|
|
|
(Mark One)
|
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
MARCH 31, 2019
;
OR
|
|
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ________TO ________.
|
|
Minnesota
|
41-1577970
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
Large accelerated filer
o
|
Accelerated filer
o
|
Non-accelerated filer
x
|
Smaller reporting company
x
|
Emerging growth company
o
|
|
Title of each class
|
|
Trading
Symbol
|
|
Name of each exchange on which registered
|
Common stock, par value $0.01
|
|
QUMU
|
|
The NASDAQ Stock Market LLC
|
|
|
Description
|
Page
|
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
Assets
|
(unaudited)
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
8,571
|
|
|
$
|
8,636
|
|
Receivables, net of allowance for doubtful accounts of $79 and $61, respectively
|
4,380
|
|
|
6,278
|
|
||
Contract assets
|
1,661
|
|
|
485
|
|
||
Income tax receivable
|
339
|
|
|
327
|
|
||
Prepaid expenses and other current assets
|
2,140
|
|
|
2,192
|
|
||
Total current assets
|
17,091
|
|
|
17,918
|
|
||
Property and equipment, net of accumulated depreciation of $2,912 and $2,809, respectively
|
680
|
|
|
545
|
|
||
Right of use assets – operating leases
|
1,128
|
|
|
—
|
|
||
Intangible assets, net
|
3,956
|
|
|
4,247
|
|
||
Goodwill
|
7,134
|
|
|
6,971
|
|
||
Deferred income taxes, non-current
|
53
|
|
|
55
|
|
||
Other assets, non-current
|
476
|
|
|
544
|
|
||
Total assets
|
$
|
30,518
|
|
|
$
|
30,280
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable and other accrued liabilities
|
$
|
2,640
|
|
|
$
|
2,838
|
|
Accrued compensation
|
1,150
|
|
|
1,548
|
|
||
Deferred revenue
|
9,558
|
|
|
9,672
|
|
||
Operating lease liabilities
|
549
|
|
|
—
|
|
||
Deferred rent
|
—
|
|
|
45
|
|
||
Financing obligations
|
131
|
|
|
152
|
|
||
Term loan
|
3,559
|
|
|
—
|
|
||
Warrant liability
|
3,087
|
|
|
2,798
|
|
||
Total current liabilities
|
20,674
|
|
|
17,053
|
|
||
Long-term liabilities:
|
|
|
|
|
|
||
Deferred revenue, non-current
|
1,425
|
|
|
1,672
|
|
||
Income taxes payable, non-current
|
568
|
|
|
563
|
|
||
Deferred tax liability, non-current
|
—
|
|
|
2
|
|
||
Operating lease liabilities, non-current
|
1,021
|
|
|
—
|
|
||
Deferred rent, non-current
|
—
|
|
|
302
|
|
||
Financing obligations, non-current
|
146
|
|
|
57
|
|
||
Term loan, non-current
|
—
|
|
|
3,431
|
|
||
Other non-current liabilities
|
—
|
|
|
195
|
|
||
Total long-term liabilities
|
3,160
|
|
|
6,222
|
|
||
Total liabilities
|
23,834
|
|
|
23,275
|
|
||
Commitments and contingencies (Note 4)
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
|
|
||
Preferred stock, $0.01 par value, authorized 250,000 shares, no shares issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value, authorized 29,750,000 shares, issued and outstanding 9,765,392
and 9,624,060, respectively
|
98
|
|
|
96
|
|
||
Additional paid-in capital
|
69,266
|
|
|
69,072
|
|
||
Accumulated deficit
|
(59,635
|
)
|
|
(58,875
|
)
|
||
Accumulated other comprehensive loss
|
(3,045
|
)
|
|
(3,288
|
)
|
||
Total stockholders’ equity
|
6,684
|
|
|
7,005
|
|
||
Total liabilities and stockholders’ equity
|
$
|
30,518
|
|
|
$
|
30,280
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Revenues:
|
|
|
|
|
|
||
Software licenses and appliances
|
$
|
1,005
|
|
|
$
|
451
|
|
Service
|
6,093
|
|
|
4,380
|
|
||
Total revenues
|
7,098
|
|
|
4,831
|
|
||
Cost of revenues:
|
|
|
|
|
|
||
Software licenses and appliances
|
311
|
|
|
335
|
|
||
Service
|
1,226
|
|
|
1,777
|
|
||
Total cost of revenues
|
1,537
|
|
|
2,112
|
|
||
Gross profit
|
5,561
|
|
|
2,719
|
|
||
Operating expenses:
|
|
|
|
|
|
||
Research and development
|
1,674
|
|
|
1,903
|
|
||
Sales and marketing
|
2,352
|
|
|
2,180
|
|
||
General and administrative
|
1,746
|
|
|
2,181
|
|
||
Amortization of purchased intangibles
|
218
|
|
|
229
|
|
||
Total operating expenses
|
5,990
|
|
|
6,493
|
|
||
Operating loss
|
(429
|
)
|
|
(3,774
|
)
|
||
Other income (expense):
|
|
|
|
|
|
||
Interest expense, net
|
(205
|
)
|
|
(844
|
)
|
||
Decrease (increase) in fair value of warrant liability
|
(289
|
)
|
|
387
|
|
||
Other, net
|
(31
|
)
|
|
(387
|
)
|
||
Total other expense, net
|
(525
|
)
|
|
(844
|
)
|
||
Loss before income taxes
|
(954
|
)
|
|
(4,618
|
)
|
||
Income tax benefit
|
(4
|
)
|
|
(88
|
)
|
||
Net loss
|
$
|
(950
|
)
|
|
$
|
(4,530
|
)
|
|
|
|
|
||||
Net loss per share – basic and diluted:
|
|
|
|
||||
Net loss per share
|
$
|
(0.10
|
)
|
|
$
|
(0.48
|
)
|
Weighted average shares outstanding
|
9,688
|
|
|
9,370
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Net loss
|
$
|
(950
|
)
|
|
$
|
(4,530
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|||
Net change in foreign currency translation adjustments
|
243
|
|
|
623
|
|
||
Total other comprehensive income
|
243
|
|
|
623
|
|
||
Total comprehensive loss
|
$
|
(707
|
)
|
|
$
|
(3,907
|
)
|
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Deficit
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Total
|
|||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balance at December 31, 2018
|
9,624
|
|
|
$
|
96
|
|
|
$
|
69,072
|
|
|
$
|
(58,875
|
)
|
|
$
|
(3,288
|
)
|
|
$
|
7,005
|
|
Adoption of ASC Topic 842
|
—
|
|
|
—
|
|
|
—
|
|
|
190
|
|
|
—
|
|
|
190
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(950
|
)
|
|
—
|
|
|
(950
|
)
|
|||||
Other comprehensive income, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
243
|
|
|
243
|
|
|||||
Issuance of stock under employee stock plan, net of forfeitures
|
156
|
|
|
2
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Redemption of stock to cover tax withholding for employee stock plan
|
(15
|
)
|
|
—
|
|
|
(36
|
)
|
|
—
|
|
|
—
|
|
|
(36
|
)
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
231
|
|
|
—
|
|
|
—
|
|
|
231
|
|
|||||
Balance at March 31, 2019
|
9,765
|
|
|
$
|
98
|
|
|
$
|
69,266
|
|
|
$
|
(59,635
|
)
|
|
$
|
(3,045
|
)
|
|
$
|
6,684
|
|
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Deficit
|
|
Accumulated
Other Comprehensive Loss |
|
Total
|
|||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balance at December 31, 2017
|
9,365
|
|
|
$
|
94
|
|
|
$
|
68,035
|
|
|
$
|
(56,197
|
)
|
|
$
|
(2,740
|
)
|
|
$
|
9,192
|
|
Adoption of ASC Topic 606
|
—
|
|
|
—
|
|
|
—
|
|
|
939
|
|
|
(5
|
)
|
|
934
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,530
|
)
|
|
—
|
|
|
(4,530
|
)
|
|||||
Other comprehensive income, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
623
|
|
|
623
|
|
|||||
Issuance of stock under employee stock plan, net of forfeitures
|
24
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Redemption of stock to cover tax withholding for employee stock plan
|
(11
|
)
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
210
|
|
|
—
|
|
|
—
|
|
|
210
|
|
|||||
Balance at March 31, 2018
|
9,378
|
|
|
$
|
94
|
|
|
$
|
68,226
|
|
|
$
|
(59,788
|
)
|
|
$
|
(2,122
|
)
|
|
$
|
6,410
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Operating activities:
|
|
|
|
|
|
||
Net loss
|
$
|
(950
|
)
|
|
$
|
(4,530
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
||||
Depreciation and amortization
|
408
|
|
|
699
|
|
||
Stock-based compensation
|
231
|
|
|
210
|
|
||
Accretion of debt discount and issuance costs
|
128
|
|
|
746
|
|
||
Gain on lease modification
|
(21
|
)
|
|
—
|
|
||
Change in fair value of warrant liability
|
289
|
|
|
(387
|
)
|
||
Deferred income taxes
|
—
|
|
|
(37
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables
|
1,914
|
|
|
1,645
|
|
||
Contract assets
|
(1,176
|
)
|
|
14
|
|
||
Income taxes receivable / payable
|
(3
|
)
|
|
(62
|
)
|
||
Prepaid expenses and other assets
|
125
|
|
|
(317
|
)
|
||
Accounts payable and other accrued liabilities
|
(75
|
)
|
|
(444
|
)
|
||
Accrued compensation
|
(405
|
)
|
|
—
|
|
||
Deferred revenue
|
(424
|
)
|
|
603
|
|
||
Deferred rent
|
—
|
|
|
(75
|
)
|
||
Other non-current liabilities
|
(24
|
)
|
|
186
|
|
||
Net cash provided by (used in) operating activities
|
17
|
|
|
(1,749
|
)
|
||
Investing activities:
|
|
|
|
|
|
||
Purchases of property and equipment
|
(14
|
)
|
|
(2
|
)
|
||
Net cash used in investing activities
|
(14
|
)
|
|
(2
|
)
|
||
Financing activities:
|
|
|
|
|
|
||
Proceeds from term loan and warrant issuance
|
—
|
|
|
10,000
|
|
||
Principal payments on term loans
|
—
|
|
|
(8,000
|
)
|
||
Payments for term loan issuance costs
|
—
|
|
|
(1,308
|
)
|
||
Principal payments on financing obligations
|
(80
|
)
|
|
(99
|
)
|
||
Common stock repurchases to settle employee withholding liability
|
(36
|
)
|
|
(19
|
)
|
||
Net cash provided by (used in) financing activities
|
(116
|
)
|
|
574
|
|
||
Effect of exchange rate changes on cash
|
48
|
|
|
45
|
|
||
Net decrease in cash and cash equivalents
|
(65
|
)
|
|
(1,132
|
)
|
||
Cash and cash equivalents, beginning of period
|
8,636
|
|
|
7,690
|
|
||
Cash and cash equivalents, end of period
|
$
|
8,571
|
|
|
$
|
6,558
|
|
Supplemental disclosures of net cash paid (received) during the period:
|
|
|
|
|
|
||
Income taxes, net
|
$
|
(17
|
)
|
|
$
|
6
|
|
Interest, net
|
$
|
4
|
|
|
$
|
33
|
|
(1)
|
Nature of Business and Basis of Presentation
|
–
|
ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Generally, the Company cannot determine the interest rate implicit in the lease because it does not have access to the lessor’s information. Therefore, the Company uses its incremental borrowing rate as the discount rate for the lease. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms.
|
–
|
The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend the lease that the Company is reasonably certain to exercise, or an option to extend the lease controlled by the lessor.
|
–
|
Lease payments included in the measurement of the lease liability include the fixed payments owed over the lease term, termination penalties, amounts expected to be payable under a residual-value guarantee, and the exercise price of an option to purchase the asset if the Company is reasonably certain to exercise the option.
|
|
December 31,
2018 |
|
Adjustments
|
|
January 1,
2019 |
||||||
Assets:
|
|
|
|
|
|
|
|||||
Property and equipment
|
$
|
545
|
|
|
$
|
124
|
|
|
$
|
669
|
|
Operating lease assets
|
—
|
|
|
1,367
|
|
|
1,367
|
|
|||
Liabilities:
|
|
|
|
|
|
|
|
|
|||
Accounts payable and other accrued liabilities
|
$
|
2,838
|
|
|
$
|
(211
|
)
|
|
$
|
2,627
|
|
Operating lease liabilities
|
—
|
|
|
759
|
|
|
759
|
|
|||
Deferred rent
|
45
|
|
|
(45
|
)
|
|
—
|
|
|||
Operating lease liabilities, non-current
|
—
|
|
|
1,100
|
|
|
1,100
|
|
|||
Deferred rent, non-current
|
302
|
|
|
(302
|
)
|
|
—
|
|
|||
Stockholders’ equity:
|
|
|
|
|
|
|
|
|
|||
Accumulated deficit
|
$
|
(58,875
|
)
|
|
$
|
190
|
|
|
$
|
(58,685
|
)
|
(2)
|
Revenue
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Software licenses and appliances
|
$
|
1,005
|
|
|
$
|
451
|
|
Service
|
|
|
|
||||
Subscription, maintenance and support
|
5,563
|
|
|
4,038
|
|
||
Professional services and other
|
530
|
|
|
342
|
|
||
Total service
|
6,093
|
|
|
4,380
|
|
||
Total revenues
|
$
|
7,098
|
|
|
$
|
4,831
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
North America
|
$
|
4,308
|
|
|
$
|
2,810
|
|
Europe
|
2,241
|
|
|
1,610
|
|
||
Asia
|
549
|
|
|
411
|
|
||
Total
|
$
|
7,098
|
|
|
$
|
4,831
|
|
(3)
|
Intangible Assets and Goodwill
|
|
March 31, 2019
|
||||||||||||||
|
Customer Relationships
|
|
Developed Technology
|
|
Trademarks / Trade-Names
|
|
Total
|
||||||||
Original cost
|
$
|
4,860
|
|
|
$
|
8,102
|
|
|
$
|
2,181
|
|
|
$
|
15,143
|
|
Accumulated amortization
|
(2,876
|
)
|
|
(7,332
|
)
|
|
(979
|
)
|
|
(11,187
|
)
|
||||
Net identifiable intangible assets
|
$
|
1,984
|
|
|
$
|
770
|
|
|
$
|
1,202
|
|
|
$
|
3,956
|
|
|
December 31, 2018
|
||||||||||||||
|
Customer Relationships
|
|
Developed Technology
|
|
Trademarks / Trade-Names
|
|
Total
|
||||||||
Original cost
|
$
|
4,818
|
|
|
$
|
8,023
|
|
|
$
|
2,180
|
|
|
$
|
15,021
|
|
Accumulated amortization
|
(2,721
|
)
|
|
(7,110
|
)
|
|
(943
|
)
|
|
(10,774
|
)
|
||||
Net identifiable intangible assets
|
$
|
2,097
|
|
|
$
|
913
|
|
|
$
|
1,237
|
|
|
$
|
4,247
|
|
|
Three Months Ended
March 31, 2019 |
||
Balance, beginning of period
|
$
|
4,247
|
|
Amortization expense
|
(335
|
)
|
|
Currency translation
|
44
|
|
|
Balance, end of period
|
$
|
3,956
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Amortization expense associated with the developed technology included in cost of revenues
|
$
|
117
|
|
|
$
|
298
|
|
Amortization expense associated with other acquired intangible assets included in operating expenses
|
218
|
|
|
229
|
|
||
Total amortization expense
|
$
|
335
|
|
|
$
|
527
|
|
(4)
|
Commitments and Contingencies
|
|
Three Months Ended
March 31, |
||
Operating lease cost
|
$
|
193
|
|
Finance lease cost:
|
|
||
Amortization of right of use assets
|
13
|
|
|
Interest on lease liabilities
|
2
|
|
|
Total finance cost
|
15
|
|
|
Total lease cost
|
$
|
208
|
|
Leases
|
Classification on Balance Sheet
|
March 31,
2019 |
||
Assets
|
|
|
||
Operating
|
Right of use assets – operating leases
|
$
|
1,128
|
|
Finance
|
Property and equipment
|
224
|
|
|
Total lease assets
|
|
$
|
1,352
|
|
Liabilities
|
|
|
||
Current
|
|
|
||
Operating
|
Operating lease liabilities
|
$
|
549
|
|
Finance
|
Financing obligations
|
79
|
|
|
Non-current
|
|
|
||
Operating
|
Operating lease liabilities, non-current
|
1,021
|
|
|
Finance
|
Financing obligations, non-current
|
146
|
|
|
Total lease liabilities
|
|
$
|
1,795
|
|
|
Operating
leases
|
|
Finance
leases
|
||||
Remainder of 2019
|
$
|
566
|
|
|
$
|
68
|
|
2020
|
427
|
|
|
91
|
|
||
2021
|
435
|
|
|
80
|
|
||
2022
|
393
|
|
|
5
|
|
||
2023
|
20
|
|
|
—
|
|
||
Total undiscounted lease payments
|
1,841
|
|
|
244
|
|
||
Less amount representing interest
|
(271
|
)
|
|
(19
|
)
|
||
Present value of lease liabilities
|
$
|
1,570
|
|
|
$
|
225
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
Term loan, at face value
|
$
|
4,000
|
|
|
$
|
4,000
|
|
Unamortized original issue discount
|
(373
|
)
|
|
(481
|
)
|
||
Unamortized debt issuance costs
|
(68
|
)
|
|
(88
|
)
|
||
Term loan
|
$
|
3,559
|
|
|
$
|
3,431
|
|
(5)
|
Fair Value Measurements
|
•
|
Level 1: Inputs are unadjusted quoted prices in active markets for identical assets and liabilities.
|
•
|
Level 2: Inputs include data points that are observable such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) such as interest rates and yield curves that are observable for the asset or liability, either directly or indirectly.
|
•
|
Level 3: Inputs are generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect an entity’s own estimates of assumptions that market participants would use in pricing the asset or liability.
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
Total Fair
Value at March 31, 2019 |
|
Quoted Prices in
Active Markets (Level 1) |
|
Significant Other
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivative warrant liability - ESW warrant
|
$
|
2,266
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,266
|
|
Derivative warrant liability - Hale warrant
|
761
|
|
|
—
|
|
|
—
|
|
|
761
|
|
||||
Derivative warrant liability - iStudy
|
60
|
|
|
—
|
|
|
—
|
|
|
60
|
|
||||
Derivative warrant liability
|
$
|
3,087
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,087
|
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
Total Fair
Value at December 31, 2018 |
|
Quoted Prices in
Active Markets (Level 1) |
|
Significant Other
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivative warrant liability - ESW warrant
|
$
|
2,015
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,015
|
|
Derivative warrant liability - Hale warrant
|
750
|
|
|
—
|
|
|
—
|
|
|
750
|
|
||||
Derivative warrant liability - iStudy
|
33
|
|
|
—
|
|
|
—
|
|
|
33
|
|
||||
Derivative warrant liability
|
$
|
2,798
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,798
|
|
Balance at December 31, 2018
|
|
$
|
2,798
|
|
Change in fair value
|
|
289
|
|
|
Balance at March 31, 2019
|
|
$
|
3,087
|
|
(6)
|
Stock-Based Compensation
|
|
Three Months Ended
March 31, |
||||
|
2019
|
|
2018
|
||
Stock options
|
17,000
|
|
|
—
|
|
Restricted stock awards and restricted stock units
|
98,492
|
|
|
—
|
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2019
|
|
2018
|
||||
Stock-based compensation cost, before income tax benefit:
|
|
|
|
|
|
|
||
Stock options
|
|
$
|
94
|
|
|
$
|
47
|
|
Restricted stock awards and restricted stock units
|
|
132
|
|
|
163
|
|
||
Performance stock units
|
|
5
|
|
|
—
|
|
||
Total stock-based compensation
|
|
$
|
231
|
|
|
$
|
210
|
|
|
|
|
|
|
||||
|
|
Three Months Ended
March 31, |
||||||
|
|
2019
|
|
2018
|
||||
Stock-based compensation cost included in:
|
|
|
|
|
|
|
||
Cost of revenues
|
|
$
|
8
|
|
|
$
|
10
|
|
Operating expenses
|
|
223
|
|
|
200
|
|
||
Total stock-based compensation
|
|
$
|
231
|
|
|
$
|
210
|
|
(7)
|
Income Taxes
|
(8)
|
Computation of Net Loss Per Share of Common Stock
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Net loss per share – basic and diluted
|
|
|
|
||||
Net loss
|
$
|
(950
|
)
|
|
$
|
(4,530
|
)
|
Weighted average shares outstanding
|
9,688
|
|
|
9,370
|
|
||
Net loss per share
|
$
|
(0.10
|
)
|
|
$
|
(0.48
|
)
|
|
Three Months Ended
March 31, |
||||
|
2019
|
|
2018
|
||
Stock options
|
1,416
|
|
|
1,316
|
|
Warrants
|
1,339
|
|
|
1,126
|
|
Restricted stock units
|
150
|
|
|
150
|
|
Total anti-dilutive
|
2,905
|
|
|
2,592
|
|
|
Three Months Ended March 31,
|
|||||||
|
Percentage of Revenues
|
|
Percent Increase (Decrease)
|
|||||
|
2019
|
|
2018
|
|
2018 to 2019
|
|||
Revenues
|
100.0
|
%
|
|
100.0
|
%
|
|
47
|
%
|
Cost of revenues
|
(21.7
|
)
|
|
(43.7
|
)
|
|
(27
|
)
|
Gross profit
|
78.3
|
|
|
56.3
|
|
|
105
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Research and development
|
23.6
|
|
|
39.4
|
|
|
(12
|
)
|
Sales and marketing
|
33.1
|
|
|
45.1
|
|
|
8
|
|
General and administrative
|
24.6
|
|
|
45.2
|
|
|
(20
|
)
|
Amortization of purchased intangibles
|
3.0
|
|
|
4.7
|
|
|
(5
|
)
|
Total operating expenses
|
84.3
|
|
|
134.4
|
|
|
(8
|
)
|
Operating loss
|
(6.0
|
)
|
|
(78.1
|
)
|
|
(89
|
)
|
Other expense, net
|
(7.4
|
)
|
|
(17.5
|
)
|
|
(38
|
)
|
Loss before income taxes
|
(13.4
|
)
|
|
(95.6
|
)
|
|
(79
|
)
|
Income tax benefit
|
—
|
|
|
(1.8
|
)
|
|
(95
|
)
|
Net loss
|
(13.4
|
)%
|
|
(93.8
|
)%
|
|
(79
|
)%
|
|
Three Months Ended March 31,
|
|||||||||||||
|
|
|
Increase
|
|
Percent Increase
|
|||||||||
|
2019
|
|
2018
|
|
2018 to 2019
|
|
2018 to 2019
|
|||||||
Software licenses and appliances
|
$
|
1,005
|
|
|
$
|
451
|
|
|
$
|
554
|
|
|
123
|
%
|
Service
|
|
|
|
|
|
|
|
|||||||
Subscription, maintenance and support
|
5,563
|
|
|
4,038
|
|
|
1,525
|
|
|
38
|
|
|||
Professional services and other
|
530
|
|
|
342
|
|
|
188
|
|
|
55
|
|
|||
Total service
|
6,093
|
|
|
4,380
|
|
|
1,713
|
|
|
39
|
|
|||
Total revenues
|
$
|
7,098
|
|
|
$
|
4,831
|
|
|
$
|
2,267
|
|
|
47
|
%
|
|
Three Months Ended March 31,
|
|||||||||||||
|
|
|
Increase
|
|
Percent Increase
|
|||||||||
|
2019
|
|
2018
|
|
2018 to 2019
|
|
2018 to 2019
|
|||||||
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Software licenses and appliances
|
$
|
694
|
|
|
$
|
116
|
|
|
$
|
578
|
|
|
498
|
%
|
Service
|
4,867
|
|
|
2,603
|
|
|
2,264
|
|
|
87
|
|
|||
Total gross profit
|
$
|
5,561
|
|
|
$
|
2,719
|
|
|
$
|
2,842
|
|
|
105
|
%
|
|
|
|
|
|
|
|
|
|||||||
Gross margin:
|
|
|
|
|
|
|
|
|||||||
Software licenses and appliances
|
69.1
|
%
|
|
25.7
|
%
|
|
43.4
|
%
|
|
|
||||
Service
|
79.9
|
%
|
|
59.4
|
%
|
|
20.5
|
%
|
|
|
||||
Total gross margin
|
78.3
|
%
|
|
56.3
|
%
|
|
22.0
|
%
|
|
|
|
Three Months Ended March 31,
|
|||||||||||||
|
|
|
Increase (Decrease)
|
|
Percent Increase (Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
2018 to 2019
|
|
2018 to 2019
|
|||||||
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Research and development
|
$
|
1,674
|
|
|
$
|
1,903
|
|
|
$
|
(229
|
)
|
|
(12
|
)%
|
Sales and marketing
|
2,352
|
|
|
2,180
|
|
|
172
|
|
|
8
|
|
|||
General and administrative
|
1,746
|
|
|
2,181
|
|
|
(435
|
)
|
|
(20
|
)
|
|||
Amortization of purchased intangibles
|
218
|
|
|
229
|
|
|
(11
|
)
|
|
(5
|
)
|
|||
Total operating expenses
|
$
|
5,990
|
|
|
$
|
6,493
|
|
|
$
|
(503
|
)
|
|
(8
|
)%
|
|
Three Months Ended March 31,
|
|||||||||||||
|
|
|
Increase (Decrease)
|
|
Percent Increase (Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
2018 to 2019
|
|
2018 to 2019
|
|||||||
Compensation and employee-related
|
$
|
1,197
|
|
|
$
|
1,473
|
|
|
$
|
(276
|
)
|
|
(19
|
)%
|
Overhead and other expenses
|
335
|
|
|
301
|
|
|
34
|
|
|
11
|
|
|||
Outside services and consulting
|
108
|
|
|
85
|
|
|
23
|
|
|
27
|
|
|||
Depreciation and amortization
|
1
|
|
|
17
|
|
|
(16
|
)
|
|
(94
|
)
|
|||
Equity-based compensation
|
33
|
|
|
27
|
|
|
6
|
|
|
22
|
|
|||
Total research and development expenses
|
$
|
1,674
|
|
|
$
|
1,903
|
|
|
$
|
(229
|
)
|
|
(12
|
)%
|
|
Three Months Ended March 31,
|
|||||||||||||
|
|
|
Increase (Decrease)
|
|
Percent Increase (Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
2018 to 2019
|
|
2018 to 2019
|
|||||||
Compensation and employee-related
|
$
|
1,826
|
|
|
$
|
1,653
|
|
|
$
|
173
|
|
|
10
|
%
|
Overhead and other expenses
|
291
|
|
|
332
|
|
|
(41
|
)
|
|
(12
|
)
|
|||
Outside services and consulting
|
209
|
|
|
172
|
|
|
37
|
|
|
22
|
|
|||
Depreciation and amortization
|
1
|
|
|
6
|
|
|
(5
|
)
|
|
(83
|
)
|
|||
Equity-based compensation
|
25
|
|
|
17
|
|
|
8
|
|
|
47
|
|
|||
Total sales and marketing expenses
|
$
|
2,352
|
|
|
$
|
2,180
|
|
|
$
|
172
|
|
|
8
|
%
|
|
Three Months Ended March 31,
|
|||||||||||||
|
|
|
Increase (Decrease)
|
|
Percent Increase (Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
2018 to 2019
|
|
2018 to 2019
|
|||||||
Compensation and employee-related
|
$
|
719
|
|
|
$
|
795
|
|
|
$
|
(76
|
)
|
|
(10
|
)%
|
Overhead and other expenses
|
341
|
|
|
326
|
|
|
15
|
|
|
5
|
|
|||
Outside services and consulting
|
450
|
|
|
758
|
|
|
(308
|
)
|
|
(41
|
)
|
|||
Depreciation and amortization
|
71
|
|
|
146
|
|
|
(75
|
)
|
|
(51
|
)
|
|||
Equity-based compensation
|
165
|
|
|
156
|
|
|
9
|
|
|
6
|
|
|||
Total general and administrative expenses
|
$
|
1,746
|
|
|
$
|
2,181
|
|
|
$
|
(435
|
)
|
|
(20
|
)%
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Interest expense, net
|
$
|
(205
|
)
|
|
$
|
(844
|
)
|
Decrease (increase) in fair value of warrant liability
|
(289
|
)
|
|
387
|
|
||
Other, net
|
(31
|
)
|
|
(387
|
)
|
||
Total other income (expense), net
|
$
|
(525
|
)
|
|
$
|
(844
|
)
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
Cash and cash equivalents
|
$
|
8,571
|
|
|
$
|
8,636
|
|
Working capital
|
$
|
(3,583
|
)
|
|
$
|
865
|
|
Financing obligations
|
$
|
277
|
|
|
$
|
209
|
|
Operating lease liabilities
|
1,570
|
|
|
—
|
|
||
Term loan
|
3,559
|
|
|
3,431
|
|
||
Financing obligations, operating lease liabilities and term loan
|
$
|
5,406
|
|
|
$
|
3,640
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Cash flows provided by (used in):
|
|
|
|
|
|
||
Operating activities
|
$
|
17
|
|
|
$
|
(1,749
|
)
|
Investing activities
|
(14
|
)
|
|
(2
|
)
|
||
Financing activities
|
(116
|
)
|
|
574
|
|
||
Effect of exchange rate changes on cash
|
48
|
|
|
45
|
|
||
Net change in cash and cash equivalents
|
$
|
(65
|
)
|
|
$
|
(1,132
|
)
|
Monthly Period
|
|
Total Number of
Shares Purchased
|
|
Average Price
Paid per Share
|
|
Total Number of Shares Purchased as part of Publicly Announced Plans or Programs
|
|
Maximum Number of Shares that may yet be Purchased under the Plans or Programs (at end of period)
|
January 2019
|
|
—
|
|
$—
|
|
—
|
|
778,365
|
February 2019
|
|
357
|
|
$2.19
|
|
—
|
|
778,365
|
March 2019
|
|
14,534
|
|
$2.40
|
|
—
|
|
778,365
|
(a)
|
The following exhibits are included herein:
|
|
|
|
|
QUMU CORPORATION
|
|
|
|
|
Registrant
|
|
|
|
|
|
Date:
|
May 7, 2019
|
|
By:
|
/s/ Vernon J. Hanzlik
|
|
|
|
|
Vernon J. Hanzlik
|
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
Date:
|
May 7, 2019
|
|
By:
|
/s/ David G. Ristow
|
|
|
|
|
David G. Ristow
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
(Principal Accounting Officer)
|
1.
|
Recitals.
The above recitals are by this reference incorporated as if fully restated herein.
|
2.
|
Premises.
As of the Effective Date, the definition of "Premises" in Article I, Section 1.4 of the Lease is hereby amended and replaced as follows:
|
3.
|
Tenant's Pro Rata Share
. Section 1.13 of the Lease is amended to provide that, as of the Effective Date, the Tenant's Pro Rata Share is 10.13%.
|
4.
|
Contingency of Sublease Termination.
Tenant previously entered into a Sublease Agreement dated April 6, 2018 ("Sublease") with Sezzle, Inc. ("Subtenant") for the "Sublease Premises," as defined in the Sublease. This Third Amendment is conditioned upon and subject to the termination of the Sublease on the Effective Date and the Subtenant surrendering possession of the Sublease Premises pursuant to the requirements of the Sublease. If the Sublease is not terminated on or before the Effective Date, then this Third Amendment to Lease shall be of no further force or effect as of the Effective Date.
|
5.
|
Release of Excluded Premises and Related Claims.
As of the Effective Date, Tenant releases all right, title and interest in the Excluded Premises. Landlord and Tenant each hereby releases, remises and forever discharges the other and its respective officers, directors, employees, agents, parents, subsidiaries and affiliates from all debts, demands, actions, causes of action, suits, accounts, covenants, controversies, agreements, promises, judgments, demands, contracts, agreements, damages, claims and liabilities whatsoever,
|
6.
|
Lease
Affirmed;
Defined
Terms.
Except as expressly modified by this Amendment, all other terms and conditions of the Lease are hereby ratified and affirmed and remain in full force and effect. This Amendment, upon execution, constitutes a part of the Lease. All capitalized terms in this Amendment shall have the same meaning as given in the Lease unless otherwise specifically defined herein. However, where any terms and provisions of this Amendment conflict or are inconsistent with the Lease, then the terms and provisions of this Amendment shall govern, control, and prevail.
|
7.
|
Successors; Amendment; Execution.
This Amendment (a) shall be binding upon and will inure to the benefit of Landlord and Tenant and their respective legal representatives, successors and assigns; (b) may be modified or amended only if in writing and signed by each party hereto; and (c) may be executed in multiple counterpart and by facsimile or electronic signature, each of which shall, for all purposes, be deemed an original, but which together shall constitute one and the same instrument, and the signature pages from any counterpart may be appended to any other counterpart to assemble fully-executed documents.
|
LANDLORD: BUTLER NORTH LLC
|
|
TENANT: QUMU CORPORATION
|
||
|
|
|
|
|
By:
|
/s/ Ned Abdul
|
|
By:
|
/s/ David G. Ristow
|
Its:
|
Chief Manager
|
|
Its:
|
CFO
|
Date:
|
1/18/2019
|
|
Date:
|
1/18/2019
|
1.
|
I have reviewed this Form 10-Q of Qumu Corporation;
|
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; and
|
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.
|
|
|
|
|
Date:
|
May 7, 2019
|
/s/ Vernon J. Hanzlik
|
|
|
|
Vernon J. Hanzlik
|
|
|
|
President and Chief Executive Officer
|
|
1.
|
I have reviewed this Form 10-Q of Qumu Corporation;
|
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; and
|
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.
|
Date:
|
May 7, 2019
|
/s/ David G. Ristow
|
|
|
|
David G. Ristow
|
|
|
|
Chief Financial Officer
|
|
(1)
|
The accompanying Quarterly Report on Form 10-Q for the period ended
March 31, 2019
fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the accompanying report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
May 7, 2019
|
/s/ Vernon J. Hanzlik
|
|
|
|
Vernon J. Hanzlik
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
Date:
|
May 7, 2019
|
/s/ David G. Ristow
|
|
|
|
David G. Ristow
|
|
|
|
Chief Financial Officer
|
|