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The Business
3 Months Ended
Mar. 31, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
The Business

The Business

Glowpoint, Inc. (“Glowpoint” or “we” or “us” or the “Company”) is a provider of cloud and managed videoconferencing services. Our services, delivered via our cloud-based OpenVideo® platform, are securely accessible via any network (private or public) and are technology-agnostic. OpenVideo® is a cloud platform that offers telepresence, video and unified communications and collaboration users a way to meet and communicate across the varying hardware/software platforms and carrier networks in a secure and seamless fashion. The Company delivers services to more than 600 different enterprises in over 68 countries supporting thousands of video endpoints, immersive telepresence rooms, and infrastructure for business-quality, real-time, two-way visual communications.

On October 1, 2012, the Company completed the acquisition of privately held Affinity VideoNet, Inc. ("Affinity"), a provider of public videoconferencing rooms and managed videoconferencing services to professional service organizations globally (as discussed in Note 3). As a result of the acquisition, Glowpoint now offers a comprehensive suite of cloud and managed video services, consisting of the following: (i) monitoring and management, and collaboration services, resulting in an end-to-end cloud and managed solution for telepresence, conference room, desktop and mobile solutions, and video infrastructure; (ii) network services that provide our customers with the flexibility to either source the entire video network from a single provider, maintain existing networks and extend a logical connection to the OpenVideo® cloud or bring bandwidth to Open Video® datacenters; (iii) Affinity public video suites that provide remote access to video communication services for everyday business meetings and events; and (iv) professional and other services consisting of video communication solutions for broadcast/media content acquisition and event services.

Glowpoint's suite of cloud and managed video services focus on multi-tiered help desk support for mixed manufacturer video environments and complements Affinity's standing as a specialized service provider of tailored, business-class meetings for professional service organizations across the world. With the acquisition of Affinity, we now employ approximately 130 employees providing clients with a wide range of products and services across the entire video spectrum, from proprietary technology to design, implementation, 24x7 monitoring and mission critical support.

The Company was formed as a Delaware corporation in May 2000. The Company operates in one segment and therefore segment information is not presented.

Liquidity
As of March 31, 2013, we had $2,166,000 of cash and positive working capital of $548,000. For the three months ended March 31, 2013, we generated a net loss of $1,985,000 and net cash provided by operating activities of $264,000. We generated cash from operations even though we incurred a net loss due to changes in working capital and certain non-cash expenses.

The Company entered into certain debt agreements in connection with the Affinity acquisition in October 2012 (see Note 4). As of March 31, 2013, the current portion of long-term debt on the Company's condensed consolidated balance sheet was $1,197,000, which includes $780,000 of outstanding borrowings under our Comerica Revolver, maturing on April 1, 2014, and $417,000 of scheduled principal payments under our other debt agreements summarized in Note 4. As of March 31, 2013, interest payments under the Company's debt agreements over the next twelve months are expected to approximate $1,122,000. As of March 31, 2013, the Company had unused borrowing availability of $419,000 under the Comerica Revolver.

Pursuant to the terms of our Series A-2 Preferred Stock and Series B-1 Preferred Stock, the Company began accruing dividends as of January 1, 2013 of approximately $105,000 per quarter, however, the company is not obligated to begin paying such dividends in cash until the Company's cash balance exceeds approximately $4,174,000.

Based on our current projection of revenue and expenses, the Company believes that it has, and will have, sufficient resources and cash flow to service its debt obligations and fund its operations for at least the next twelve months following the filing of this Quarterly Report on Form 10-Q. We have historically been able to raise capital in private placements as needed to fund operations and provide growth capital. There can be no assurances, however, that we will be able to raise additional capital as may be needed or upon acceptable terms, or that current economic conditions will not negatively impact us. If the current economic conditions negatively impact us and we are unable to raise additional capital that may be needed on terms acceptable to us, it could have a material adverse effect on the Company.

Quarterly Financial Information and Results of Operations

The condensed consolidated financial statements as of March 31, 2013 and for the three months ended March 31, 2013 and 2012 are unaudited and, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position as of March 31, 2013, and the results of operations for the three months ended March 31, 2013 and 2012, the statement of stockholders' equity for the three months ended March 31, 2013 and the statement of cash flows for the three months ended March 31, 2013 and 2012. The results for the three month ended March 31, 2013 are not necessarily indicative of the results to be expected for the entire year. The condensed balance sheet as of December 31, 2012 has been derived from audited financial statements for the year ended December 31, 2012. While management of the Company believes that the disclosures presented are adequate to make the information not misleading, these condensed consolidated financial statements should be read in conjunction with audited condensed consolidated financial statements and the footnotes thereto for the fiscal year ended December 31, 2012 as filed with the Securities and Exchange Commission with our Form 10-K on April 1, 2013 (the "Audited 2012 Financial Statements").