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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
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Delaware
|
|
77-0521800
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(State or other jurisdiction of
incorporation or organization)
|
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(I.R.S. Employer
Identification Number)
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Large accelerated filer
|
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¨
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Accelerated filer
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ý
|
|
|
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|
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Page No.
|
|
|
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Item 1.
|
||
|
|
|
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||
|
|
|
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Condensed Consolidated Statements of
Operations
|
|
|
|
|
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||
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|
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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||
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Item 1A.
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||
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Item 2.
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Item 6.
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Item 1.
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Financial Statements.
|
|
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December 31,
2014 |
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June 30,
2014* |
||||
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(unaudited)
|
|
|
||||
Assets
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
14,987
|
|
|
$
|
14,534
|
|
Short-term investments
|
|
113,096
|
|
|
122,315
|
|
||
Accounts receivable, net of allowances of $211 and $206 at December 31, 2014 and June 30, 2014, respectively
|
|
31,272
|
|
|
25,762
|
|
||
Deferred income taxes
|
|
116
|
|
|
784
|
|
||
Restricted cash
|
|
5,097
|
|
|
5,995
|
|
||
Income taxes receivable
|
|
14,175
|
|
|
6,932
|
|
||
Prepaid expenses and other current assets
|
|
6,439
|
|
|
9,491
|
|
||
Total current assets
|
|
185,182
|
|
|
185,813
|
|
||
Property and equipment, net
|
|
7,768
|
|
|
8,814
|
|
||
Deferred income taxes, non-current
|
|
545
|
|
|
550
|
|
||
Goodwill and intangible assets, net
|
|
39,033
|
|
|
40,733
|
|
||
Other assets
|
|
4,019
|
|
|
3,931
|
|
||
Total assets
|
|
$
|
236,547
|
|
|
$
|
239,841
|
|
Liabilities and stockholders’ equity
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
1,132
|
|
|
$
|
502
|
|
Accrued compensation
|
|
8,918
|
|
|
12,874
|
|
||
Accrued royalties
|
|
9,827
|
|
|
3,671
|
|
||
Other accrued expenses
|
|
10,332
|
|
|
12,343
|
|
||
Deferred revenue
|
|
5,219
|
|
|
2,381
|
|
||
Income taxes payable
|
|
868
|
|
|
804
|
|
||
Total current liabilities
|
|
36,296
|
|
|
32,575
|
|
||
Deferred rent, non-current
|
|
5,417
|
|
|
7,129
|
|
||
Other long-term liabilities
|
|
8,937
|
|
|
7,732
|
|
||
Commitments and contingencies (Note 5)
|
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|
||||
Preferred stock, $0.001 par value: 50,000 shares authorized; no shares issued or outstanding
|
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value: 600,000 shares authorized; 39,903 and 39,462 shares issued and outstanding at December 31, 2014 and June 30, 2014, respectively
|
|
40
|
|
|
40
|
|
||
Additional paid-in capital
|
|
135,587
|
|
|
129,278
|
|
||
Accumulated other comprehensive income (loss)
|
|
(989
|
)
|
|
576
|
|
||
Retained earnings
|
|
51,259
|
|
|
62,511
|
|
||
Total stockholders’ equity
|
|
185,897
|
|
|
192,405
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
236,547
|
|
|
$
|
239,841
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
||||||
Product
|
|
$
|
23,461
|
|
|
$
|
18,367
|
|
|
$
|
42,377
|
|
|
$
|
37,658
|
|
Services
|
|
16,319
|
|
|
18,794
|
|
|
32,390
|
|
|
43,799
|
|
||||
Total revenue
|
|
39,780
|
|
|
37,161
|
|
|
74,767
|
|
|
81,457
|
|
||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
||||||||
Product
|
|
12,824
|
|
|
9,367
|
|
|
23,002
|
|
|
18,676
|
|
||||
Services
|
|
6,709
|
|
|
5,807
|
|
|
12,491
|
|
|
12,547
|
|
||||
Total cost of revenue
|
|
19,533
|
|
|
15,174
|
|
|
35,493
|
|
|
31,223
|
|
||||
Gross profit
|
|
20,247
|
|
|
21,987
|
|
|
39,274
|
|
|
50,234
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Research and development
|
|
16,620
|
|
|
14,173
|
|
|
33,618
|
|
|
28,716
|
|
||||
Sales and marketing
|
|
6,710
|
|
|
7,838
|
|
|
12,906
|
|
|
15,456
|
|
||||
General and administrative
|
|
5,697
|
|
|
6,702
|
|
|
11,910
|
|
|
12,573
|
|
||||
Restructuring costs
|
|
565
|
|
|
283
|
|
|
565
|
|
|
831
|
|
||||
Total operating expenses
|
|
29,592
|
|
|
28,996
|
|
|
58,999
|
|
|
57,576
|
|
||||
Loss from operations
|
|
(9,345
|
)
|
|
(7,009
|
)
|
|
(19,725
|
)
|
|
(7,342
|
)
|
||||
Other income, net
|
|
870
|
|
|
1,121
|
|
|
2,173
|
|
|
1,403
|
|
||||
Loss before benefit for income taxes
|
|
(8,475
|
)
|
|
(5,888
|
)
|
|
(17,552
|
)
|
|
(5,939
|
)
|
||||
Benefit for income taxes
|
|
(5,752
|
)
|
|
(1,891
|
)
|
|
(6,892
|
)
|
|
(1,951
|
)
|
||||
Net loss
|
|
$
|
(2,723
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.07
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.10
|
)
|
Diluted
|
|
$
|
(0.07
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.10
|
)
|
Weighted average shares used in computing net loss per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
39,916
|
|
|
38,508
|
|
|
39,727
|
|
|
38,660
|
|
||||
Diluted
|
|
39,916
|
|
|
38,508
|
|
|
39,727
|
|
|
38,660
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Stock compensation expense included above:
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
|
$
|
27
|
|
|
$
|
30
|
|
|
$
|
51
|
|
|
$
|
66
|
|
Research and development
|
|
1,125
|
|
|
1,063
|
|
|
2,625
|
|
|
2,072
|
|
||||
Sales and marketing
|
|
730
|
|
|
769
|
|
|
1,494
|
|
|
1,466
|
|
||||
General and administrative
|
|
657
|
|
|
801
|
|
|
1,757
|
|
|
1,542
|
|
||||
Total stock compensation expense
|
|
$
|
2,539
|
|
|
$
|
2,663
|
|
|
$
|
5,927
|
|
|
$
|
5,146
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Net loss
|
|
$
|
(2,723
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment, net of tax
|
|
(360
|
)
|
|
(6
|
)
|
|
(1,005
|
)
|
|
45
|
|
||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
Unrealized gain (loss) on available-for-sale securities, net of tax
|
|
(115
|
)
|
|
101
|
|
|
(304
|
)
|
|
240
|
|
||||
Reclassification adjustments for gain on available-for-sale securities recognized, net of tax
|
|
(11
|
)
|
|
(67
|
)
|
|
(256
|
)
|
|
(86
|
)
|
||||
Net increase (decrease) from available-for-sale securities, net of tax
|
|
(126
|
)
|
|
34
|
|
|
(560
|
)
|
|
154
|
|
||||
Other comprehensive income (loss), net of tax:
|
|
(486
|
)
|
|
28
|
|
|
(1,565
|
)
|
|
199
|
|
||||
Comprehensive loss
|
|
$
|
(3,209
|
)
|
|
$
|
(3,969
|
)
|
|
$
|
(12,225
|
)
|
|
$
|
(3,789
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
||||||
|
|
December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Operating activities
|
|
|
|
|
||||
Net loss
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
2,876
|
|
|
3,424
|
|
||
Amortization of net premium on short-term investments
|
|
850
|
|
|
1,904
|
|
||
Stock-based compensation expense
|
|
5,927
|
|
|
5,146
|
|
||
Loss on disposal of property and equipment
|
|
8
|
|
|
14
|
|
||
Bad debt expense
|
|
14
|
|
|
59
|
|
||
Excess tax benefits from employee stock option plans
|
|
—
|
|
|
259
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
|
|
(5,524
|
)
|
|
2,187
|
|
||
Deferred income taxes
|
|
673
|
|
|
(2,065
|
)
|
||
Restricted cash
|
|
898
|
|
|
(10,964
|
)
|
||
Income taxes receivable
|
|
(7,243
|
)
|
|
—
|
|
||
Prepaid expenses and other current assets
|
|
3,052
|
|
|
(1,200
|
)
|
||
Other assets
|
|
42
|
|
|
405
|
|
||
Accounts payable
|
|
647
|
|
|
(562
|
)
|
||
Accrued compensation
|
|
(3,956
|
)
|
|
(287
|
)
|
||
Accrued royalties
|
|
6,156
|
|
|
(4,669
|
)
|
||
Accrued expenses and other liabilities
|
|
(953
|
)
|
|
9,059
|
|
||
Income taxes payable
|
|
64
|
|
|
(301
|
)
|
||
Deferred rent
|
|
(1,104
|
)
|
|
(650
|
)
|
||
Deferred revenue
|
|
2,807
|
|
|
(4,573
|
)
|
||
Net cash used in operating activities
|
|
(5,426
|
)
|
|
(6,802
|
)
|
||
Investing activities
|
|
|
|
|
||||
Purchases of property and equipment
|
|
(512
|
)
|
|
(540
|
)
|
||
Purchases of short-term investments
|
|
(87,803
|
)
|
|
(41,820
|
)
|
||
Purchase of long-term investments
|
|
(200
|
)
|
|
(600
|
)
|
||
Proceeds from sales and maturities of short-term investments
|
|
95,611
|
|
|
67,543
|
|
||
Net cash provided by investing activities
|
|
7,096
|
|
|
24,583
|
|
||
Financing activities
|
|
|
|
|
||||
Proceeds from exercise of stock options
|
|
1,781
|
|
|
638
|
|
||
Repurchase of common stock
|
|
(1,139
|
)
|
|
(6,277
|
)
|
||
Tax withholdings related to net share settlements of restricted stock units
|
|
(854
|
)
|
|
(513
|
)
|
||
Excess tax benefits from employee stock option plans
|
|
—
|
|
|
(259
|
)
|
||
Net cash used in financing activities
|
|
(212
|
)
|
|
(6,411
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
|
(1,005
|
)
|
|
45
|
|
||
Net increase in cash and cash equivalents
|
|
453
|
|
|
11,415
|
|
||
Cash and cash equivalents, at beginning of period
|
|
14,534
|
|
|
25,787
|
|
||
Cash and cash equivalents, at end of period
|
|
$
|
14,987
|
|
|
$
|
37,202
|
|
Supplemental disclosure of cash flow information
|
|
|
|
|
||||
Income taxes paid, net
|
|
$
|
97
|
|
|
$
|
220
|
|
1.
|
Summary of business and significant accounting policies
|
|
|
Foreign Currency
Translation Adjustments |
|
Unrealized
Gains (Losses) on Available-for-Sale Securities |
|
Total
|
||||||
Balance, net of tax as of June 30, 2014
|
|
$
|
321
|
|
|
$
|
255
|
|
|
$
|
576
|
|
Other comprehensive loss before reclassifications, net of tax
|
|
(1,005
|
)
|
|
(304
|
)
|
|
(1,309
|
)
|
|||
Amount reclassified from accumulated other comprehensive loss, net of tax
|
|
—
|
|
|
(256
|
)
|
|
(256
|
)
|
|||
Other comprehensive loss, net of tax
|
|
(1,005
|
)
|
|
(560
|
)
|
|
(1,565
|
)
|
|||
Balance, net of tax as of December 31, 2014
|
|
$
|
(684
|
)
|
|
$
|
(305
|
)
|
|
$
|
(989
|
)
|
2.
|
Net income (loss) per share
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net loss
|
|
$
|
(2,723
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
Weighted average common shares used in computing net loss per share, basic and diluted
|
|
39,916
|
|
|
38,508
|
|
|
39,727
|
|
|
38,660
|
|
||||
Net loss per share, basic and diluted
|
|
$
|
(0.07
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.10
|
)
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
|
December 31,
|
|
December 31,
|
||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||
Stock options
|
|
5,387
|
|
|
5,935
|
|
|
5,387
|
|
|
5,935
|
|
Restricted stock units
|
|
4,810
|
|
|
3,048
|
|
|
4,810
|
|
|
3,048
|
|
Restricted common stock
|
|
—
|
|
|
228
|
|
|
—
|
|
|
228
|
|
Total
|
|
10,197
|
|
|
9,211
|
|
|
10,197
|
|
|
9,211
|
|
3.
|
Cash, cash equivalents and short-term investments
|
|
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Estimated
Fair Value
|
||||||||
Cash
|
|
$
|
14,566
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,566
|
|
Cash equivalents:
|
|
|
|
|
|
|
|
|
||||||||
Money market mutual funds
|
|
421
|
|
|
—
|
|
|
—
|
|
|
421
|
|
||||
Total cash equivalents
|
|
421
|
|
|
—
|
|
|
—
|
|
|
421
|
|
||||
Total cash and cash equivalents
|
|
14,987
|
|
|
—
|
|
|
—
|
|
|
14,987
|
|
||||
Short-term securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. agency securities
|
|
561
|
|
|
—
|
|
|
(1
|
)
|
|
560
|
|
||||
Asset-backed securities
|
|
13,311
|
|
|
—
|
|
|
(18
|
)
|
|
13,293
|
|
||||
Municipal securities
|
|
16,878
|
|
|
17
|
|
|
(10
|
)
|
|
16,885
|
|
||||
Commercial paper
|
|
2,748
|
|
|
1
|
|
|
—
|
|
|
2,749
|
|
||||
Agency bonds
|
|
10,591
|
|
|
—
|
|
|
(6
|
)
|
|
10,585
|
|
||||
Corporate bonds
|
|
69,175
|
|
|
20
|
|
|
(171
|
)
|
|
69,024
|
|
||||
Total short-term investments
|
|
113,264
|
|
|
38
|
|
|
(206
|
)
|
|
113,096
|
|
||||
Cash, cash equivalents and short-term investments
|
|
$
|
128,251
|
|
|
$
|
38
|
|
|
$
|
(206
|
)
|
|
$
|
128,083
|
|
|
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Estimated
Fair Value
|
||||||||
Cash
|
|
$
|
12,912
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,912
|
|
Cash equivalents:
|
|
|
|
|
|
|
|
|
||||||||
Money market mutual funds
|
|
622
|
|
|
—
|
|
|
—
|
|
|
622
|
|
||||
Commercial paper
|
|
1,000
|
|
|
—
|
|
|
—
|
|
|
1,000
|
|
||||
Total cash equivalents
|
|
1,622
|
|
|
—
|
|
|
—
|
|
|
1,622
|
|
||||
Total cash and cash equivalents
|
|
14,534
|
|
|
—
|
|
|
—
|
|
|
14,534
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
||||||||
Municipal securities
|
|
96,522
|
|
|
330
|
|
|
(4
|
)
|
|
96,848
|
|
||||
Commercial paper
|
|
997
|
|
|
2
|
|
|
—
|
|
|
999
|
|
||||
Corporate bonds
|
|
24,402
|
|
|
68
|
|
|
(2
|
)
|
|
24,468
|
|
||||
Total short-term investments
|
|
121,921
|
|
|
400
|
|
|
(6
|
)
|
|
122,315
|
|
||||
Cash, cash equivalents and short-term investments
|
|
$
|
136,455
|
|
|
$
|
400
|
|
|
$
|
(6
|
)
|
|
$
|
136,849
|
|
|
|
Amortized
Cost
|
|
Estimated
Fair Value
|
||||
Due within one year
|
|
$
|
44,210
|
|
|
$
|
44,207
|
|
Due within two years
|
|
47,691
|
|
|
47,595
|
|
||
Due after two years
|
|
21,363
|
|
|
21,294
|
|
||
Total
|
|
$
|
113,264
|
|
|
$
|
113,096
|
|
4.
|
Fair value of financial instruments
|
|
|
Fair Value Measurements at December 31, 2014 Using
|
||||||||||||||
|
|
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
|
|
Significant
Other
Observable
Inputs
|
|
Significant
Unobservable
Inputs
|
||||||||
|
|
Total
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Description
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
|
||||||||
Money market mutual funds
|
|
$
|
421
|
|
|
$
|
421
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total cash equivalents
|
|
421
|
|
|
421
|
|
|
—
|
|
|
—
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
||||||||
U.S. agency securities
|
|
560
|
|
|
560
|
|
|
—
|
|
|
—
|
|
||||
Asset-backed securities
|
|
13,293
|
|
|
—
|
|
|
13,293
|
|
|
—
|
|
||||
Municipal securities
|
|
16,885
|
|
|
—
|
|
|
16,885
|
|
|
—
|
|
||||
Commercial paper
|
|
2,749
|
|
|
—
|
|
|
2,749
|
|
|
—
|
|
||||
Agency bonds
|
|
10,585
|
|
|
—
|
|
|
10,585
|
|
|
—
|
|
||||
Corporate bonds
|
|
69,024
|
|
|
—
|
|
|
69,024
|
|
|
—
|
|
||||
Total short-term investments
|
|
113,096
|
|
|
560
|
|
|
112,536
|
|
|
—
|
|
||||
Cash equivalents and short-term investments
|
|
$
|
113,517
|
|
|
$
|
981
|
|
|
$
|
112,536
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements at June 30, 2014 Using
|
||||||||||||||
|
|
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
|
|
Significant
Other
Observable
Inputs
|
|
Significant
Unobservable
Inputs
|
||||||||
|
|
Total
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Description
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
|
||||||||
Money market mutual funds
|
|
$
|
622
|
|
|
$
|
622
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial paper
|
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
||||
Total cash equivalents
|
|
1,622
|
|
|
622
|
|
|
1,000
|
|
|
—
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
||||||||
Municipal securities
|
|
96,848
|
|
|
—
|
|
|
96,848
|
|
|
—
|
|
||||
Commercial paper
|
|
999
|
|
|
—
|
|
|
999
|
|
|
—
|
|
||||
Corporate bonds
|
|
24,468
|
|
|
—
|
|
|
24,468
|
|
|
—
|
|
||||
Total short-term investments
|
|
122,315
|
|
|
—
|
|
|
122,315
|
|
|
—
|
|
||||
Cash equivalents and short-term investments
|
|
$
|
123,937
|
|
|
$
|
622
|
|
|
$
|
123,315
|
|
|
$
|
—
|
|
5.
|
Commitments and contingencies
|
|
|
Payments Due by Period
|
||||||||||||||||||||||||||
|
|
Total
|
|
Fiscal 2015
|
|
Fiscal 2016
|
|
Fiscal 2017
|
|
Fiscal 2018
|
|
Fiscal 2019
|
|
Thereafter
|
||||||||||||||
Operating lease obligations, net of sublease income
|
|
$
|
24,535
|
|
|
$
|
2,765
|
|
|
$
|
5,458
|
|
|
$
|
5,093
|
|
|
$
|
4,774
|
|
|
$
|
4,553
|
|
|
$
|
1,892
|
|
Purchase obligations
|
|
4,222
|
|
|
2,213
|
|
|
1,728
|
|
|
281
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total contractual obligations
|
|
$
|
28,757
|
|
|
$
|
4,978
|
|
|
$
|
7,186
|
|
|
$
|
5,374
|
|
|
$
|
4,774
|
|
|
$
|
4,553
|
|
|
$
|
1,892
|
|
7.
|
Stock-based compensation
|
|
|
Number of
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life
(years)
|
|
Aggregate
Intrinsic
Value
|
|||||
Options outstanding as of June 30, 2014
|
|
5,697
|
|
|
$
|
5.59
|
|
|
|
|
|
||
Granted
|
|
494
|
|
|
|
|
|
|
|
||||
Exercised
|
|
(391
|
)
|
|
|
|
|
|
|
||||
Canceled
|
|
(413
|
)
|
|
|
|
|
|
|
||||
Options outstanding as of December 31, 2014
|
|
5,387
|
|
|
$
|
5.44
|
|
|
5.05
|
|
$
|
9,685
|
|
As of December 31, 2014:
|
|
|
|
|
|
|
|
|
|||||
Options vested and expected to vest
|
|
5,195
|
|
|
$
|
5.39
|
|
|
5.00
|
|
$
|
9,552
|
|
Options exercisable
|
|
4,080
|
|
|
$
|
5.07
|
|
|
4.41
|
|
$
|
8,802
|
|
|
|
Number of
Shares
|
|
Weighted
Average
Remaining
Contractual Life
(years)
|
|
Aggregate
Intrinsic Value
|
|||
RSUs outstanding as of June 30, 2014
|
|
4,710
|
|
|
|
|
|
||
Granted
|
|
1,231
|
|
|
|
|
|
||
Vested
|
|
(339
|
)
|
|
|
|
|
||
Canceled
|
|
(792
|
)
|
|
|
|
|
||
RSUs outstanding as of December 31, 2014
|
|
4,810
|
|
|
1.65
|
|
$
|
32,081
|
|
As of December 31, 2014:
|
|
|
|
|
|
|
|||
RSUs expected to vest
|
|
4,045
|
|
|
1.53
|
|
$
|
26,983
|
|
|
|
Number of
Shares
|
|
Shares available for grant as of June 30, 2014
|
|
605
|
|
Additional shares authorized
|
|
1,578
|
|
Granted
|
|
(1,725
|
)
|
RSUs withheld for taxes in net share settlements
|
|
117
|
|
Canceled
|
|
1,208
|
|
Shares available for grant as of December 31, 2014
|
|
1,783
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Stock option awards
|
|
$
|
545
|
|
|
$
|
1,025
|
|
|
$
|
1,234
|
|
|
$
|
2,284
|
|
RSU awards
|
|
1,945
|
|
|
1,182
|
|
|
4,187
|
|
|
1,950
|
|
||||
Restricted common stock
|
|
49
|
|
|
456
|
|
|
506
|
|
|
912
|
|
||||
Total stock-based compensation expense
|
|
$
|
2,539
|
|
|
$
|
2,663
|
|
|
$
|
5,927
|
|
|
$
|
5,146
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
|
December 31,
|
|
December 31,
|
||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||
Expected volatility
|
|
59
|
%
|
|
—
|
%
|
|
54
|
%
|
|
62
|
%
|
Expected term (in years)
|
|
4.42
|
|
|
—
|
|
|
4.38
|
|
|
4.45
|
|
Risk-free interest rate
|
|
1.49
|
%
|
|
—
|
%
|
|
1.62
|
%
|
|
1.44
|
%
|
Dividend yield
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
8.
|
Stock repurchase program
|
9.
|
Income taxes
|
Cash
|
|
$
|
100
|
|
Accounts receivable
|
|
177
|
|
|
Other assets
|
|
209
|
|
|
Customer relationships
|
|
400
|
|
|
Developed technology
|
|
7,100
|
|
|
Goodwill
|
|
16,907
|
|
|
Liabilities assumed
|
|
(1,135
|
)
|
|
Total value of assets acquired and liabilities assumed
|
|
$
|
23,758
|
|
|
|
Severance and Benefits
|
|
Facility Exit Costs and Asset Impairment
|
|
Total
|
||||||
Balance at June 30, 2014
|
|
$
|
2,126
|
|
|
$
|
2,743
|
|
|
$
|
4,869
|
|
Restructuring expenses
|
|
—
|
|
|
903
|
|
|
903
|
|
|||
Cash payments
|
|
(2,104
|
)
|
|
(757
|
)
|
|
(2,861
|
)
|
|||
Other
|
|
(3
|
)
|
|
61
|
|
|
58
|
|
|||
Balance at December 31, 2014
|
|
$
|
19
|
|
|
$
|
2,950
|
|
|
$
|
2,969
|
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Revenue
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
$
|
24,077
|
|
|
$
|
18,964
|
|
|
$
|
43,579
|
|
|
$
|
38,854
|
|
Advertising
|
|
4,732
|
|
|
2,868
|
|
|
8,707
|
|
|
4,948
|
|
||||
Mobile Navigation
|
|
10,971
|
|
|
15,329
|
|
|
22,481
|
|
|
37,655
|
|
||||
Total revenue
|
|
39,780
|
|
|
37,161
|
|
|
74,767
|
|
|
81,457
|
|
||||
Cost of revenue
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
13,240
|
|
|
9,367
|
|
|
23,636
|
|
|
18,676
|
|
||||
Advertising
|
|
3,298
|
|
|
1,826
|
|
|
5,838
|
|
|
3,079
|
|
||||
Mobile Navigation
|
|
2,995
|
|
|
3,981
|
|
|
6,019
|
|
|
9,468
|
|
||||
Total cost of revenue
|
|
19,533
|
|
|
15,174
|
|
|
35,493
|
|
|
31,223
|
|
||||
Gross profit
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
10,837
|
|
|
9,597
|
|
|
19,943
|
|
|
20,178
|
|
||||
Advertising
|
|
1,434
|
|
|
1,042
|
|
|
2,869
|
|
|
1,869
|
|
||||
Mobile Navigation
|
|
7,976
|
|
|
11,348
|
|
|
16,462
|
|
|
28,187
|
|
||||
Total gross profit
|
|
$
|
20,247
|
|
|
$
|
21,987
|
|
|
$
|
39,274
|
|
|
$
|
50,234
|
|
Gross margin
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
45
|
%
|
|
51
|
%
|
|
46
|
%
|
|
52
|
%
|
||||
Advertising
|
|
30
|
%
|
|
36
|
%
|
|
33
|
%
|
|
38
|
%
|
||||
Mobile Navigation
|
|
73
|
%
|
|
74
|
%
|
|
73
|
%
|
|
75
|
%
|
||||
Total gross margin
|
|
51
|
%
|
|
59
|
%
|
|
53
|
%
|
|
62
|
%
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Revenue
|
|
$
|
39,780
|
|
|
$
|
37,161
|
|
|
$
|
74,767
|
|
|
$
|
81,457
|
|
Gross margin
|
|
51
|
%
|
|
59
|
%
|
|
53
|
%
|
|
62
|
%
|
||||
Non-GAAP gross margin
|
|
53
|
%
|
|
61
|
%
|
|
55
|
%
|
|
64
|
%
|
||||
Automotive gross margin
|
|
45
|
%
|
|
51
|
%
|
|
46
|
%
|
|
52
|
%
|
||||
Automotive non-GAAP gross margin
|
|
46
|
%
|
|
51
|
%
|
|
47
|
%
|
|
52
|
%
|
||||
Advertising gross margin
|
|
30
|
%
|
|
36
|
%
|
|
33
|
%
|
|
38
|
%
|
||||
Advertising non-GAAP gross margin
|
|
39
|
%
|
|
51
|
%
|
|
43
|
%
|
|
55
|
%
|
||||
Mobile navigation gross margin
|
|
73
|
%
|
|
74
|
%
|
|
73
|
%
|
|
75
|
%
|
||||
Mobile navigation non-GAAP gross margin
|
|
74
|
%
|
|
77
|
%
|
|
75
|
%
|
|
77
|
%
|
||||
Net loss
|
|
$
|
(2,723
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
Non-GAAP net income (loss)
|
|
$
|
(2,995
|
)
|
|
$
|
(990
|
)
|
|
$
|
(6,866
|
)
|
|
$
|
2,193
|
|
Adjusted EBITDA
|
|
$
|
(4,842
|
)
|
|
$
|
(2,433
|
)
|
|
$
|
(10,357
|
)
|
|
$
|
2,059
|
|
Diluted net loss per share
|
|
$
|
(0.07
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.10
|
)
|
Diluted non-GAAP net income (loss) per share
|
|
$
|
(0.08
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
0.05
|
|
•
|
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditures;
|
•
|
non-GAAP gross margin, non-GAAP net income (loss) and adjusted EBITDA do not reflect the potentially dilutive impact of equity-based compensation;
|
•
|
adjusted EBITDA does not reflect tax payments that historically have represented a reduction in cash available to us or tax benefits that may arise as a result of generating net losses; and
|
•
|
other companies, including companies in our industry, may calculate adjusted EBITDA or similarly titled measures differently, which reduces its usefulness as a comparative measure.
|
|
|
Automotive
|
|
Advertising
|
|
Mobile Navigation
|
|
Total
|
||||||||||||||||
|
|
Three Months Ended December 31,
|
|
Three Months Ended December 31,
|
|
Three Months Ended December 31,
|
|
Three Months Ended
December 31,
|
||||||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Gross margin
|
|
45
|
%
|
|
51
|
%
|
|
30
|
%
|
|
36
|
%
|
|
73
|
%
|
|
74
|
%
|
|
51
|
%
|
|
59
|
%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capitalized software and developed technology amortization
|
|
1
|
%
|
|
—
|
%
|
|
9
|
%
|
|
15
|
%
|
|
1
|
%
|
|
3
|
%
|
|
2
|
%
|
|
2
|
%
|
Non-GAAP gross margin
|
|
46
|
%
|
|
51
|
%
|
|
39
|
%
|
|
51
|
%
|
|
74
|
%
|
|
77
|
%
|
|
53
|
%
|
|
61
|
%
|
|
|
Automotive
|
|
Advertising
|
|
Mobile Navigation
|
|
Total
|
||||||||||||||||
|
|
Six Months Ended December 31,
|
|
Six Months Ended December 31,
|
|
Six Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Gross margin
|
|
46
|
%
|
|
52
|
%
|
|
33
|
%
|
|
38
|
%
|
|
73
|
%
|
|
75
|
%
|
|
53
|
%
|
|
62
|
%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capitalized software and developed technology amortization
|
|
1
|
%
|
|
—
|
%
|
|
10
|
%
|
|
17
|
%
|
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
Non-GAAP gross margin
|
|
47
|
%
|
|
52
|
%
|
|
43
|
%
|
|
55
|
%
|
|
75
|
%
|
|
77
|
%
|
|
55
|
%
|
|
64
|
%
|
|
|
Three Months Ended
December 31,
|
|
Six Months Ended
December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net loss
|
|
$
|
(2,723
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
Adjustments:
|
||||||||||||||||
Benefit from income tax due to tax return filings
|
|
(4,061
|
)
|
|
—
|
|
|
(4,061
|
)
|
|
—
|
|
||||
Restructuring costs
|
|
565
|
|
|
283
|
|
|
565
|
|
|
831
|
|
||||
Capitalized software and developed technology amortization
|
|
867
|
|
|
818
|
|
|
1,770
|
|
|
1,718
|
|
||||
Stock-based compensation expense:
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
|
27
|
|
|
30
|
|
|
51
|
|
|
66
|
|
||||
Research and development
|
|
1,125
|
|
|
1,063
|
|
|
2,625
|
|
|
2,072
|
|
||||
Sales and marketing
|
|
730
|
|
|
769
|
|
|
1,494
|
|
|
1,466
|
|
||||
General and administrative
|
|
657
|
|
|
801
|
|
|
1,757
|
|
|
1,542
|
|
||||
Total stock-based compensation
|
|
2,539
|
|
|
2,663
|
|
|
5,927
|
|
|
5,146
|
|
||||
Tax effect of adding back adjustments
|
|
(182
|
)
|
|
(757
|
)
|
|
(407
|
)
|
|
(1,514
|
)
|
||||
Non-GAAP net income (loss)
|
|
$
|
(2,995
|
)
|
|
$
|
(990
|
)
|
|
$
|
(6,866
|
)
|
|
$
|
2,193
|
|
|
|
Three Months Ended
December 31,
|
|
Six Months Ended
December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net loss
|
|
$
|
(2,723
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
Adjustments:
|
|
|
|
|
|
|
|
|
||||||||
Restructuring costs
|
|
565
|
|
|
283
|
|
|
565
|
|
|
831
|
|
||||
Stock-based compensation expense
|
|
2,539
|
|
|
2,663
|
|
|
5,927
|
|
|
5,146
|
|
||||
Depreciation and amortization
|
|
1,399
|
|
|
1,630
|
|
|
2,876
|
|
|
3,424
|
|
||||
Interest and other income, net
|
|
(870
|
)
|
|
(1,121
|
)
|
|
(2,173
|
)
|
|
(1,403
|
)
|
||||
Benefit for income taxes
|
|
(5,752
|
)
|
|
(1,891
|
)
|
|
(6,892
|
)
|
|
(1,951
|
)
|
||||
Adjusted EBITDA
|
|
$
|
(4,842
|
)
|
|
$
|
(2,433
|
)
|
|
$
|
(10,357
|
)
|
|
$
|
2,059
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
Consolidated Statements of Operations Data
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(in thousands)
|
||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
||||||||
Product
|
|
$
|
23,461
|
|
|
$
|
18,367
|
|
|
$
|
42,377
|
|
|
$
|
37,658
|
|
Services
|
|
16,319
|
|
|
18,794
|
|
|
32,390
|
|
|
43,799
|
|
||||
Total revenue
|
|
39,780
|
|
|
37,161
|
|
|
74,767
|
|
|
81,457
|
|
||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
||||||||
Product
|
|
12,824
|
|
|
9,367
|
|
|
23,002
|
|
|
18,676
|
|
||||
Services
|
|
6,709
|
|
|
5,807
|
|
|
12,491
|
|
|
12,547
|
|
||||
Total cost of revenue
|
|
19,533
|
|
|
15,174
|
|
|
35,493
|
|
|
31,223
|
|
||||
Gross profit
|
|
20,247
|
|
|
21,987
|
|
|
39,274
|
|
|
50,234
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Research and development
|
|
16,620
|
|
|
14,173
|
|
|
33,618
|
|
|
28,716
|
|
||||
Sales and marketing
|
|
6,710
|
|
|
7,838
|
|
|
12,906
|
|
|
15,456
|
|
||||
General and administrative
|
|
5,697
|
|
|
6,702
|
|
|
11,910
|
|
|
12,573
|
|
||||
Restructuring costs
|
|
565
|
|
|
283
|
|
|
565
|
|
|
831
|
|
||||
Total operating expenses
|
|
29,592
|
|
|
28,996
|
|
|
58,999
|
|
|
57,576
|
|
||||
Loss from operations
|
|
(9,345
|
)
|
|
(7,009
|
)
|
|
(19,725
|
)
|
|
(7,342
|
)
|
||||
Other income, net
|
|
870
|
|
|
1,121
|
|
|
2,173
|
|
|
1,403
|
|
||||
Loss before benefit for income taxes
|
|
(8,475
|
)
|
|
(5,888
|
)
|
|
(17,552
|
)
|
|
(5,939
|
)
|
||||
Benefit for income taxes
|
|
(5,752
|
)
|
|
(1,891
|
)
|
|
(6,892
|
)
|
|
(1,951
|
)
|
||||
Net loss
|
|
$
|
(2,723
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(10,660
|
)
|
|
$
|
(3,988
|
)
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
|
December 31,
|
|
December 31,
|
||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||
Revenue:
|
|
(as a percentage of revenue)
|
||||||||||
Product
|
|
59
|
%
|
|
49
|
%
|
|
57
|
%
|
|
46
|
%
|
Services
|
|
41
|
%
|
|
51
|
%
|
|
43
|
%
|
|
54
|
%
|
Total revenue
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Cost of revenue:
|
|
|
|
|
|
|
|
|
||||
Product
|
|
32
|
%
|
|
25
|
%
|
|
31
|
%
|
|
23
|
%
|
Services
|
|
17
|
%
|
|
16
|
%
|
|
16
|
%
|
|
15
|
%
|
Total cost of revenue
|
|
49
|
%
|
|
41
|
%
|
|
47
|
%
|
|
38
|
%
|
Gross profit
|
|
51
|
%
|
|
59
|
%
|
|
53
|
%
|
|
62
|
%
|
Operating expenses:
|
|
|
|
|
|
|
|
|
||||
Research and development
|
|
42
|
%
|
|
38
|
%
|
|
45
|
%
|
|
35
|
%
|
Sales and marketing
|
|
17
|
%
|
|
21
|
%
|
|
17
|
%
|
|
19
|
%
|
General and administrative
|
|
14
|
%
|
|
18
|
%
|
|
16
|
%
|
|
16
|
%
|
Restructuring costs
|
|
1
|
%
|
|
1
|
%
|
|
1
|
%
|
|
1
|
%
|
Total operating expenses
|
|
74
|
%
|
|
78
|
%
|
|
79
|
%
|
|
71
|
%
|
Loss from operations
|
|
(23
|
)%
|
|
(19
|
)%
|
|
(26
|
)%
|
|
(9
|
)%
|
Other income, net
|
|
2
|
%
|
|
3
|
%
|
|
3
|
%
|
|
2
|
%
|
Loss before benefit for income taxes
|
|
(21
|
)%
|
|
(16
|
)%
|
|
(23
|
)%
|
|
(7
|
)%
|
Benefit for income taxes
|
|
(14
|
)%
|
|
(5
|
)%
|
|
(9
|
)%
|
|
(2
|
)%
|
Net loss
|
|
(7
|
)%
|
|
(11
|
)%
|
|
(14
|
)%
|
|
(5
|
)%
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Revenue
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
$
|
24,077
|
|
|
$
|
18,964
|
|
|
$
|
43,579
|
|
|
$
|
38,854
|
|
Advertising
|
|
4,732
|
|
|
2,868
|
|
|
8,707
|
|
|
4,948
|
|
||||
Mobile Navigation
|
|
10,971
|
|
|
15,329
|
|
|
22,481
|
|
|
37,655
|
|
||||
Total revenue
|
|
39,780
|
|
|
37,161
|
|
|
74,767
|
|
|
81,457
|
|
||||
Cost of revenue
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
13,240
|
|
|
9,367
|
|
|
23,636
|
|
|
18,676
|
|
||||
Advertising
|
|
3,298
|
|
|
1,826
|
|
|
5,838
|
|
|
3,079
|
|
||||
Mobile Navigation
|
|
2,995
|
|
|
3,981
|
|
|
6,019
|
|
|
9,468
|
|
||||
Total cost of revenue
|
|
19,533
|
|
|
15,174
|
|
|
35,493
|
|
|
31,223
|
|
||||
Gross profit
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
10,837
|
|
|
9,597
|
|
|
19,943
|
|
|
20,178
|
|
||||
Advertising
|
|
1,434
|
|
|
1,042
|
|
|
2,869
|
|
|
1,869
|
|
||||
Mobile Navigation
|
|
7,976
|
|
|
11,348
|
|
|
16,462
|
|
|
28,187
|
|
||||
Total gross profit
|
|
$
|
20,247
|
|
|
$
|
21,987
|
|
|
$
|
39,274
|
|
|
$
|
50,234
|
|
Gross margin
|
|
|
|
|
|
|
|
|
||||||||
Automotive
|
|
45
|
%
|
|
51
|
%
|
|
46
|
%
|
|
52
|
%
|
||||
Advertising
|
|
30
|
%
|
|
36
|
%
|
|
33
|
%
|
|
38
|
%
|
||||
Mobile Navigation
|
|
73
|
%
|
|
74
|
%
|
|
73
|
%
|
|
75
|
%
|
||||
Total gross margin
|
|
51
|
%
|
|
59
|
%
|
|
53
|
%
|
|
62
|
%
|
|
|
Six Months Ended
|
||||||
|
|
December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
|
|
|
|
|
||||
Net cash used in operating activities
|
|
$
|
(5,426
|
)
|
|
$
|
(6,802
|
)
|
Net cash provided by investing activities
|
|
7,096
|
|
|
24,583
|
|
||
Net cash used in financing activities
|
|
(212
|
)
|
|
(6,411
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
|
(1,005
|
)
|
|
45
|
|
||
Net increase in cash and cash equivalents
|
|
$
|
453
|
|
|
$
|
11,415
|
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk.
|
Item 4.
|
Controls and Procedures.
|
Item 1.
|
Legal Proceedings.
|
Item 1A.
|
Risk Factors.
|
•
|
the transition away from paid carrier navigation to freemium offerings for mobile phone-based navigation services;
|
•
|
the ability of automobile manufacturer customers to sell automobiles equipped with our products;
|
•
|
the introduction of competitive in-car platforms and products, such as Apple's CarPlay and Google's auto initiatives, including
Open Automotive Alliance;
|
•
|
the seasonality of new vehicle model introductions and consumer buying patterns, as well as the effects of economic uncertainty on vehicle purchases
,
particularly outside of the U.S.;
|
•
|
the effectiveness of our entry into new business areas, such as advertising;
|
•
|
changes made to existing contractual obligations with a customer that may affect the nature and timing of revenue recognition;
|
•
|
the loss of our relationship or a change in our revenue model with any particular wireless carrier customer;
|
•
|
poor reviews of automotive service offerings into which our navigation solutions are integrated resulting in limited uptake of navigation options by car buyers;
|
•
|
loss of subscribers by our wireless carrier customers or a continued reduction in the number of subscribers to plans that include our services;
|
•
|
the timing and quality of information we receive from our customers;
|
•
|
our inability to attract new end users;
|
•
|
the amount and timing of operating costs and capital expenditures related to the expansion of our operations and infrastructure through acquisitions or organic growth;
|
•
|
the timing of expenses related to the development or acquisition of technologies, products or businesses;
|
•
|
the timing and success of new service introductions by us or our competitors;
|
•
|
the timing and success of marketing expenditures for our products;
|
•
|
the extent of any interruption in our services;
|
•
|
potential foreign currency exchange gains and losses associated with expenses and sales denominated in currencies other than the U.S. dollar;
|
•
|
general economic, industry and market conditions that impact expenditures for new vehicles, smartphones and mobile location services in the United States and other countries where we sell our services and products;
|
•
|
changes in interest rates and our mix of investments, which would impact our return on our investments in cash and marketable securities;
|
•
|
changes in our effective tax rates; and
|
•
|
the impact of new accounting pronouncements.
|
•
|
the provision of their services at no or low cost to consumers;
|
•
|
significantly greater revenue and financial resources;
|
•
|
stronger brand and consumer recognition regionally or worldwide;
|
•
|
the capacity to leverage their marketing expenditures across a broader portfolio of mobile and nonmobile products;
|
•
|
access to core technology and intellectual property, including more extensive patent portfolios;
|
•
|
access to custom or proprietary content;
|
•
|
quicker pace of innovation;
|
•
|
stronger wireless carrier, automotive, handset manufacturer and advertising agency relationships;
|
•
|
stronger international presence may make our larger competitors more attractive partners to automotive manufacturers and OEMs;
|
•
|
greater resources to make and integrate acquisitions;
|
•
|
lower labor and development costs; and
|
•
|
broader global distribution and presence.
|
•
|
difficulties in integrating and managing the operations, technologies and products of the companies we acquire;
|
•
|
diversion of our management’s attention from normal daily operation of our business;
|
•
|
our inability to maintain the key business relationships and the reputations of the businesses we acquire;
|
•
|
our inability to retain key personnel of the acquired company;
|
•
|
uncertainty of entry into markets in which we have limited or no prior experience and in which competitors have stronger market positions;
|
•
|
our dependence on unfamiliar affiliates and customers of the companies we acquire;
|
•
|
insufficient revenue to offset our increased expenses associated with acquisitions;
|
•
|
our responsibility for the liabilities of the businesses we acquire, including those which we may not anticipate; and
|
•
|
our inability to maintain internal standards, controls, procedures and policies.
|
•
|
changes in forecasted annual operating income or loss by jurisdiction;
|
•
|
changes in relative proportions of revenue and income or loss before taxes in the various jurisdictions in which we operate;
|
•
|
changes to the valuation allowance on net deferred tax assets;
|
•
|
changes to actual or forecasted permanent differences between book and tax reporting, including the tax effects of purchase accounting for acquisitions and non-recurring charges which may cause fluctuations between reporting periods;
|
•
|
impacts from any future tax settlements with state, federal or foreign tax authorities;
|
•
|
impacts from changes in tax laws, regulations and interpretations in the jurisdictions in which we operate, as well as the requirements of certain tax rulings;
|
•
|
impacts from withholding requirements in various non-U.S. jurisdictions and our ability to recoup those withholdings, which may depend on how much revenue we have in a particular jurisdiction to offset the related expenses;
|
•
|
impacts from acquisitions and related integration activities;
|
•
|
impacts from new FASB requirements; or
|
•
|
impacts from our inability to benefit from the carryback of net losses to prior years beginning in fiscal 2016 due to benefit limitations.
|
•
|
damage to or failure of our computer software or hardware or our connections and outsourced service arrangements with third parties;
|
•
|
errors in the processing of data by our servers;
|
•
|
computer viruses or software defects;
|
•
|
physical or electronic break-ins, sabotage, intentional acts of vandalism and similar events; or
|
•
|
errors by our employees or third party service providers.
|
•
|
fluctuations in currency exchange rates;
|
•
|
unexpected changes in foreign regulatory requirements;
|
•
|
difficulties in managing the staffing of remote operations;
|
•
|
potentially adverse tax consequences, including the complexities of foreign value added tax systems, foreign tax withholding, restrictions on the repatriation of earnings and changes in tax rates;
|
•
|
dependence on foreign wireless carriers with different pricing models;
|
•
|
roaming charges to end users;
|
•
|
availability of reliable mobile networks in those countries;
|
•
|
requirements that we comply with local telecommunication regulations and automobile hands free laws in those countries;
|
•
|
the burdens of complying with a wide variety of foreign laws and different legal standards;
|
•
|
increased financial accounting and reporting burdens and complexities;
|
•
|
political, social and economic instability in some jurisdictions;
|
•
|
terrorist attacks and security concerns in general; and
|
•
|
reduced or varied protection for intellectual property rights in some countries.
|
•
|
the implementation of our equipment at new data centers and expansion of our operations at data centers;
|
•
|
the replacement of outdated or failing equipment; and
|
•
|
the acquisition of key technologies to support or expand our products and services.
|
•
|
adversely affect our relationships with our current or future customers and other business partners;
|
•
|
cause delays or stoppages in the shipment of Telenav enabled or preloaded mobile phones or vehicles, or cause us to modify or suspend the provision of our navigation services;
|
•
|
cause us to incur significant expenses in defending claims brought against our customers, other business partners or us;
|
•
|
divert management's attention and resources;
|
•
|
subject us to significant damages or settlements;
|
•
|
require us to enter into settlements, royalty or licensing agreements on unfavorable terms; or
|
•
|
require us or our business partners to cease certain activities and/or modify our products or services.
|
•
|
actual or anticipated fluctuations in our operating results;
|
•
|
changes in the financial projections we may provide to the public or our failure to meet these projections;
|
•
|
announcements by us or our competitors of significant technical innovations, relationship changes with key customers, acquisitions, strategic partnerships, joint ventures, capital raising activities or capital commitments;
|
•
|
the public’s response to our press releases or other public announcements, including our filings with the SEC;
|
•
|
lawsuits threatened or filed against us; and
|
•
|
large distributions of our common stock by significant stockholders to limited partners or others who immediately resell the shares.
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds.
|
|
|
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 (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs (1)
|
||||||
October 1 – October 31, 2014
|
|
19,591
|
|
|
$
|
6.33
|
|
|
19,591
|
|
|
$
|
9,875,964
|
|
November 1 – November 30, 2014
|
|
68,440
|
|
|
$
|
6.86
|
|
|
68,440
|
|
|
$
|
9,406,176
|
|
December 1 – December 31, 2014
|
|
81,955
|
|
|
$
|
6.66
|
|
|
81,955
|
|
|
$
|
8,860,508
|
|
Total
|
|
169,986
|
|
|
$
|
6.70
|
|
|
169,986
|
|
|
$
|
8,860,508
|
|
(1)
|
The purchases of our shares of common stock by us were made pursuant to a stock repurchase plan announced by us in September 2014 that expires in September 2015, under which our board of directors authorized us to purchase shares of our common stock up to an aggregate of $10.0 million, inclusive of broker fees.
|
Item 6.
|
Exhibits.
|
Exhibit
Number
|
|
Description
|
|
Incorporated by Reference
From Form
|
|
Incorporated by Reference From Exhibit Number
|
|
Date
Filed
|
|
|
|
|
|
|
|
|
|
10.16.30+
|
|
Patent License Agreement, dated January 1, 2014, by and between Telenav, Inc., and HERE Global B.V. (f/k/a Navteq B.V.)
|
|
Filed herewith
|
|
|
|
|
10.32#
|
|
Form of Restricted Stock Unit Award Agreement under the 2009 Equity Incentive Plan
|
|
Filed herewith
|
|
|
|
|
10.33#
|
|
Form of Restricted Stock Unit Award Agreement under the Amended and Restated Telenav, Inc. 2011 Stock Option and Grant Plan
|
|
Filed herewith
|
|
|
|
|
10.34#
|
|
Separation Agreement, dated November 18, 2014, by and between Telenav, Inc. and Vincent Nakayama
|
|
Filed herewith
|
|
|
|
|
31.1
|
|
Certification Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a),
as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of President and Chief Executive Officer
|
|
Filed herewith
|
|
|
|
|
31.2
|
|
Certification Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer
|
|
Filed herewith
|
|
|
|
|
32.1~
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of President and Chief Executive Officer
|
|
Furnished herewith
|
|
|
|
|
32.2~
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer
|
|
Furnished herewith
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
Filed herewith
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
Filed herewith
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document
|
|
Filed herewith
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document
|
|
Filed herewith
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document
|
|
Filed herewith
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
Filed herewith
|
|
|
|
|
+
|
Portions of the exhibit have been omitted pursuant to a request for confidential treatment filed with the Securities and Exchange Commission.
|
#
|
Management contracts or compensation plans or arrangements in which directors or executive officers are eligible to participate.
|
~
|
In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 33-8238 and 34-47986, Final Rule: Management’s Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports, the certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Exchange Act. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.
|
|
|
|
TELENAV, INC.
|
||
|
|
|
|
|
|
Dated:
|
February 5, 2015
|
|
By:
|
|
/s/ Dr. HP J
IN
|
|
|
|
|
|
Dr. HP Jin
|
|
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
|
Dated:
|
February 5, 2015
|
|
By:
|
|
/s/ MICHAEL STRAMBI
|
|
|
|
|
|
Michael Strambi
|
|
|
|
|
|
Chief Financial Officer and Treasurer
|
|
|
|
|
|
(Principal Financial and Accounting Officer)
|
Exhibit
Number
|
|
Description
|
|
Incorporated by Reference
From Form
|
|
Incorporated by Reference From Exhibit Number
|
|
Date
Filed
|
|
|
|
|
|
|
|
|
|
10.16.30+
|
|
Patent License Agreement, dated January 1, 2014, by and between Telenav, Inc., and HERE Global B.V. (f/k/a Navteq B.V.)
|
|
Filed herewith
|
|
|
|
|
10.32#
|
|
Form of Restricted Stock Unit Award Agreement under the 2009 Equity Incentive Plan
|
|
Filed herewith
|
|
|
|
|
10.33#
|
|
Form of Restricted Stock Unit Award Agreement under the Amended and Restated Telenav, Inc. 2011 Stock Option and Grant Plan
|
|
Filed herewith
|
|
|
|
|
10.34#
|
|
Separation Agreement, dated November 18, 2014, by and between Telenav, Inc. and Vincent Nakayama
|
|
Filed herewith
|
|
|
|
|
31.1
|
|
Certification Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of President and Chief Executive Officer
|
|
Filed herewith
|
|
|
|
|
31.2
|
|
Certification Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer
|
|
Filed herewith
|
|
|
|
|
32.1~
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of President and Chief Executive Officer
|
|
Furnished herewith
|
|
|
|
|
32.2~
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer
|
|
Furnished herewith
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
Filed herewith
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
Filed herewith
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document
|
|
Filed herewith
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document
|
|
Filed herewith
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document
|
|
Filed herewith
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
Filed herewith
|
|
|
|
|
+
|
Portions of the exhibit have been omitted pursuant to a request for confidential treatment filed with the Securities and Exchange Commission.
|
#
|
Management contracts or compensation plans or arrangements in which directors or executive officers are eligible to participate.
|
~
|
In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 33-8238 and 34-47986, Final Rule: Management’s Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports, the certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Exchange Act. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.
|
1.01
|
The term “Patents” shall mean solely the patents that are owned by HERE, claim the subject matter of or a method, system or software product for [*****] for use in [*****], and have a priority date prior to the [*****] of this Agreement. For the avoidance of doubt, (i) [*****], and (ii) any and all patents that issue from divisions, continuations, continuations-in-part, reissues, reexaminations, reviews, renewals, foreign counterparts and extensions of any of the patents set forth in subsection (i) above, including patents that issue from [*****], shall be deemed Patent under this Section 1.01.
|
1.02
|
The term “[*****]” shall mean any [*****] of any of the Patents.
|
1.03
|
The term “[*****],” also known as “[*****],” shall mean a representation of [*****] of [*****] from a [*****] to an extent
[*****] by the [*****] in a [*****] or [*****].
|
1.04
|
The term “[*****]” shall mean a [*****] developed by or for Licensee and sold or otherwise distributed to Licensee Customer for installation in [*****] sold by Licensee Customers in countries in the Licensed Territories, which (i) solely uses the Data and Additional Content set forth under the applicable TL; and (ii) is capable of [*****] and/or enabling “[*****]” or “[*****]” (as defined herein) functionality and (iii) is covered by one or more [*****].
|
1.05
|
The term “[*****]” shall mean functionality that enables [*****] for, or in connection with, any systems or functions for [*****] or [*****] of [*****], including, for example, systems or functions for the control of [*****] and [*****].
|
1.06
|
The term “[*****]” shall mean functionality that enables [*****] to provide advisory functions regarding [*****] to the End User (as defined in the applicable TL) such as [*****], but which does not provide [*****].
|
1.07
|
The term “Effective Date” shall mean January 1, 2014.
|
1.08
|
The term “Term of this Agreement” shall commence on the Effective Date and continue until the later of the expiration dates of the TLs covering: (a) [*****] (currently [*****] (and its successors)) or (b) [*****] (currently [*****] (and their successors)), unless terminated earlier by mutual agreement or under the provisions of this Agreement, whereupon all rights and licenses granted hereunder shall terminate and the Agreement shall expire.
Notwithstanding the foregoing, this Agreement shall terminate and expire when all Patents cease to be in force. |
1.09
|
The term “[*****]” shall mean [*****], and any other [*****] in which Patents shall be issued or registered.
|
1.10
|
The term “[*****]” shall include any [*****] of [*****]. “[*****]” of an entity means any legal entity that is for the time being controlled by such an entity. Control, in this context, exists where one entity owns directly or indirectly more than fifty per cent (50%) of the voting stock in another entity, or regardless of stock or equity ownership, is otherwise able (whether by law or contract) to direct its affairs or to appoint a majority of the members of the board of directors or an equivalent body able to determine the course of action of the entity by virtue of its voting or other rights.
|
1.11
|
The term “[*****]” shall mean the [*****] to the [*****] (“[*****]”), dated [*****] , by and between [*****] and [*****] (“[*****]”) with respect to [*****], which was subsequently [*****] by [*****] to [*****] ([*****]) under which [*****] is licensed to [*****].
|
1.12
|
The term “[*****]” shall mean [*****], [*****] and their respective [*****]. “[*****]” under this Section 1.12 means any entity that (i) directly or indirectly is controlled by or controls such Party or (ii) is under common control with such Party. For these purposes, an entity shall be treated as being controlled by another if that other entity has fifty percent (50%) or more of votes in such entity, is able to direct its affairs and/or to control the composition of its board of directors or equivalent body.
|
2.01
|
As of the Effective Date, subject to the license fees set forth under Article 3 of this Agreement, HERE hereby (i) grants to Licensee a personal, non-exclusive, non-transferable, non-assignable, royalty bearing license without the right to sublicense, solely under the Patents to manufacture, install, use, import, distribute, offer to sell, sell or otherwise develop the [*****] solely for use in connection with or sale to Licensee Customer in the Licensed Territories and for the purpose of Licensee Customer manufacturing, installing, using, importing, distributing, offering to sell, selling or otherwise disposing of the [*****] within the Licensed Territories; and (ii) irrevocably releases Licensee and Licensee Customer from any and all liability for any infringement of the Patents solely to the extent such liability arises out of the manufacture, use, offer to sell and/or sale of the [*****] by Licensee to Licensee Customer prior to the Effective Date in the Licensed Territories solely to the extent such infringing activity/activities would have been licensed under this subsection (i) above if the license would have existed at the time of such activity/activities.
Subject to mandatory law, the Parties agree and acknowledge that any pass-through rights under any Patents that may under applicable law be enjoyed by any direct or indirect recipients of [*****] installed in [*****] sold by Licensee Customer (such as distributors, resellers, retailers, customers or other |
2.02
|
If, subsequent to the [*****], [*****] or [*****] (“[*****]”) [*****] an entity (“[*****]”) whereby such [*****] becomes such [*****]’s [*****], this Agreement shall apply to the [*****], but only for the time after such [*****], without any [*****].
If an [*****] of [*****] or its [*****] shall cease to be [*****] then the license granted to such [*****] shall terminate with effect from when such [*****] ceases to be an [*****] of [*****] or its [*****].
|
2.03
|
Notwithstanding anything to the contrary in this Agreement, except for the [*****] granted under this Article 2 with respect to the [*****], no [*****] or [*****] nor any [*****] or [*****] (including without limitation any [*****] or [*****]), whether express or implied or by estoppel, are granted hereunder under any [*****] or [*****] or other [*****] by HERE or its [*****].
|
3.01
|
Licensee shall pay HERE [*****] for each [*****] installed, sold or otherwise disposed of by or on behalf of Licensee Customers in any Licensed Territory, or distributed for use in any Licensed Territory (e.g., the consumer resides in a Licensed Territory), prior to the Effective Date and during the Term of this Agreement. For the purposes of this Article 3, the terms “sale”, “sold” and/or “otherwise disposed of” when used for [*****] shall include any conveyance of a legal right to use the [*****] or a copy thereof, including the licensing of the [*****].
|
4.01
|
[*****] for the [*****] to the [*****] of this Agreement shall be due within [*****] of the [*****]. [*****] for [*****] shall be due in accordance with terms specified in the [*****]. By each such due date, Licensee shall include the [*****] and [*****] of [*****] sold or otherwise disposed of for the [*****] in the [*****] specified under the [*****].
|
4.02
|
All [*****] by Licensee to HERE under this Agreement shall be due and [*****] no [*****] than the dates specified in this Agreement. If no date has been specified [*****] shall be payable upon demand. All payments to HERE under this Agreement shall be made in accordance with [*****] and/or [*****].
|
5.01
|
Licensee shall keep and shall ensure that [*****] are [*****] bound to keep true and complete records of all data necessary for the determination of the [*****] of the [*****] that shall become due under Article [*****] hereof pursuant to Section [*****] of the [*****], and shall permit HERE or [*****] to examine such records under [*****] of the [*****]
|
6.01
|
If Licensee fails to make a [*****] when due and such [*****] continues for [*****] after written notice thereof from HERE, or if Licensee becomes [*****] or [*****] in [*****] or [*****] or is [*****], HERE may terminate this Agreement, and thus the license granted, upon [*****] prior written notice to Licensee. All other rights and obligations of the parties accruing hereunder prior to any termination of the Agreement shall survive such termination.
|
6.02
|
For clarity, unless otherwise terminated earlier, the rights, [*****] and [*****] with respect to [*****] shall terminate upon the termination or expiration of the [*****] with said [*****], regardless of the [*****] of this Agreement.
|
7.01
|
Licensee shall mark all [*****] sold or otherwise disposed of by it under the license granted by this Agreement with the word “Patent” or “Patents” and the number or numbers of the Patents applicable thereto. Such notice shall be included in any packaging of the [*****] and on any display screen that includes notification of intellectual property rights in the [*****] that shows during operation, installation or setup of a [*****].
|
8.01
|
Licensee shall not have the right to [*****] under this Agreement without the prior written consent of HERE.
|
8.02
|
This Agreement may not be [*****] or [*****] by Licensee without the prior written consent of HERE.
|
8.03
|
All [*****] or [*****] by any [*****] in any [*****] on the [*****] by Licensee to HERE shall be [*****] and [*****] by Licensee.
|
8.04
|
Any notice or communication required or permitted hereunder shall be in writing, which shall be deemed to include facsimile and may be sent by facsimile or prepaid registered airmail, addressed to the party concerned at such address as such party shall have notified to the party giving notice in writing for that purpose, failing which at the registered office or principal place of business of the party receiving the notice.
|
8.05
|
Nothing in this Agreement will be [*****] as:
|
(i)
|
[*****] or [*****] by HERE as to the [*****] or [*****] of any of the [*****];
|
(ii)
|
[*****] or [*****] that anything [*****] for [*****], [*****] or [*****] under any [*****] in this Agreement is or will be [*****] from [*****] of [*****] of [*****];
|
(iii)
|
an [*****] on HERE to [*****] or [*****] any of the [*****];
|
(iv)
|
an [*****] to [*****] or [*****] actions or suits against [*****] for [*****] of the [*****];
|
(v)
|
conferring the right to [*****] in [*****], [*****] or [*****] any [*****], or any [*****] or [*****] thereof, of HERE; or
|
(vi)
|
conferring any [*****] or [*****] under any [*****] of HERE other than [*****].
|
8.06
|
This Agreement shall be construed, and the performance thereof shall be enforced, in accordance with the laws of the [*****].
|
8.07
|
Should any provision of this Agreement be invalid or unenforceable or should the Agreement contain an omission, the remaining provisions shall be valid. In the place of an invalid provision, a valid provision which comes [*****] to the one actually agreed upon is presumed to be agreed upon by the parties; the same shall apply in the case of an omission.
|
8.08
|
This Agreement may not be amended except in a written instrument signed by both parties.
|
8.09
|
Either Party may [*****] the [*****] of this Agreement, but shall otherwise [*****] the [*****] and [*****] of this Agreement [*****] and shall not, without the prior written consent of the other Party, [*****] any [*****] thereof to any [*****] other than (i) its [*****] bound by written obligations of [*****] or otherwise subject to a [*****] of [*****] through a [*****] and [*****], and (ii) its [*****], except for the purposes of [*****] with a [*****], a direction or request for [*****] by a [*****] or [*****] having [*****] to [*****] such information or if otherwise [*****] by applicable law or regulations. In the event that a Party is required to [*****] this Agreement or any of its [*****] to [*****] in order to [*****] with such [*****], [*****] or [*****], it shall use its [*****] to ensure that the [*****] to which such [*****] is to be made [*****] and [*****] such [*****]. Additionally, during the [*****]
|
1.01
|
The term “Patents” shall mean solely the patents that are owned by HERE, claim the subject matter of or a method, system or software product for [*****] for use in [*****], and have a priority date prior to the [*****] of this Agreement. For the avoidance of doubt, (i) [*****], and (ii) any and all patents that issue from divisions, continuations, continuations-in-part, reissues, reexaminations, reviews, renewals, foreign counterparts and extensions of any of the patents set forth in subsection (i) above, including patents that issue from [*****] shall be deemed Patent under this Section 1.01. .
|
1.02
|
xxx xxxx “xxxxx” xxxxx xxxx xxx xxxxx xx xxx xx xxx xxxxxxx
.
|
1.03
|
The term “[*****],” also known as “[*****],” shall mean a representation of [*****] of [*****] from a [*****] to an extent
[*****] by the [*****] in a [*****] or [*****].
|
1.04
|
The term “[*****]” shall mean a [*****] developed by or for Licensee and sold or otherwise distributed to Licensee Customer for installation in [*****] sold by Licensee Customers in countries in the Licensed Territories, which (i) solely uses the Data and Additional Content set forth under the applicable TL; and (ii) is capable of [*****] and/or enabling “[*****]” or “[*****]” (as defined herein) functionality and (iii) is covered by one or more [*****].
|
1.05
|
The term “[*****]” shall mean functionality that enables [*****] for, or in connection with, any systems or functions for [*****] or [*****] of [*****], including, for example, systems or functions for the control of [*****] and [*****].
|
1.06
|
The term “[*****]” shall mean functionality that enables [*****] to provide advisory functions regarding [*****] to the End User (as defined in the applicable TL) such as [*****], but which does not provide [*****].
|
1.07
|
The term “Effective Date” shall mean January 1, 2014.
|
1.08
|
The term “Term of this Agreement” shall commence on the Effective Date and continue until the later of the expiration dates of the TLs covering: (a) [*****] (currently [*****] (and its successors)) or (b) [*****] (currently [*****] (and their successors)), unless terminated earlier by mutual agreement or under the provisions of this Agreement, whereupon all rights and licenses granted hereunder shall terminate and the Agreement shall expire.
Notwithstanding the foregoing, this Agreement shall terminate and expire when all Patents cease to be in force. |
1.09
|
The term “[*****]” shall mean [*****], and any other [*****] in which Patents shall be issued or registered.
|
1.10
|
xxx xxxx “xxxxxxxx” xxxxx xxxxxxx xxx xxxxxxxxxx xx xxxxxxxx. “xxxxxxxxx” xx xx xxxxxx xxxxx xxx xxxxx xxxxxx xxxx xx xxx xxx xxxx xxxxx xxxxxxxxxx xx xxxx xx xxxxxx. xxxxxxx, xx xxxx xxxxxxx, xxxxxx xxxxx xxx xxxxxx xxxx xxxxxxxx xx xxxxxxxxxx xxxx xxxx xxxxx xxx xxxx (xxx) xx xxx xxxxxx xxxxx xx xxxxxxx xxxxxx, xx xxxxxxxxxx xx xxxxx xx xxxxxx xxxxxxxxx, xx xxxxxxxxx xxxx (xxxxxxx xx xxx xx xxxxxxxx) xx xxxxxx xxx xxxxxxx xx xx xxxxxxx x xxxxxxxx xx xxx xxxxxxx xx xxx xxxxx xx xxxxxxxxx xx xx xxxxxxxxxx xxxx xxxx xx xxxxxxxxx xxx xxxxxx xx xxxxxx xx xxx xxxxxx xx xxxxxx xx xxx xxxxxx xx xxxxx xxxxxx
.
|
1.11
|
xxx xxxx “xx” xxxxx xxxx xxx xxxxxxxxx xxxxxxx xx xxx xxxx xxxxxxx xxxxxxxxx (“xxx”), xxxxx xxxxxxxx x, xxxx , xx xxx xxxxxxx xxxxxxxx xxx xxxxxxxxxx xxxxxxxxxxxx xxxxxxxxxxx (“xxx”) xxxx xxxxxxx xx xxxxxxxx xxxxxxxx, xxxxx xxx xxxxxxxxxxxx xxxxxxxx xx xxx xx xxxx xxxxx xxxxxxx, xxx (x/x/x xxxxxx xxxxx xxxxxxx, xxx) xxxxx xxxxx xx xxxx-xxxxxxx xxxxx xxxxxxxx xxxxxxxxxxx xx xxxxxxxx xx xxxxxxxx xxxxxxxx
.
|
1.12
|
The term “[*****]” shall mean [*****], [*****] and their respective [*****]. “[*****]” under this Section 1.12 means any entity that (i) directly or indirectly is controlled by or controls such Party or (ii) is under common control with such Party. For these purposes, an entity shall be treated as being controlled by another if that other entity has fifty percent (50%) or more of votes in such entity, is able to direct its affairs and/or to control the composition of its board of directors or equivalent body.
|
2.01
|
As of the Effective Date, subject to the license fees set forth under Article 3 of this Agreement, HERE hereby (i) grants to Licensee a personal, non-exclusive, non-transferable, non-assignable, royalty bearing license without the right to sublicense, solely under the Patents to manufacture, install, use, import, distribute, offer to sell, sell or otherwise develop the [*****] solely for use in connection with or sale to Licensee Customer in the Licensed Territories and for the purpose of Licensee Customer manufacturing, installing, using, importing, distributing, offering to sell, selling or otherwise disposing of the [*****] within the Licensed Territories; and (ii) irrevocably releases Licensee and Licensee Customer from any and all liability for any infringement of the Patents solely to the extent such liability arises out of the manufacture, use, offer to sell and/or sale of the [*****] by Licensee to Licensee Customer prior to the Effective Date in the Licensed Territories solely to the extent such infringing activity/activities would have been licensed under this subsection (i) above if the license would have existed at the time of such activity/activities.
|
2.02
|
xx, xxxxxxxxxx xx xxx xxxxxxxxx xxxx, xxxxxxxx xx xxx xxxxxxxxx (“xxxxxxxxx xxxxx”) xxxxxxxx xx xxxxxx (“xxxxxxxx xxxxxx”) xxxxxxx xxxx xxxxxxxx xxxxxx xxxxxxx xxxx xxxxxxxxx xxxxx’x xxxxxxxxx, xxxx xxxxxxxxx xxxxx xxxxx xx xxx xxxxxxxx xxxxxx, xxx xxxx xxx xxx xxxx xxxxx xxxx xxxxxxxxxxx, xxxxxxx xxx xxxxxxxxxxx xxxxxx.
xx xx xxxxxxxxx xx xxxxxxxx xx xxx xxxxxxxxx xxxxx xxxxx xx xx xx xxxxxxxxx xxxx xxx xxxxxxx xxxxxxx xx xxxx xx xxxxxxxxx xxxxx xxxxxxxxx xxxx xxxxxx xxxx xxxx xxxx xx xxxxxxxxx xxxxxx xx xx xx xxxxxxxxx xx xxxxxxxx xx xxx xxxxxxxxx
.
|
2.03
|
xxxxxxxxxxxxxxx xxxxxxxx xx xxx xxxxxxxx xx xxxx xxxxxxxxx, xxxxxx xxx xxx xxxxxxx xxxxxxx xxxxxxx xxxxx xxxx xxxxxxx x xxxx xxxxxxx xx xxx xxxxxxx, xx xxxxx, xxxxxxxxxx xx xxxxxxx xxxxxxxx xxx xxx xxxxx xxxxxx xx xxxxxxxxxx (xxxxxxxxx xxxxxxx xxxxxxxxxx xxx xxxxxxxxx xxx xx xxx xx xxx-xxxxxxxxx xxxxxxxxx), xxxxxxx xxxxxxx xx xxxxxxx xx xx xxxxxxxx, xxx xxxxxxx xxxxxxxxx xxxxx xxx xxxxxxx xx xxxxxx xxxxxxxxxxxx xx xxxxx xxxxxxxxxxxx xxxxxxxx xxxxxx xx xxxx xx xxx xxxxxxxxxx
.
|
3.01
|
Licensee shall pay HERE [*****] for each [*****] installed, sold or otherwise disposed of by or on behalf of Licensee Customers in any Licensed Territory, or distributed for use in any Licensed Territory (e.g., the consumer resides in a Licensed Territory), prior to the Effective Date and during the Term of this Agreement. For the purposes of this Article 3, the terms “sale”, “sold” and/or “otherwise disposed of” when used for [*****] shall include any conveyance of a legal right to use the [*****] or a copy thereof, including the licensing of the [*****].
|
4.01
|
xxxxxxxxx xxx xxx xxxxxx xxxxx xx xxx xxxxxxxxx xxxx xx xxxx xxxxxxxxx xxxxx xx xxx xxxxxx xx xxxx xx xxx xxxxxxxxx xxxx. xxxxxxxxx xxx xxxxxxxxxx xxxxxxx xxxxx xx xxx xx xxxxxxxxxx xxxx xxxxx xxxxxxxxx xx xxx xxx. xx xxxx xxxx xxx xxxx, xxxxxxxx xxxxx xxxxxxx xxx xxxxxxxxxx xxx xxxxx xx xxxx-xxxxxxx xxxxx xxxxxxxx xxxxxxxxxxx xxxx xx xxxxxxxxx xxxxxxxx xx xxx xxx xxxxxxxx xxxxxx xx xxx xxxxxxx xxx xxxxxx xxxxxxxxx xxxxx xxx xxx
.
|
4.02
|
xxx xxxxxxxx xx xxxxxxxx xx xxxx xxxxx xxxx xxxxxxxxx xxxxx xx xxx xxx xxxxxxx xx xxxxx xxxx xxx xxxxx xxxxxxxxx xx xxxx xxxxxxxxx. xx xx xxxx xxx xxxx xxxxxxxxx x xxxxxxx xxxxx xx xxxxxxx xxxx xxxxxx. xxx xxxxxxxx xx xxxx xxxxx xxxx xxxxxxxxx xxxxx xx xxxx xx xxxxxxxxxx xxxx xxxxxxxxxx xxx xxx/xx xx
.
|
5.01
|
xxxxxxxx xxxxx xxxx xxx xxxxx xxxxxx xxxx xxxxxxxx xxxxxxxxx xxx xxxxxxxxxxxxx xxxxx xx xxxx xxxx xxx xxxxxxxx xxxxxxx xx xxx xxxx xxxxxxxxx xxx xxx xxxxxxxxxxxxx xx xxx xxxxxx xx xxx xxxxxxx xxxxxxxx xxxx xxxxx xxxxxx xxx xxxxx xxxxxxx x xxxxxx xxxxxxxx xx xxxxxxx xxx xx xxx xxx, xxx xxxxx xxxxxx xxxx xx xx xxxxxxxxxxxxx xxxxxxxxx xxxxx xxxxx xxxxxxx xx xxxxxxx xxxx xxxxxxx xxxxx xxxxxxx xxx xx xxx xxx
.
|
6.01
|
xx xxxxxxxx xxxxx xx xxxx x xxxxxx xx xxxxxxx xxxx xxx xxx xxxx xxxxxxx xxxxxxxxx xxx xxxxx (xx) xxxx xxxxx xxxxxxx xxxxxx xxxxxxx xxxx xxxx, xx xx xxxxxxxx xxxxxxx xxxxxxxxx xx xxxxx x xxxxxxxx xx xxxxxxxxxx xx xxxxxxxxxx xx xx xxxxxxxxxxx xxxxxxxxx, xxxx xxx xxxxxxxxx xxxx xxxxxxxxx, xxx xxxx xxx xxxxxxx xxxxxxx, xxxx xxx (xx) xxxx xxxxx xxxxxxx xxxxxx xx xxxxxxxx. xxx xxxxx xxxxxx xxx xxxxxxxxxxx xx xxx xxxxxxx xxxxxxxx xxxxxxxxx xxxxx xx xxx xxxxxxxxxxx xx xxx xxxxxxxxx xxxxx xxxxxxx xxxx xxxxxxxxxxx
.
|
6.02
|
xxx xxxxxxx, xxxxxx xxxxxxxxx xxxxxxxxxx xxxxxxx, xxx xxxxxx, xxxxxxxx xxx xxxxxxx xxxxxxxxxxx xxxx xxxxxxx xx x xxxxxxxx xxxxxxxx xxxxx xxxxxxxxx xxxx xxx xxxxxxxxxxx xx xxxxxxxxxx xx xxx xx xxxx xxxx xxxxxxxx xxxxxxxx, xxxxxxxxxx xx xxx xxxx xx xxxx xxxxxxxxx
.
|
7.01
|
Licensee shall mark all [*****] sold or otherwise disposed of by it under the license granted by this Agreement with the word “Patent” or “Patents” and the number or numbers of the Patents applicable thereto. Such notice shall be included in any packaging of the [*****] and on any display screen that includes notification of intellectual property rights in the [*****] that shows during operation, installation or setup of a [*****].
|
8.01
|
xxxxxxxx xxxxx xxx xxxx xxx xxxxx xx xxxxx xxxxxxxxxxx xxxxx xxxx xxxxxxxxx xxxxxxx xxx xxxxx xxxxxxx xxxxxxx xx xxxx
.
|
8.02
|
xxxx xxxxxxxxx xxx xxx xx xxxxxxxx xx xxxxxxxxx xxxxxxxxxxx xx xxxxxxxx xxxxxxx xxx xxxxx xxxxxxx xxxxxxx xx xxxx
.
|
8.03
|
xxx xxxxx, xxxxxx, xxxx, xxxxxxx xx xxxxxxx xxxxxxx xx xxx xxxxxx xxxxxxxxx xx xxx xxxxxxxxxxxx xx xxx xxxxxxx xxxxxxx xx xxxxxxxx xx xxxx xxxxx xx xxxxx xxx xxxx xx xxxxxxxx
.
|
8.04
|
xxx xxxxxx xx xxxxxxxxxxxxx xxxxxxxx xx xxxxxxxxx xxxxxxxxx xxxxx xx xx xxxxxxx, xxxxx xxxxx xx xxxxxx xx xxxxxxx xxxxxxxxx xxx xxx xx xxxx xx xxxxxxxxx xx xxxxxxx xxxxxxxxxx xxxxxxx, xxxxxxxxx xx xxx xxxxx xxxxxxxxx xx xxxx xxxxxxx xx xxxx xxxxx xxxxx xxxx xxxxxxxx xx xxx xxxxx xxxxxx xxxxxx xx xxxxxxx xxx xxxx xxxxxxx, xxxxxxx xxxxx xx xxx xxxxxxxxxx xxxxxx xx xxxxxxxxx xxxxx xx xxxxxxxx xx xxx xxxxx xxxxxxxxx xxx xxxxxx
.
|
8.05
|
xxxxxxx xx xxxx xxxxxxxxx xxxx xx xxxxxxxxx xx:
|
8.06
|
xxxx xxxxxxxxx xxxxx xx xxxxxxxxx, xxx xxx xxxxxxxxxxx xxxxxxx xxxxx xx xxxxxxxx, xx xxxxxxxxxx xxxx xxx xxxx xx xxx xxxxxxxxxxx
.
|
8.07
|
xxxxxx xxx xxxxxxxxx xx xxxx xxxxxxxxx xx xxxxxxx xx xxxxxxxxxxxxx xx xxxxxx xxx xxxxxxxxx xxxxxxx xx xxxxxxxx, xxx xxxxxxxxx xxxxxxxxxx xxxxx xx xxxxx. xx xxx xxxxx xx xx xxxxxxx xxxxxxxxx, x xxxxx
|
8.08
|
xxxx xxxxxxxxx xxx xxx xx xxxxxxx xxxxxx xx x xxxxxxx xxxxxxxxxx xxxxxx xx xxxx xxxxxxx
.
|
8.09
|
xxxxxx xxxxx xxx xxxxxxxx xxx xxxxxxxxx xx xxxx xxxxxxxxx, xxx xxxxx xxxxxxxxx xxxx xxx xxxxx xxx xxxxxxxxxx xx xxxx xxxxxxxxx xxxxxxxxxxxx xxx xxxxx xxx, xxxxxxx xxx xxxxx xxxxxxx xxxxxxx xx xxx xxxxx xxxxx, xxxxxxx xxx xxxx xxxxxxx xx xxx xxxxx xxxxx xxxxx xxxx (x) xxx xxxxxxxx xxxxxxxxxxxx xxxxxxxx xxxxx xx xxxxxxx xxxxxxxxxxx xx xxxxxxxxxxxxxxx xx xxxxxxxxx xxxxxxx xx x xxxxxxx xxxxxxx xxxxxxxxxxxx xxxxxxxxxx xx xxxxxx xxxxxxxxxxxxxxx xxxxxxx x xxxxxxxxxx xxx xxxxxxxxx xxxxxxxxxxxx xxxxxxxxxxx, xxx (xx) xxx xxxxxxxxxx, xxxxxx xxx xxx xxxxxxxx xx xxxxxxxxx xxxx x xxxxx xxxxx, x xxxxxxxxx xx xxxxxxx xxx xxxxxxxxxxx xx x xxxxxxxxxxxx xxxx xx xxxxxxxxxx xxxxxxxxx xxxxxx xxxxxxxxx xx xxxxxxx xxxx xxxxxxxxxxx xx xx xxxxxxxxx xxxxxxxx xx xxxxxxxxxx xxx xx xxxxxxxxxxx. xx xxx xxxxx xxxx x xxxxx xx xxxxxxxx xx xxxxxxxx xxxx xxxxxxxxx xx xxx xx xxx xxxxxxxxxx xx x xxxxx xxxxx xx xxxxx xx xxxxxx xxxx xxxx xxxxx xxxxx, xxxxxxxxx xx xxxxxxx, xx xxxxx xxx xxx xxxx xxxxxxxxxx xx xxxxxx xxxx xxx xxxxx xxxxx xx xxxxx xxxx xxxxxxxxxx xx xx xx xxxx xxxxxxxx xxx xxxxxxxxx xxxx xxxxxxxxxxxxxxx. xxxxxxxxxxxx, xxxxxx xxx xxxx xx xxx xx xxxx x xxxxxxxx xxxxxxxx, xxxxxxxx xxx xxxxxxxx xxx xxxxxxxx xxxxxxxxx xx xxxxxxx x xx xxxx xxxxxxxx xxxxxxxx xx xxx xxxxxxxxx xxxx xxx xxxxxxxx xxxxxxxx xxxxxx xx xxxxxxx xx xx xxxxx xx xxx xxxxxxxxxxxxxxx xxxxxxxxxxx xx xxxx xxxxxxxxx
.
|
Grant Date
|
|
|
|
Date of Grant
|
|
|
|
Vesting Commencement Date
|
|
|
|
Number of Restricted Stock Units
|
|
|
|
PARTICIPANT:
|
|
TELENAV, INC.
|
|
|
|
|
|
/s/ Loren E. Hillberg
|
Signature
|
|
By: Loren E. Hillberg
|
|
|
General Counsel and Corporate Secretary
|
Print Name
|
|
|
|
|
|
Residence Address
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Grant Date
|
|
|
|
Date of Grant
|
|
|
|
Vesting Commencement Date
|
|
|
|
Number of Restricted Stock Units
|
|
|
|
PARTICIPANT:
|
|
TELENAV, INC.
|
|
|
|
|
|
/s/ Loren E. Hillberg
|
Signature
|
|
By: Loren E. Hillberg
|
|
|
General Counsel and Corporate Secretary
|
Print Name
|
|
|
|
|
|
Residence Address
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vincent Nakayama, an individual
|
|||
Dated: November 8, 2014
|
/s/ Vincent Nakayama
|
|||
|
Vincent Nakayama
|
|
Telenav, Inc.
|
|||
Dated: November 18, 2014
|
By:
/s/ HP Jin
|
|||
|
Dr. HP Jin
|
|||
|
President & CEO
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Telenav, 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:
|
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 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:
|
February 5, 2015
|
|
By:
|
|
/s/ Dr. HP JIN
|
|
|
|
|
|
DR. HP Jin
|
|
|
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Telenav, 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:
|
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 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:
|
February 5, 2015
|
|
By:
|
|
/s/ MICHAEL STRAMBI
|
|
|
|
|
|
Michael Strambi
|
|
|
|
|
|
Chief Financial Officer
|
Date:
|
February 5, 2015
|
|
By:
|
|
/s/ Dr. HP JIN
|
|
|
|
|
|
Dr. HP Jin
|
|
|
|
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President and Chief Executive Officer
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Date:
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February 5, 2015
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By:
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/s/ MICHAEL STRAMBI
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Michael Strambi
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Chief Financial Officer
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