8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 17, 2009

A.D.A.M., Inc.

(Exact name of registrant as specified in its charter)

Commission File Number: 000-26962

Georgia	58-1878070
(State or other jurisdiction of incorporation)	(IRS Employer Identification No.)

10 10^th Street NE, Suite 525

Atlanta, Georgia 30309-3848

(Address of principal executive offices, including zip code)

404-604-2757

(Registrant’s telephone number, including area code)

1600 RiverEdge Parkway, Suite 100

Atlanta, Georgia 30328

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Information to be included in the report

Item 2.02. Results of Operations and Financial Condition

On March 17, 2009, A.D.A.M., Inc. issued a press release announcing its financial results for the fourth quarter and year ended December 31, 2008. The press release is attached as Exhibit 99.1 to this Form 8-K. The information in this Form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934 and shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits

(d) The following exhibit is being furnished with this report pursuant to Item 2.02 of this Form 8-K:

Exhibit No.	Description
99.1	Press Release Regarding Financial Results for the Fourth Quarter and Year Ended December 31, 2008

Signature(s)

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	A.D.A.M., Inc.
Date: March 17, 2009	By:	/s/ Kevin S. Noland
		Kevin S. Noland
		President and Chief Executive Officer

Exhibit Index

Exhibit No.	Description
EX-99.1	Press Release Regarding Financial Results for the Fourth Quarter and Year Ended December 31, 2008.

EX-99.1

Exhibit 99.1

A.D.A.M., Inc. Announces Financial Results for Fourth Quarter and Year-End 2008

Total license revenues increase 8% for the year; Content license revenues increase 19%;

Full-year Non-GAAP operating income of $5,711,000 hits 20% of revenues

ATLANTA, GA – March 17, 2009 – A.D.A.M., Inc. (Nasdaq: ADAM), a leading provider of health information and benefit technology solutions, today announced financial results for its fourth quarter and year ended December 31, 2008.

“We delivered profitable operating results even in a challenging economic environment while investing and repositioning the company for long-term growth,” said Kevin Noland, President and Chief Executive Officer of A.D.A.M. “We are very pleased with 19% growth in our health content licensing business which is a result of people and product investments we made previously. During 2008, we continued to invest in sales, marketing and customer service functions for Benergy as we look to grow our important broker channel and capitalize on the opportunities we see with larger employers. In addition, we replaced several internal product offerings with a broader suite of products that allows us to provide a more comprehensive product set for our broker and employer clients through new outsourced relationships. While this was underway, A.D.A.M. continued to generate positive operating cash flows and ended the year in a solid financial position. Based on the strength of our business model, we secured new long-term debt financing in the fourth quarter and with a lower cash interest rate.”

Fourth Quarter Highlights

License revenues for the fourth quarter ended December 31, 2008, which include both health content and Benergy products, were $6,367,000 as compared to $6,182,000 for the same period of 2007, an increase of 3%, primarily as a result of growth in health content licensing.

Total revenues for the fourth quarter ended December 31, 2008 were $7,406,000 as compared to $7,633,000 for the same period of 2007, a decrease of 3%. Fourth quarter revenues were primarily impacted as a result of a professional services contract relating to the Company’s education business in excess of $350,000 that occurred in the prior year period.

Net loss for the fourth quarter ended December 31, 2008 was $2,007,000 or $0.19 per share on a fully diluted basis as compared to a profit of $1,824,000 or $0.17 per share on a fully diluted basis for the same period of 2007. The fourth quarter of 2008 included charges of $3,006,000 relating to facility consolidation and loan refinance expenses, while 2007 included an income tax benefit of $1,510,000, related to the Company’s utilization of its net operating loss carryforward.

Adjusted non-GAAP operating income for the fourth quarter ended December 31, 2008 was $1,642,000, or 22% of revenues, compared to $1,624,000, or 21%, for the same period in 2007. Adjusted EBITDA was $2,023,000, or 27% of revenues, for the fourth quarter ended December 31, 2008 as compared to $2,215,000, or 29% for the same period of 2007.

During the fourth quarter, the Company expanded its credit facility to include a term loan of $10,000,000 and a revolving credit facility of $3,000,000. In conjunction with the new facility, the Company terminated its agreement with its previous lender and recorded a non-cash charge of $813,000 related to the write-off of unamortized financing fees and the issuance of warrants related to the termination of the prior agreement.

Also completed in the fourth quarter was the Company’s facility consolidation program. This program included an outsourcing arrangement with a third party to resell their financial service offerings, such as Flexible Spending Account administration, which will provide a broader and more comprehensive service offering to our customers. This allowed the Company to close two office facilities and reduce personnel related to several product offerings and consolidate support services into the Atlanta location. As a result, the Company recorded $2,193,000 in costs related to the facility consolidation program.

Full Year 2008 Financial Results

For the year ended December 31, 2008, revenues were $28,857,000, up 4% from $27,878,000 from the same period last year. License revenues for the year were $25,395,000 an increase of 8% in total and 19% related to health content licensing. This increase in license revenues was driven by expansion of the Company’s licensing customer base under multiple year contracts that generate recurring revenues for the Company. Product revenues for the year ended December 31, 2008, which are comprised of the Company’s products for the education market, were $1,182,000 as compared to $1,642,000 for the same period last year, a decline of 28%. The decrease in product revenues is a result of the market shift away from CD-ROM-based educational products and towards Web-based e-learning platforms. To meet the growing need for online education products, the Company expects to release a Web-based version of its core educational product later this year. Revenues from professional services for the year ended December 31, 2008 were $2,280,000 as compared to $2,673,000 for the same period last year, a decrease of 15%. The decrease in professional services revenue was a result of a large contract completed in 2007.

Adjusted non-GAAP operating income for the year ended December 31, 2008, was $5,711,000 or 20% of revenues compared to $6,046,000 or 22% of revenues in the prior year. During the year, the Company’s expenditures in sales and marketing increased by 49% as the Company completed expansion of its sales and marketing functions to better serve its customers and address new business opportunities.

Net income for the year ended December 31, 2008 was $38,000, and included $3,006,000 of facility consolidation and refinance charges. Non-GAAP net income for the year was $4,700,000 or 16% of revenues.

During 2008, the Company generated $5,962,000 in cash flow from operations and the Company’s cash on hand was $1,377,000 at December 31, 2008. During the year, the Company reduced its debt under long-term loan obligations by $10,000,000 and increased its unused line of credit by $1,000,000.

“The operational steps we took in 2008 better positions us to support our brokers, increase our sales and build a stronger brand presence with larger employers while reducing our overall operating expenditures going forward. While there are certain unknowns relating to the economy in the next several quarters, we believe we have excellent prospects long-term with healthy profit margins and strong cash flow. A.D.A.M. is uniquely positioned to address the needs of employers and healthcare organizations as well as consumers who continue to bear more of the cost and management of their benefits and healthcare,” Mr. Noland concluded.

Use of Non-GAAP Measures

To supplement our consolidated financial statements presented in accordance with GAAP, we present investors with certain non-GAAP operational measures, including adjusted operating income, adjusted net income, adjusted earnings per share and adjusted EBITDA, all of which primarily exclude the effects of amortization of intangible assets, stock-based compensation, acquisition related expenses, facility consolidation charges, debt refinancing costs, and the income tax benefits from valuation of future tax loss carryforwards.

Our management considers the total return of an investment we have made in an acquisition (i.e., operating profit generated as compared to the purchase price paid) without taking into consideration any allocations made for accounting purposes. Thus, because the purchase price for an acquisition does not necessarily reflect the accounting value assigned to intangible assets, including customer lists and goodwill, when analyzing the return provided by the acquisition in subsequent periods, our management, for planning and evaluation purposes, excludes the GAAP impact of acquired intangible assets and other acquisition related expenses to our financial results. We believe that such an approach is useful in understanding the long-term return provided by an acquisition and that our investors benefit from a supplemental non-GAAP financial measure that adjusts for the accounting expense associated with acquired intangible assets.

Similarly, we believe that excluding stock-based compensation expense provides supplemental information and an alternative presentation useful to investors’ understanding of our operating results and trends, especially when comparing those results on a consistent basis to results for previous periods and anticipated results for future periods.

We also believe that, in excluding stock-based compensation, amortization of intangible assets, facility consolidation and the other listed items in the GAAP to Non-GAAP reconciliation schedules, our non-GAAP financial measures provide investors with transparency into the information and basis used by management and our board of directors to measure and forecast our results of operations, to compare on a consistent basis our results of operations for the current period to that of prior periods, to compare our results of operations on a more consistent basis against that of other companies in making financial and operating decisions, and to establish targets for management incentive compensation.

We believe that the presentation of non-GAAP operational measures of adjusted operating income, adjusted net income, adjusted earnings per share and adjusted EBITDA provide important supplemental information to management and investors regarding financial and business trends relating to the company’s financial condition and results of operations. These non-GAAP operational measures have historically been used as key performance metrics by our senior management as they evaluate the performance of the consolidated financial results. These non-GAAP operational measures are reviewed individually as well as in total in measuring our performance against internal and external expectations for the period. The expectations for such key non-GAAP operational measures are the basis for any financial guidance provided by management for future periods. Management believes that the use of each of these non-GAAP financial measures provides enhanced consistency and comparability with our past financial reports. We provide this information to investors to enable them to perform additional analyses of past, present and future operating performance.

We believe that each of these operational measures is useful to investors in their assessment of our operating performance and the valuation of our company. Adjusted operating income, adjusted net income, adjusted earnings per share and adjusted EBITDA are significant measures used by management for:

• Reporting our financial results and forecasts to our board of directors;

• Evaluating the operating performance of our company;

• Managing and comparing performance internally and externally against our peers; and

• Establishing internal operating targets.

These non-GAAP operational measures, including adjusted operating income, adjusted net income, adjusted earnings per share and adjusted EBITDA are used by us as broad measures of financial performance that encompass our operating performance, cash, capital structure, investment management, and income tax planning effectiveness. These operational measures are not calculated in accordance with GAAP and should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. These operational measures have limitations in that they do not reflect all of the costs or reductions to revenues associated with the operations of our business as determined in accordance with GAAP. In addition, these operational measures may not be comparable to non-GAAP financial measures reported by other companies. As a result, one should not consider these measures in isolation or as a substitute for analysis of our results as reported under GAAP. We compensate for these limitations by analyzing current and future results on a GAAP basis as well as a non-GAAP basis, prominently disclosing GAAP results and providing reconciliations from GAAP results to operational measures. The limitations in relying on our non-GAAP financial measures include the fact that the adjusted operating income, adjusted net income, adjusted earnings per share and adjusted EBITDA operational measures do not include the impact of stock-based compensation expense or the effects of amortization of intangible assets, acquisition related expenses and other charges. We expect to continue to incur expenses similar to the non-GAAP adjustments described above, and the exclusion or inclusion of these items from our non-GAAP financial measures should not be construed as an inference that these costs are unusual or infrequent.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended. The forward-looking statements are based on A.D.A.M.’s current intent, belief and expectations. These statements, especially revenue, net income, cash flow, are not guarantees of future performance and involve a number of risks and uncertainties that can be difficult to predict and that could cause actual results, performance or developments to differ materially. Factors that could affect the company’s actual results, performance or developments include general economic conditions, development of the Internet as a source of health information, pricing actions taken by competitors, demand for the company’s health information, regulatory changes in laws and regulations that impact how the company conducts its business and the other factors described in A.D.A.M.’s filings with the SEC. A.D.A.M. undertakes no obligation or duty to update or revise any of its forward-looking statements whether as a result of new information, future events, circumstances or otherwise.

Conference Call and Earnings Release Information

A.D.A.M. will conduct its fourth quarter and year-end 2008 earnings conference call on March 17, 2009 at 10:00AM Eastern Time (ET). To participate in the call, please dial 866-624-3372 approximately five minutes prior to the start time. International callers may dial 706-758-3874. A digital replay will be available at 12:00 PM ET the same day by dialing 800-633-8284 or 402-977-9140 with reservation code 21. The telephone replay will be available until March 31, 2009. To listen to a replay of the call online, visit www.adam.com.

About A.D.A.M., Inc.

A.D.A.M. (Nasdaq: ADAM) is a leading provider of health information and benefits management solutions to healthcare organizations, employers, consumers, and educational institutions. With an industry-leading employee and benefits management platform and one of the largest consumer health information libraries in the world, A.D.A.M. empowers consumers to get smart about their health and wellness, while reducing the costs of healthcare and benefits administration. For more information, visit www.adam.com or call 1-800-755-ADAM.

###

Contact:

A.D.A.M., Inc.

Investor Relations

Victor Thompson

404-806-1396

A.D.A.M., Inc.

Consolidated Statements of Operations (Unaudited)

Fourth Quarter, 2008 and 2007

(numbers in thousands, except per share data)

	Three Months Ended December 31,						% Increase (Decrease)
	2008		% of Revenues	2007		% of Revenues
Revenues, net:
Licensing	$	6,367	86%	$	6,182	81%	3%
Product		257	3%		330	4%	-22%
Professional services and other		782	11%		1,121	15%	-30%
Total revenues, net		7,406	100%		7,633	100%	-3%
Cost of Revenues:
Cost of revenues		1,218	16%		1,487	19%	-18%
Cost of revenues—amortization		261	4%		471	6%	-45%
Total cost of revenues		1,479	20%		1,958	26%	-24%
Gross Profit		5,927	80%		5,675	74%	4%
Operating expenses:
Product and content development		1,209	16%		1,440	19%	-16%
Sales and marketing		2,319	31%		1,674	22%	39%
General and administrative		4,041	55%		1,730	23%	134%
Total operating expenses		7,569	102%		4,844	63%	56%
Operating income		(1,642)	-22%		831	11%	(a)
Interest expense		366	5%		614	8%	-40%
Interest income		(1)	0%		(97)	-1%	(a)
Income before income taxes		(2,007)	-27%		314	4%	(a)
Income tax benefit		—	0%		(1,510)	-20%	(a)
Net Income	$	(2,007)	-27%	$	1,824	24%	(a)
Earnings Per Share
Basic	$	(0.20)		$	0.19
Diluted	$	(0.19)		$	0.17
Weighted Average Common Shares Outstanding
Basic		9,876			9,628
Diluted		10,390			10,885
(a) not meaningful

A.D.A.M., Inc.

Consolidated Statements of Operations (Unaudited)

Year-to-Date, 2008 and 2007

(numbers in thousands, except per share data)

	Twelve Months Ended December 31,
				% of					% of		% Increase
	2008			Revenues		2007			Revenues		(Decrease)
Revenues, net:
Licensing	$	25,395		88	%	$	23,563		84	%	8	%
Product		1,182		4	%		1,642		6	%	-28	%
Professional services and other		2,280		8	%		2,673		10	%	-15	%
Total revenues, net		28,857		100	%		27,878		100	%	4	%
Cost of Revenues:
Cost of revenues		4,201		14	%		5,092		18	%	-17	%
Cost of revenues–  amortization		1,699		6	%		1,477		6	%	15	%
Total cost of revenues		5,900		20	%		6,569		24	%	-10	%
Gross Profit		22,957		80	%		21,309		76	%	8	%
Operating expenses:
Product and content development		4,297		15	%		4,666		17	%	-8	%
Sales and marketing		8,961		31	%		6,026		21	%	49	%
General and administrative		7,897		27	%		5,858		21	%	35	%
Total operating expenses		21,155		73	%		16,550		59	%	28	%
Operating income		1,802		6	%		4,759		17	%	-62	%
Interest expense		1,495		5	%		2,565		9	%	-42	%
Interest income		(27	)	0	%		(235	)	-1	%	-89	%
Loss on sale of investments		296		1	%		—		0	%	(a	)
Income before income taxes		38		0	%		2,429		9	%	(a	)
Income tax benefit		—		0	%		(1,510	)	-5	%	(a	)
Net Income	$	38		0	%	$	3,939		14	%	(a	)
Earnings Per Share
Basic	$	0.00				$	0.42
Diluted	$	0.00				$	0.38
Weighted Average Common Shares Outstanding
Basic		9,813					9,461
Diluted		10,642					10,442
(a) not meaningful

A.D.A.M., Inc.

Reconciliation of Selected GAAP Measures to Non-GAAP Measures (1) (Unaudited)

Fourth Quarter, 2008 and 2007

(numbers in thousands, except per share data)

	Three Months Ended December 31,
	2008			2008			2007		2007			% Increase/
	GAAP			Non-GAAP			GAAP		Non-GAAP			Decrease
Reconciliation of GAAP Operating Income, Net Income and EPS to Non-GAAP measures.
GAAP Operating Income	$	(1,642	)	$	(1,642	)	$	831	$	831
Severance (2)					—					529
Facility consolidation (3)					2,193					—
Loan refinance (4)					813					—
Stock-based compensation (5)					278					264
Non-GAAP Operating Income				$	1,642				$	1,624		1	%
GAAP Net Income	$	(2,007	)	$	(2,007	)	$	1,824	$	1,824
Severance (2)					—					529
Facility consolidation (3)					2,193					—
Loan refinance (4)					813					—
Stock-based compensation (5)					278					264
Amortization of purchased intangibles (6)					188					188
Income tax expense (benefit) (7)					—					(1,510	)
Non-GAAP Net Income				$	1,465				$	1,295		13	%
Diluted Earnings Per Share	$	(0.19	)	$	0.14		$	0.17	$	0.12
Diluted common shares outstanding		10,390			10,390			10,885		10,885
Reconciliation of GAAP Net Income to Adjusted EBITDA is as follows:
GAAP Net Income				$	(2,007	)			$	1,824
Severance (2)					—					529
Facility consolidation (3)					2,193					—
Loan refinance (4)					813					—
Interest expense (income), net					365					517
Stock-based compensation (5)					278					264
Amortization of purchased intangibles (6)					188					188
Depreciation					121					120
Amortization of software development					72					283
Income tax expense (benefit) (7)					—					(1,510	)
Adjusted EBITDA				$	2,023				$	2,215		-9	%

(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered as a substitute for comparable GAAP measures and should be read only in conjunction with our financial statements prepared in accordance with GAAP and our press release, which explains our use of non-GAAP measures.

(2) Severance for former employees of OnlineBenefits.

(3) Consolidation of facilities and support services into Atlanta.

(4) Cost to refinance long-term debt.

(5) Stock-based compensation related to non-cash charges for stock options.

(6) Amortization of customer list and purchased software acquired with Online Benefits.

(7) Income tax benefit adjustment for expected future use of NOL carryforwards.

A.D.A.M., Inc.

Reconciliation of Selected GAAP Measures to Non-GAAP Measures (1) (Unaudited)

Year-to-Date, 2008 and 2007

(numbers in thousands, except per share data)

	Twelve Months Ended December 31,
	2008		2008		2007		2007			% Increase/
	GAAP		Non-GAAP		GAAP		Non-GAAP			Decrease
Reconciliation of GAAP Operating Income, Net Income and EPS to Non-GAAP measures.
GAAP Operating Income	$	1,802	$	1,802	$	4,759	$	4,759
Severance (2)				—				529
Facility consolidation (3)				2,193				—
Loan refinance (4)				813				—
Stock-based compensation (5)				903				758
Non-GAAP Operating Income			$	5,711			$	6,046		-6	%
GAAP Net Income	$	38	$	38	$	3,939	$	3,939
Severance (2)				—				529
Facility consolidation (3)				2,193				—
Loan refinance (4)				813				—
Stock-based compensation (5)				903				758
Amortization of purchased intangibles (6)				753				753
Income tax expense (benefit) (7)				—				(1,510	)
Non-GAAP Net Income			$	4,700			$	4,469		5	%
Diluted Earnings Per Share	$	0.00	$	0.44	$	0.38	$	0.43
Diluted common shares outstanding		10,642		10,642		10,442		10,442
Reconciliation of GAAP Net Income to Adjusted EBITDA is as follows:
GAAP Net Income			$	38			$	3,939
Severance (2)				—				529
Facility consolidation (3)				2,193				—
Loan refinance (4)				813				—
Interest expense (income), net				1,468				2,330
Stock-based compensation (5)				903				758
Amortization of purchased intangibles (6)				753				753
Depreciation				450				450
Amortization of software development				946				724
Income tax expense (benefit) (7)				—				(1,510	)
Loss on sale of investments (8)				296				—
Adjusted EBITDA			$	7,860			$	7,973		-1	%

(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered as a substitute for comparable GAAP measures and should be read only in conjunction with our financial statements prepared in accordance with GAAP and our press release, which explains our use of non-GAAP measures.

(2) Severance for former employees of OnlineBenefits.

(3) Consolidation of facilities and support services into Atlanta.

(4) Costs to refinance long-term debt.

(5) Stock-based compensation related to non-cash charges for stock options.

(6) Amortization of customer list and purchased software acquired with Online Benefits.

(7) Income tax benefit adjustment for expected future use of NOL carryforwards.

(8) Recognition of loss from sale of interest bearing short term investments.

A.D.A.M., Inc.

Consolidated Balance Sheets

December 31, 2008 and 2007

(numbers in thousands)

	December 31, 2008			December 31, 2007
	(Unaudited)
Assets
Current assets
Cash and cash equivalents	$	1,377		$	5,425
Short term investments		—			2,809
Accounts receivable, net		3,986			3,940
Restricted cash		47			46
Inventories, net		33			65
Prepaids and other current assets		597			839
Deferred income tax asset		558			793
Total current assets		6,598			13,917
Non-current assets
Property and equipment, net		1,592			801
Intangible assets, net		9,979			9,953
Goodwill		27,617			27,468
Other assets		206			152
Deferred financing costs, net		92			852
Deferred income tax asset		7,062			6,827
Total non-current assets		46,548			46,053
Total Assets	$	53,146		$	59,970
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payables and accrued expenses	$	3,880		$	3,658
Deferred revenue		5,995			5,676
Current portion of long-term debt		2,000			3,250
Current portion of capital lease obligations		44			105
Total current liabilities		11,919			12,689
Non-current liabilities
Capital lease obligations, net of current portion		112			85
Other liabilities		1,293			899
Long-term debt, net of current portion		8,000			16,750
Total non-current liabilities		9,405			17,734
Stockholders’ equity
Common stock		102			100
Treasury stock		(1,088	)		(1,088	)
Additional paid-in capital		58,475			56,406
Unrealized loss on investments		—			(166	)
Accumulated deficit		(25,667	)		(25,705	)
Total stockholders’ equity		31,822			29,547
Total Liabilities and Stockholders’ Equity	$	53,146		$	59,970

A.D.A.M., Inc.

Consolidated Statements of Cash Flows

Year-to-Date, 2008 and 2007

(numbers in thousands)

	Twelve Months Ended			Twelve Months Ended
	December 31, 2008			December 31, 2007
	(Unaudited)
Cash flows from operating activities
Net income	$	38		$	3,939
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		2,149			1,927
Deferred tax asset		—			(1,510	)
Deferred financing cost amortization and write-off		852			339
Loss on sale of assets		249			4
Loss on sale of investments		296			—
Stock-based compensation expense		903			758
Warrants expense		366			—
Changes in assets and liabilities:
Accounts receivable		(46	)		(858	)
Inventories		32			9
Prepaids and other assets		188			833
Accounts payable and accrued liabilities		222			(417	)
Deferred revenue		319			1,229
Other liabilities		394			(414	)
Net cash provided by operating activities		5,962			5,839
Cash flows from investing activities
Purchases of property and equipment		(1,426	)		(387	)
Proceeds from sale of property and equipment		2			7
Additional cost of previous acquisition		(149	)		(195	)
Net change in restricted cash		(1	)		2,148
Software product and content development costs		(1,725	)		(1,154	)
Proceeds from sale of investments		2,716			—
Maturities and reclassifications of investments		—			—
Purchase of investments		(37	)		(180	)
Net cash provided by (used in) investing activities		(620	)		239
Cash flows from financing activities
Payment on note payable		—			(1,500	)
Payment on long-term debt		(20,000	)		(5,000	)
Payment of deferred financing costs		(91	)		—
Proceeds from issuance of term note		10,000			—
Proceeds from exercise of common stock options		802			1,544
Repayments on capital leases		(101	)		(143	)
Net cash used in financing activities		(9,390	)		(5,099	)
Increase (Decrease) in cash and cash equivalents		(4,048	)		979
Cash and cash equivalents, beginning of period		5,425			4,446
Cash and cash equivalents, end of period	$	1,377		$	5,425