|
|
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
MARYLAND
|
|
39-1783372
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
Large accelerated filer
|
|
¨
|
|
Accelerated filer
|
|
¨
|
|
|
|
|
|
|
|
Non-accelerated filer
|
|
¨
|
|
Smaller reporting company
|
|
x
|
|
|
|
|
|
|
|
|
|
|
|
Emerging growth company
|
|
¨
|
Class
|
|
Outstanding
April 30, 2020
|
Common Stock, $0.01 par value
|
|
6,788,321
|
|
|
|
PAGE NO.
|
PART I
|
||
|
|
|
Item 1.
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
PART II
|
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 6.
|
||
|
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Product and other
|
$
|
2,812
|
|
|
$
|
1,796
|
|
|
$
|
4,867
|
|
|
$
|
3,547
|
|
Services
|
5,854
|
|
|
6,201
|
|
|
11,814
|
|
|
11,952
|
|
||||
Total revenue
|
8,666
|
|
|
7,997
|
|
|
16,681
|
|
|
15,499
|
|
||||
Cost of revenue:
|
|
|
|
|
|
|
|
||||||||
Product and other
|
1,158
|
|
|
645
|
|
|
1,989
|
|
|
1,296
|
|
||||
Services
|
1,247
|
|
|
1,359
|
|
|
2,595
|
|
|
2,550
|
|
||||
Total cost of revenue
|
2,405
|
|
|
2,004
|
|
|
4,584
|
|
|
3,846
|
|
||||
Gross margin
|
6,261
|
|
|
5,993
|
|
|
12,097
|
|
|
11,653
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Selling and marketing
|
3,057
|
|
|
3,836
|
|
|
6,453
|
|
|
7,779
|
|
||||
General and administrative
|
1,176
|
|
|
1,345
|
|
|
2,617
|
|
|
2,883
|
|
||||
Product development
|
1,499
|
|
|
1,935
|
|
|
3,089
|
|
|
3,768
|
|
||||
Total operating expenses
|
5,732
|
|
|
7,116
|
|
|
12,159
|
|
|
14,430
|
|
||||
Income (loss) from operations
|
529
|
|
|
(1,123
|
)
|
|
(62
|
)
|
|
(2,777
|
)
|
||||
Non-operating expenses:
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
(218
|
)
|
|
(227
|
)
|
|
(481
|
)
|
|
(381
|
)
|
||||
Other expense, net
|
(58
|
)
|
|
(11
|
)
|
|
(43
|
)
|
|
(3
|
)
|
||||
Total non-operating expenses
|
(276
|
)
|
|
(238
|
)
|
|
(524
|
)
|
|
(384
|
)
|
||||
Income (loss) before income taxes
|
253
|
|
|
(1,361
|
)
|
|
(586
|
)
|
|
(3,161
|
)
|
||||
Income tax expense
|
(158
|
)
|
|
(125
|
)
|
|
(139
|
)
|
|
(113
|
)
|
||||
Net income (loss)
|
$
|
95
|
|
|
$
|
(1,486
|
)
|
|
$
|
(725
|
)
|
|
$
|
(3,274
|
)
|
Dividends on preferred stock
|
—
|
|
|
(45
|
)
|
|
|
|
(98
|
)
|
|||||
Net income (loss) attributable to common stockholders
|
$
|
95
|
|
|
$
|
(1,531
|
)
|
|
$
|
(725
|
)
|
|
$
|
(3,372
|
)
|
Income (loss) per common share
|
|
|
|
|
|
|
|
||||||||
– basic
|
$
|
0.01
|
|
|
$
|
(0.29
|
)
|
|
$
|
(0.11
|
)
|
|
$
|
(0.64
|
)
|
– diluted
|
$
|
0.01
|
|
|
$
|
(0.29
|
)
|
|
$
|
(0.11
|
)
|
|
$
|
(0.64
|
)
|
Weighted average common shares
|
|
|
|
|
|
|
|
||||||||
– basic
|
6,785,180
|
|
|
5,278,500
|
|
|
6,760,779
|
|
|
5,232,449
|
|
||||
– diluted
|
6,933,227
|
|
|
5,278,500
|
|
|
6,760,779
|
|
|
5,232,449
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Net income (loss)
|
$
|
95
|
|
|
$
|
(1,486
|
)
|
|
$
|
(725
|
)
|
|
$
|
(3,274
|
)
|
Foreign currency translation adjustment
|
5
|
|
|
(17
|
)
|
|
(3
|
)
|
|
45
|
|
||||
Comprehensive income (loss)
|
$
|
100
|
|
|
$
|
(1,503
|
)
|
|
$
|
(728
|
)
|
|
$
|
(3,229
|
)
|
|
Preferred stock
|
|
Common
stock
|
|
Additional
paid-in
capital
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
loss
|
|
Receivable
for
common
stock issued
|
|
Treasury
stock
|
|
Total
|
||||||||||||||||
Balance, September 30, 2018
|
$
|
1,651
|
|
|
$
|
51
|
|
|
$
|
200,130
|
|
|
$
|
(207,419
|
)
|
|
$
|
(676
|
)
|
|
$
|
(26
|
)
|
|
$
|
(169
|
)
|
|
$
|
(6,458
|
)
|
Cumulative effect of ASC 606 adoption Note 6
|
—
|
|
|
—
|
|
|
—
|
|
|
1,691
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,691
|
|
||||||||
Adjusted balance, October 1, 2018
|
1,651
|
|
|
51
|
|
|
200,130
|
|
|
(205,728
|
)
|
|
(676
|
)
|
|
(26
|
)
|
|
(169
|
)
|
|
(4,767
|
)
|
||||||||
Stock compensation
|
—
|
|
|
—
|
|
|
220
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
220
|
|
||||||||
Issuance of common stock and warrants
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||||||
Warrants issued in connection with subordinated notes payable
|
—
|
|
|
—
|
|
|
674
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
674
|
|
||||||||
Conversion of preferred stock
|
(563
|
)
|
|
2
|
|
|
561
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Preferred stock dividends
|
99
|
|
|
—
|
|
|
(99
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45
|
|
|
—
|
|
|
—
|
|
|
45
|
|
||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,274
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,274
|
)
|
||||||||
Balance, March 31, 2019
|
$
|
1,187
|
|
|
$
|
53
|
|
|
$
|
201,490
|
|
|
$
|
(209,002
|
)
|
|
$
|
(631
|
)
|
|
$
|
(26
|
)
|
|
$
|
(169
|
)
|
|
$
|
(7,098
|
)
|
|
Preferred stock
|
|
Common
stock
|
|
Additional
paid-in
capital
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
loss
|
|
Receivable
for
common
stock issued
|
|
Treasury
stock
|
|
Total
|
||||||||||||||||
Balance, December 31, 2018
|
$
|
1,141
|
|
|
$
|
53
|
|
|
$
|
200,802
|
|
|
$
|
(207,516
|
)
|
|
$
|
(614
|
)
|
|
$
|
(26
|
)
|
|
$
|
(169
|
)
|
|
$
|
(6,329
|
)
|
Stock compensation
|
—
|
|
|
—
|
|
|
56
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
56
|
|
||||||||
Issuance of common stock and warrants
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||||||
Warrants issued in connection with subordinated notes payable
|
—
|
|
|
—
|
|
|
674
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
674
|
|
||||||||
Preferred stock dividends
|
46
|
|
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,486
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,486
|
)
|
||||||||
Balance, March 31, 2019
|
$
|
1,187
|
|
|
$
|
53
|
|
|
$
|
201,490
|
|
|
$
|
(209,002
|
)
|
|
$
|
(631
|
)
|
|
$
|
(26
|
)
|
|
$
|
(169
|
)
|
|
$
|
(7,098
|
)
|
|
Preferred stock
|
|
Common
stock
|
|
Additional
paid-in
capital
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
loss
|
|
Receivable
for
common
stock issued
|
|
Treasury
stock
|
|
Total
|
||||||||||||||||
Balance, September 30, 2019
|
—
|
|
|
$
|
67
|
|
|
203,735
|
|
|
(209,340
|
)
|
|
(546
|
)
|
|
—
|
|
|
(169
|
)
|
|
(6,253
|
)
|
|||||||
Stock compensation
|
—
|
|
|
—
|
|
|
86
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
86
|
|
||||||||
Issuance of common stock
|
—
|
|
|
1
|
|
|
63
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
64
|
|
||||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(725
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(725
|
)
|
||||||||
Balance, March 31, 2020
|
$
|
—
|
|
|
$
|
68
|
|
|
$
|
203,884
|
|
|
$
|
(210,065
|
)
|
|
$
|
(549
|
)
|
|
$
|
—
|
|
|
$
|
(169
|
)
|
|
$
|
(6,831
|
)
|
|
Preferred stock
|
|
Common
stock
|
|
Additional
paid-in
capital
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
loss
|
|
Receivable
for
common
stock issued
|
|
Treasury
stock
|
|
Total
|
||||||||||||||||
Balance, December 31, 2019
|
$
|
—
|
|
|
$
|
67
|
|
|
$
|
203,787
|
|
|
$
|
(210,160
|
)
|
|
$
|
(554
|
)
|
|
$
|
—
|
|
|
$
|
(169
|
)
|
|
$
|
(7,029
|
)
|
Stock compensation
|
—
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34
|
|
||||||||
Issuance of common stock
|
—
|
|
|
1
|
|
|
63
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
64
|
|
||||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
95
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
95
|
|
||||||||
Balance, March 31, 2020
|
$
|
—
|
|
|
$
|
68
|
|
|
$
|
203,884
|
|
|
$
|
(210,065
|
)
|
|
$
|
(549
|
)
|
|
$
|
—
|
|
|
$
|
(169
|
)
|
|
$
|
(6,831
|
)
|
|
Six Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Operating activities
|
|
|
|
||||
Net loss
|
(725
|
)
|
|
(3,274
|
)
|
||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
||||
Amortization of other intangibles
|
150
|
|
|
97
|
|
||
Depreciation and amortization of property and equipment
|
433
|
|
|
516
|
|
||
Provision for doubtful accounts - including financing receivables
|
9
|
|
|
26
|
|
||
Stock-based compensation expense related to stock options and warrants
|
86
|
|
|
219
|
|
||
Deferred loan interest to related party
|
264
|
|
|
—
|
|
||
Stock issued for board of director fees
|
64
|
|
|
—
|
|
||
Remeasurement loss (gain) on derivative liability
|
63
|
|
|
(7
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
175
|
|
|
1,354
|
|
||
Financing receivables
|
—
|
|
|
(2
|
)
|
||
Inventories
|
(45
|
)
|
|
(612
|
)
|
||
Investment in sales-type lease
|
126
|
|
|
—
|
|
||
Capitalized commissions
|
134
|
|
|
105
|
|
||
Prepaid expenses and other current assets
|
64
|
|
|
(25
|
)
|
||
Right-of-use assets under operating leases
|
562
|
|
|
—
|
|
||
Operating lease obligations
|
(578
|
)
|
|
—
|
|
||
Other long-term assets
|
4
|
|
|
—
|
|
||
Accounts payable and accrued liabilities
|
(162
|
)
|
|
89
|
|
||
Other long-term liabilities
|
(1
|
)
|
|
(33
|
)
|
||
Unearned revenue
|
57
|
|
|
(1,704
|
)
|
||
Net cash provided by (used in) operating activities
|
680
|
|
|
(3,251
|
)
|
||
Investing activities
|
|
|
|
||||
Purchases of property and equipment
|
(118
|
)
|
|
(222
|
)
|
||
Net cash used in investing activities
|
(118
|
)
|
|
(222
|
)
|
||
Financing activities
|
|
|
|
||||
Proceeds from notes payable
|
463
|
|
|
4,500
|
|
||
Proceeds from lines of credit
|
—
|
|
|
8,748
|
|
||
Payments on notes payable
|
(618
|
)
|
|
(333
|
)
|
||
Payments on lines of credit
|
—
|
|
|
(9,186
|
)
|
||
Payment of debt issuance costs
|
—
|
|
|
(110
|
)
|
||
Proceeds from issuance of preferred stock and common stock
|
—
|
|
|
5
|
|
||
Proceeds from exercise of common stock options
|
1
|
|
|
—
|
|
||
Payments on finance lease obligations
|
(124
|
)
|
|
(134
|
)
|
||
Net cash provided by (used in) financing activities
|
(278
|
)
|
|
3,490
|
|
||
Changes in cash and cash equivalents due to changes in foreign currency
|
7
|
|
|
(24
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
291
|
|
|
(7
|
)
|
||
Cash and cash equivalents at beginning of year
|
4,295
|
|
|
1,189
|
|
||
Cash and cash equivalents at end of period
|
$
|
4,586
|
|
|
$
|
1,182
|
|
Supplemental cash flow information:
|
|
|
|
||||
Interest paid
|
$
|
479
|
|
|
$
|
264
|
|
Income taxes paid, foreign
|
90
|
|
|
160
|
|
||
Non-cash financing and investing activities:
|
|
|
|
||||
Property and equipment financed by finance lease or accounts payable
|
821
|
|
|
112
|
|
||
Debt discount
|
—
|
|
|
676
|
|
||
Preferred stock dividends paid in additional shares
|
—
|
|
|
98
|
|
||
Conversion of preferred shares
|
—
|
|
|
563
|
|
1.
|
Basis of Presentation and Significant Accounting Policies
|
|
|
||
Investment in sales-type lease, gross:
|
|
||
2020
|
$
|
13
|
|
2021
|
147
|
|
|
2022
|
13
|
|
|
Gross investment in sales-type lease
|
173
|
|
|
Less: Unearned income
|
3
|
|
|
Total investment in sales-type lease
|
$
|
170
|
|
|
|
||
Current portion of total investment in sales-type lease
|
$
|
11
|
|
Long-term portion of total investment in sales-type lease
|
159
|
|
|
|
$
|
170
|
|
|
March 31,
2020 |
|
September 30, 2019
|
||||
Raw materials and supplies
|
$
|
230
|
|
|
$
|
163
|
|
Finished goods
|
402
|
|
|
395
|
|
||
Less: Obsolescence reserve
|
(30
|
)
|
|
—
|
|
||
|
$
|
602
|
|
|
$
|
558
|
|
March 31, 2020
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total Fair Value
|
||||||||
Derivative liability
|
|
$
|
—
|
|
|
$
|
72
|
|
|
$
|
—
|
|
|
$
|
72
|
|
September 30, 2019
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total Fair Value
|
||||||||
Derivative liability
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
Options
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-Average
Remaining Contractual
Period in Years
|
|||
Outstanding at October 1, 2019
|
1,654,429
|
|
|
$
|
5.62
|
|
|
4.9
|
Granted
|
184,750
|
|
|
1.18
|
|
|
9.6
|
|
Exercised
|
(1,000
|
)
|
|
0.66
|
|
|
8.7
|
|
Forfeited
|
(54,700
|
)
|
|
4.07
|
|
|
4.3
|
|
Outstanding at March 31, 2020
|
1,783,479
|
|
|
5.20
|
|
|
4.9
|
|
Exercisable at March 31, 2020
|
1,416,998
|
|
|
6.21
|
|
|
3.8
|
Non-vested Options
|
Options
|
|
Weighted-Average
Grant Date Fair
Value
|
|||
Non-vested at October 1, 2019
|
357,114
|
|
|
$
|
0.77
|
|
Granted
|
184,750
|
|
|
0.51
|
|
|
Vested
|
(153,049
|
)
|
|
0.97
|
|
|
Forfeited
|
(22,334
|
)
|
|
0.55
|
|
|
Non-vested at March 31, 2020
|
366,481
|
|
|
$
|
0.57
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended March 31,
|
||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||
Denominator for basic net income (loss) per share - weighted average common shares
|
6,785,180
|
|
|
5,278,500
|
|
|
6,760,779
|
|
|
5,232,449
|
|
Effect of dilutive options (treasury method)
|
148,047
|
|
|
—
|
|
—
|
|
—
|
|||
Denominator for diluted net income (loss) per share - adjusted weighted average common shares
|
6,933,227
|
|
|
5,278,500
|
|
|
6,760,779
|
|
|
5,232,449
|
|
Options, warrants and convertible shares outstanding during each period, but not included in the computation of diluted net loss per share because they are antidilutive
|
1,933,990
|
|
|
2,076,083
|
|
|
2,082,037
|
|
|
2,076,083
|
|
|
Operating Leases
|
|
Finance Leases
|
||||
2020 (remaining)
|
$
|
688
|
|
|
$
|
88
|
|
2021
|
1,026
|
|
|
128
|
|
||
2022
|
292
|
|
|
79
|
|
||
2023
|
94
|
|
|
8
|
|
||
2024
|
102
|
|
|
5
|
|
||
Thereafter
|
101
|
|
|
—
|
|
||
Total
|
2,303
|
|
|
308
|
|
||
Less: imputed interest
|
(303
|
)
|
|
(23
|
)
|
||
Total
|
$
|
2,000
|
|
|
$
|
285
|
|
|
As reported
|
|
ASC 842 adoption
|
|
Adjusted
|
||||||
|
September 30, 2019
|
|
adjustments
|
|
October 1, 2019
|
||||||
Right-of-use assets under operating leases
|
—
|
|
|
2,533
|
|
|
2,533
|
|
|||
Total assets
|
$
|
15,180
|
|
|
$
|
2,533
|
|
|
$
|
17,713
|
|
|
|
|
|
|
|
||||||
Current portion of operating lease obligations
|
$
|
—
|
|
|
$
|
1,314
|
|
|
$
|
1,314
|
|
Accrued liabilities
|
2,216
|
|
|
(44
|
)
|
|
2,172
|
|
|||
Total current liabilities
|
13,831
|
|
|
1,270
|
|
|
15,101
|
|
|||
|
|
|
|
|
|
||||||
Long-term portion of operating lease obligations
|
—
|
|
|
1,263
|
|
|
1,263
|
|
|||
Total liabilities
|
$
|
21,433
|
|
|
$
|
2,533
|
|
|
$
|
23,966
|
|
|
|
Six Months Ended March 31, 2020
|
||
Operating lease costs
|
|
$
|
662
|
|
Variable operating lease costs
|
|
29
|
|
|
Total operating lease cost
|
|
$
|
691
|
|
|
|
|
||
Finance lease cost:
|
|
|
||
Amortization of right-of-use assets
|
|
$
|
106
|
|
Interest on lease liabilities
|
|
12
|
|
|
Total finance lease cost
|
|
$
|
118
|
|
|
|
March 31, 2020
|
|
Weighted average remaining lease term (in years)
|
|
|
|
Operating leases
|
|
2.6
|
|
Finance leases
|
|
2.3
|
|
Weighted average discount rate
|
|
|
|
Operating leases
|
|
11.82
|
%
|
Finance leases
|
|
7.14
|
%
|
•
|
Product and other revenue from sale of Mediasite recorder units and server software was $2.8 million in Q2-2020 and $1.8 million in Q2-2019. Average selling price was lower in Q2-2020 as compared to Q2-2019 primarily as a result of a higher sales volume of low-cost recorders. Production and other revenue in Q2-2020 included a large refresh recorder transaction while Q2-2019 was negatively impacted by our planned reduced reliance on distribution.
|
|
Q2-2020
|
|
Q2-2019
|
||||
Recorders sold
|
369
|
|
|
131
|
|
||
Rack units to mobile units ratio
|
25.4 to 1
|
|
|
3.4 to 1
|
|
||
Average sales price, excluding service (000’s)
|
$
|
4.7
|
|
|
$
|
7.5
|
|
Refresh Units
|
58
|
|
|
70
|
|
•
|
Services revenue represents the portion of fees charged for Mediasite customer support contracts amortized over the length of the contract, typically 12 months, as well as training, installation, events and content hosting services. Services revenue decreased $347 thousand or 6% from $6.2 million in Q2-2019 to $5.9 million in Q2-2020 primarily due to cancellations in event services due to COVID-19.
|
•
|
At March 31, 2020, $11.5 million of revenue was deferred, of which we expect to recognize $9.5 million in the next twelve months, including approximately $3.6 million in the quarter ending June 30, 2020. At September 30, 2019, $11.5 million of revenue was deferred.
|
•
|
Other revenue relates to freight charges billed separately to our customers.
|
•
|
$4.9 million product and other revenue from the sale of 572 Mediasite recorders and software during YTD-2020 versus $3.5 million from the delivery of 235 Mediasite recorders and software in YTD-2019. Recorders sold were substantially more than YTD-2019, partially due to a large refresh order in Q2-2020 and our planned reduced reliance on distribution.
|
•
|
$11.8 million from Mediasite customer support contracts, installation, training, events and hosting services versus $12.0 million in 2019.
|
•
|
Material and freight costs for the Mediasite recorders. Costs for Q2-2020 Mediasite recorder hardware and other costs totaled $453 thousand, along with $37 thousand of freight costs, and $645 thousand of labor and allocated costs, compared to Q2-2019 Mediasite recorder costs of $233 thousand for hardware and other costs, $50 thousand for freight and $383 thousand of labor and allocated costs. This resulted in gross margin on products of 59% in Q2-2020 and 64% in Q2-2019.
|
•
|
Services costs. Staff wages and other costs allocated to cost of service revenue were $1.2 million in Q2-2020 and $1.4 million in Q2-2019, resulting in gross margin on services of 79% in Q2-2020 and 78% in Q2-2019.
|
•
|
Material and freight costs for the Mediasite recorders. Costs for YTD-2020 Mediasite recorder hardware and other costs totaled $600 thousand, along with $58 thousand of freight costs, and $1,289 thousand of labor and allocated costs, compared to YTD-2019 Mediasite recorder costs of $491 thousand for hardware and other costs, $103 thousand for freight and $775 thousand of labor and allocated costs. This resulted in gross margin on products of 59% in YTD-2020 and 63% in YTD-2019.
|
•
|
Service costs. Staff wages and other costs allocated to cost of service revenue were $2.6 million in YTD-2020 and $2.6 million in YTD-2019, resulting in gross margin on services of 78% in YTD-2020 and 79% in YTD-2019.
|
•
|
Salary, commissions, and benefits expense decreased by $392 thousand as a result of reduced headcount.
|
•
|
Travel expenses, including entertainment and meals, decreased by $153 thousand.
|
•
|
Selling and marketing expenses for Sonic Foundry International and Mediasite KK accounted for $143 thousand and $615 thousand respectively, an aggregate decrease of $51 thousand from Q2-2019.
|
•
|
Salary, commissions, and benefits expense decreased by $736 thousand as a result of reduced headcount.
|
•
|
Travel expenses, including entertainment and meals, decreased by $308 thousand.
|
•
|
Selling and marketing expenses for Sonic Foundry International and Mediasite KK accounted for $281 thousand and $1,337 thousand, respectively, an aggregate decrease of $43 thousand from YTD-2019.
|
•
|
Decrease in compensation and benefits of $81 thousand as a result of reduced headcount.
|
•
|
Professional services increased by $72 thousand primarily due to increase in legal and advisory fees.
|
•
|
G&A expenses for Sonic Foundry International and Mediasite KK accounted for $13 thousand and $185 thousand respectively, an aggregate decrease of $78 thousand from Q2-2019.
|
•
|
Decrease in compensation and benefits of $356 thousand as a result of reduced headcount.
|
•
|
Professional services increased by $172 thousand primarily due to an increase in legal and advisory fees.
|
•
|
G&A expenses for Sonic Foundry International and Mediasite KK accounted for $30 thousand and $425 thousand respectively, an aggregate decrease of $71 thousand from YTD-2019.
|
•
|
Decrease in compensation and benefits of $341 thousand as a result of reduced headcount.
|
•
|
Decrease in professional services of $41 thousand.
|
•
|
Product development expense for Sonic Foundry International and Mediasite KK accounted for $108 thousand and $76 thousand respectively, an aggregate decrease of $24 thousand compared to Q2-2019.
|
•
|
Decrease in compensation and benefits of $463 thousand related primarily to an increase in compensation rates and the cost of benefits.
|
•
|
Decrease in professional services of $50 thousand, due to decreased use of outsourced development.
|
•
|
Product development expense for Sonic Foundry International and Mediasite KK accounted for $226 thousand and $146 thousand respectively, an aggregate decrease of $31 thousand compared to YTD-2019.
|
NUMBER
|
|
DESCRIPTION
|
|
3.1
|
|
|
|
|
|
|
|
3.2
|
|
|
|
|
|
|
|
3.3
|
|
|
|
|
|
|
|
3.4
|
|
|
|
|
|
|
|
3.5
|
|
|
|
|
|
|
|
10.1*
|
|
|
|
|
|
|
|
10.2*
|
|
|
|
|
|
|
|
10.3*
|
|
|
|
|
|
|
|
10.4
|
|
|
|
|
|
|
|
10.5*
|
|
|
|
10.6
|
|
|
Forms of Subscription Agreements, Lock-Up Agreements and Warrant Agreements dated December 22, 2014 among Sonic Foundry, Inc. and Mark Burish, and Sonic Foundry, Inc. and Andrew Burish, filed as Exhibits 10.1, 10.2, and 10.3 to the Form 8-K filed on December 30, 2014 and hereby incorporated by reference.
|
|
|
|
|
10.7
|
|
|
|
|
|
|
|
10.8
|
|
|
|
|
|
|
|
10.9
|
|
|
|
|
|
|
|
10.10
|
|
|
|
|
|
|
10.11
|
|
|
|
|
|
|
|
10.12
|
|
|
|
|
|
|
|
10.13
|
|
|
|
|
|
|
|
10.14
|
|
|
|
|
|
|
|
10.15
|
|
|
|
|
|
|
|
10.16
|
|
|
|
|
|
|
|
10.17
|
|
|
|
|
|
|
|
10.18
|
|
|
|
|
|
|
|
10.19
|
|
|
|
|
|
|
|
10.20
|
|
|
|
|
|
|
|
10.21
|
|
|
|
|
|
|
|
10.22
|
|
|
|
|
|
|
|
10.23
|
|
|
|
|
|
|
|
10.24
|
|
|
|
|
|
|
|
10.25
|
|
|
|
|
|
|
|
10.26
|
|
|
|
|
|
|
|
10.27
|
|
|
|
|
|
|
|
10.28
|
|
|
|
|
|
|
|
10.29
|
|
|
|
|
|
|
|
10.30
|
|
|
|
|
|
|
|
10.31
|
|
|
|
|
|
|
|
10.32
|
|
|
|
|
|
|
|
10.33
|
|
|
|
|
|
|
10.34
|
|
|
|
|
|
|
|
10.35
|
|
|
|
|
|
|
|
10.36
|
|
|
|
|
|
|
|
10.37
|
|
|
|
|
|
|
|
10.38
|
|
|
|
|
|
|
|
10.39
|
|
|
|
|
|
|
|
10.40
|
|
|
|
|
|
|
|
10.41
|
|
|
|
|
|
|
|
10.42
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
|
|
|
32
|
|
|
|
|
|
|
|
101
|
|
|
The following materials from the Sonic Foundry, Inc. Form 10-Q for the quarter ended March 31, 2020 formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Balance Sheets, (iii) the Condensed Consolidated Statement of Comprehensive Income (Loss), (iv) the Condensed Consolidated Statements of Stockholders' Deficit, (v) the Condensed Consolidated Statements of Cash Flows and (vi) Notes to Condensed Consolidated Financial Statements.
|
*
|
Compensatory Plan or Arrangement
|
|
|
|
|
|
May 14, 2020
|
|
By:
|
|
/s/ Michael Norregaard
|
|
|
|
|
Michael Norregaard
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
|
May 14, 2020
|
|
By:
|
|
/s/ Kenneth A. Minor
|
|
|
|
|
Kenneth A. Minor
|
|
|
|
|
Interim Chief Financial Officer
|
Name
|
Kase Building 2F Room No.202
|
Location
|
19-17 1-chome Sumiyoshi Koto-ku Tokyo
|
Structure/Size
|
Steel frame 4-story Building
|
Lease Space
|
Occupied area 28.16㎡
|
Rent
|
Monthly 80,000 yen
|
CAM
|
Monthly -
|
Security Deposit
|
80,000 yen
|
|
-
|
Guarantee Money
|
-
|
|
-
|
Remuneration
|
-
|
|
-
|
Renewal fee
|
New Rent 1 month
|
Cancellation
|
1 month before
|
Contract term
|
November 2, 2019 ~ November 1, 2021
|
Inhabitant
|
Name
|
Age
|
Relation
|
Workplace - School
|
Shuji Sakamoto
|
51
|
Himself
|
Mediasite K.K.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receiving Account
|
Name of Bank
|
The Tokyo Higashi Shinkin Bank Sumiyoshi Branch
|
||
Type of Account
|
Ordinary Account
|
Account No.
|
16860
|
|
Phonetic Transcription
|
|
|||
Account Holder
|
Sanji Kase
|
■ Bank transfer of Rent for the following month to above account (bank commission to be paid by B)
|
●B shall bear the following amount of cleaning cost for occupied space at the time of quit and surrender.
Actual cost
●Any matter not stipulated in this Contract shall follow former contractual clauses.
●B shall bear the cost of removing cigarette tar stain and odor, which cannot be handled by regular cleaning process.
●It is prohibited to keep pets or bring in and use(play)the piano.
●It is prohibited to use oil stove and bring its fuel (kerosene) in to the housing space.
|
Lessor【A】
|
Address
|
1-19-17 Sumiyoshi Koto-ku Tokyo
|
||
Name
|
Sanji Kato
|
TEL No.
|
03-3631-0575
|
Lessee【B】
|
Address
|
8F Shinbashi-Sumitomo Building 5-11-3 Shinbashi Minato-ku Tokyo
|
||
Phonetic Signs
|
|
TEL No.
|
03 – 6452 - 9043
|
|
Name
|
Mediasite K.K.
Hisatoshi Nakagawa, Rep. Director
|
Mobile No.
|
- -
|
|
e-mail
|
|
|||
Workplace
|
|
TEL No.
|
- -
|
|
Location
|
|
Joint/Several Guarantor
|
Address
|
|
||
Phonetic Signs
|
|
TEL No.
|
- -
|
|
Name
|
Registered stamp
|
Mobile No.
|
- -
|
|
Relationship
|
|
|||
Workplace
|
|
TEL No.
|
- -
|
|
Location
|
|
Emergency Contact
|
Address
|
8F Shinbashi-Sumitomo Building 5-11-3 Shinbashi Minato-ku Tokyo
|
||
Phonetic Signs
|
|
TEL No.
|
03 – 6452 - 9043
|
|
Name
|
Mediasite K.K.
Hisatoshi Nakagwa Rep. Director
|
Mobile No.
|
- -
|
|
Relationship
|
|
|||
Workplace
|
|
TEL. No.
|
- -
|
|
Location
|
|
Maintenance
Company
|
Location
|
Lessor’s own maintenance
|
|
貸主自主管理
|
Name
|
|
|
|
|
Contact
|
|
|
|
Receipt of Keys
|
maker
|
|
Number
|
Key No
|
|
Maker
|
|
Number
|
Key No
|
|
We will return the keys upon quit and surrender. Should they get lost, we assure you we will bear replacement costs of the cylinder keys.
|
||||||||||
Duly received above keys:
Date Month Year stamp
|
(1)
|
Tenant shall use Lease Premises as the office or studio only for videotaping/recording lectures and promoting distribution and sale services as well as system development and shall not use it for any other purpose than that.
|
(2)
|
If Tenant wishes to change the purpose of its use, it must obtain Lessor’s written approval in advance.
|
(1)
|
The term of the lease under this Agreement shall be from April 1, 2014 to March 31, 2016.
|
(2)
|
The Agreement shall be renewed for additional two (2) years from the next day of the expiration of the term of this Agreement, unless either of Lessor or Tenant
|
(1)
|
Tenant shall pay to Lessor monthly rent of 94, 300 yen (hereinafter referred to “Rent”).
|
(2)
|
Tenant shall pay the Rent for the following month by 25th of each month by the method designated by Lessor. However, for the initial month of the conclusion of this Agreement, payment shall be made simultaneously with the conclusion of this Agreement,
|
(3)
|
If the lease period is less than one month at the beginning of this Agreement, the Rent shall be calculated on a pro-rated basis with one month being 30 days.
|
(4)
|
If the lease period is less than one month at the end of this Agreement, Tenant shall pay the Rent in full.
|
(1)
|
Lessor may revise the Rent and CAM if they become unreasonable in comparison with other rents of neighboring buildings, or as a result of Lessor’s increased economic burden, resulting from revision of relevant laws and regulations, economic conditions, alteration or improvement of facilities, increased taxes and levies imposed or any other reasons.
|
(2)
|
When this Agreement is renewed pursuant to Clause 3 (2), the Rent shall be increased by ten (10) percent.
|
1.
|
Electricity costs, costs of gas and water (tap and sewage)
|
2.
|
Air-conditioning cost to be charged after meter measurement.
|
3.
|
Cleaning cost of Lease Premises
|
4.
|
Maintenance and management costs of fixtures, facilities and equipment belonging to Tenant’s ownership. If Lessor pays such costs for Tenant’s sake, Tenant shall immediately reimburse them upon request and by the method designated by Lessor.
|
(1)
|
Real estate acquisition tax and/or property tax imposed on fixtures and appurtenant facilities under Tenant’s ownership shall be borne by Tenant, regardless of taxable name.
|
(2)
|
If above taxes are imposed to Lessor in an inseparable manner and as part of overall taxes for the principal structure of the Building, Lessor shall prorate the corresponding taxes based on the Tenant’s submitted construction costs and charge them to Tenant in writing.
|
(3)
|
When above taxes are charge by Lessor, Tenant shall pay the amount of those taxes by the method designate by Lessor, without any objection and delay.
|
(1)
|
Tenant shall deposit 400,000 yen to Lessor to secure the full performance of any and all obligations owed by Tenant under this Agreement and arising from its implementation thereof, at the time of conclusion of this Agreement, and by the method designated by Lessor. However, no interest on this Security Deposit shall be payable from Lessor.
|
(2)
|
Tenant shall not demand to set off or apply the Security Deposit against the Rent or any other obligations under this Agreement.
|
(3)
|
If Tenant delays or default to pay any obligations to Lessor, Lessor may apply all or any of the Security Deposit in the preceding paragraph for the fulfillment of such obligations, at any time and without prior notice to Tenant. In such case, Lessor shall notify Tenant of the application of the Security Deposit without delay. Upon receipt of such notification, Tenant shall deposit again the amount equivalent to the resulting deficit of the Security Deposit within five (5) days from the receipt of such notification
|
(4)
|
When this Agreement terminates, and Lessor acknowledges that Tenant has completed the surrender of the Lease Premises and has performed any other obligations, Lessor shall refund to Tenant the balance of the Security Deposit after deducting Tenant’s remaining obligations and in exchange of
|
(5)
|
Tenant shall not assign, pledge the reclaiming right to the Security Deposit to any third party.
|
(1)
|
Tenant must occupy and use Lease Premises as well as common areas like the entrance of the Building, staircases, elevators by well complying with the Building’s in-house rules and regulations established by Lessor, and with due care as a good faith manager. When such rules and regulations are added or modified by Lessor, Tenant shall approve and observe such changes without raising any objection.
|
(2)
|
Tenant shall, under its own responsibility, take all necessary measures during its use of the Lease Premises, relating to the maintenance of security, prevention of fire and so forth.
|
(3)
|
Tenant shall safely and strictly take custody of keys of the Lease Premises, lent by Lessor, and shall return them to Lessor at the time of termination of this Agreement.
|
1.
|
To assign or pledge part or whole of the leasing right to any third party.
|
2.
|
To sublet part or whole of the Lease Premises to any third party.
|
3.
|
To let any third party to use the Lease Premises by such method of outsourcing or other contractual arrangement or to use the Lease Premises as their nominal address of residence or business office for any third party.
|
4.
|
To show the name of any third party on the door of the Lease Premises, or install a telephone under the name of any third party.
|
5.
|
To stay overnight or reside in the Lease Premises or let any third party to stay overnight or reside.
|
6.
|
To cook food in the Building
|
7.
|
To bring into the Lease Premises animals or things which might cause fire, explosion, vibration, odor, noise or any other annoyance to others.
|
8.
|
To place any appliance or equipment in common areas, obstructing smooth passage or use by Lessor or other tenants.
|
9.
|
To commit any other act which might cause annoyance to other tenants or inflict damage to the Building for its maintenance.
|
1.
|
To change the purpose of use of the Lease Premises
|
2.
|
To refurbish the inside of the Lease Premises (including repainting of walls, ceilings or, floors) and to install, transfer, remove appurtenant facilities or to carry out other work to modify the present state
|
3.
|
To repair, install, transfer, remove or modify the present state of apparatuses relating to
|
4.
|
To bring into the Lease Premises or transfer a safe deposit box, heavy furniture like steel cabinets, large or tall equipment, or machines with high electric capacity like computers.
|
5.
|
To install, attach, or show signs, advertisements, signals in the Lease Premises, regardless of the inside or outside.
|
6.
|
To take any other actions similar to the above to modify the present state of the Lease Premises or the Building.
|
(1)
|
If Tenant wishes to carry out works pursuant to the preceding clause, Tenant shall submit application for approval from Lessor for the execution of works in writing before its start, and obtain its prior approval in writing. This application must attach design drawings, specifications and cost estimates of the works. Tennant must report the final costs incurred relating to the works to Lessor after completion.
|
(2)
|
If Tenants executes works different from design drawings and specifications approved by Lessor or executes works without Lessor’s approval, then Lessor may order to stop works and cause Tenant to restore the original state of the works executed at the cost of Tenant.
|
(1)
|
If Tenant becomes aware of the damage or breakdown of the principal structure of the Building, fixtures or appurtenant facilities under Lessor’s ownership or the high possibility of such damage or breakdown, Tenant shall promptly Lessor thereof.
|
(2)
|
Lessor shall carry out, at its own cost, repair of the principal structure of the Building, fixtures or appurtenant facilities necessary for their maintenance and preservation. Provided, however, that Tenant shall bear the cost for the repair work if such damage or breakdown has resulted from the cause attributable to Tenant, or if such work is carried out in the Lease Premises, regardless of the whatsoever the cause.
|
(3)
|
If there arises the need for Lessor to suspend leasing part or whole of the Lease Premise or common areas to carry out work for repair, alteration or improvement, Tenant must accept Lessor’s request for cooperation. In such case, Tenant shall not demand to Lessor any compensation regardless of name and reason.
|
(1)
|
If and when Lessor, its designee or other party associated with Lessor deems necessary to enter into the Lease Premises for the purpose of preservation, sanitation, prevention of fire or crime, or maintenance or operation of the Building, it may enter into, inspect the same and take all and any appropriate actions after giving prior notice to Tenant. In such case, Tenant must cooperate with Lessor without any objection.
|
(2)
|
Notwithstanding above, Lessor, in the case of emergency, may enter into the Lease Premises without advance notice and take actions and measures as provided in the preceding paragraph. But in such case, Lessor shall notify Tenant of its entry thereafter.
|
(1)
|
If either Lessor or Tenant elects to terminate this Agreement during term of the lease, it shall advise to the other party to that effect, at least six (6) month’s prior written notice. Provided, however, that Tenant may terminate this Agreement with immediate effect by paying the amount equivalent to six (6) months’ Rent to Lessor.
|
(2)
|
If this Agreement is terminated by any reason attributable to Tenant’s liability, Tenant must pay to Lessor breach-of-contract damage amounting to the same in the preceding paragraph (1).
|
(3)
|
Once Tenant sends early termination notice to Lessor, Tenant may not revoke it, unless Lessor agrees otherwise.
|
(4)
|
During the period from the time either Lessor or Tenant sends early termination notice to the other party, to the time this Agreement is terminated, if a new tenant candidate wishes to confirm the inside of the Lease Premises, Tenant must accept it without objection.
|
(1)
|
If Tenant is delinquent of the payment of the Rent or CAM for more than one (1) month or Tenant fails to pay other obligations to Lessor within the prescribed period
|
(2)
|
If Tenant changes the purpose of use of the Lease Premises without Lessor’s approval
|
(3)
|
If Tenant abandons the Lease Premises for more than one (1) month without any justifiable reasons
|
(4)
|
If Tenant neglects to deposit or to fill up the deficit under Clause 9(3)
|
(5)
|
If Tenant breaches any provision in Clause 12 and 13
|
(6)
|
If Tenant or its employee gives substantial damage on the Lease Premises or cause fire, either intentionally or by negligence
|
(7)
|
If Tenant alters its organization or type of business and Lessor acknowledges it as significant change of corporate status
|
(8)
|
If a petition of the commencement of temporary foreclosure, temporary disposal, foreclosure, auction as well as bankruptcy, corporate rehabilitation, special liquidation, winding-up or other and similar legal proceeding is filed by or against Tenant
|
(9)
|
If tenant is a natural person and he/she is adjudged to be placed under start of guardianship, ward or assistance or is sentenced by court to be guilty with penalty of more than imprisonment
|
(1)
|
If Tenant, its employee, or other person associated with Tenant inflicts damage on other tenants or general customers in the Building, Tenant must compensate for the said damages, at its own cost and responsibility.
|
(2)
|
When Tenant is inflicted damage by an act of a third party including other tenants, Tenant may not demand any compensation to Lessor.
|
(1)
|
Lessor shall be exculpated from any liability if Tenant suffers any loss or damage due to reasons listed hereunder:
|
1)
|
Earthquake, fire, flood, storm or other natural disasters under force majeure
|
2)
|
Breakdown of appurtenant, unforeseen accidents, theft and other cases not attributable to Lessor’s liability
|
3)
|
Lessor’s observance of laws and regulations, instructions or administrative guidance from competent authority, relating to cases like saving of electricity or fuel
|
4)
|
Any other force majeure events
|
(2)
|
In addition to above, Lessor shall not be held liable for compensation for any loss or damage Tenant has suffered arising from temporary closure or restriction on use of the Lease Premises due to Lessor’s inspection, maintenance or repair work of the principal structure of the Building, fixtures and appurtenant facilities under Lessor’s ownership.
|
(1)
|
Upon expiration, rescission, cancellation or termination due to other reason under this Agreement, Tenant shall quit and surrender the Lease Premises to Lessor, after restoring the Lease Premises to its original conditions as of the time of Tenant’s entering.
|
(2)
|
If Tenant fails to restore the Lease Premises to the original conditions, Lessor may cause the restoration work to be performed at the cost of Tenant, and Tenant shall not raise any objection against it.
|
(3)
|
With respect to any fixtures, equipment or other properties, left by Lessor in the Lease Premises, the ownership of the said properties shall be transferred to Lessor at no cost to Lessor, on the following day of the expiration of this Agreement. Lessor may dispose of them at its own discretion and at the cost of Tenant.
|
(4)
|
Lessor may deduct costs and expenses to be borne by Tenant in accordance with above (2) and (3), from the Security Deposit under Clause 9, return to Tenant the balance of Security Deposit after deduction as provided in Clause 9(4).
|
(5)
|
Tenant shall not, while surrendering the Lease Premises, demand recoupment of the costs and expenses disbursed for the fixtures and appurtenant facilities in the Lease Premises, or compensation for moving expense, surrender cost, lost business and goodwill, or any other monetary claims, under whatsoever title or name, as well as may not require Lessor to purchase fixtures and facilities affixed to the Lease Premises at the cost of Tenant.
|
(1)
|
A joint-and-several guarantor (hereinafter to be referred to as “Guarantor “) shall jointly and severally perform any and all obligations owed by Tenant under this Agreement.
|
(2)
|
The same shall apply if this Agreement is renewed pursuant to Clause 3(2).
|
(3)
|
If Guarantor’s asset significantly reduces or Guarantor’s social standing or residence change, Tenant shall immediately notify Lessor in writing to that effect. In such case, if Lessor deemed Guarantor as being disqualified, Tenant shall secure a different joint-and-several guarantor that Lessor agrees.
|
1.
|
This contract on special provisions is concluded between Lessor and Tenant to confirm and add mutual agreement on special provisions attached to original Agreement, in consideration of the fact that Lessor took over the contractual position as the lessor of the Building from Maida Juken K.K. (hereinafter referred to as “Preceding Lessor”).
|
2.
|
Payment method of the Rent and CAM shall be as follows:
|
1)
|
Tenant shall pay the Rent and CAM for the following month by the end of each month to the bank account designated by Lessor using automatic bank account transfer contract with the bank.
|
2)
|
Receiving bank: RESONA Bank, Esaka Branch
|
3)
|
Name of account holder: Maida Housing Corporation
|
3.
|
Tenant shall bear consumption tax separately.
|
4.
|
Bank commission with regard to the payment of the Rent or other expenses shall be borne by Tenant.
|
5.
|
Refund of the Security Deposit in accordance with Clause 9 (4) shall be made by bank account transfer and its bank commission shall be borne by Tenant.
|
6.
|
Tenant shall take a fire insurance designated by Lessor at its own cost.
|
7.
|
Upon termination of this Agreement, Tenant shall remove fixtures and appurtenant facilities constructed by Tenant and other properties or items installed by Tenant and restore the Leased Premises to the original conditions at the time Preceding Lessor delivered the Leased Premises.
|
8.
|
Lessor and Tenant confirm that the cash amount of Security Deposit stipulated in Clause 9 was handed over from Preceding Lessor to Lessor.
|
9.
|
Clause 6(2) shall be reread as follows:
|
Branch No.
|
Account No.
|
Loan No.
|
Settlement Account
(1: Current 2: Ordinary)
|
Rate
|
Date of Loan
|
Amount of Loan
|
Interest by the 1st repayment
|
|||
653
|
206135
|
90259
|
2
|
|
7937455
|
1.475
|
%
|
01/30/2020
|
¥50,000,000
|
yen
|
Number
|
Date of Repayment
|
|
Repayment Amount
|
Interest portion
|
Principal portion
|
Loan Balance
|
|||||||
Year
|
Month
|
day
|
|
(Total)
|
|||||||||
1
|
|
2
|
1
|
31
|
|
4,224,416
|
|
57,416
|
|
4,167,000
|
|
45,833,000
|
|
2
|
|
2
|
3
|
2
|
|
4,215,829
|
|
48,829
|
|
4,167,000
|
|
41,666,000
|
|
3
|
|
2
|
3
|
31
|
|
4,212,461
|
|
45,461
|
|
4,167,000
|
|
37,499,000
|
|
4
|
|
2
|
4
|
30
|
|
4,210,103
|
|
43,103
|
|
4,167,000
|
|
33,332,000
|
|
5
|
|
2
|
6
|
1
|
|
4,201,178
|
|
34,178
|
|
4,167,000
|
|
29,165,000
|
|
6
|
|
2
|
6
|
30
|
|
4,198,315
|
|
31,315
|
|
4,167,000
|
|
24,998,000
|
|
7
|
|
2
|
7
|
31
|
|
4,193,095
|
|
26,095
|
|
4,167,000
|
|
20,831,000
|
|
8
|
|
2
|
8
|
31
|
|
4,187,202
|
|
20,202
|
|
4,167,000
|
|
16,664,000
|
|
9
|
|
2
|
9
|
30
|
|
4,183,665
|
|
16,665
|
|
4,167,000
|
|
12,497,000
|
|
10
|
|
2
|
11
|
2
|
|
4,176,425
|
|
9,425
|
|
4,167,000
|
|
8,330,000
|
|
11
|
|
2
|
11
|
30
|
|
4,172,046
|
|
5,046
|
|
4,167,000
|
|
4,163,000
|
|
12
|
|
2
|
12
|
30
|
|
4,163,000
|
|
—
|
|
4,163,000
|
|
—
|
|
|
|
|
By:
|
|
/s/ Michael Norregaard
|
Name:
|
|
Michael Norregaard
|
Title:
|
|
Chief Executive Officer
|
|
|
|
|
|
|
By:
|
|
/s/ Mark Burish
|
Name:
|
|
Mark Burish
|
|
|
|
(i)
|
all consents, approvals, authorizations and orders necessary for the execution and delivery by Company of this Agreement and for the transactions contemplated hereunder, have been obtained, and the Company has the corporate power and authority necessary to enter into this Agreement and to perform the transactions hereunder except for such consents, approvals, authorizations, orders, licenses, registrations or qualifications the failure of which to obtain would not, individually or in the aggregate, have a material adverse effect on Company or Company’s ability to perform its obligations hereunder;
|
(ii)
|
the execution, delivery and performance by Company of this Agreement and the consummation by Company of the transactions contemplated herein will not (A) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of Company pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which Company is a party or by which Company is bound or to which any of the property or assets of Company is subject, (B) result in any violation of the provisions of the charter or by-laws of Company or (C) result in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority having jurisdiction over Company, except, in the case of clauses (A) and (C) above, for any such conflict, breach, violation or default that would not, individually or in the aggregate, have a material adverse effect on Company or Company’s ability to perform its obligations hereunder and thereunder;
|
(iii)
|
this Agreement has been duly authorized, and when executed and delivered by Company and will constitute a valid and legally binding agreement of Company enforceable against Company in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally or by equitable principles relating to enforceability;
|
(iv)
|
the Company has been duly organized and is validly existing and in good standing under the laws of its jurisdiction of organization, is duly qualified to do business and is in good standing (to the extent such concept exists) in each jurisdiction in which its ownership or lease of property or the conduct of its business requires such qualification, and has all power and authority necessary to own or hold its properties and to conduct the business in which it is engaged, except where the failure to be so qualified or in good standing (to the extent such concept exists) or have such power or authority would not, individually or in the aggregate, have a material adverse effect on Company or on the performance by Company of its obligations under this Agreement;
|
(v)
|
upon delivery to Burish of a certificate endorsed in blank by an effective endorsement, Burish will acquire good and marketable title to such certificates and the shares of Common Stock represented thereby, free of any liens, encumbrances and adverse claims; and
|
(vi)
|
the Company has made its own independent inquiry as to the legal, tax and accounting aspects of the transaction contemplated by this Agreement, and Company has not relied on Burish or his legal counsel or other advisors for legal, tax or accounting advice in connection with the transactions contemplated by this Agreement.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Sonic Foundry, 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 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:
|
5.
|
The registrant's other certifying officer 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 registrant's board of directors (or persons performing the equivalent function):
|
|
|
|
By:
|
|
/s/ Michael Norregaard
|
By:
|
|
Michael Norregaard
|
Title:
|
|
Chief Executive Officer
|
|
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Sonic Foundry, 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 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:
|
5.
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The registrant's other certifying officer 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 registrant's board of directors (or persons performing the equivalent function):
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By:
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/s/ Kenneth A. Minor
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By:
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Kenneth A. Minor
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Title:
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Interim Chief Financial Officer
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By:
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/s/ Michael Norregaard
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By:
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Michael Norregaard
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Title:
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Chief Executive Officer
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By:
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/s/ Kenneth A. Minor
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By:
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Kenneth A. Minor
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Title:
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Interim Chief Financial Officer
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