x | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended March 31, 2017. |
¨ | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Delaware (State or Other Jurisdiction of Incorporation or Organization) | 77-0312442 (I.R.S. Employer Identification No.) |
Large accelerated filer o | Accelerated filer o |
Non-accelerated filer o | Smaller reporting company x |
Emerging growth company o | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o |
PART I - FINANCIAL INFORMATION | ||
Item 1. Financial Statements | ||
Condensed Consolidated Balance Sheets at March 31, 2017 (unaudited) and December 31, 2016 | ||
Unaudited Condensed Consolidated Statements of Operations for the three months ended March 31, 2017 and 2016 | ||
Unaudited Condensed Consolidated Statement of Stockholders’ Equity for the three months ended March 31, 2017 | ||
Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2017 and 2016 | ||
Notes to unaudited Condensed Consolidated Financial Statements | ||
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | ||
Item 3. Quantitative and Qualitative Disclosures About Market Risk | ||
Item 4. Controls and Procedures | ||
PART II - OTHER INFORMATION | ||
Item 1. Legal Proceedings | ||
Item 1A. Risk Factors | ||
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | ||
Item 3. Defaults Upon Senior Securities | ||
Item 4. Mine Safety Disclosures | ||
Item 5. Other Information | ||
Item 6. Exhibits | ||
Signatures |
March 31, 2017 | December 31, 2016 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash | $ | 1,110 | $ | 1,140 | |||
Accounts receivable, net | 1,642 | 1,635 | |||||
Prepaid expenses and other current assets | 1,036 | 978 | |||||
Total current assets | 3,788 | 3,753 | |||||
Property and equipment, net | 1,997 | 2,203 | |||||
Goodwill | 9,225 | 9,225 | |||||
Intangibles, net | 1,092 | 1,309 | |||||
Other assets | 10 | 10 | |||||
Total assets | $ | 16,112 | $ | 16,500 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Current portion of long-term debt | $ | 10,678 | $ | 10,660 | |||
Accounts payable | 156 | 75 | |||||
Accrued expenses and other liabilities | 1,222 | 1,165 | |||||
Accrued dividends | 50 | 47 | |||||
Accrued sales taxes and regulatory fees | 340 | 395 | |||||
Total current liabilities | 12,446 | 12,342 | |||||
Long term liabilities: | |||||||
Deferred tax liability | 257 | 230 | |||||
Total liabilities | 12,703 | 12,572 | |||||
Commitments and contingencies (see Note 11) | |||||||
Stockholders’ equity: | |||||||
Preferred stock, Series A-2, convertible; $.0001 par value; $7,500 stated value; 7,500 shares authorized, 32 shares issued and outstanding and liquidation preference of $237 at March 31, 2017 and December 31, 2016 | 100 | 100 | |||||
Common stock, $.0001 par value; 150,000,000 shares authorized; 36,782,000 issued and 36,535,000 outstanding at March 31, 2017 and 36,659,000 issued and 36,455,000 outstanding at December 31, 2016 | 4 | 4 | |||||
Treasury stock, 247,000 and 204,000 shares at March 31, 2017 and December 31, 2016, respectively | (231 | ) | (219 | ) | |||
Additional paid-in capital | 180,494 | 180,333 | |||||
Accumulated deficit | (176,958 | ) | (176,290 | ) | |||
Total stockholders’ equity | 3,409 | 3,928 | |||||
Total liabilities and stockholders’ equity | $ | 16,112 | $ | 16,500 |
Three Months Ended | |||||||
March 31, | |||||||
2017 | 2016 | ||||||
Revenue | $ | 4,080 | $ | 5,518 | |||
Operating expenses: | |||||||
Cost of revenue (exclusive of depreciation and amortization) | 2,448 | 3,459 | |||||
Research and development | 287 | 287 | |||||
Sales and marketing | 140 | 280 | |||||
General and administrative | 1,016 | 1,240 | |||||
Depreciation and amortization | 459 | 547 | |||||
Total operating expenses | 4,350 | 5,813 | |||||
Loss from operations | (270 | ) | (295 | ) | |||
Interest and other expense, net | 371 | 380 | |||||
Loss before income taxes | (641 | ) | (675 | ) | |||
Income tax expense | 27 | 37 | |||||
Net loss | (668 | ) | (712 | ) | |||
Preferred stock dividends | 3 | 3 | |||||
Net loss attributable to common stockholders | $ | (671 | ) | $ | (715 | ) | |
Net loss attributable to common stockholders per share: | |||||||
Basic and diluted net loss per share | $ | (0.02 | ) | $ | (0.02 | ) | |
Weighted-average number of shares of common stock: | |||||||
Basic and diluted | 36,181 | 35,456 |
Series A-2 Preferred Stock | Common Stock | Treasury Stock | ||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Additional Paid-In Capital | Accumulated Deficit | Total | ||||||||||||||||||||||||
Balance at December 31, 2016 | 32 | $ | 100 | 36,659 | $ | 4 | 204 | $ | (219 | ) | $ | 180,333 | $ | (176,290 | ) | $ | 3,928 | |||||||||||||||
Net loss | — | — | — | — | — | — | — | (668 | ) | (668 | ) | |||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | 164 | — | 164 | |||||||||||||||||||||||
Issuance of stock on vested restricted stock units | — | — | 123 | — | — | — | — | — | — | |||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | — | (3 | ) | — | (3 | ) | |||||||||||||||||||||
Repurchase of common stock | — | — | — | — | 43 | (12 | ) | — | — | (12 | ) | |||||||||||||||||||||
Balance at March 31, 2017 | 32 | $ | 100 | 36,782 | $ | 4 | 247 | $ | (231 | ) | $ | 180,494 | $ | (176,958 | ) | $ | 3,409 |
Three Months Ended March 31, | |||||||
2017 | 2016 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (668 | ) | $ | (712 | ) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Depreciation and amortization | 459 | 547 | |||||
Bad debt recovery | (4 | ) | (9 | ) | |||
Amortization of deferred financing costs | 18 | 18 | |||||
Stock-based compensation expense | 164 | 312 | |||||
Deferred tax provision | 27 | 37 | |||||
Increase (decrease) attributable to changes in assets and liabilities: | |||||||
Accounts receivable | (2 | ) | (36 | ) | |||
Prepaid expenses and other current assets | (60 | ) | 34 | ||||
Accounts payable | 83 | 38 | |||||
Accrued expenses and other liabilities | 56 | (78 | ) | ||||
Accrued sales taxes and regulatory fees | (55 | ) | 207 | ||||
Net cash provided by operating activities | 18 | 358 | |||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (36 | ) | (78 | ) | |||
Net cash used in investing activities | (36 | ) | (78 | ) | |||
Cash flows from financing activities: | |||||||
Purchase of treasury stock | (12 | ) | (13 | ) | |||
Net cash used in financing activities | (12 | ) | (13 | ) | |||
Increase (decrease) in cash and cash equivalents | (30 | ) | 267 | ||||
Cash at beginning of period | 1,140 | 1,764 | |||||
Cash at end of period | $ | 1,110 | $ | 2,031 | |||
Supplemental disclosures of cash flow information: | |||||||
Cash paid during the period for interest | $ | 266 | $ | 281 | |||
Non-cash investing and financing activities: | |||||||
Preferred stock dividends | $ | 3 | $ | 3 |
March 31, 2017 | December 31, 2016 | ||||||
Accrued interest | $ | 746 | $ | 658 | |||
Accrued compensation | 251 | 133 | |||||
Other accrued expenses | 225 | 374 | |||||
Accrued expenses and other liabilities | $ | 1,222 | $ | 1,165 |
March 31, 2017 | December 31, 2016 | ||||||
Main Street Term Loan, net of unamortized debt discount based on an imputed interest rate of 12%; $106 at March 31, 2017 and $123 at December 31, 2016, respectively. | $ | 8,894 | $ | 8,877 | |||
SRS Note, net of unamortized debt discount based on an imputed interest rate of 15%; $1 at March 31, 2017 and $2 at December 31, 2016, respectively. | 1,784 | 1,783 | |||||
Total | 10,678 | 10,660 | |||||
Less current maturities | (10,678 | ) | (10,660 | ) | |||
Long-term debt, net of current portion | $ | — | $ | — |
Outstanding | Exercisable | ||||||||||||
Number of Shares Underlying Options | Weighted Average Exercise Price | Number of Shares Underlying Options | Weighted Average Exercise Price | ||||||||||
Options outstanding, December 31, 2016 | 1,222 | $ | 1.99 | 1,198 | $ | 1.99 | |||||||
Granted | — | — | |||||||||||
Exercised | — | — | |||||||||||
Expired | — | — | |||||||||||
Forfeited and canceled | — | — | |||||||||||
Options outstanding, March 31, 2017 | 1,222 | $ | 1.99 | 1,222 | $ | 1.99 |
Three Months Ended | |||||||
March 31, | |||||||
2017 | 2016 | ||||||
General and administrative | $ | 18 | $ | 94 | |||
$ | 18 | $ | 94 |
Restricted Shares | Weighted Average Grant Price | |||||
Unvested restricted shares outstanding, December 31, 2016 | 363 | $ | 1.08 | |||
Granted | — | — | ||||
Vested | (9 | ) | 1.47 | |||
Forfeited | — | — | ||||
Unvested restricted shares outstanding, March 31, 2017 | 354 | $ | 1.07 |
Three Months Ended | |||||||
March 31, | |||||||
2017 | 2016 | ||||||
Cost of revenue | $ | 2 | $ | 2 | |||
Research and development | 1 | 1 | |||||
General and administrative | 12 | 117 | |||||
$ | 15 | $ | 120 |
RSUs | Weighted Average Grant Price | |||||
Unvested RSUs outstanding, December 31, 2016 | 3,196 | $ | 0.62 | |||
Granted | — | — | ||||
Vested | (253 | ) | 0.58 | |||
Forfeited | (5 | ) | 0.83 | |||
Unvested RSUs outstanding, March 31, 2017 | 2,938 | $ | 0.62 |
Three Months Ended | |||||||
March 31, | |||||||
2017 | 2016 | ||||||
Cost of revenue | $ | 12 | $ | 8 | |||
Research and development | 14 | 9 | |||||
Sales and marketing | 4 | 4 | |||||
General and administrative | 100 | 77 | |||||
$ | 130 | $ | 98 |
Three Months Ended March 31, | |||||||
2017 | 2016 | ||||||
Numerator: | |||||||
Net loss | $ | (668 | ) | $ | (712 | ) | |
Less: preferred stock dividends | 3 | 3 | |||||
Net loss attributable to common stockholders | $ | (671 | ) | $ | (715 | ) | |
Denominator: | |||||||
Weighted-average number of shares of common stock for basic and diluted net loss per share | 36,181 | 35,456 | |||||
Basic and diluted net loss per share | $ | (0.02 | ) | $ | (0.02 | ) |
Three Months Ended March 31, | |||||
2017 | 2016 | ||||
Unvested restricted stock units | 2,938 | 3,145 | |||
Vested restricted stock units | 517 | — | |||
Unvested restricted stock awards | 354 | 363 | |||
Outstanding stock options | 1,222 | 1,250 | |||
Shares of common stock issuable upon conversion of preferred stock, Series A-2 | 79 | 79 |
Year Ending December 31, | |||
Remaining 2017 | $ | 226 | |
2018 | 308 | ||
2019 | 88 | ||
2020 | 23 | ||
$ | 645 |
Three Months Ended March 31, | |||||||
2017 | 2016 | ||||||
Domestic | $ | 2,853 | $ | 4,094 | |||
Foreign | 1,227 | 1,424 | |||||
Total Revenue | $ | 4,080 | $ | 5,518 |
Three Months Ended | |||||||
March 31, | |||||||
2017 | 2016 | ||||||
Revenue | |||||||
Video collaboration services | $ | 2,450 | $ | 2,988 | |||
Network services | 1,523 | 2,347 | |||||
Professional and other services | 107 | 183 | |||||
Total revenue | $ | 4,080 | $ | 5,518 |
Three Months Ended | |||||||
March 31, | |||||||
2017 | 2016 | ||||||
Net loss | $ | (668 | ) | $ | (712 | ) | |
Depreciation and amortization | 459 | 547 | |||||
Interest and other expense, net | 371 | 380 | |||||
Income tax expense | 27 | 37 | |||||
EBITDA | 189 | 252 | |||||
Stock-based compensation | 164 | 312 | |||||
Severance | 16 | 57 | |||||
Adjusted EBITDA | $ | 369 | $ | 621 |
Exhibit Number | Description | |
31.1* | Rule 13a—14(a)/15d—14(a) Certification of the Chief Executive Officer. | |
31.2* | Rule 13a—14(a)/15d—14(a) Certification of the Chief Financial Officer. | |
32.1* | Section 1350 Certification of the Chief Executive Officer and Chief Financial Officer. | |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase | |
101.LAB | XBRL Taxonomy Extension Label Linkbase | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
GLOWPOINT, INC. | ||
5/11/2017 | By: | /s/ Peter Holst |
Peter Holst | ||
Chief Executive Officer | ||
(Principal Executive Officer) |
5/11/2017 | By: | /s/ David Clark |
David Clark | ||
Chief Financial Officer | ||
(Principal Financial and Accounting Officer) |
1. | I have reviewed this quarterly report on Form 10-Q of Glowpoint, 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(s) 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. |
5. | The registrant's other certifying officer(s) 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. |
1. | I have reviewed this quarterly report on Form 10-Q of Glowpoint, 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(s) 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. |
5. | The registrant's other certifying officer(s) 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. |
1. | The accompanying Quarterly Report on Form 10-Q of the Company for the quarter ended March 31, 2017 (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Document and Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
May 08, 2017 |
|
Document and Entity Information | ||
Entity Registrant Name | GLOWPOINT, INC. | |
Entity Central Index Key | 0000746210 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding (in shares) | 36,535,000 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Stockholders’ equity: | ||
Preferred stock Series A-2, convertible, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock Series A-2, stated value | $ 7,500 | $ 7,500 |
Preferred stock Series A-2, shares authorized (in shares) | 7,500 | 7,500 |
Preferred stock Series A-2, shares issued (in shares) | 32 | 32 |
Preferred stock Series A-2, shares outstanding (in shares) | 32 | 32 |
Preferred stock Series A-2, liquidation value | $ 237,000 | $ 237,000 |
Common stock, convertible, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 36,782,000 | 36,659,000 |
Common stock, shares outstanding (in shares) | 36,535,000 | 36,455,000 |
Treasury stock, shares (in shares) | 247,000 | 204,000 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Income Statement [Abstract] | ||
Revenue | $ 4,080 | $ 5,518 |
Operating expenses: | ||
Cost of revenue (exclusive of depreciation and amortization) | 2,448 | 3,459 |
Research and development | 287 | 287 |
Sales and marketing | 140 | 280 |
General and administrative | 1,016 | 1,240 |
Depreciation and amortization | 459 | 547 |
Total operating expenses | 4,350 | 5,813 |
Loss from operations | (270) | (295) |
Interest and other expense, net | 371 | 380 |
Loss before income taxes | (641) | (675) |
Income tax expense | 27 | 37 |
Net loss | (668) | (712) |
Preferred stock dividends | 3 | 3 |
Net loss attributable to common stockholders | $ (671) | $ (715) |
Net loss attributable to common stockholders per share: | ||
Basic and diluted net loss per share (in dollars per share) | $ (0.02) | $ (0.02) |
Weighted-average number of shares of common stock: | ||
Basic and diluted (in shares) | 36,181 | 35,456 |
Business Description and Significant Accounting Policies |
3 Months Ended |
---|---|
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Business Description and Significant Accounting Policies | Business Description and Significant Accounting Policies Business Description Glowpoint, Inc. (“Glowpoint” or “we” or “us” or the “Company”) is a managed service provider of video collaboration and network applications. Our services are designed to provide a comprehensive suite of automated and concierge applications to simplify the user experience and expedite the adoption of video as the primary means of collaboration. Our customers include Fortune 1000 companies, along with small and medium enterprises in a variety of industries. We market our services globally through a multi-channel sales approach that includes direct sales and channel partners. The Company was formed as a Delaware corporation in May 2000. The Company operates in one segment. Principles of Consolidation The condensed consolidated financial statements include the accounts of Glowpoint and our 100%-owned subsidiary, GP Communications, LLC, whose business function is to provide interstate telecommunications services for regulatory purposes. All material inter-company balances and transactions have been eliminated in consolidation. Basis of Presentation The Company's fiscal year ends on December 31 of each calendar year. The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year ended December 31, 2016. In the opinion of the Company's management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. The December 31, 2016 year-end condensed consolidated balance sheet data in this document were derived from audited consolidated financial statements and does not include all of the disclosures required by U.S. generally accepted accounting principles. These condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements as of and for the fiscal year ended December 31, 2016 and notes thereto included in the Company's fiscal 2016 Annual Report on Form 10-K, filed with the SEC on March 31, 2017 (the “2016 10-K”). The results of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. Significant Accounting Policies The significant accounting policies used in preparation of these condensed consolidated financial statements are disclosed in our 2016 10-K, and there have been no changes to the Company's significant accounting policies during the three months ended March 31, 2017. Taxes Billed to Customers and Remitted to Taxing Authorities We recognize taxes billed to customers in revenue and taxes remitted to taxing authorities in our cost of revenue. For the three months ended March 31, 2017, we included taxes of $151,000 in revenue, and we included taxes of $140,000 in cost of revenue. For the three months ended March 31, 2016, we included taxes of $254,000 in revenue, and we included taxes of $427,000 in cost of revenue. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ASU 2014-09, “Revenue from Contracts with Customers” (Subtopic 606), which supersedes most existing revenue recognition guidance under U.S. generally accepted accounting principles (“U.S. GAAP”). The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We continue to evaluate the impact of the pending adoption of ASU 2014-09 on our consolidated financial statements and believe that the Company will use the retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption. The Company has commenced analysis of our revenue streams and the application of the standard. Management does not expect the adoption of ASU 2014-09 to have a material impact on our financial statements and disclosures. In November 2015, the FASB issued ASU 2015-17, “Income Taxes” (Subtopic 740). The amendments in this update require deferred tax liabilities and assets be classified as non-current regardless of the classification of the underlying assets and liabilities. For public companies, the amendments will be effective for financial statements issued for annual periods beginning after December 15, 2016. Earlier application is permitted. Management does not expect the adoption of ASU 2015-17 to have a material impact on our financial statements and disclosures. In February 2016, the FASB created Topic 842 and issued ASU 2016-02, “Leases”. The guidance in this update supersedes Topic 840, “Leases”. This ASU requires lessees to recognize a right-of-use assets and a lease liability, initially measured at the present value of the lease payments on the balance sheet. For public companies, the amendments will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted. Management is currently evaluating the impact of the adoption of ASU 2016-02 on our financial statements and disclosures. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation” (Subtopic 718), which simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The new rules are effective and were adopted by the Company in the first quarter of 2017. Periods prior to 2017 were not adjusted to reflect the adoption of this accounting standard as the Company has adopted this standard on a prospective basis beginning January 1, 2017. The adoption of the new accounting rules did not have a material impact on the Company’s financial condition, results of operations or cash flows. In August 2016, the FASB issued ASU 2016-09, “Statement of Cash Flows-Classification of Certain Cash Receipts and Cash Payments” (Subtopic 230). This guidance clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The amendment addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. These updates are effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual periods, with early adoption permitted. The guidance should be applied retrospectively unless it is impractical to do so; in which case, the guidance should be applied prospectively as of the earliest date practicable. Management is currently evaluating the impact of the adoption of ASU 2016-09 on our financial statements and disclosures. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows-Restricted Cash” (Subtopic 230). These amendments require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a result, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning of period and end of period total amounts shown on the statement of cash flows. The amendments do not provide definition of restricted cash or restricted cash equivalents. Effective date for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. Management does not expect the adoption of ASU 2016-18 to have any impact on our financial statements and disclosures, as restricted cash is currently included in the change of cash on the statement of cash flows. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment” (Subtopic 350). This guidance simplifies the accounting for goodwill impairment by removal of Step 2 of the goodwill impairment test. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. For public companies, the standard will be effective for calendar year-end December 15, 2020. Earlier adoption is permitted for any impairment test performed after January 1, 2017. Management is currently evaluating the impact of the adoption of ASU 2017-04 on our financial statements and disclosures. |
Liquidity and Going Concern |
3 Months Ended |
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Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity and Going Concern | Liquidity and Going Concern As of March 31, 2017, we had $1,110,000 of cash and a working capital deficit of $8,658,000. Our cash balance as of March 31, 2017 includes restricted cash of $18,000 (as discussed in Note 4). For the three months ended March 31, 2017, we generated a net loss of $668,000 and net cash provided by operating activities of $18,000. We generated cash flow from operations even though we incurred a net loss as our net loss includes non-cash operating expenses that are added back to our cash flow from operations (as shown on the condensed consolidated statements of cash flows). A substantial portion of our cash flow from operations is dedicated to the payment of interest on our indebtedness, thereby reducing our ability to use our cash flow to fund our operations, capital expenditures and investments in sales and marketing. For the three months ended March 31, 2017 and 2016, our cash flow from operations was reduced by $266,000 and $281,000, respectively, for interest payments on our indebtedness. The Company is party to a loan agreement with Main Street Capital Corporation (“Main Street”), as lender and as administrative agent and collateral agent for itself and the other lenders from time to time party thereto (the “Main Street Loan Agreement”). The Main Street Loan Agreement provides for an $11,000,000 senior secured term loan facility as of March 31, 2017 (the “Main Street Term Loan”). As of March 31, 2017, the Company had outstanding borrowings of $9,000,000 under the Main Street Term Loan. While an event of default exists under the Main Street Loan Agreement (see below), we cannot access the $2,000,000 of remaining availability under the Main Street Term Loan. Borrowings under the Main Street Term Loan mature on October 17, 2018 unless sooner terminated as provided in the Main Street Loan Agreement. The Main Street Loan Agreement provides that the Main Street Term Loan borrowings bear interest at 12% per annum. Interest payments on the outstanding borrowings under the Main Street Term Loan are due monthly. The Company must make quarterly principal payments on the Main Street Term Loan through the maturity date in an amount equal to 50% of Excess Cash Flow generated by the Company during the trailing fiscal quarter (Excess Cash Flow is defined in the Main Street Loan Agreement and is effectively equal to cash flow from operations less capital expenditures less principal payments on capital leases). During the three months ended March 31, 2017, the Company was not required to make principal payments based on Excess Cash Flow. As of March 31, 2017, Main Street owns 7,711,517 shares, or 21%, of the Company’s common stock. The Main Street Loan Agreement contains certain financial covenants that are measured on a quarterly basis. The Company breached its debt to Adjusted EBITDA ratio covenant as of the end of the second, third, and fourth quarters of 2016 and March 31, 2017 and breached the fixed charge coverage ratio covenant as of the end of the third and fourth quarters of 2016 and March 31, 2017, each of which constitutes an event of default under the Main Street Loan Agreement. Main Street has not provided a waiver of the existing defaults, and thus Main Street may seek several remedies under the loan documents including, without limitation, acceleration of the indebtedness owing under the Main Street Loan Agreement. Based on the Company’s current financial projections, we believe that the Company will likely breach both financial covenants in the Main Street Loan Agreement throughout 2017 and 2018. We are exploring various alternatives to renegotiate our financial covenants and address our liquidity issues, including, without limitation, a potential restructuring of the Main Street and SRS indebtedness (see below), which may involve a conversion of a portion or all of our debt to equity or a debt refinancing, coupled with a capital raise. As of March 31, 2017, the Company had outstanding borrowings of $1,785,000 on a promissory note (the “SRS Note”) to Shareholder Representative Services LLC (“SRS”) the Company issued in connection with the 2012 acquisition of Affinity Videonet, Inc. (“Affinity”) and amended in February 2015 (see Note 7 for further discussion). The maturity date of the SRS Note is July 6, 2017 and the interest rate on the SRS Note is 15% per annum. Payment of all interest earned after March 1, 2015 is due on July 6, 2017, unless certain trailing Adjusted EBITDA targets are met as defined in the SRS Note. The SRS Note is subordinate to borrowings under the Main Street Loan Agreement, and is only permitted to be repaid if permitted by the terms of the Main Street Loan Agreement. Therefore, if the indebtedness under the Main Street Loan Agreement remains outstanding on July 6, 2017 and unless Main Street permits the Company to repay the SRS Note and the Company has the financial resources to make such payment, the Company will be in default under the SRS Note, which will remain outstanding. We do not expect Main Street will permit the Company to repay the SRS Note while the Main Street indebtedness remains outstanding. In addition, under the terms of the Subordination Agreement among the Company, SRS and Main Street, repayment of the principal and accrued interest on the SRS Note is permitted to occur only if the Company’s cash balance is 200% greater than the balance of the SRS Note. Accrued interest on the SRS Note is expected to increase from $653,000 at March 31, 2017 to $752,000 as of June 30, 2017. The Company believes that, based on our projection of revenue, expenses, capital expenditures and cash flows, it will not have sufficient resources and cash flows to service its debt obligations, including repayment of the SRS Note, and fund its operations for at least the next twelve months following the filing of this Report. In addition, there can be no assurances that Main Street will not accelerate the indebtedness outstanding under the Main Street Loan Agreement. If our lenders accelerate the repayment of such indebtedness, we would not have sufficient resources or cash flow to repay the indebtedness. While we expect to continue to adjust our cost of revenue and other operating expenses to partially offset the impact of revenue declines associated with our legacy services, a restructuring of our Main Street and SRS debt or capital infusion is necessary to fund our obligations. We have renegotiated financial covenants and refinanced our indebtedness in the past but there is no assurance we can renegotiate or refinance all or any portion of our indebtedness. If we were unable to repay or otherwise refinance the indebtedness under the loan agreements upon acceleration or when otherwise due, our lenders could foreclose on the collateral that secures our obligations under the loan agreements, which could force us into bankruptcy or liquidation. If we need access to capital to fund operations or provide growth capital, we would likely need to raise capital in one or more equity offerings. There can be no assurance we will succeed in raising necessary capital or that any such offering will be on terms acceptable to the Company. If we cannot raise additional capital that may be needed on terms acceptable to us, it could have a material adverse effect on the Company. The factors discussed above raise substantial doubt as to our ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments that might result from these uncertainties. |
Capitalized Software Costs |
3 Months Ended |
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Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Capitalized Software Costs | Capitalized Software Costs The Company capitalizes certain costs incurred in connection with developing or obtaining internal-use software. All software development costs have been appropriately accounted for as required by ASC Topic 350-40 “Intangible – Goodwill and Other – Internal-Use Software”. Capitalized software costs are included in Property and Equipment on our condensed consolidated balance sheets and are amortized over three to four years. Software costs that do not meet capitalization criteria are expensed as incurred. For the three months ended March 31, 2017, we capitalized $34,000 of internal-use software costs and we amortized $157,000 of these costs. For the three months ended March 31, 2016, we capitalized $62,000 and we amortized $179,000, respectively, of these costs. During the three months ended March 31, 2017 and 2016, we recorded no impairment losses related to capitalized software. |
Restricted Cash |
3 Months Ended |
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Mar. 31, 2017 | |
Restricted Cash and Investments [Abstract] | |
Restricted Cash | Restricted Cash As of March 31, 2017 and December 31, 2016, our cash balance included restricted cash of $18,000, respectively. The $18,000 letter of credit that serves as the security deposit for our lease of office space in Colorado (as discussed in Note 10) is secured by an equal amount of cash pledged as collateral and such cash is held in a restricted bank account. |
Accrued Expenses and Other Liabilities |
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Expenses and Other Liabilities | Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consisted of the following (in thousands):
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Debt |
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt Debt consisted of the following (in thousands):
The Main Street Loan Agreement provides for an $11,000,000 senior secured term loan facility (“Main Street Term Loan”). As of March 31, 2017, the Company had outstanding borrowings of $9,000,000 under the Main Street Term Loan. While an event of default exists under the Main Street Loan Agreement (see below), we cannot access the $2,000,000 of remaining availability under the Main Street Term Loan. Borrowings under the Main Street Term Loan mature on October 17, 2018 unless sooner terminated as provided in the Main Street Loan Agreement. The Main Street Loan Agreement provides that the Main Street Term Loan borrowings bear interest at 12% per annum. Interest payments on the outstanding borrowings under the Main Street Term Loan are due monthly. The Company must make quarterly principal payments on the Main Street Term Loan through the maturity date in an amount equal to 50% of Excess Cash Flow generated by the Company during the trailing fiscal quarter (Excess Cash Flow is defined in the Main Street Loan Agreement and is effectively equal to cash flow from operations less capital expenditures less principal payments on capital leases). During the three months ended March 31, 2017, the Company made no principal payments on the Main Street Term Loan. The Company may prepay borrowings under the Main Street Loan Agreement at any time without premium or penalty, subject to certain notice and minimum prepayment requirements. The obligations of the Company under the Main Street Loan Agreement are secured by substantially all of the assets of the Company, including all intellectual property, equity interests in subsidiaries, equipment and other personal property. The Main Street Loan Agreement contains standard representations, warranties and covenants for a transaction of its nature, including, among other things, covenants relating to (i) financial reporting and notification, (ii) payment of obligations, (iii) compliance with applicable laws and (iv) notification of certain events and covenants and restrictive provisions which may, among other things, limit the Company’s ability to sell assets, incur additional indebtedness, make investments or loans and create liens. The Main Street Loan Agreement contains events of default customary for similar financings with corresponding grace periods, including failure to pay any principal or interest when due, failure to perform or observe covenants, breaches of representations and warranties, certain cross defaults, certain bankruptcy related events, monetary judgments defaults and a change in control. The Main Street Loan Agreement contains certain financial covenants that are measured on a quarterly basis. The Company breached its debt to Adjusted EBITDA ratio covenant as of the end of the second, third and fourth quarters of 2016 and March 31, 2017 and breached the fixed charge coverage ratio covenant as of the end of the third and fourth quarters of 2016 and March 31, 2017, each of which constitutes an event of default under the Main Street Loan Agreement. Main Street has not provided a waiver of the existing defaults, and thus Main Street may seek several remedies under the loan documents including, without limitation, acceleration of the indebtedness owing under the Main Street Loan Agreement. Based on the Company’s current financial projections, we believe that the Company will likely breach both financial covenants in the Main Street Loan Agreement throughout 2017 and 2018. We are exploring various alternatives to renegotiate our financial covenants and address our liquidity issues, including, without limitation, a potential restructuring of the Main Street and SRS indebtedness (see below), which may involve a conversion of a portion or all of our debt to equity or a debt refinancing, coupled with a capital raise. Although the maturity date of the Main Street Term Loan is October 17, 2018, the Company has classified this debt as current given the existing defaults and potential acceleration of such indebtedness. As of March 31, 2017, the Company had outstanding borrowings of $1,785,000 on a promissory note (the “SRS Note”) to Shareholder Representative Services LLC (“SRS”) the Company issued in connection with the 2012 acquisition of Affinity Videonet, Inc. (“Affinity”) and amended in February 2015 (see Note 7 for further discussion). The maturity date of the SRS Note is July 6, 2017 and the interest rate on the SRS Note is 15% per annum. Payment of all interest earned after March 1, 2015 is due on July 6, 2017, unless certain trailing Adjusted EBITDA targets are met as defined in the SRS Note. The SRS Note is subordinate to borrowings under the Main Street Loan Agreement, and is only permitted to be repaid if permitted by the terms of the Main Street Loan Agreement. Therefore, if the indebtedness under the Main Street Loan Agreement remains outstanding on July 6, 2017 and unless Main Street permits the Company to repay the SRS Note and the Company has the financial resources to make such payment, the Company will be in default under the SRS Note, which will remain outstanding. We do not expect Main Street will permit the Company to repay the SRS Note while the Main Street indebtedness remains outstanding. In addition, under the terms of the Subordination Agreement among the Company, SRS and Main Street, repayment of the principal and accrued interest on the SRS Note may occur only if the Company’s cash balance is 200% greater than the balance of the SRS Note. The Company is required to make monthly principal payments in the amount of $50,000 in the event the Company’s trailing three month AEBITDA exceeds $1,500,000. The Company is required to make additional payments on the principal amount over the remaining term of the SRS Note in an amount equal to 40% of the Company’s trailing six month Adjusted EBITDA less $3,000,000. During the three months ended March 31, 2017, the Company was not required to make any principal payments on the SRS Note. As of March 31, 2017, accrued interest expense on the SRS Note was $653,000. Deferred financing costs related to our debt agreements of $107,000 and $125,000 are included as a direct deduction of the carrying amount of our debt as of March 31, 2017 and December 31, 2016, respectively. The financing costs are amortized using the effective interest method over the term of each loan through each maturity date. During the three months ended March 31, 2017 and 2016, amortization of deferred financing costs was $18,000, respectively, which is recorded in “Interest and Other Expense, Net” on our Condensed Consolidated Statement of Operations. |
Preferred Stock |
3 Months Ended |
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Mar. 31, 2017 | |
Preferred Stock, Number of Shares, Par Value and Other Disclosures [Abstract] | |
Preferred Stock | Preferred Stock Our Certificate of Incorporation authorizes us to issue up to 5,000,000 shares of preferred stock. As of March 31, 2017, there were: 100 shares of Series B-1 Preferred Stock authorized, and no shares issued or outstanding; 7,500 shares of Series A-2 Preferred Stock authorized and 32 shares issued and outstanding; and 4,000 shares of Series D Preferred Stock authorized and no shares issued or outstanding. Each share of Series A-2 Preferred Stock has a stated value of $7,500 per share (the “A-2 Stated Value”), a liquidation preference equal to the A-2 Stated Value, and is convertible at the holder’s election into Common Stock at a conversion price per share of $2.9835 as of March 31, 2017. Therefore, each share of Series A-2 Preferred Stock is convertible into 2,514 shares of Common Stock as of March 31, 2017. The conversion price is subject to adjustment upon the occurrence of certain events set forth in our Certificate of Incorporation. During the three months ended March 31, 2017, there were no adjustments to the conversion price. The Series A-2 Preferred Stock is subordinate to the Series B-1 Preferred Stock but senior to all other classes of equity, has weighted average anti-dilution protection and, commencing on January 1, 2013, is entitled to cumulative dividends at a rate of 5% per annum, payable quarterly, based on the A-2 Stated Value. Once dividend payments commence, all dividends are payable at the option of the holder in cash or through the issuance of a number of additional shares of Series A-2 Preferred Stock with an aggregate liquidation preference equal to the dividend amount payable on the applicable dividend payment date. As of March 31, 2017, the Company has recorded $50,000 in accrued dividends on the accompanying condensed consolidated balance sheet related to the remaining Series A-2 Preferred Stock outstanding. The Company, at our option, may redeem all or a portion of the Series A-2 Preferred Stock in cash at a price per share of $8,250 per share (equal to $7,500 per share multiplied by 110%) plus all accrued and unpaid dividends. In accordance with ASC Topic 815, we evaluated whether our convertible preferred stock contains provisions that protect holders from declines in our stock price or otherwise could result in modification of the exercise price or shares to be issued under the respective preferred stock agreements based on a variable that is not an input to the fair value of a “fixed-for-fixed” option and require a derivative liability. The Company determined no derivative liability is required under ASC Topic 815 with respect to our convertible preferred stock. A contingent beneficial conversion amount is required to be calculated and recognized when and if the adjusted conversion price of the convertible preferred stock is adjusted to reflect a down round stock issuance that reduces the conversion price below the $1.16 fair value of the common stock on the issuance date of the convertible preferred stock. |
Stock Based Compensation |
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Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Based Compensation | Stock Based Compensation Glowpoint 2014 Equity Incentive Plan On May 28, 2014, the Glowpoint, Inc. 2014 Equity Incentive Plan (the “2014 Plan”) was approved by the Company’s stockholders at the Company’s 2014 Annual Meeting of Stockholders. The purpose of the 2014 Plan is to promote the success of the Company and to increase stockholder value by providing an additional means to attract, motivate, retain, and reward selected employees and other eligible persons through the grant of equity awards. Awards may be granted under the 2014 Plan to officers, employees, directors and consultants of the Company or its subsidiary. The 2014 Plan permits the grant of stock options, stock appreciation rights, restricted shares, restricted stock units, cash awards and other awards, including stock bonuses, performance stock, performance units, dividend equivalents, or similar rights to purchase or acquire shares, whether at a fixed or variable price or ratio related to the Company’s common stock, upon the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other conditions, or any combination thereof, or any similar securities with a value derived from the value of or related to the Company’s common stock, or returns thereon. A total of 4,400,000 shares of the Company’s common stock were initially available for issuance under the 2014 Plan. As of March 31, 2017, 636,000 shares were available for issuance under the 2014 Plan. Glowpoint 2000 Stock Incentive Plan In June 2010, the Board terminated the Glowpoint 2000 Stock Incentive Plan (as amended, the “2000 Plan”). Notwithstanding the termination of the 2000 Plan, outstanding awards under the 2000 Plan will remain in effect in accordance with their terms. As of March 31, 2017, options to purchase a total of 13,000 shares of common stock were outstanding under the 2000 Plan. Glowpoint 2007 Stock Incentive Plan In May 2014, the Board terminated the Glowpoint 2007 Stock Incentive Plan (the “2007 Plan”). Notwithstanding the termination of the 2007 Plan, outstanding awards under the 2007 Plan will remain in effect in accordance with their terms. As of March 31, 2017, options to purchase a total of 1,209,000 shares of common stock and 184,000 shares of restricted stock were outstanding under the 2007 Plan. Stock Options The Company periodically grants stock options to employees and directors in accordance with the provisions of our stock incentive plans, with the exercise price of the stock options being set at or above the closing price of our common stock at the date of grant. A summary of stock options granted, exercised, expired and forfeited under our stock incentive plans and stock options outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
Stock-based compensation expense related to stock options is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
There is no remaining unrecognized stock-based compensation expense for options as of March 31, 2017. |
Restricted Stock Awards |
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Awards | Stock Based Compensation Glowpoint 2014 Equity Incentive Plan On May 28, 2014, the Glowpoint, Inc. 2014 Equity Incentive Plan (the “2014 Plan”) was approved by the Company’s stockholders at the Company’s 2014 Annual Meeting of Stockholders. The purpose of the 2014 Plan is to promote the success of the Company and to increase stockholder value by providing an additional means to attract, motivate, retain, and reward selected employees and other eligible persons through the grant of equity awards. Awards may be granted under the 2014 Plan to officers, employees, directors and consultants of the Company or its subsidiary. The 2014 Plan permits the grant of stock options, stock appreciation rights, restricted shares, restricted stock units, cash awards and other awards, including stock bonuses, performance stock, performance units, dividend equivalents, or similar rights to purchase or acquire shares, whether at a fixed or variable price or ratio related to the Company’s common stock, upon the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other conditions, or any combination thereof, or any similar securities with a value derived from the value of or related to the Company’s common stock, or returns thereon. A total of 4,400,000 shares of the Company’s common stock were initially available for issuance under the 2014 Plan. As of March 31, 2017, 636,000 shares were available for issuance under the 2014 Plan. Glowpoint 2000 Stock Incentive Plan In June 2010, the Board terminated the Glowpoint 2000 Stock Incentive Plan (as amended, the “2000 Plan”). Notwithstanding the termination of the 2000 Plan, outstanding awards under the 2000 Plan will remain in effect in accordance with their terms. As of March 31, 2017, options to purchase a total of 13,000 shares of common stock were outstanding under the 2000 Plan. Glowpoint 2007 Stock Incentive Plan In May 2014, the Board terminated the Glowpoint 2007 Stock Incentive Plan (the “2007 Plan”). Notwithstanding the termination of the 2007 Plan, outstanding awards under the 2007 Plan will remain in effect in accordance with their terms. As of March 31, 2017, options to purchase a total of 1,209,000 shares of common stock and 184,000 shares of restricted stock were outstanding under the 2007 Plan. Stock Options The Company periodically grants stock options to employees and directors in accordance with the provisions of our stock incentive plans, with the exercise price of the stock options being set at or above the closing price of our common stock at the date of grant. A summary of stock options granted, exercised, expired and forfeited under our stock incentive plans and stock options outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
Stock-based compensation expense related to stock options is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
There is no remaining unrecognized stock-based compensation expense for options as of March 31, 2017. |
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Awards | Restricted Stock Awards A summary of restricted stock awards granted, vested, forfeited and unvested outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
The number of shares of restricted stock awards vested during the three months ended March 31, 2017 includes 3,271 shares withheld and repurchased by the Company on behalf of employees to satisfy $1,000 of tax obligations relating to the vesting of such shares. Such shares are held in the Company’s treasury stock as of March 31, 2017. Stock-based compensation expense related to restricted stock awards is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
Certain restricted stock awards have performance-based vesting provisions and are subject to forfeiture, in whole or in part, if these performance conditions are not achieved. Management assesses, on an ongoing basis, the probability of whether the performance criteria will be achieved and, once it is deemed probable, compensation expense is recognized over the relevant performance period. For those awards not subject to performance criteria, the cost of the restricted stock awards is expensed, which is determined to be the fair market value of the shares at the date of grant, on a straight-line basis over the vesting period. The remaining unrecognized stock-based compensation expense for restricted stock awards as of March 31, 2017 was $218,000. Of this amount, $63,000 relates to time-based awards with a remaining weighted average period of 1.05 years. The remaining $155,000 of unrecognized stock-based compensation expense relates to performance-based awards for which expense will be recognized upon the Company achieving defined revenue targets and other financial goals and will expire 10 years from the grant date. |
Restricted Stock Units |
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | Stock Based Compensation Glowpoint 2014 Equity Incentive Plan On May 28, 2014, the Glowpoint, Inc. 2014 Equity Incentive Plan (the “2014 Plan”) was approved by the Company’s stockholders at the Company’s 2014 Annual Meeting of Stockholders. The purpose of the 2014 Plan is to promote the success of the Company and to increase stockholder value by providing an additional means to attract, motivate, retain, and reward selected employees and other eligible persons through the grant of equity awards. Awards may be granted under the 2014 Plan to officers, employees, directors and consultants of the Company or its subsidiary. The 2014 Plan permits the grant of stock options, stock appreciation rights, restricted shares, restricted stock units, cash awards and other awards, including stock bonuses, performance stock, performance units, dividend equivalents, or similar rights to purchase or acquire shares, whether at a fixed or variable price or ratio related to the Company’s common stock, upon the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other conditions, or any combination thereof, or any similar securities with a value derived from the value of or related to the Company’s common stock, or returns thereon. A total of 4,400,000 shares of the Company’s common stock were initially available for issuance under the 2014 Plan. As of March 31, 2017, 636,000 shares were available for issuance under the 2014 Plan. Glowpoint 2000 Stock Incentive Plan In June 2010, the Board terminated the Glowpoint 2000 Stock Incentive Plan (as amended, the “2000 Plan”). Notwithstanding the termination of the 2000 Plan, outstanding awards under the 2000 Plan will remain in effect in accordance with their terms. As of March 31, 2017, options to purchase a total of 13,000 shares of common stock were outstanding under the 2000 Plan. Glowpoint 2007 Stock Incentive Plan In May 2014, the Board terminated the Glowpoint 2007 Stock Incentive Plan (the “2007 Plan”). Notwithstanding the termination of the 2007 Plan, outstanding awards under the 2007 Plan will remain in effect in accordance with their terms. As of March 31, 2017, options to purchase a total of 1,209,000 shares of common stock and 184,000 shares of restricted stock were outstanding under the 2007 Plan. Stock Options The Company periodically grants stock options to employees and directors in accordance with the provisions of our stock incentive plans, with the exercise price of the stock options being set at or above the closing price of our common stock at the date of grant. A summary of stock options granted, exercised, expired and forfeited under our stock incentive plans and stock options outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
Stock-based compensation expense related to stock options is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
There is no remaining unrecognized stock-based compensation expense for options as of March 31, 2017. |
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Vested restricted stock units | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | Restricted Stock Units A summary of restricted stock units (“RSUs”) granted, vested, forfeited and unvested outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
As of March 31, 2017, 517,000 vested RSUs issued to non-employee directors remain outstanding as shares of common stock have not yet been delivered due to the deferred payment provisions set forth in these RSUs. As of March 31, 2017, there were approximately 1,747,000 unvested RSUs that have performance-based vesting provisions and are subject to forfeiture, in whole or in part, if these performance conditions are not achieved. Management assesses, on an ongoing basis, the probability of whether the performance criteria will be achieved and, once it is deemed probable, compensation expense is recognized over the relevant performance period. As of March 31, 2017, there were approximately 1,191,000 unvested RSUs that have timed-based vesting provisions, and the cost of the RSUs is expensed, which is determined to be the fair market value of the shares at the date of grant, on a straight-line basis over the vesting period. Stock-based compensation expense related to RSUs is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
The remaining unrecognized stock-based compensation expense for RSUs as of March 31, 2017 was $1,390,000. Of this amount $352,000 relates to time-based RSUs with a remaining weighted average period of 0.72 years. The remaining $1,038,000 of unrecognized stock-based compensation expense relates to performance-based RSUs for which expense will be recognized upon the Company achieving defined revenue targets and other financial goals over fiscal years 2017 and 2018. There was no tax benefit recognized for stock-based compensation for the three months ended March 31, 2017 or 2016. No compensation costs were capitalized as part of the cost of an asset during the periods presented. |
Net Loss Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. The weighted-average number of shares of common stock outstanding does not include any potentially dilutive securities or any unvested restricted shares of common stock. These unvested restricted shares, although classified as issued and outstanding at March 31, 2017 and 2016, are considered contingently returnable until the restrictions lapse and will not be included in the basic net loss per share calculation until the shares are vested. Unvested shares of our restricted stock do not contain non-forfeitable rights to dividends and dividend equivalents. Unvested restricted stock units are not included in calculations of basic net loss per share, as they are not considered issued and outstanding at time of grant. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including stock options, preferred stock, restricted stock units, and unvested restricted stock awards, to the extent they are dilutive. For the three months ended March 31, 2017 and 2016, all such common stock equivalents have been excluded from diluted net loss per share as the effect to net loss per share would be anti-dilutive (decrease our net loss per share). The following table sets forth the computation of the Company’s basic and diluted net loss per share (in thousands, except per share data):
The following table represents the potential shares that were excluded from the computation of weighted-average number of shares of common stock in computing the diluted net loss per share for the periods presented because including them would have had an anti-dilutive effect (in thousands):
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies Operating Leases We lease two facilities in Denver, CO and Oxnard, CA that are under operating leases through December 2018 and March 2020, respectively. Both of these leases require us to pay increases in real estate taxes, operating costs and repairs over certain base year amounts. Lease payments for the three months ended March 31, 2017 and 2016 were $74,000 and $72,000, respectively. Future minimum rental commitments under all non-cancelable operating leases as of March 31, 2017, are as follows (in thousands):
Commercial Commitments We have entered into a number of agreements with our suppliers to purchase communications and consulting services. Some of the agreements require a minimum amount of services to be purchased over the life of the agreement, or during a specified period of time. Glowpoint believes that it will meet its commercial commitments. Historically, in certain instances where Glowpoint did not meet the minimum commitments, no penalties for minimum commitments have been assessed and the Company has entered into new agreements. It has been our experience that the prices and terms of successor agreements are similar to those offered by other suppliers. Glowpoint does not believe that any loss contingency related to a potential shortfall should be recorded in the consolidated financial statements because it is not probable, from the information available and from prior experience, that Glowpoint has incurred a liability. Letters of Credit As of March 31, 2017, the Company had an outstanding irrevocable standby letter of credit with Wells Fargo Bank, N.A., for $18,000 to serve as our security deposit for our lease of office space in Colorado. See Note 5. |
Major Customers |
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Mar. 31, 2017 | |
Risks and Uncertainties [Abstract] | |
Major Customers | Major Customers Major customers are defined as direct customers or channel partners that account for more than 10% of the Company’s revenue. For the three months ended March 31, 2017, two major customers represented 21% and 16%, respectively, of our revenue and represented 43% and 15%, respectively, of our accounts receivable balance at March 31, 2017. For the three months ended March 31, 2016, two major customers represented 13% and 11%, respectively, of our revenue. In January 2017, our largest customer filed a voluntary petition for protection under Chapter 11 of the United States Bankruptcy Code. This customer has paid us in full for all amounts that were due as of their bankruptcy filing date. Since the bankruptcy filing date, we have continued to perform services for this customer, with payments expected to be received in accordance with our normal terms. It has not yet been determined whether the bankruptcy estate will assume or reject our contract with this customer. A rejection of our contract with this customer by the bankruptcy estate could have a material adverse effect on our business, financial condition and results of operations, as any reduction in the use of our services or the business failure by one of our major customers or wholesale channel partners could have such a result. |
Geographical Data |
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Geographical Data | Geographical Data For the three months ended March 31, 2017 and 2016, there was no material revenue attributable to any individual foreign country. Revenue by geographic area is allocated as follows (in thousands):
Long-lived assets were 100% located in domestic markets as of March 31, 2017 and December 31, 2016. |
Related Party Transactions |
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Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions As of March 31, 2017, Peter Holst, the Company’s President and CEO and a prior stockholder of Affinity, held a 27% interest in the SRS Note, which was issued to SRS on behalf of the prior stockholders of Affinity in October 2012. See Note 6 for a description of the terms of the SRS Note. As of March 31, 2017, Main Street owns 7,711,517 shares, or 21%, of the Company’s common stock. Main Street is the Company’s senior debt lender (see Note 6). Transactions with related parties, including the transactions referred to above, are reviewed and approved by independent members of the Board of Directors of the Company in accordance with the Company’s Code of Business Conduct and Ethics. |
Business Description and Significant Accounting Policies (Policies) |
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Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of Glowpoint and our 100%-owned subsidiary, GP Communications, LLC, whose business function is to provide interstate telecommunications services for regulatory purposes. All material inter-company balances and transactions have been eliminated in consolidation. |
Basis of Presentation | Basis of Presentation The Company's fiscal year ends on December 31 of each calendar year. The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year ended December 31, 2016. In the opinion of the Company's management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. |
Taxes Billed to Customers and Remitted to Taxing Authorities | Taxes Billed to Customers and Remitted to Taxing Authorities We recognize taxes billed to customers in revenue and taxes remitted to taxing authorities in our cost of revenue. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ASU 2014-09, “Revenue from Contracts with Customers” (Subtopic 606), which supersedes most existing revenue recognition guidance under U.S. generally accepted accounting principles (“U.S. GAAP”). The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We continue to evaluate the impact of the pending adoption of ASU 2014-09 on our consolidated financial statements and believe that the Company will use the retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption. The Company has commenced analysis of our revenue streams and the application of the standard. Management does not expect the adoption of ASU 2014-09 to have a material impact on our financial statements and disclosures. In November 2015, the FASB issued ASU 2015-17, “Income Taxes” (Subtopic 740). The amendments in this update require deferred tax liabilities and assets be classified as non-current regardless of the classification of the underlying assets and liabilities. For public companies, the amendments will be effective for financial statements issued for annual periods beginning after December 15, 2016. Earlier application is permitted. Management does not expect the adoption of ASU 2015-17 to have a material impact on our financial statements and disclosures. In February 2016, the FASB created Topic 842 and issued ASU 2016-02, “Leases”. The guidance in this update supersedes Topic 840, “Leases”. This ASU requires lessees to recognize a right-of-use assets and a lease liability, initially measured at the present value of the lease payments on the balance sheet. For public companies, the amendments will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted. Management is currently evaluating the impact of the adoption of ASU 2016-02 on our financial statements and disclosures. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation” (Subtopic 718), which simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The new rules are effective and were adopted by the Company in the first quarter of 2017. Periods prior to 2017 were not adjusted to reflect the adoption of this accounting standard as the Company has adopted this standard on a prospective basis beginning January 1, 2017. The adoption of the new accounting rules did not have a material impact on the Company’s financial condition, results of operations or cash flows. In August 2016, the FASB issued ASU 2016-09, “Statement of Cash Flows-Classification of Certain Cash Receipts and Cash Payments” (Subtopic 230). This guidance clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The amendment addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. These updates are effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual periods, with early adoption permitted. The guidance should be applied retrospectively unless it is impractical to do so; in which case, the guidance should be applied prospectively as of the earliest date practicable. Management is currently evaluating the impact of the adoption of ASU 2016-09 on our financial statements and disclosures. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows-Restricted Cash” (Subtopic 230). These amendments require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a result, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning of period and end of period total amounts shown on the statement of cash flows. The amendments do not provide definition of restricted cash or restricted cash equivalents. Effective date for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. Management does not expect the adoption of ASU 2016-18 to have any impact on our financial statements and disclosures, as restricted cash is currently included in the change of cash on the statement of cash flows. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment” (Subtopic 350). This guidance simplifies the accounting for goodwill impairment by removal of Step 2 of the goodwill impairment test. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. For public companies, the standard will be effective for calendar year-end December 15, 2020. Earlier adoption is permitted for any impairment test performed after January 1, 2017. Management is currently evaluating the impact of the adoption of ASU 2017-04 on our financial statements and disclosures. |
Capitalized Software Costs | Capitalized Software Costs The Company capitalizes certain costs incurred in connection with developing or obtaining internal-use software. All software development costs have been appropriately accounted for as required by ASC Topic 350-40 “Intangible – Goodwill and Other – Internal-Use Software”. Capitalized software costs are included in Property and Equipment on our condensed consolidated balance sheets and are amortized over three to four years. Software costs that do not meet capitalization criteria are expensed as incurred. |
Accrued Expenses and Other Liabilities (Tables) |
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Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities consisted of the following (in thousands):
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Debt (Tables) |
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Schedule of Long-term Debt Instruments | Debt consisted of the following (in thousands):
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Stock Based Compensation (Tables) |
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Summary of Stock Option Activity | A summary of stock options granted, exercised, expired and forfeited under our stock incentive plans and stock options outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Compensation Expense | Stock-based compensation expense related to stock options is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
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Restricted Stock Awards (Tables) - Restricted Stock |
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Restricted Stock Activity | A summary of restricted stock awards granted, vested, forfeited and unvested outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
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Summary of Compensation Expense | Stock-based compensation expense related to restricted stock awards is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
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Restricted Stock Units (Tables) - Vested restricted stock units |
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Summary of Restricted Stock Units Activity | A summary of restricted stock units (“RSUs”) granted, vested, forfeited and unvested outstanding as of, and changes made during, the three months ended March 31, 2017, is presented below (shares in thousands):
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Summary of Compensation Expense | Stock-based compensation expense related to RSUs is allocated as follows for the three months ended March 31, 2017 and 2016 (in thousands):
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Net Loss Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table represents the potential shares that were excluded from the computation of weighted-average number of shares of common stock in computing the diluted net loss per share for the periods presented because including them would have had an anti-dilutive effect (in thousands):
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Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of the Company’s basic and diluted net loss per share (in thousands, except per share data):
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Commitments and Contingencies (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2017 | |||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum rental commitments under all non-cancelable operating leases as of March 31, 2017, are as follows (in thousands):
|
Geographical Data (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Revenue by Geographical Areas | Revenue by geographic area is allocated as follows (in thousands):
|
Business Description and Significant Accounting Policies - Narrative (Details) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017
USD ($)
segment
|
Mar. 31, 2016
USD ($)
|
|
Finite-Lived Intangible Assets [Line Items] | ||
Number of operating segments | segment | 1 | |
Ownership percentage in subsidiary | 100.00% | |
Revenues | ||
Finite-Lived Intangible Assets [Line Items] | ||
Excise and sales taxes | $ 151 | $ 254 |
Network and Infrastructure Costs | ||
Finite-Lived Intangible Assets [Line Items] | ||
Excise and sales taxes | $ 140 | |
Cost of revenue | ||
Finite-Lived Intangible Assets [Line Items] | ||
Excise and sales taxes | $ 427 |
Capitalized Software Costs - Narrative (Details) - Software and Software Development Costs - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Property, plant and equipment, additions | $ 34,000 | $ 62,000 |
Amortization | 157,000 | 179,000 |
Other asset impairment charges | $ 0 | $ 0 |
Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Property, plant and equipment, useful life | 3 years | |
Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Property, plant and equipment, useful life | 4 years |
Restricted Cash - Narrative (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash and cash equivalents, current | $ 18 | $ 18 |
Colorado | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, letter of credit | $ 18 |
Accrued Expenses and Other Liabilities - Schedule of Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Accrued Expenses, Current [Abstract] | ||
Accrued interest | $ 746 | $ 658 |
Accrued compensation | 251 | 133 |
Other accrued expenses | 225 | 374 |
Accrued expenses and other liabilities | $ 1,222 | $ 1,165 |
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Debt Instrument [Line Items] | ||
Long-term debt | $ 10,678 | $ 10,660 |
Less current maturities | (10,678) | (10,660) |
Long-term debt, net of current portion | 0 | 0 |
Promissory Note with Stockholder Representative | Promissory Note | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 1,784 | 1,783 |
Debt Instrument, imputed interest rate, percentage | 15.00% | |
Debt instrument, unamortized discount | $ 1 | 2 |
Main Street Capital Corporation | Term Loan | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 8,894 | 8,877 |
Debt Instrument, imputed interest rate, percentage | 12.00% | |
Debt instrument, unamortized discount | $ 106 | $ 123 |
Stock Based Compensation - Expense Allocation (Details) - Stock Options - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 18 | $ 94 |
General and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 18 | $ 94 |
Net Loss Per Share - Narrative (Details) |
3 Months Ended |
---|---|
Mar. 31, 2017
shares
| |
Earnings Per Share [Abstract] | |
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 |
Unvested restricted shares excluded from earnings per share computation (in shares) | 0 |
Net Loss Per Share - Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Numerator: | ||
Net loss | $ (668) | $ (712) |
Less: preferred stock dividends | 3 | 3 |
Net loss attributable to common stockholders | $ (671) | $ (715) |
Denominator: | ||
Weighted-average number of shares of common stock for basic and diluted net loss per share (in shares) | 36,181 | 35,456 |
Basic and diluted net loss per share (in dollars per share) | $ (0.02) | $ (0.02) |
Commitments and Contingencies - Narrative (Details) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017
USD ($)
facility
|
Mar. 31, 2016
USD ($)
|
|
Long-term Purchase Commitment [Line Items] | ||
Number of leased facilities | facility | 2 | |
Operating lease payments | $ 74 | $ 72 |
Colorado | ||
Long-term Purchase Commitment [Line Items] | ||
Letters of credit outstanding, amount | 18 | |
Wells Fargo Bank, N.A. | Colorado | ||
Long-term Purchase Commitment [Line Items] | ||
Letters of credit outstanding, amount | $ 18 |
Commitments and Contingencies - Future Minimum Rental Commitments (Details) $ in Thousands |
Mar. 31, 2017
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
Remaining 2017 | $ 226 |
2018 | 308 |
2019 | 88 |
2020 | 23 |
Total | $ 645 |
Major Customers - Narrative (Details) - Customer Concentration Risk - customer |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Revenues | ||
Concentration Risk [Line Items] | ||
Number of customers | 2 | 2 |
Revenues | Customer No. 1 | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 21.00% | |
Revenues | Customer No. 2 | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 16.00% | |
Revenues | Customer No. 3 | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 13.00% | |
Revenues | Customer No. 4 | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 11.00% | |
Accounts Receivable | Customer No. 1 | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 43.00% | |
Accounts Receivable | Customer No. 2 | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 15.00% |
Geographical Data - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Mar. 31, 2017 |
Dec. 31, 2016 |
Mar. 31, 2016 |
|
Segment Reporting [Abstract] | |||
Revenue attributable to individual foreign country | $ 0 | $ 0 | |
Long lived assets located in domestic markets | 100.00% | 100.00% |
Geographical Data - Revenue by Geographic Area (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Segment Reporting Information [Line Items] | ||
Revenue | $ 4,080 | $ 5,518 |
Domestic | ||
Segment Reporting Information [Line Items] | ||
Revenue | 2,853 | 4,094 |
Foreign | ||
Segment Reporting Information [Line Items] | ||
Revenue | $ 1,227 | $ 1,424 |
Related Party Transactions - Narrative (Details) |
Mar. 31, 2017
shares
|
---|---|
President and CEO | Promissory Note | Promissory Note with Stockholder Representative | |
Related Party Transaction [Line Items] | |
Interest in note payable, percentage | 27.00% |
Main Street Capital Corporation | |
Related Party Transaction [Line Items] | |
Common shares owned by stockholder (in shares) | 7,711,517 |
Common shares owned by stockholder, percentage | 21.00% |
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