XML 19 R8.htm IDEA: XBRL DOCUMENT v3.19.2
Note 1 - Description of Business
9 Months Ended
Jun. 30, 2019
Notes to Financial Statements  
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]
1.
   Description of Business
 
Overview
 
Bridgeline Digital, The Digital Engagement Company™ (the “Company”), helps customers with their digital experience from websites and intranets to online stores and campaigns and integrates Web Content Management, eCommerce, Marketing Automation, Site Search, Authenticated Portals, Social Media Management, Translation and Web Analytics to help organizations deliver digital experiences. The Bridgeline Unbound platform is delivered through a cloud-based SaaS (“Software as a Service”) multi-tenant business model, providing maintenance, daily technical operation and support; or via a traditional perpetual licensing business model, in which the software resides on a dedicated server in either the customer’s facility or hosted by Bridgeline via a cloud-based hosted services model.
 
The Company was incorporated under the laws of the State of Delaware on
August 28, 2000.
 
Locations
 
The Company’s corporate office is located in Burlington, Massachusetts.  The Company has
three
wholly-owned subsidiaries: Bridgeline Digital Pvt. Ltd. located in Bangalore, India, Bridgeline Digital Canada, Inc. located in Ontario, Canada, and Stantive Technologies Pty. Ltd. located in Australia.
 
Increase in Authorized Shares and Reverse Stock Split
 
On
April 26, 2019,
the Company’s Shareholders and the Board of Directors approved an amendment to the Company’s Amended and Restated Certificate of Incorporation to increase the total number of shares of Common Stock, par value
$0.001
per share (“
Common Stock
”), authorized for issuance thereunder from
50
million shares to
2.5
billion shares (the “
Increase in Authorized
”). On the same date the Company’s Shareholders and the Board of Directors also approved an amendment to the Company’s Amended and Restated Certificate of Incorporation to effect a reverse stock split of both its issued and outstanding and authorized shares of Common Stock, par value
$0.001
per share, at a ratio of
one
(
1
) share of Common Stock for every
fifty
(
50
) shares of Common Stock at any time prior to
December 31, 2019 (
the “Reverse Split”) pursuant to which all classes of the Company’s issued and outstanding shares of Common Stock at the close of business on such date were combined and reconstituted into a smaller number of shares of Common Stock in a ratio of
one
(
1
) share of Common Stock for every
fifty
(
50
) shares of Common Stock (
“1
-for-
50
reverse stock split”). The
1
-for-
50
reverse stock split was effective as of close of business on
May 1, 2019 (
the “Effective Date”) and the Company’s stock began trading on a split-adjusted basis on
May 2, 2019.
 
The reverse stock split reduced the number of shares of the Company’s Common Stock authorized from
2.5
billion shares to
50
million shares. Proportional adjustments have been made to the conversion and exercise prices of the Company’s outstanding convertible preferred stock, warrants, restricted stock awards, and stock options, and to the number of shares issued and issuable under the Company’s Stock Incentive Plans. The Company did
not
issue any fractional shares in connection with the reverse stock split. Instead, any stockholder who would otherwise be entitled to receive a fractional share of Common Stock as a result of the reverse stock split is entitled to receive a cash payment in lieu thereof based on the average of the closing sales prices of a share of the Company’s Common Stock on the Nasdaq Capital Market during regular trading hours for the
five
consecutive trading days immediately preceding the Effective Date. The reverse stock split does
not
modify the rights or preferences of the Common Stock. The number of authorized shares of the Company’s Common Stock is
50
million shares and the par value remains
$0.001.
 
The accompanying unaudited interim condensed consolidated financial statements as of
June 30, 2019
and
September 30, 2018
and for the
three
and
nine
months ended
June 30, 2019
and
2018
and footnotes have been retroactively adjusted to reflect the effects of the
1
-for-
50
reverse stock split.
 
Liquidity
and Management’s Plans
 
The Company has incurred operating losses and used cash in its operating activities for the past several years. Cash was used to fund operations, develop new products, and build infrastructure. During the past
two
fiscal years and continuing into the current fiscal year, the Company has executed on a restructuring plan that included a reduction of workforce and office space, which significantly reduced operating expenses. The Company is continuing to maintain tight control over discretionary spending in the current fiscal year.
 
In the
second
quarter of this current fiscal year, the Company concluded a private offering that raised a net
$9.2
million in cash. Proceeds were used to pay down the Heritage Bank of Commerce line of credit to
zero
and pay the Company’s outstanding loan to Montage Capital II, L.P in full. The Company has
zero
debt at
June 30, 2019.
Also, in the
second
quarter of the current fiscal year, the Company used cash to purchase the assets of Seevolution, Inc. and Stantive Technologies Group Inc., which assets included technology and customers. The Company believes the future revenues and cash flows from these newly acquired customers will supplement the working capital to sustain operations for the next
twelve
months. While there can be
no
assurances that the anticipated sales will be achieved for future periods to provide positive cash flows, the Company’s management believes it will have an appropriate cost structure to support the revenues that will be achieved. As such, management believes that it is probable that we will meet our working capital, capital expenditure and debt repayment needs, if any, for the next
twelve
months from the issuance date of this Form
10
-Q.