Unless the Board of Directors shall otherwise provide, regular meetings of the Executive Committee or any other committee appointed pursuant to this Section 25 shall be held at such times and places as are determined by the Board of Directors, or by any such committee, and when notice thereof has been given to each member of such committee, no further notice of such regular meetings need be given thereafter. Special meetings of any such committee may be held at any place which has been determined from time to time by such committee, and may be called by any director who is a member of such committee, upon notice to the members of such committee of the time and place of such special meeting given in the manner provided for the giving of notice to members of the Board of Directors of the time and place of special meetings of the Board of Directors. Notice of any special meeting of any committee may be waived in writing at any time before or after the meeting and will be waived by any director by attendance thereat, except when the director attends such special meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Unless otherwise provided by the Board of Directors in the resolutions authorizing the creation of the committee, a majority of the authorized number of members of any such committee shall constitute a quorum for the transaction of business, and the act of a majority of those present at any meeting at which a quorum is present shall be the act of such committee.

Section 26. Chairman of the Board of Directors; Organization. At every meeting of the directors, the Chairman of the Board of Directors, or, if a Chairman has not been appointed or is absent, the President (if a director), or if the President is absent, the most senior Vice President (if a director), or, in the absence of any such person, a chairman of the meeting chosen by a majority of the directors present, shall preside over the meeting. The Secretary, or in his absence, any Assistant Secretary directed to do so by the President, shall act as secretary of the meeting. The Chairman of the Board of Directors shall also preside at all meetings of the stockholders of the corporation unless the President is presiding thereat. The Chairman of the Board of Directors shall perform other duties commonly incident to such position, and shall also perform such other duties and have such other powers, as the Board of Directors shall designate from time to time.

ARTICLE V

OFFICERS

Section 27. Officers Designated. The officers of the corporation shall include, if and when designated by the Board of Directors, the Chief Executive Officer, the President, one or more Vice Presidents, the Secretary, the Chief Financial Officer, the Treasurer and the

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Controller, all of whom shall be elected at the annual organizational meeting of the Board of Directors. The Board of Directors may also appoint one or more Assistant Secretaries, Assistant Treasurers, Assistant Controllers and such other officers and agents with such powers and duties as it shall deem necessary. The Board of Directors may assign such additional titles to one or more of the officers as it shall deem appropriate. Any one person may hold any number of offices of the corporation at any one time unless specifically prohibited therefrom by law. The salaries and other compensation of the officers of the corporation shall be fixed by or in the manner designated by the Board of Directors.

Section 28. Tenure And Duties Of Officers.

(a) General. All officers shall hold office at the pleasure of the Board of Directors and until their successors shall have been duly elected and qualified, unless sooner removed. Any officer elected or appointed by the Board of Directors may be removed at any time by the Board of Directors. If the office of any officer becomes vacant for any reason, the vacancy may be filled by the Board of Directors.

(b) Duties of President. The President shall preside at all meetings of the stockholders and at all meetings of the Board of Directors, unless the Chairman of the Board of Directors has been appointed and is presiding thereat. Unless some other officer has been elected Chief Executive Officer of the corporation, the President shall be the chief executive officer of the corporation and shall, subject to the control of the Board of Directors, have general supervision, direction and control of the business and officers of the corporation. The President shall perform other duties commonly incident to the office and shall also perform such other duties and have such other powers, as the Board of Directors shall designate from time to time.

(c) Duties of Vice Presidents. The Vice Presidents may assume and perform the duties of the President in the absence or disability of the President or whenever the office of President is vacant. The Vice Presidents shall perform other duties commonly incident to their office and shall also perform such other duties and have such other powers as the Board of Directors or the President shall designate from time to time.

(d) Duties of Secretary. The Secretary shall attend all meetings of the stockholders and of the Board of Directors and shall record all acts and proceedings thereof in the minute book of the corporation. The Secretary shall give notice in conformity with these Bylaws of all meetings of the stockholders and of all meetings of the Board of Directors and any committee thereof requiring notice. The Secretary shall perform all other duties provided for in these Bylaws and other duties commonly incident to the office and shall also perform such other duties and have such other powers, as the Board of Directors shall designate from time to time. The President may direct any Assistant Secretary to assume and perform the duties of the Secretary in the absence or disability of the Secretary, and each Assistant Secretary shall perform other duties commonly incident to the office and shall also perform such other duties and have such other powers as the Board of Directors or the President shall designate from time to time.

(e) Duties of Chief Financial Officer. The Chief Financial Officer shall keep or cause to be kept the books of account of the corporation in a thorough and proper manner and shall render statements of the financial affairs of the corporation in such form and as often as

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required by the Board of Directors or the President. The Chief Financial Officer, subject to the order of the Board of Directors, shall have the custody of all funds and securities of the corporation. The Chief Financial Officer shall perform other duties commonly incident to the office and shall also perform such other duties and have such other powers as the Board of Directors or the President shall designate from time to time. The President may direct the Treasurer or any Assistant Treasurer, or the Controller or any Assistant Controller to assume and perform the duties of the Chief Financial Officer in the absence or disability of the Chief Financial Officer, and each Treasurer and Assistant Treasurer and each Controller and Assistant Controller shall perform other duties commonly incident to the office and shall also perform such other duties and have such other powers as the Board of Directors or the President shall designate from time to time.

Section 29. Delegation Of Authority. The Board of Directors may from time to time delegate the powers or duties of any officer to any other officer or agent, notwithstanding any provision hereof.

Section 30. Resignations. Any officer may resign at any time by giving notice in writing or by electronic transmission to the Board of Directors or to the President or to the Secretary. Any such resignation shall be effective when received by the person or persons to whom such notice is given, unless a later time is specified therein, in which event the resignation shall become effective at such later time. Unless otherwise specified in such notice, the acceptance of any such resignation shall not be necessary to make it effective. Any resignation shall be without prejudice to the rights, if any, of the corporation under any contract with the resigning officer.

Section 31. Removal. Any officer may be removed from office at any time, either with or without cause, by the affirmative vote of a majority of the directors in office at the time, or by the unanimous written consent of the directors in office at the time, or by any committee or superior officers upon whom such power of removal may have been conferred by the Board of Directors.

ARTICLE VI

EXECUTION OF CORPORATE INSTRUMENTS AND VOTING OF SECURITIES

OWNED BY THE CORPORATION

Section 32. Execution Of Corporate Instruments. The Board of Directors may, in its discretion, determine the method and designate the signatory officer or officers, or other person or persons, to execute on behalf of the corporation any corporate instrument or document, or to sign on behalf of the corporation the corporate name without limitation, or to enter into contracts on behalf of the corporation, except where otherwise provided by law or these Bylaws, and such execution or signature shall be binding upon the corporation.

All checks and drafts drawn on banks or other depositaries on funds to the credit of the corporation or in special accounts of the corporation shall be signed by such person or persons as the Board of Directors shall authorize so to do.

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Unless authorized or ratified by the Board of Directors or within the agency power of an officer, no officer, agent or employee shall have any power or authority to bind the corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.

Section 33. Voting Of Securities Owned By The Corporation. All stock and other securities of other corporations owned or held by the corporation for itself, or for other parties in any capacity, shall be voted, and all proxies with respect thereto shall be executed, by the person authorized so to do by resolution of the Board of Directors, or, in the absence of such authorization, by the Chairman of the Board of Directors, the Chief Executive Officer, the President, or any Vice President.

ARTICLE VII

SHARES OF STOCK

Section 34. Form And Execution Of Certificates. The shares of the corporation shall be represented by certificates, or shall be uncertificated. Certificates for the shares of stock, if any, shall be in such form as is consistent with the Certificate of Incorporation and applicable law. Every holder of stock represented by certificate in the corporation shall be entitled to have a certificate signed by or in the name of the corporation by the Chairman of the Board of Directors, or the President or any Vice President and by the Treasurer or Assistant Treasurer or the Secretary or Assistant Secretary, certifying the number of shares owned by such holder in the corporation. Any or all of the signatures on the certificate may be facsimiles. In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued with the same effect as if he were such officer, transfer agent, or registrar at the date of issue.

Section 35. Lost Certificates. A new certificate or certificates may be issued in place of any certificate or certificates theretofore issued by the corporation alleged to have been lost, stolen, or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen, or destroyed. The corporation may require, as a condition precedent to the issuance of a new certificate or certificates, the owner of such lost, stolen, or destroyed certificate or certificates, or the owner’s legal representative, to agree to indemnify the corporation in such manner as it shall require or to give the corporation a surety bond in such form and amount as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost, stolen, or destroyed.

Section 36. Transfers.

(a) Transfers of record of shares of stock of the corporation shall be made only upon its books by the holders thereof, in person or by attorney duly authorized, and in the case of stock represented by certificate, upon the surrender of a properly endorsed certificate or certificates for a like number of shares.

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(b) The corporation shall have power to enter into and perform any agreement with any number of stockholders of any one or more classes of stock of the corporation to restrict the transfer of shares of stock of the corporation of any one or more classes owned by such stockholders in any manner not prohibited by the DGCL.

Section 37. Fixing Record Dates.

(a) In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board of Directors may fix, in advance, a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall, subject to applicable law, not be more than sixty (60) nor less than ten (10) days before the date of such meeting. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

(b) Prior to the Initial Public Offering, in order that the corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. Any stockholder of record seeking to have the stockholders authorize or take corporate action by written consent shall, by written notice to the Secretary, request the Board of Directors to fix a record date. The Board of Directors shall promptly, but in all events within ten (10) days after the date on which such a request is received, adopt a resolution fixing the record date. If no record date has been fixed by the Board of Directors within ten (10) days of the date on which such a request is received, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by applicable law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business or an officer or agent of the corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.

(c) In order that the corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a

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record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty (60) days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

Section 38. Registered Stockholders. The corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware.

ARTICLE VIII

OTHER SECURITIES OF THE CORPORATION

Section 39. Execution Of Other Securities. All bonds, debentures and other corporate securities of the corporation, other than stock certificates (covered in Section 34), may be signed by the Chairman of the Board of Directors, the President or any Vice President, or such other person as may be authorized by the Board of Directors, and the corporate seal impressed thereon or a facsimile of such seal imprinted thereon and attested by the signature of the Secretary or an Assistant Secretary, or the Chief Financial Officer or Treasurer or an Assistant Treasurer; provided, however, that where any such bond, debenture or other corporate security shall be authenticated by the manual signature, or where permissible facsimile signature, of a trustee under an indenture pursuant to which such bond, debenture or other corporate security shall be issued, the signatures of the persons signing and attesting the corporate seal on such bond, debenture or other corporate security may be the imprinted facsimile of the signatures of such persons. Interest coupons appertaining to any such bond, debenture or other corporate security, authenticated by a trustee as aforesaid, shall be signed by the Treasurer or an Assistant Treasurer of the corporation or such other person as may be authorized by the Board of Directors, or bear imprinted thereon the facsimile signature of such person. In case any officer who shall have signed or attested any bond, debenture or other corporate security, or whose facsimile signature shall appear thereon or on any such interest coupon, shall have ceased to be such officer before the bond, debenture or other corporate security so signed or attested shall have been delivered, such bond, debenture or other corporate security nevertheless may be adopted by the corporation and issued and delivered as though the person who signed the same or whose facsimile signature shall have been used thereon had not ceased to be such officer of the corporation.

ARTICLE IX

DIVIDENDS

Section 40. Declaration Of Dividends. Dividends upon the capital stock of the corporation, subject to the provisions of the Certificate of Incorporation and applicable law, if any, may be declared by the Board of Directors pursuant to law at any regular or special meeting. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the Certificate of Incorporation and applicable law.

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Section 41. Dividend Reserve. Before payment of any dividend, there may be set aside out of any funds of the corporation available for dividends such sum or sums as the Board of Directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purpose as the Board of Directors shall think conducive to the interests of the corporation, and the Board of Directors may modify or abolish any such reserve in the manner in which it was created.

ARTICLE X

FISCAL YEAR

Section 42. Fiscal Year. The fiscal year of the corporation shall be fixed by resolution of the Board of Directors.

ARTICLE XI

INDEMNIFICATION

Section 43. Indemnification Of Directors, Executive Officers, Other Officers, Employees And Other Agents.

(a) Directors and Executive Officers. The corporation shall indemnify its directors and executive officers (For the purposes of this Article XI, “Executive Officers” shall have the meaning defined in Rule 3b-7 promulgated under the 1934 Act) to the fullest extent not prohibited by the DGCL or any other applicable law; provided, however, that the corporation may modify the extent of such indemnification by individual contracts with its directors and executive officers; and, provided, further, that the corporation shall not be required to indemnify any director or executive officer in connection with any proceeding (or part thereof) initiated by such person unless (i) such indemnification is expressly required to be made by law, (ii) the proceeding was authorized by the Board of Directors of the corporation, (iii) such indemnification is provided by the corporation, in its sole discretion, pursuant to the powers vested in the corporation under the DGCL or any other applicable law or (iv) such indemnification is required to be made under subsection (d).

(b) Officers, Employees and Other Agents. The corporation shall have power to indemnify its other officers employees and other agents as set forth in the DGCL or any other applicable law. The Board of Directors shall have the power to delegate the determination of whether indemnification shall be given to any such person except executive officers to such officers or other persons as the Board of Directors shall determine.

(c) Expenses. The corporation shall advance to any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he is or was a director or executive officer, of the corporation, or is or was serving at the request of

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the corporation as a director or executive officer of another corporation, partnership, joint venture, trust or other enterprise, prior to the final disposition of the proceeding, promptly following request therefor, all expenses incurred by any director or executive officer in connection with such proceeding provided, however, that if the DGCL requires, an advancement of expenses incurred by a director or executive officer in his or her capacity as a director or executive officer (and not in any other capacity in which service was or is rendered by such indemnitee, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the corporation of an undertaking (hereinafter an “Undertaking”), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a “final adjudication”) that such indemnitee is not entitled to be indemnified for such expenses under this Section 43 or otherwise.

Notwithstanding the foregoing, unless otherwise determined pursuant to paragraph (e) of this Section 43, no advance shall be made by the corporation to an executive officer of the corporation (except by reason of the fact that such executive officer is or was a director of the corporation in which event this paragraph shall not apply) in any action, suit or proceeding, whether civil, criminal, administrative or investigative, if a determination is reasonably and promptly made (i) by a majority vote of directors who were not parties to the proceeding, even if not a quorum, or (ii) by a committee of such directors designated by a majority vote of such directors, even though less than a quorum, or (iii) if there are no such directors, or such directors so direct, by independent legal counsel in a written opinion, that the facts known to the decision-making party at the time such determination is made demonstrate clearly and convincingly that such person acted in bad faith or in a manner that such person did not believe to be in or not opposed to the best interests of the corporation.

(d) Enforcement. Without the necessity of entering into an express contract, all rights to indemnification and advances to directors and executive officers under this Bylaw shall be deemed to be contractual rights and be effective to the same extent and as if provided for in a contract between the corporation and the director or executive officer. Any right to indemnification or advances granted by this Section 43 to a director or executive officer shall be enforceable by or on behalf of the person holding such right in any court of competent jurisdiction if (i) the claim for indemnification or advances is denied, in whole or in part, or (ii) no disposition of such claim is made within ninety (90) days of request therefor. The claimant in such enforcement action, if successful in whole or in part, shall be entitled to be paid also the expense of prosecuting the claim. In connection with any claim for indemnification, the corporation shall be entitled to raise as a defense to any such action that the claimant has not met the standards of conduct that make it permissible under the DGCL or any other applicable law for the corporation to indemnify the claimant for the amount claimed. In connection with any claim by an executive officer of the corporation (except in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such executive officer is or was a director of the corporation) for advances, the corporation shall be entitled to raise a defense as to any such action clear and convincing evidence that such person acted in bad faith or in a manner that such person did not believe to be in or not opposed to the best interests of the corporation, or with respect to any criminal action or proceeding that such person acted without reasonable cause to believe that his conduct was lawful. Neither the failure of the corporation (including its Board of Directors, independent legal counsel or its stockholders) to

20.

have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he has met the applicable standard of conduct set forth in the DGCL or any other applicable law, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that claimant has not met the applicable standard of conduct. In any suit brought by a director or executive officer to enforce a right to indemnification or to an advancement of expenses hereunder, the burden of proving that the director or executive officer is not entitled to be indemnified, or to such advancement of expenses, under this section 43 or otherwise shall be on the corporation.

(e) Non-Exclusivity of Rights. The rights conferred on any person by this Bylaw shall not be exclusive of any other right which such person may have or hereafter acquire under any applicable statute, provision of the Certificate of Incorporation, Bylaws, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding office. The corporation is specifically authorized to enter into individual contracts with any or all of its directors, officers, employees or agents respecting indemnification and advances, to the fullest extent not prohibited by the DGCL, or by any other applicable law.

(f) Survival of Rights. The rights conferred on any person by this Bylaw shall continue as to a person who has ceased to be a director or executive officer and shall inure to the benefit of the heirs, executors and administrators of such a person.

(g) Insurance. To the fullest extent permitted by the DGCL or any other applicable law, the corporation, upon approval by the Board of Directors, may purchase insurance on behalf of any person required or permitted to be indemnified pursuant to this Section 43.

(h) Amendments. Any repeal or modification of this Section 43 shall only be prospective and shall not affect the rights under this Bylaw in effect at the time of the alleged occurrence of any action or omission to act that is the cause of any proceeding against any agent of the corporation.

(i) Saving Clause. If this Bylaw or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the corporation shall nevertheless indemnify each director and executive officer to the full extent not prohibited by any applicable portion of this Section 43 that shall not have been invalidated, or by any other applicable law. If this Section 43 shall be invalid due to the application of the indemnification provisions of another jurisdiction, then the corporation shall indemnify each director and executive officer to the full extent under any other applicable law.

(j) Certain Definitions. For the purposes of this Bylaw, the following definitions shall apply:

(1) The term “proceeding” shall be broadly construed and shall include, without limitation, the investigation, preparation, prosecution, defense, settlement, arbitration and appeal of, and the giving of testimony in, any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative.

21.

(2) The term “expenses” shall be broadly construed and shall include, without limitation, court costs, attorneys’ fees, witness fees, fines, amounts paid in settlement or judgment and any other costs and expenses of any nature or kind incurred in connection with any proceeding.

(3) The term the “corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Section 43 with respect to the resulting or surviving corporation as he would have with respect to such constituent corporation if its separate existence had continued.

(4) References to a “director,” “executive officer,” “officer,” “employee,” or “agent” of the corporation shall include, without limitation, situations where such person is serving at the request of the corporation as, respectively, a director, executive officer, officer, employee, trustee or agent of another corporation, partnership, joint venture, trust or other enterprise.

(5) References to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to “serving at the request of the corporation” shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the corporation” as referred to in this Section 43.

ARTICLE XII

NOTICES

Section 44. Notices.

(a) Notice To Stockholders. Written notice to stockholders of stockholder meetings shall be given as provided in Section 7 herein. Without limiting the manner by which notice may otherwise be given effectively to stockholders under any agreement or contract with such stockholder, and except as otherwise required by law, written notice to stockholders for purposes other than stockholder meetings may be sent by US mail or nationally recognized overnight courier, or by facsimile, telegraph or telex or by electronic mail or other electronic means.

22.

(b) Notice To Directors. Any notice required to be given to any director may be given by the method stated in subsection (a), as otherwise provided in these Bylaws, or by overnight delivery service, facsimile, telex or telegram, except that such notice other than one which is delivered personally shall be sent to such address as such director shall have filed in writing with the Secretary, or, in the absence of such filing, to the last known post office address of such director.

(c) Affidavit Of Mailing. An affidavit of mailing, executed by a duly authorized and competent employee of the corporation or its transfer agent appointed with respect to the class of stock affected, or other agent, specifying the name and address or the names and addresses of the stockholder or stockholders, or director or directors, to whom any such notice or notices was or were given, and the time and method of giving the same, shall in the absence of fraud, be prima facie evidence of the facts therein contained.

(d) Methods of Notice. It shall not be necessary that the same method of giving notice be employed in respect of all recipients of notice, but one permissible method may be employed in respect of any one or more, and any other permissible method or methods may be employed in respect of any other or others.

(e) Notice To Person With Whom Communication Is Unlawful. Whenever notice is required to be given, under any provision of law or of the Certificate of Incorporation or Bylaws of the corporation, to any person with whom communication is unlawful, the giving of such notice to such person shall not be required and there shall be no duty to apply to any governmental authority or agency for a license or permit to give such notice to such person. Any action or meeting which shall be taken or held without notice to any such person with whom communication is unlawful shall have the same force and effect as if such notice had been duly given. In the event that the action taken by the corporation is such as to require the filing of a certificate under any provision of the DGCL, the certificate shall state, if such is the fact and if notice is required, that notice was given to all persons entitled to receive notice except such persons with whom communication is unlawful.

(f) Notice To Person With Undeliverable Address. Whenever notice is required to be given, under any provision of law or the Certificate of Incorporation or Bylaws of the corporation, to any stockholder to whom (i) notice of two consecutive annual meetings, and all notices of meetings or of the taking of action by written consent without a meeting to such person during the period between such two consecutive annual meetings, or (ii) all, and at least two, payments (if sent by first class mail) of dividends or interest on securities during a twelve-month period, have been mailed addressed to such person at his address as shown on the records of the corporation and have been returned undeliverable, the giving of such notice to such person shall not be required. Any action or meeting which shall be taken or held without notice to such person shall have the same force and effect as if such notice had been duly given. If any such person shall deliver to the corporation a written notice setting forth his then current address, the requirement that notice be given to such person shall be reinstated. In the event that the action taken by the corporation is such as to require the filing of a certificate under any provision of the DGCL, the certificate need not state that notice was not given to persons to whom notice was not required to be given pursuant to this paragraph.

23.

ARTICLE XIII

FORUM FOR ADJUDICATION OF DISPUTES

Unless the corporation consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director or officer or other employee of the corporation to the corporation or the corporation’s stockholders, (iii) any action asserting a claim against the corporation or any director or officer or other employee of the corporation arising pursuant to any provision of the DGCL or the corporation’s Certificate of Incorporation or Bylaws, or (iv) any action asserting a claim against the corporation or any director or officer or other employee of the corporation governed by the internal affairs doctrine, shall be a state court located within the State of Delaware (or, if no state court located within the State of Delaware has jurisdiction, the federal district court for the District of Delaware). Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the corporation shall be deemed to have notice of and to have consented to the provisions of this Article XIII.

ARTICLE XIV

AMENDMENTS

Section 45. The Board of Directors is expressly empowered to adopt, amend or repeal the Bylaws of the corporation. Any adoption, amendment or repeal of the Bylaws of the corporation by the Board of Directors shall require the approval of a majority of the authorized number of directors. The stockholders shall also have power to adopt, amend or repeal the Bylaws of the corporation; provided, however, that, in addition to any vote of the holders of any class or series of stock of the corporation required by law or by the Certificate of Incorporation, the affirmative vote of the holders of at least sixty-six and two-thirds percent (66-2/3%) of the voting power of all of the then-outstanding shares of the capital stock of the corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required to adopt, amend or repeal any provision of the Bylaws of the corporation.

ARTICLE XV

LOANS TO OFFICERS

Section 46. Loans To Officers. Except as prohibited by law, the corporation may lend money to, or guarantee any obligation of, or otherwise assist any officer or other employee of the corporation or of its subsidiaries, including any officer or employee who is a Director of the corporation or its subsidiaries, whenever, in the judgment of the Board of Directors, such loan, guarantee or assistance may reasonably be expected to benefit the corporation. The loan, guarantee or other assistance may be with or without interest and may be unsecured, or secured

24.

in such manner as the Board of Directors shall approve, including, without limitation, a pledge of shares of stock of the corporation. Nothing in these Bylaws shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the corporation at common law or under any statute.

25.

TABLE OF CONTENTS

ARTICLE I	OFFICES	1
Section 1.	Registered Office	1
Section 2.	Other Offices	1
ARTICLE II	CORPORATE SEAL	1
Section 3.	Corporate Seal	1
ARTICLE III	STOCKHOLDERS’ MEETINGS	1
Section 4.	Place Of Meetings	1
Section 5.	Annual Meetings	1
Section 6.	Special Meetings	3
Section 7.	Notice Of Meetings	4
Section 8.	Quorum	5
Section 9.	Adjournment And Notice Of Adjourned Meetings	6
Section 10.	Voting Rights	6
Section 11.	Joint Owners Of Stock	6
Section 12.	List Of Stockholders	6
Section 13.	Action Without Meeting	7
Section 14.	Organization	8
ARTICLE IV	DIRECTORS	8
Section 15.	Number And Term Of Office	8
Section 16.	Powers	8
Section 17.	Board of Directors	8
Section 18.	Vacancies	9
Section 19.	Resignation	10
Section 20.	Removal	10
Section 21.	Meetings	10
Section 22.	Quorum And Voting	11
Section 23.	Action Without Meeting	12
Section 24.	Fees And Compensation	12
Section 25.	Committees	12
Section 26.	Chairman of the Board of Directors; Organization	13
ARTICLE V	OFFICERS	13
Section 27.	Officers Designated	13
Section 28.	Tenure And Duties Of Officers	14
Section 29.	Delegation Of Authority	15
Section 30.	Resignations	15
Section 31.	Removal	15

TABLE OF CONTENTS

(CONTINUED)

ARTICLE VI	EXECUTION OF CORPORATE INSTRUMENTS AND VOTING OF SECURITIES OWNED BY THE CORPORATION	15
Section 32.	Execution Of Corporate Instruments	15
Section 33.	Voting Of Securities Owned By The Corporation	16
ARTICLE VII	SHARES OF STOCK	16
Section 34.	Form And Execution Of Certificates	16
Section 35.	Lost Certificates	16
Section 36.	Transfers	16
Section 37.	Fixing Record Dates	17
Section 38.	Registered Stockholders	18
ARTICLE VIII	OTHER SECURITIES OF THE CORPORATION	18
Section 39.	Execution Of Other Securities	18
ARTICLE IX	DIVIDENDS	18
Section 40.	Declaration Of Dividends	18
Section 41.	Dividend Reserve	19
ARTICLE X	FISCAL YEAR	19
Section 42.	Fiscal Year	19
ARTICLE XI	INDEMNIFICATION	19
Section 43.	Indemnification Of Directors, Executive Officers, Other Officers, Employees And Other Agents	19
ARTICLE XII	NOTICES	22
Section 44.	Notices	22
ARTICLE XIII	FORUM FOR ADJUDICATION OF DISPUTES	24
ARTICLE XIV	AMENDMENTS	24
Section 45.	The Board of Directors is expressly empowered to adopt, amend or repeal the Bylaws of the corporation	24
ARTICLE XV	LOANS TO OFFICERS	24
Section 46.	Loans To Officers	24

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Evan L. Kaplan, certify that:

1. I have reviewed this Form 10-Q of iPass Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2013	By:	/S/    EVAN L. KAPLAN
		Evan L. Kaplan
		President and Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Karen Willem, certify that:

1. I have reviewed this Form 10-Q of iPass Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2013	By:	/S/    KAREN WILLEM
		Karen Willem
		Senior Vice President and Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002, 18 U.S.C SECTION 1350

In connection with the Quarterly Report of iPass Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Evan L. Kaplan, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 7, 2013	By:	/S/    EVAN L. KAPLAN
		Evan L. Kaplan
		President and Chief Executive Officer (Principal Executive Officer)

This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of iPass Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.

EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002, 18 U.S.C SECTION 1350

In connection with the Quarterly Report of iPass Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Karen Willem, Senior Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 7, 2013	By:	/S/    KAREN WILLEM
		Karen Willem
		Senior Vice President and Chief Financial Officer (Principal Financial Officer)

This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of iPass Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.

XML

Other Assets (Tables)

9 Months Ended

Sep. 30, 2013

Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract]

Components of Other Assets

Other assets consisted of the following:

	September 30, 2013		December 31, 2012
	(In thousands)
Prepaid lease obligations	$	97	$	236
Deferred installation costs		1,746		2,180
Deposits		818		854
Long-term deferred tax assets, net		195		195
Restricted cash		250		970
	$	3,106	$	4,435

XML

Condensed Consolidated Statements of Comprehensive Loss (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Statement Of Income And Comprehensive Income [Abstract]
Revenue	$ 26,869	$ 30,818	$ 85,163	$ 96,356
Cost of revenues and operating expenses:
Network access costs	12,062	12,574	37,203	41,049
Network operations	4,717	5,126	14,284	15,932
Research and development	3,171	3,300	10,199	10,447
Sales and marketing	4,368	4,547	13,658	14,981
General and administrative	4,886	5,645	16,323	16,147
Restructuring charges and related adjustments	13	10	639	16
Amortization of intangible assets		50		169
Total cost of revenue and operating expenses	29,217	31,252	92,306	98,741
Operating loss	(2,348)	(434)	(7,143)	(2,385)
Interest income	2	4	9	10
Foreign exchange losses, net	(155)	(66)	(342)	(129)
Loss before income taxes	(2,501)	(496)	(7,476)	(2,504)
Provision for income taxes	341	275	327	422
Net loss	(2,842)	(771)	(7,803)	(2,926)
Comprehensive loss	$ (2,842)	$ (771)	$ (7,803)	$ (2,926)
Basic and diluted net loss per share	$ (0.04)	$ (0.01)	$ (0.12)	$ (0.05)
Number of shares used in per share calculations:
Basic and diluted	64,143,389	61,094,346	63,008,098	60,450,920

XML

Accrued Liabilities

9 Months Ended

Sep. 30, 2013

Payables And Accruals [Abstract]

Accrued Liabilities

Note 5. Accrued Liabilities

Accrued liabilities consisted of the following:

	September 30, 2013		December 31, 2012
	(In thousands)
Accrued sales tax liabilities	$	1,084	$	1,080
Accrued restructuring liabilities – current(1)		224		203
Accrued bonus, commissions and other employee benefits		2,671		2,550
Amounts due to customers		877		1,061
Other accrued liabilities		3,439		3,737
	$	8,295	$	8,631

(1) See Note 6. Accrued Restructuring.

XML

Fair Value - Additional Information (Detail) (USD $)	9 Months Ended
	Sep. 30, 2013
Fair Value Disclosures [Abstract]
Transfers between Levels 1, 2, and 3	$ 0

XML

Accrued Liabilities (Tables)

9 Months Ended

Sep. 30, 2013

Payables And Accruals [Abstract]

Schedule of Accrued Liabilities

Accrued liabilities consisted of the following:

	September 30, 2013		December 31, 2012
	(In thousands)
Accrued sales tax liabilities	$	1,084	$	1,080
Accrued restructuring liabilities – current(1)		224		203
Accrued bonus, commissions and other employee benefits		2,671		2,550
Amounts due to customers		877		1,061
Other accrued liabilities		3,439		3,737
	$	8,295	$	8,631

(1) See Note 6. Accrued Restructuring.

XML

Segment and Geographical Information - Reconciliations of Total Segment Operating Loss (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Amortization of intangibles		$ (50)		$ (169)
Restructuring charges and related adjustments	(13)	(10)	(639)	(16)
Total operating loss	(2,348)	(434)	(7,143)	(2,385)
Interest income	2	4	9	10
Foreign exchange losses, net	(155)	(66)	(342)	(129)
Loss before income taxes	(2,501)	(496)	(7,476)	(2,504)
Operating Segments [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Total operating loss	(2,335)	(383)	(6,514)	(2,208)
Segment Reconciling Items [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Amortization of intangibles		(50)		(169)
Restructuring charges and related adjustments	(13)	(10)	(639)	(16)
Certain state sales tax and federal tax items		$ 9	$ 10	$ 8

XML

Other Assets - Components of Other Assets (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Other Assets [Abstract]
Prepaid lease obligations	$ 97	$ 236
Deferred installation costs	1,746	2,180
Deposits	818	854
Long-term deferred tax assets, net	195	195
Restricted cash	250	970
Other Assets	$ 3,106	$ 4,435

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Property and Equipment, Net - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Property Plant And Equipment [Abstract]
Depreciation expense	$ 0.6	$ 0.5	$ 1.9	$ 1.7
Property and equipment, wrote-off	0	0	0.3	2.7
Capitalized costs related to the ERP			$ 3.4

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Net Loss Per Common Share - Schedule of Computation of Basic and Diluted Net Loss Per Share (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Numerator:
Net loss	$ (2,842)	$ (771)	$ (7,803)	$ (2,926)
Denominator:
Basic and diluted net loss per common share - Weighted average shares outstanding	64,143,389	61,094,346	63,008,098	60,450,920
Basic and diluted net loss per common share	$ (0.04)	$ (0.01)	$ (0.12)	$ (0.05)

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Commitments and Contingencies - Additional Information (Detail) (USD $)	9 Months Ended
	Sep. 30, 2013
Commitment And Contingencies [Line Items]
Lease expiration date	Jun. 30, 2017
Facility lease obligations	$ 400,000
Purchase commitments expiration period	Expire on various dates through July 2016
Software And Infrastructure Hardware [Member]
Commitment And Contingencies [Line Items]
Future minimum purchase commitments	$ 0.4

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Property and Equipment, Net - Components of Property and Equipment, Net (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Property Plant And Equipment [Abstract]
Equipment	$ 15,439	$ 14,292
Furniture and fixtures	2,217	2,214
Computer software	10,283	6,891
Capital work-in-progress	252	3,356
Leasehold improvements	1,372	1,578
Property plant and equipment, gross	29,563	28,331
Less: Accumulated depreciation and amortization	(23,143)	(21,782)
Property and equipment, net	$ 6,420	$ 6,549

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Basis of Presentation

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

Basis of Presentation

Note 1. Basis of Presentation

The condensed consolidated financial statements include the accounts of iPass Inc. (the “Company”) and its wholly owned subsidiaries. The condensed consolidated financial statements that accompany these notes have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) consistent in all material respects with those applied in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. The Condensed Consolidated Financial Statements for December 31, 2012, were derived from audited financial statements but do not include all disclosures required by GAAP. The interim financial information is unaudited but reflects all normal adjustments that are, in the opinion of management, necessary to provide a fair presentation for the interim periods presented. This interim financial information should be read in conjunction with the Consolidated Financial Statements and the Notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. The results of operations for the three and nine months ended September 30, 2013, are not necessarily indicative of the operating results for the full fiscal year or any future periods.

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results that the Company experiences may differ materially from those estimates. Estimates are used for, but not limited to the valuation of accounts receivables, other long-lived assets, network access costs, stock-based compensation, legal contingencies, and income taxes.

The Company reports comprehensive loss in a single continuous financial statement within the Condensed Consolidated Statements of Comprehensive Loss. The Company’s comprehensive loss is equivalent to its net loss because the Company does not have any transactions that are recorded through other comprehensive income (loss).

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Property and Equipment, Net

9 Months Ended

Sep. 30, 2013

Property Plant And Equipment [Abstract]

Property and Equipment, Net

Note 3. Property and Equipment, net

Property and equipment, net, consisted of the following:

	September 30, 2013			December 31, 2012
	(In thousands)
Equipment	$	15,439		$	14,292
Furniture and fixtures		2,217			2,214
Computer software		10,283			6,891
Capital work-in-progress		252			3,356
Leasehold improvements		1,372			1,578
		29,563			28,331
Less: Accumulated depreciation and amortization		(23,143	)		(21,782	)
Property and equipment, net	$	6,420		$	6,549

Depreciation expense was approximately $0.6 million and $1.9 million for the three and nine months ended September 30, 2013, respectively, and $0.5 million and $1.7 million for the three and nine months ended September 30, 2012, respectively. The Company did not retire any property and equipment during the three months ended September 30, 2013 and 2012. During the nine months ended September 30, 2013 and 2012, the Company retired approximately $0.3 million and $2.7 million, respectively, of gross property and equipment, nearly all of which were fully depreciated.

During January 2013, the Company went “live” with a new enterprise resource planning (ERP) system. Accordingly, approximately $3.4 million of capitalized costs related to the ERP implementation was reclassified from capital work-in-progress to computer software.

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Accrued Restructuring

9 Months Ended

Sep. 30, 2013

Restructuring And Related Activities [Abstract]

Accrued Restructuring

Note 6. Accrued Restructuring

During the year ended December 31, 2009, the Company announced restructuring plans (the “2009 Plans”) to reduce operating costs and focus resources on key strategic priorities, which resulted in a workforce reduction of 146 positions across all functional areas and abandonment of certain facilities and termination of a contract obligation. As of September 30, 2013, the Company had remaining cash payments of approximately $0.4 million.

In the first quarter of 2013, the Company announced a restructuring plan (the “Q1 2013 Plan”) to re-align its cost structure to focus investments, resources and operating expenses on the Company’s growing Open Mobile business, which resulted in a workforce reduction of 16 positions across all functional areas and termination of a lease contract. The Company recorded a restructuring charge of approximately $0.6 million during the first quarter of 2013, which included severance, facility exit costs and other associated costs. The Company has paid approximately $0.6 million during the nine months period ending September 30, 2013.

The following is a rollforward of restructuring liability for the Q1 2013 and 2009 Plans:

	Three Months Ended September 30,
	2013			2012
	(In thousands)
Beginning balance	$	448		$	633
Restructuring charges and related adjustments		13			10
Payments		(91	)		(118	)
Ending balance	$	370		$	525

	Nine Months Ended  September 30,
	2013			2012
	(In thousands)
Beginning balance	$	483		$	736
Restructuring charges and related adjustments		639			16
Payments		(752	)		(227	)
Ending balance	$	370		$	525

As of September 30, 2013, approximately $0.2 million of the restructuring liability is included in accrued liabilities, and the remaining restructuring liability of approximately $0.2 million is included in other long-term liabilities.

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Other Assets

9 Months Ended

Sep. 30, 2013

Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract]

Other Assets

Note 4. Other Assets

Other assets consisted of the following:

	September 30, 2013		December 31, 2012
	(In thousands)
Prepaid lease obligations	$	97	$	236
Deferred installation costs		1,746		2,180
Deposits		818		854
Long-term deferred tax assets, net		195		195
Restricted cash		250		970
	$	3,106	$	4,435

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Accrued Liabilities - Schedule of Accrued Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Payables And Accruals [Abstract]
Accrued sales tax liabilities	$ 1,084	$ 1,080
Accrued restructuring liabilities - current	224	203
Accrued bonus, commissions and other employee benefits	2,671	2,550
Amounts due to customers	877	1,061
Other accrued liabilities	3,439	3,737
Accrued liabilities	$ 8,295	$ 8,631

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Commitments and Contingencies - Schedule of Future Minimum Lease Payments (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013
Commitments And Contingencies Disclosure [Abstract]
Remaining 2013	$ 781
2014	3,012
2015	1,288
2016	538
2017	266
Operating leases, future minimum payments	$ 5,885

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Segment and Geographical Information - Revenue and Operating Loss for Each Reportable Segment (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Revenue from External Customer [Line Items]
Net Revenue	$ 26,869	$ 30,818	$ 85,163	$ 96,356
Total Segment Operating Income (Loss)	(2,348)	(434)	(7,143)	(2,385)
Operating Segments [Member]
Revenue from External Customer [Line Items]
Net Revenue	26,869	30,818	85,163	96,356
Total Segment Operating Income (Loss)	(2,335)	(383)	(6,514)	(2,208)
Operating Segments [Member] | Mobility Services [Member]
Revenue from External Customer [Line Items]
Net Revenue	18,573	22,372	59,842	71,479
Total Segment Operating Income (Loss)	(2,660)	(251)	(6,987)	(1,768)
Operating Segments [Member] | iPass Unity [Member]
Revenue from External Customer [Line Items]
Net Revenue	8,296	8,446	25,321	24,877
Total Segment Operating Income (Loss)	$ 325	$ (132)	$ 473	$ (440)

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Statement Of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 1,124	$ 1,173

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Segment and Geographical Information

9 Months Ended

Sep. 30, 2013

Segment Reporting [Abstract]

Segment and Geographical Information

Note 9. Segment and Geographical Information

The Company’s two reportable operating segments are: Mobility Services and iPass Unity Network Services (“iPass Unity”; formerly known as Managed Network Services). The Mobility Services segment includes services that help enterprises manage the networks, connections and devices used by their mobile workforce. The iPass Unity segment provides customers with Wi-Fi and Wide Area Network solutions. The Company’s Chief Operating Decision Maker (the “CODM”) is the Company’s President and Chief Executive Officer. The CODM allocates resources to and assesses the performance of each operating segment, using information about its revenue, segment income or loss from operations before income taxes, excluding amortization of intangibles, and restructuring.

The accounting policies of the reportable operating segments are substantially the same as those the Company uses for its condensed consolidated financial statements. All direct costs are allocated to the respective operating segments. In addition to direct costs, certain indirect costs are allocated to each operating segment including costs relating to shared services in management, finance, legal, human resources, facilities, and information technology. Indirect costs are allocated based on headcount, salaries and operating segment revenue. The total pool of operating costs and network access costs allocated to the reportable operating segments were $29.2 million and $31.2 million for the three months ended September 30, 2013 and 2012, respectively, and $91.7 million and $98.6 million for the nine months ended September 30, 2013 and 2012, respectively. Costs related to amortization of intangibles, and restructuring activities are not allocated to operating segments. By definition, operating segment operating income (loss) also excludes interest income, foreign exchange gains and losses, and income taxes.

Revenue and operating loss for each reportable operating segment for the three and nine months ended September 30, 2013 and 2012, were as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	Net Revenue		Total Segment Operating Income (Loss)			Net Revenue		Total Segment Operating Income (Loss)
	(In thousands)
2013
Mobility Services	$	18,573	$	(2,660	)	$	59,842	$	(6,987	)
iPass Unity		8,296		325			25,321		473
Total Segment	$	26,869	$	(2,335	)	$	85,163	$	(6,514	)
2012
Mobility Services	$	22,372	$	(251	)	$	71,479	$	(1,768	)
iPass Unity		8,446		(132	)		24,877		(440	)
Total Segment	$	30,818	$	(383	)	$	96,356	$	(2,208	)

Substantially all of the Company’s long-lived assets are located in the United States. The CODM does not evaluate operating segments using discrete asset information. Accordingly, no segment assets have been reported.

There were no material intersegment sales or transfers for the three and nine months ended September 30, 2013 and 2012, to arrive at net segment revenue.

Reconciliations of total segment operating loss to total operating loss and total loss before income taxes for the three and nine months ended September 30, 2013 and 2012, are as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands)
Total segment operating loss	$	(2,335	)	$	(383	)	$	(6,514	)	$	(2,208	)
Amortization of intangibles		—			(50	)		—			(169	)
Restructuring charges and related adjustments		(13	)		(10	)		(639	)		(16	)
Certain state sales tax and federal tax items		—			9			10			8
Total operating loss		(2,348	)		(434	)		(7,143	)		(2,385	)
Interest income		2			4			9			10
Foreign exchange losses, net		(155	)		(66	)		(342	)		(129	)
Total loss before income taxes	$	(2,501	)	$	(496	)	$	(7,476	)	$	(2,504	)

The following table summarizes total Company revenue by country or by geographical region for the periods presented:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
United States		56	%		59	%		57	%		59	%
EMEA		33	%		31	%		33	%		31	%
Asia Pacific		10	%		10	%		9	%		10	%
Rest of the World		1	%		—			1	%		—

No individual country, except for the United States, represented 10% or more of total revenue for the three and nine months ended September 30, 2013 and 2012. No individual customer represented 10% or more of total revenue for the three and nine months ended September 30, 2013 and 2012.

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Condensed Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:
Net loss	$ (7,803)	$ (2,926)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Stock-based compensation	2,472	1,781
Amortization of intangible assets		169
Depreciation and amortization	1,867	1,660
Loss on disposal of property and equipment	2	3
Provision for (recovery of) doubtful accounts	53	(203)
Changes in operating assets and liabilities:
Accounts receivable	552	2,115
Prepaid expenses and other current assets	254	787
Other assets	609	569
Accounts payable	1,600	(681)
Accrued liabilities	(336)	354
Deferred revenue	(928)	(128)
Other liabilities	(167)	62
Net cash provided by (used in) operating activities	(1,825)	3,562
Cash flows from investing activities:
Purchases of property and equipment	(1,753)	(4,096)
Change in restricted cash pledged for letter of credit	720	471
Net cash used in investing activities	(1,033)	(3,625)
Cash flows from financing activities:
Proceeds from issuance of common stock	1,237	1,194
Stock repurchase		(70)
Net cash provided by financing activities	1,237	1,124
Net increase (decrease) in cash and cash equivalents	(1,621)	1,061
Cash and cash equivalents at beginning of period	26,822	25,439
Cash and cash equivalents at end of period	25,201	26,500
Supplemental disclosures of cash flow information:
Net cash paid for taxes	176	310
Accrued amounts for acquisition of property and equipment	$ 308	$ 458

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 25,201	$ 26,822
Accounts receivable, net of allowance for doubtful accounts of $1,124 and $1,173, respectively	16,655	17,260
Prepaid expenses and other current assets	4,803	5,058
Total current assets	46,659	49,140
Property and equipment, net	6,420	6,549
Other assets	3,106	4,435
Total assets	56,185	60,124
Current liabilities:
Accounts payable	9,082	7,496
Accrued liabilities	8,295	8,631
Deferred revenue, short-term	3,476	3,787
Total current liabilities	20,853	19,914
Deferred revenue, long-term	2,217	2,834
Other long-term liabilities	308	475
Total liabilities	23,378	23,223
Stockholders' equity:
Common stock	64	61
Additional paid-in capital	217,160	213,454
Accumulated deficit	(184,417)	(176,614)
Total stockholders' equity	32,807	36,901
Total liabilities and stockholders' equity	$ 56,185	$ 60,124

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Accrued Restructuring - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended						3 Months Ended	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2009 Employees	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2011	Sep. 30, 2013 2009 Plans [Member]	Mar. 31, 2013 Q1 2013 Plan [Member] Employees	Sep. 30, 2013 Q1 2013 Plan [Member]	Sep. 30, 2013 Accrued Liabilities [Member]	Sep. 30, 2013 Other Noncurrent Liabilities [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring plan, number of positions					146						16
Remaining restructuring charges	$ 370,000	$ 525,000	$ 370,000	$ 525,000		$ 448,000	$ 483,000	$ 633,000	$ 736,000	$ 400,000
Restructuring charges	13,000	10,000	639,000	16,000							600,000
Cash payment of restructuring charges	91,000	118,000	752,000	227,000								600,000
Accrued restructuring liabilities - current	224,000		224,000				203,000						200,000
Accrued restructuring liabilities - Noncurrent														$ 200,000

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Fair Value - Fair Value of Financial Assets (Excluding Cash) and Financial Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	$ 18,303	$ 18,298
Total financial liabilities	351	483
Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	18,303	18,298
Lease Liabilities Incurred in Connection with the Restructuring Plan [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial liabilities	351	483
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	18,303	18,298
Total financial liabilities
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 1 [Member] | Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	18,303	18,298
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 1 [Member] | Lease Liabilities Incurred in Connection with the Restructuring Plan [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial liabilities
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets
Total financial liabilities
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 2 [Member] | Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 2 [Member] | Lease Liabilities Incurred in Connection with the Restructuring Plan [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial liabilities
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets
Total financial liabilities	351	483
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 3 [Member] | Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets
Fair Value Measurements Recurring [Member] | Fair Value Measured Using Level 3 [Member] | Lease Liabilities Incurred in Connection with the Restructuring Plan [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial liabilities	$ 351	$ 483

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Segment and Geographical Information - Summary of Revenue by Geographical Region (Detail) (Revenue [Member], EMEA [Member])	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Jun. 30, 2012
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Percentage of revenue by geographical region	56.00%	59.00%	57.00%	59.00%
EMEA [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Percentage of revenue by geographical region	33.00%	31.00%	33.00%	31.00%
Asia Pacific [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Percentage of revenue by geographical region	10.00%	10.00%	9.00%	10.00%
Rest of the World [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Percentage of revenue by geographical region	1.00%		1.00%

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Net Loss Per Common Share - Schedule of Anti-Dilutive Shares Excluded from Computation of Diluted Net Loss Per Share (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total	6,038,066	4,730,168	5,342,099	4,199,895
Options to Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total	3,063,652	2,756,280	2,822,823	2,398,451
Restricted Stock Awards, Including Participating Securities [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total	2,974,414	1,973,888	2,519,276	1,801,444

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Segment and Geographical Information - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended
	Sep. 30, 2013 Country Customer	Sep. 30, 2012 Country Customer	Sep. 30, 2013 Segment Customer Country	Sep. 30, 2012 Customer Country	Sep. 30, 2013 Revenue [Member] Customer Concentration Risk [Member]	Sep. 30, 2012 Revenue [Member] Customer Concentration Risk [Member]	Sep. 30, 2013 Revenue [Member] Customer Concentration Risk [Member]	Sep. 30, 2012 Revenue [Member] Customer Concentration Risk [Member]	Sep. 30, 2013 United States [Member] Revenue [Member] EMEA [Member]	Sep. 30, 2012 United States [Member] Revenue [Member] EMEA [Member]	Sep. 30, 2013 United States [Member] Revenue [Member] EMEA [Member]	Jun. 30, 2012 United States [Member] Revenue [Member] EMEA [Member]	Sep. 30, 2013 Minimum [Member] United States [Member] Revenue [Member] EMEA [Member]	Sep. 30, 2012 Minimum [Member] United States [Member] Revenue [Member] EMEA [Member]	Sep. 30, 2013 Minimum [Member] United States [Member] Revenue [Member] EMEA [Member]	Sep. 30, 2012 Minimum [Member] United States [Member] Revenue [Member] EMEA [Member]	Sep. 30, 2013 Intersegment Eliminations [Member]	Sep. 30, 2012 Intersegment Eliminations [Member]	Sep. 30, 2013 Intersegment Eliminations [Member]	Sep. 30, 2012 Intersegment Eliminations [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Number of reportable operating segments			2
Operating costs allocated to reportable segments	$ 29,200,000	$ 31,200,000	$ 91,700,000	$ 98,600,000
Inter-segment sale or transfer	$ 26,869,000	$ 30,818,000	$ 85,163,000	$ 96,356,000													$ 0	$ 0	$ 0	$ 0
Concentration risk, percentage					10.00%	10.00%	10.00%	10.00%	56.00%	59.00%	57.00%	59.00%	10.00%	10.00%	10.00%	10.00%
Number of individual country customer	0	0	0	0
Number of individual customer	0	0	0	0

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Net Loss Per Common Share

9 Months Ended

Sep. 30, 2013

Earnings Per Share [Abstract]

Net Loss Per Common Share

Note 8. Net Loss Per Common Share

Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding plus dilutive potential common shares as determined using the treasury stock method for outstanding stock options, restricted stock-based awards and shares issuable under the employee stock purchase plan, unless the result of adding such shares would be anti-dilutive. Unvested participating securities are included in the weighted daily average number of shares outstanding used in the calculation of diluted net income per common share, but are excluded from the calculation of diluted net loss per share. In a net loss position, basic and diluted net loss per common share are equal, since the weighted average number of shares used to compute diluted net loss per common share excludes anti-dilutive securities, including participating securities. As a result of the Company’s net loss for the three and nine months ended September 30, 2013, and for the three and nine months ended September 30, 2012, the Company has excluded all potential shares of common stock from the diluted net loss per share calculation as their inclusion would have had an anti-dilutive effect.

The following table sets forth the computation of basic and diluted net loss per share:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands, except share and per share amounts)
Numerator:
Net loss	$	(2,842	)	$	(771	)	$	(7,803	)	$	(2,926	)
Denominator:
Basic and diluted net loss per common share – Weighted average shares outstanding		64,143,389			61,094,346			63,008,098			60,450,920
Basic and diluted net loss per common share	$	(0.04	)	$	(0.01	)	$	(0.12	)	$	(0.05	)

The following weighted average potential shares of common stock have been excluded from the computation of diluted net loss per share because the effect of including these shares would have been anti-dilutive:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Options to purchase common stock		3,063,652		2,756,280		2,822,823		2,398,451
Restricted stock awards, including participating securities		2,974,414		1,973,888		2,519,276		1,801,444
Total		6,038,066		4,730,168		5,342,099		4,199,895

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Accrued Restructuring - Summary of Accrued Restructuring (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Restructuring And Related Activities [Abstract]
Beginning balance	$ 448	$ 633	$ 483	$ 736
Restructuring charges and related adjustments	13	10	639	16
Payments	(91)	(118)	(752)	(227)
Ending balance	$ 370	$ 525	$ 370	$ 525

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Property and Equipment, Net (Tables)

9 Months Ended

Sep. 30, 2013

Property Plant And Equipment [Abstract]

Components of Property and Equipment, Net

Property and equipment, net, consisted of the following:

	September 30, 2013			December 31, 2012
	(In thousands)
Equipment	$	15,439		$	14,292
Furniture and fixtures		2,217			2,214
Computer software		10,283			6,891
Capital work-in-progress		252			3,356
Leasehold improvements		1,372			1,578
		29,563			28,331
Less: Accumulated depreciation and amortization		(23,143	)		(21,782	)
Property and equipment, net	$	6,420		$	6,549

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2013

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 7. Commitments and Contingencies

Lease and Purchase Commitments

The Company leases facilities under operating leases that expire at various dates through June 2017. Future minimum lease payments under these operating leases, including approximately $0.4 million of future payments on leases accounted for under the Company’s restructuring plans, as of September 30, 2013, are as follows:

Year	Operating Leases
	(In thousands)
Remaining 2013	$	781
2014		3,012
2015		1,288
2016		538
2017		266
	$	5,885

The Company has contracts with certain network service providers, mobile data providers and other vendors which have minimum purchase commitments that expire on various dates through July 2016. Future minimum purchase commitments as of September 30, 2013 under all agreements are as follows:

Year	Minimum Purchase Commitments
	(In thousands)
Remaining 2013	$	607
2014		1,086
2015		30
2016		111
	$	1,834

Subsequent to September 30, 2013, the Company entered into a future minimum purchase commitment to acquire enterprise database software and infrastructure hardware of approximately $4.0 million to be paid over the next three years.

Legal Proceedings

The Company is involved in legal proceedings and claims arising in the ordinary course of business. While there can be no assurances as to the ultimate outcome of any litigation involving the Company, management does not believe any such pending legal proceeding or claim will result in a judgment or settlement that would have a material adverse effect on the Company’s financial position, results of operations or cash flows.

In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to customers, business partners, and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by the Company, or from intellectual property infringement claims made by third-parties. Certain indemnification agreements may not be subject to maximum loss clauses. If the potential loss from any indemnification claim is considered probable and the amount or the range of the loss can be estimated, the Company accrues a liability for the estimated loss. To date, claims under such indemnification provisions have not been significant.

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Fair Value

9 Months Ended

Sep. 30, 2013

Fair Value Disclosures [Abstract]

Fair Value

Note 2. Fair Value

Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction in the principal or most advantageous market between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers assumptions that market participants would use when pricing the asset or liability.

Fair Value Hierarchy

The three levels of inputs that may be used to measure fair value are as follows:

• Level 1—Quoted prices in active markets for identical assets or liabilities;

• Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The recurring fair value measurements of these financial assets (excluding cash) and financial liabilities were determined using the following inputs at September 30, 2013, and December 31, 2012, respectively:

	As of September 30, 2013								As of December 31, 2012
	Fair Value Measured Using						Total Balance		Fair Value Measured Using						Total Balance
	Level 1		Level 2		Level 3				Level 1		Level 2		Level 3
	(In thousands)
Financial assets
Money market funds(1)	$	18,303	$	—	$	—	$	18,303	$	18,298	$	—	$	—	$	18,298
Total financial assets	$	18,303	$	—	$	—	$	18,303	$	18,298	$	—	$	—	$	18,298
Financial liabilities
Lease liabilities incurred in connection with the restructuring plan(2)	$	—	$	—	$	351	$	351	$	—	$	—	$	483	$	483
Total financial liabilities	$	—	$	—	$	351	$	351	$	—	$	—	$	483	$	483

(1) Held in cash and cash equivalents on the Company’s condensed consolidated balance sheets.

(2) Lease liabilities are recorded at fair value and are included as liabilities in the Company’s condensed consolidated balance sheets. The lease liabilities were recorded in connection with lease abandonment plans implemented in 2009. Management made assumptions in determining the fair value of the lease liabilities. The discounted cash flow valuation technique used to determine fair value included inputs, such as the future rent payment schedule, the discount rate and sublease income based on the executed sublease agreement through the end of the lease terms.

There were no transfers between Levels 1, 2, and 3 from December 31, 2012, through September 30, 2013.

As of September 30, 2013, and December 31, 2012, the carrying amounts of accounts receivable, accounts payable and accrued liabilities, approximated fair value due to their short maturities.

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Commitments and Contingencies - Schedule of Future Minimum Purchase Commitments (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013
Commitments And Contingencies Disclosure [Abstract]
Remaining 2013	$ 607
2014	1,086
2015	30
2016	111
Future minimum purchase commitments	$ 1,834

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Accrued Restructuring (Tables)

9 Months Ended

Sep. 30, 2013

Restructuring And Related Activities [Abstract]

Summary of Accrued Restructuring

The following is a rollforward of restructuring liability for the Q1 2013 and 2009 Plans:

	Three Months Ended September 30,
	2013			2012
	(In thousands)
Beginning balance	$	448		$	633
Restructuring charges and related adjustments		13			10
Payments		(91	)		(118	)
Ending balance	$	370		$	525

	Nine Months Ended  September 30,
	2013			2012
	(In thousands)
Beginning balance	$	483		$	736
Restructuring charges and related adjustments		639			16
Payments		(752	)		(227	)
Ending balance	$	370		$	525

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Fair Value (Tables)

9 Months Ended

Sep. 30, 2013

Fair Value Disclosures [Abstract]

Fair Value of Financial Assets (Excluding Cash) and Financial Liabilities

The recurring fair value measurements of these financial assets (excluding cash) and financial liabilities were determined using the following inputs at September 30, 2013, and December 31, 2012, respectively:

	As of September 30, 2013								As of December 31, 2012
	Fair Value Measured Using						Total Balance		Fair Value Measured Using						Total Balance
	Level 1		Level 2		Level 3				Level 1		Level 2		Level 3
	(In thousands)
Financial assets
Money market funds(1)	$	18,303	$	—	$	—	$	18,303	$	18,298	$	—	$	—	$	18,298
Total financial assets	$	18,303	$	—	$	—	$	18,303	$	18,298	$	—	$	—	$	18,298
Financial liabilities
Lease liabilities incurred in connection with the restructuring plan(2)	$	—	$	—	$	351	$	351	$	—	$	—	$	483	$	483
Total financial liabilities	$	—	$	—	$	351	$	351	$	—	$	—	$	483	$	483

(1) Held in cash and cash equivalents on the Company’s condensed consolidated balance sheets.

(2) Lease liabilities are recorded at fair value and are included as liabilities in the Company’s condensed consolidated balance sheets. The lease liabilities were recorded in connection with lease abandonment plans implemented in 2009. Management made assumptions in determining the fair value of the lease liabilities. The discounted cash flow valuation technique used to determine fair value included inputs, such as the future rent payment schedule, the discount rate and sublease income based on the executed sublease agreement through the end of the lease terms.

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Segment and Geographical Information (Tables)

9 Months Ended

Sep. 30, 2013

Segment Reporting [Abstract]

Revenue and Operating Loss for Each Reportable Segment

Revenue and operating loss for each reportable operating segment for the three and nine months ended September 30, 2013 and 2012, were as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	Net Revenue		Total Segment Operating Income (Loss)			Net Revenue		Total Segment Operating Income (Loss)
	(In thousands)
2013
Mobility Services	$	18,573	$	(2,660	)	$	59,842	$	(6,987	)
iPass Unity		8,296		325			25,321		473
Total Segment	$	26,869	$	(2,335	)	$	85,163	$	(6,514	)
2012
Mobility Services	$	22,372	$	(251	)	$	71,479	$	(1,768	)
iPass Unity		8,446		(132	)		24,877		(440	)
Total Segment	$	30,818	$	(383	)	$	96,356	$	(2,208	)

Reconciliations of Total Segment Operating Loss

Reconciliations of total segment operating loss to total operating loss and total loss before income taxes for the three and nine months ended September 30, 2013 and 2012, are as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands)
Total segment operating loss	$	(2,335	)	$	(383	)	$	(6,514	)	$	(2,208	)
Amortization of intangibles		—			(50	)		—			(169	)
Restructuring charges and related adjustments		(13	)		(10	)		(639	)		(16	)
Certain state sales tax and federal tax items		—			9			10			8
Total operating loss		(2,348	)		(434	)		(7,143	)		(2,385	)
Interest income		2			4			9			10
Foreign exchange losses, net		(155	)		(66	)		(342	)		(129	)
Total loss before income taxes	$	(2,501	)	$	(496	)	$	(7,476	)	$	(2,504	)

Summary of Revenue by Geographical Region

The following table summarizes total Company revenue by country or by geographical region for the periods presented:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
United States		56	%		59	%		57	%		59	%
EMEA		33	%		31	%		33	%		31	%
Asia Pacific		10	%		10	%		9	%		10	%
Rest of the World		1	%		—			1	%		—

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Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2013

Commitments And Contingencies Disclosure [Abstract]

Schedule of Future Minimum Lease Payments

The Company leases facilities under operating leases that expire at various dates through June 2017. Future minimum lease payments under these operating leases, including approximately $0.4 million of future payments on leases accounted for under the Company’s restructuring plans, as of September 30, 2013, are as follows:

Year	Operating Leases
	(In thousands)
Remaining 2013	$	781
2014		3,012
2015		1,288
2016		538
2017		266
	$	5,885

Schedule of Future Minimum Purchase Commitments

Future minimum purchase commitments as of September 30, 2013 under all agreements are as follows:

Year	Minimum Purchase Commitments
	(In thousands)
Remaining 2013	$	607
2014		1,086
2015		30
2016		111
	$	1,834

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Document and Entity Information	9 Months Ended
	Sep. 30, 2013	Oct. 31, 2013
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Entity Registrant Name	IPASS INC
Entity Central Index Key	0001053374
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		64,307,424

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Net Loss Per Common Share (Tables)

9 Months Ended

Sep. 30, 2013

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Net Loss Per Share

The following table sets forth the computation of basic and diluted net loss per share:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(In thousands, except share and per share amounts)
Numerator:
Net loss	$	(2,842	)	$	(771	)	$	(7,803	)	$	(2,926	)
Denominator:
Basic and diluted net loss per common share – Weighted average shares outstanding		64,143,389			61,094,346			63,008,098			60,450,920
Basic and diluted net loss per common share	$	(0.04	)	$	(0.01	)	$	(0.12	)	$	(0.05	)

Schedule of Anti-dilutive Shares Excluded from Computation of Diluted Net Loss Per Share

The following weighted average potential shares of common stock have been excluded from the computation of diluted net loss per share because the effect of including these shares would have been anti-dilutive:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Options to purchase common stock		3,063,652		2,756,280		2,822,823		2,398,451
Restricted stock awards, including participating securities		2,974,414		1,973,888		2,519,276		1,801,444
Total		6,038,066		4,730,168		5,342,099		4,199,895