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x
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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
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31-1455414
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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Large accelerated filer
¨
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
x
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(Do not check if a smaller reporting company)
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TABLE OF CONTENTS
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||
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Page
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Part I.
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FINANCIAL INFORMATION
|
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Item 1.
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Financial Statements
|
|
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Condensed Consolidated Balance Sheets at April 30, 2016 and January 31, 2016
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Condensed Consolidated Statements of Operations for the three months ended April 30, 2016 and 2015
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Condensed Consolidated Statements of Cash Flows for the three months ended April 30, 2016 and 2015
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Notes to Condensed Consolidated Financial Statements
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Item 2.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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Item 3.
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Quantitative and Qualitative Disclosures About Market Risk
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Item 4.
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Controls and Procedures
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Part II.
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OTHER INFORMATION
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Item 1.
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Legal Proceedings
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Item 1A.
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Risk Factors
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Item 6.
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Exhibits
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Signatures
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As of
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||||||
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April 30, 2016
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January 31, 2016
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||||
ASSETS
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|
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||||
Current assets:
|
|
|
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||||
Cash and cash equivalents
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$
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6,516,222
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|
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$
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9,882,136
|
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Accounts receivable, net of allowance for doubtful accounts of $191,306 and $155,407, respectively
|
4,053,983
|
|
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4,199,315
|
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||
Contract receivables
|
93,831
|
|
|
119,697
|
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||
Prepaid hardware and third-party software for future delivery
|
7,595
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|
|
5,858
|
|
||
Prepaid client maintenance contracts
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983,787
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|
|
956,913
|
|
||
Other prepaid assets
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997,397
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941,532
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Other current assets
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28,265
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|
|
97,986
|
|
||
Total current assets
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12,681,080
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16,203,437
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|
||
Non-current assets:
|
|
|
|
||||
Property and equipment:
|
|
|
|
||||
Computer equipment
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2,645,851
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|
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2,647,135
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|
||
Computer software
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811,460
|
|
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801,895
|
|
||
Office furniture, fixtures and equipment
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683,443
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|
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683,443
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|
||
Leasehold improvements
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729,348
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729,348
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||
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4,870,102
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|
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4,861,821
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|
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Accumulated depreciation and amortization
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(2,725,612
|
)
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(2,407,746
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)
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||
Property and equipment, net
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2,144,490
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2,454,075
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Contract receivables, less current portion
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—
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8,711
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|
||
Capitalized software development costs, net of accumulated amortization of $15,635,713 and $14,919,948, respectively
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5,905,861
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6,123,638
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Intangible assets, net of accumulated amortization of $4,997,121 and $4,671,675, respectively
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7,829,879
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|
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8,155,325
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|
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Deferred financing costs, net of accumulated amortization of zero and $84,531, respectively
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—
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|
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270,147
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|
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Goodwill
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16,184,667
|
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16,184,667
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Other
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726,895
|
|
|
746,018
|
|
||
Total non-current assets
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32,791,792
|
|
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33,942,581
|
|
||
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$
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45,472,872
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$
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50,146,018
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STREAMLINE HEALTH SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
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|||||||
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As of
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||||||
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April 30, 2016
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January 31, 2016
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
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|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
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$
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569,276
|
|
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$
|
1,136,779
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Accrued compensation
|
407,088
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|
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935,324
|
|
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Accrued other expenses
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536,233
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328,551
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Current portion of term loan
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2,468,227
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|
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673,807
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|
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Deferred revenues
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8,397,555
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10,447,280
|
|
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Current portion of capital lease obligations
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411,263
|
|
|
592,642
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|
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Total current liabilities
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12,789,642
|
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14,114,383
|
|
||
Non-current liabilities:
|
|
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|
||||
Term loan
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5,645,800
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|
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7,861,084
|
|
||
Warrants liability
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165,710
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|
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205,113
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|
||
Royalty liability
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2,327,136
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|
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2,291,888
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|
||
Lease incentive liability
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371,788
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|
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369,406
|
|
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Capital lease obligations
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57,526
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|
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93,257
|
|
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Deferred revenues, less current portion
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1,078,729
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1,212,709
|
|
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Total non-current liabilities
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9,646,689
|
|
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12,033,457
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|
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Total liabilities
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22,436,331
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26,147,840
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|
||
Series A 0% Convertible Redeemable Preferred Stock, $.01 par value per share, $8,849,985 redemption value, 4,000,000 shares authorized, 2,949,995 shares issued and outstanding, net of unamortized preferred stock discount of $491,216 and $875,935, respectively
|
8,358,769
|
|
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7,974,050
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock, $.01 par value per share, 45,000,000 shares authorized; 19,411,549 and 18,783,540 shares issued and outstanding, respectively
|
194,115
|
|
|
187,836
|
|
||
Additional paid in capital
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79,825,549
|
|
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79,700,577
|
|
||
Accumulated deficit
|
(65,341,892
|
)
|
|
(63,864,285
|
)
|
||
Total stockholders’ equity
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14,677,772
|
|
|
16,024,128
|
|
||
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$
|
45,472,872
|
|
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$
|
50,146,018
|
|
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Three Months Ended April 30
|
||||||
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2016
|
|
2015
|
||||
Revenues:
|
|
|
|
||||
Systems sales
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$
|
511,267
|
|
|
$
|
298,616
|
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Professional services
|
690,615
|
|
|
350,959
|
|
||
Maintenance and support
|
3,755,553
|
|
|
3,654,065
|
|
||
Software as a service
|
1,709,786
|
|
|
1,865,802
|
|
||
Total revenues
|
6,667,221
|
|
|
6,169,442
|
|
||
Operating expenses:
|
|
|
|
||||
Cost of systems sales
|
745,484
|
|
|
726,791
|
|
||
Cost of professional services
|
638,764
|
|
|
771,496
|
|
||
Cost of maintenance and support
|
857,818
|
|
|
816,905
|
|
||
Cost of software as a service
|
484,243
|
|
|
738,831
|
|
||
Selling, general and administrative
|
3,598,841
|
|
|
4,506,174
|
|
||
Research and development
|
1,722,187
|
|
|
2,224,193
|
|
||
Total operating expenses
|
8,047,337
|
|
|
9,784,390
|
|
||
Operating loss
|
(1,380,116
|
)
|
|
(3,614,948
|
)
|
||
Other income (expense):
|
|
|
|
||||
Interest expense
|
(162,012
|
)
|
|
(243,941
|
)
|
||
Miscellaneous income
|
66,222
|
|
|
1,988,974
|
|
||
Loss before income taxes
|
(1,475,906
|
)
|
|
(1,869,915
|
)
|
||
Income tax (expense) benefit
|
(1,701
|
)
|
|
3,882
|
|
||
Net loss
|
$
|
(1,477,607
|
)
|
|
$
|
(1,866,033
|
)
|
Less: deemed dividends on Series A Preferred Shares
|
(384,719
|
)
|
|
(295,657
|
)
|
||
Net loss attributable to common shareholders
|
$
|
(1,862,326
|
)
|
|
$
|
(2,161,690
|
)
|
Basic net loss per common share
|
$
|
(0.10
|
)
|
|
$
|
(0.12
|
)
|
Number of shares used in basic per common share computation
|
18,995,289
|
|
|
18,600,957
|
|
||
Diluted net loss per common share
|
$
|
(0.10
|
)
|
|
$
|
(0.12
|
)
|
Number of shares used in diluted per common share computation
|
18,995,289
|
|
|
18,600,957
|
|
|
Three Months Ended April 30
|
||||||
|
2016
|
|
2015
|
||||
Operating activities:
|
|
|
|
||||
Net loss
|
$
|
(1,477,607
|
)
|
|
$
|
(1,866,033
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation
|
320,672
|
|
|
314,325
|
|
||
Amortization of capitalized software development costs
|
715,765
|
|
|
782,468
|
|
||
Amortization of intangible assets
|
325,446
|
|
|
337,230
|
|
||
Amortization of other deferred costs
|
61,184
|
|
|
59,362
|
|
||
Valuation adjustment for warrants liability
|
(39,403
|
)
|
|
(1,266,464
|
)
|
||
Share-based compensation expense
|
477,212
|
|
|
651,982
|
|
||
Other valuation adjustments
|
47,417
|
|
|
43,412
|
|
||
Loss on disposal of property and equipment
|
567
|
|
|
34,228
|
|
||
Provision for accounts receivable
|
71,907
|
|
|
80,086
|
|
||
Deferred tax benefit
|
—
|
|
|
(9,574
|
)
|
||
Changes in assets and liabilities, net of effects of acquisitions:
|
|
|
|
||||
Accounts and contract receivables
|
108,002
|
|
|
551,201
|
|
||
Other assets
|
(39,082
|
)
|
|
346,036
|
|
||
Accounts payable
|
(567,503
|
)
|
|
(536,076
|
)
|
||
Accrued expenses
|
(279,881
|
)
|
|
(117,157
|
)
|
||
Deferred revenues
|
(2,183,705
|
)
|
|
(463,777
|
)
|
||
Net cash used in operating activities
|
(2,459,009
|
)
|
|
(1,058,751
|
)
|
||
Investing activities:
|
|
|
|
||||
Purchases of property and equipment
|
(11,654
|
)
|
|
(15,582
|
)
|
||
Capitalization of software development costs
|
(497,988
|
)
|
|
—
|
|
||
Net cash used in investing activities
|
(509,642
|
)
|
|
(15,582
|
)
|
||
Financing activities:
|
|
|
|
||||
Principal repayments on term loan
|
(168,451
|
)
|
|
(125,000
|
)
|
||
Principal payments on capital lease obligation
|
(217,110
|
)
|
|
(199,022
|
)
|
||
Recovery of deferred financing costs
|
—
|
|
|
2,111
|
|
||
Proceeds from exercise of stock options and stock purchase plan
|
—
|
|
|
143,350
|
|
||
Payments related to settlement of employee shared-based awards
|
(11,702
|
)
|
|
—
|
|
||
Net cash used in financing activities
|
(397,263
|
)
|
|
(178,561
|
)
|
||
Decrease in cash and cash equivalents
|
(3,365,914
|
)
|
|
(1,252,894
|
)
|
||
Cash and cash equivalents at beginning of period
|
9,882,136
|
|
|
6,522,600
|
|
||
Cash and cash equivalents at end of period
|
$
|
6,516,222
|
|
|
$
|
5,269,706
|
|
|
Total Fair Value
|
|
Quoted Prices in Active Markets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
At April 30, 2016
|
|
|
|
|
|
|
|
||||||||
Warrants liability (1)
|
$
|
166,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
166,000
|
|
Royalty liability (2)
|
2,327,000
|
|
|
—
|
|
|
—
|
|
|
2,327,000
|
|
||||
|
|
|
|
|
|
|
|
||||||||
At January 31, 2016
|
|
|
|
|
|
|
|
||||||||
Warrants liability (1)
|
$
|
205,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
205,000
|
|
Royalty liability (2)
|
2,292,000
|
|
|
—
|
|
|
—
|
|
|
2,292,000
|
|
(1)
|
The initial fair value of warrants liability was determined by management with the assistance of an independent third-party valuation specialist, and by management thereafter. Changes in fair value of the warrants are recognized within miscellaneous income in the condensed consolidated statements of operations.
|
(2)
|
The initial fair value of royalty liability was determined by management with the assistance of an independent third-party valuation specialist, and by management thereafter. The fair value of the royalty liability is determined based on the probability-weighted revenue scenarios for the Looking Glass® Clinical Analytics solution licensed from Montefiore Medical Center (discussed in Note 3 - Acquisitions and Strategic Agreements). Fair value adjustments are included within miscellaneous income in the condensed consolidated statements of operations.
|
•
|
Persuasive evidence of an arrangement exists,
|
•
|
Delivery has occurred or services have been rendered,
|
•
|
The arrangement fees are fixed or determinable, and
|
•
|
Collectibility is reasonably assured.
|
•
|
VSOE — the price at which an element is sold as a separate stand-alone transaction
|
•
|
TPE — the price of an element, charged by another company that is largely interchangeable in any particular transaction
|
•
|
ESP — our best estimate of the selling price of an element of the transaction
|
|
Three Months Ended
|
||||||
|
April 30, 2016
|
|
April 30, 2015
|
||||
Net loss
|
$
|
(1,477,607
|
)
|
|
$
|
(1,866,033
|
)
|
Less: deemed dividends on Series A Preferred Stock
|
(384,719
|
)
|
|
(295,657
|
)
|
||
Net loss attributable to common stockholders
|
$
|
(1,862,326
|
)
|
|
$
|
(2,161,690
|
)
|
Weighted average shares outstanding used in basic per common share computations
|
18,995,289
|
|
|
18,600,957
|
|
||
Stock options and restricted stock
|
—
|
|
|
—
|
|
||
Number of shares used in diluted per common share computation
|
18,995,289
|
|
|
18,600,957
|
|
||
Basic net loss per share of common stock
|
$
|
(0.10
|
)
|
|
$
|
(0.12
|
)
|
Diluted net loss per share of common stock
|
$
|
(0.10
|
)
|
|
$
|
(0.12
|
)
|
|
|
|
|
|
Facilities
|
|
Equipment
|
|
Fiscal Year Totals
|
||||||
2016 (nine months remaining)
|
$
|
730,000
|
|
|
$
|
8,000
|
|
|
$
|
738,000
|
|
2017
|
1,007,000
|
|
|
11,000
|
|
|
1,018,000
|
|
|||
2018
|
1,039,000
|
|
|
11,000
|
|
|
1,050,000
|
|
|||
2019
|
967,000
|
|
|
11,000
|
|
|
978,000
|
|
|||
2020
|
504,000
|
|
|
11,000
|
|
|
515,000
|
|
|||
Thereafter
|
964,000
|
|
|
4,000
|
|
|
968,000
|
|
|||
Total
|
$
|
5,211,000
|
|
|
$
|
56,000
|
|
|
$
|
5,267,000
|
|
For the four-quarter period ending
|
|
Minimum EBITDA
|
||
April 30, 2016
|
|
$
|
3,000,000
|
|
July 31, 2016
|
|
1,500,000
|
|
|
October 31, 2016
|
|
250,000
|
|
|
January 31, 2017
|
|
0
|
|
|
April 30, 2016
|
|
January 31, 2016
|
||||
Senior term loan
|
$
|
8,114,000
|
|
|
$
|
8,535,000
|
|
Capital lease
|
469,000
|
|
|
686,000
|
|
||
Total
|
8,583,000
|
|
|
9,221,000
|
|
||
Less: Current portion
|
(2,879,000
|
)
|
|
(1,266,000
|
)
|
||
Non-current portion of debt
|
$
|
5,704,000
|
|
|
$
|
7,955,000
|
|
|
|
Senior Term Loan (1)
|
|
Capital Lease (2)
|
|
Total
|
||||||
2016
|
|
$
|
2,244,000
|
|
(3)
|
$
|
390,000
|
|
|
$
|
2,634,000
|
|
2017
|
|
898,000
|
|
|
93,000
|
|
|
991,000
|
|
|||
2018
|
|
898,000
|
|
|
—
|
|
|
898,000
|
|
|||
2019
|
|
4,326,000
|
|
|
—
|
|
|
4,326,000
|
|
|||
Total repayments
|
|
$
|
8,366,000
|
|
|
$
|
483,000
|
|
|
$
|
8,849,000
|
|
(1)
|
Term loan balance on the condensed consolidated balance sheet is reported net of deferred financing costs of
$252,000
.
|
(2)
|
Future minimum lease payments include principal plus interest.
|
(3)
|
Includes required prepayment of
$1,738,000
made in May 2016. See Note 8 - Subsequent Events for further details.
|
•
|
competitive products and pricing;
|
•
|
product demand and market acceptance;
|
•
|
new product development;
|
•
|
key strategic alliances with vendors and channel partners that resell our products;
|
•
|
our ability to control costs;
|
•
|
availability of products produced by third party vendors;
|
•
|
the healthcare regulatory environment;
|
•
|
potential changes in legislation, regulation and government funding affecting the healthcare industry;
|
•
|
healthcare information systems budgets;
|
•
|
availability of healthcare information systems trained personnel for implementation of new systems, as well as maintenance of legacy systems;
|
•
|
the success of our relationships with channel partners;
|
•
|
fluctuations in operating results;
|
•
|
critical accounting policies and judgments;
|
•
|
changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other standard-setting organization;
|
•
|
changes in economic, business and market conditions impacting the healthcare industry, the markets in which we operate and nationally; and
|
•
|
our ability to maintain compliance with the terms of our credit facilities.
|
|
Three Months Ended
|
|
|
|||||||||||
(in thousands):
|
April 30, 2016
|
|
April 30, 2015
|
|
Change
|
|
% Change
|
|||||||
Systems Sales:
|
|
|
|
|
|
|
|
|||||||
Proprietary software - perpetual license
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
18
|
|
|
100
|
%
|
Term license
|
361
|
|
|
288
|
|
|
73
|
|
|
25
|
%
|
|||
Hardware and third-party software
|
131
|
|
|
10
|
|
|
121
|
|
|
1,210
|
%
|
|||
Professional services
|
691
|
|
|
351
|
|
|
340
|
|
|
97
|
%
|
|||
Maintenance and support
|
3,756
|
|
|
3,654
|
|
|
102
|
|
|
3
|
%
|
|||
Software as a service
|
1,710
|
|
|
1,866
|
|
|
(156
|
)
|
|
(8
|
)%
|
|||
Total Revenues
|
$
|
6,667
|
|
|
$
|
6,169
|
|
|
$
|
498
|
|
|
8
|
%
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
(in thousands):
|
April 30, 2016
|
|
April 30, 2015
|
|
Change
|
|
% Change
|
|||||||
Cost of systems sales
|
$
|
745
|
|
|
$
|
727
|
|
|
$
|
18
|
|
|
2
|
%
|
Cost of professional services
|
639
|
|
|
771
|
|
|
(132
|
)
|
|
(17
|
)%
|
|||
Cost of maintenance and support
|
858
|
|
|
817
|
|
|
41
|
|
|
5
|
%
|
|||
Cost of software as a service
|
484
|
|
|
739
|
|
|
(255
|
)
|
|
(35
|
)%
|
|||
Total cost of sales
|
$
|
2,726
|
|
|
$
|
3,054
|
|
|
$
|
(328
|
)
|
|
(11
|
)%
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
(in thousands):
|
April 30, 2016
|
|
April 30, 2015
|
|
Change
|
|
% Change
|
|||||||
General and administrative expenses
|
$
|
2,455
|
|
|
$
|
3,351
|
|
|
$
|
(896
|
)
|
|
(27
|
)%
|
Sales and marketing expenses
|
1,144
|
|
|
1,155
|
|
|
(11
|
)
|
|
(1
|
)%
|
|||
Total selling, general, and administrative expense
|
$
|
3,599
|
|
|
$
|
4,506
|
|
|
$
|
(907
|
)
|
|
(20
|
)%
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
(in thousands):
|
April 30, 2016
|
|
April 30, 2015
|
|
Change
|
|
% Change
|
|||||||
Research and development expense
|
$
|
1,722
|
|
|
$
|
2,224
|
|
|
$
|
(502
|
)
|
|
(23
|
)%
|
Plus: Capitalized research and development cost
|
498
|
|
|
—
|
|
|
498
|
|
|
100
|
%
|
|||
Total research and development cost
|
$
|
2,220
|
|
|
$
|
2,224
|
|
|
$
|
(4
|
)
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|||||||||||
(in thousands):
|
April 30, 2016
|
|
April 30, 2015
|
|
Change
|
|
% Change
|
|||||||
Interest expense
|
$
|
(162
|
)
|
|
$
|
(244
|
)
|
|
$
|
82
|
|
|
(34
|
)%
|
Miscellaneous income
|
66
|
|
|
1,989
|
|
|
(1,923
|
)
|
|
(97
|
)%
|
|||
Total other income (expenses)
|
$
|
(96
|
)
|
|
$
|
1,745
|
|
|
$
|
(1,841
|
)
|
|
(106
|
)%
|
|
|
|
|
|
|
|
|
|
April 30, 2016
|
|
April 30, 2015
|
||||
Company proprietary software
|
$
|
21,410,000
|
|
|
$
|
25,347,000
|
|
Third-party hardware and software
|
200,000
|
|
|
113,000
|
|
||
Professional services
|
5,480,000
|
|
|
8,046,000
|
|
||
Maintenance and support
|
20,793,000
|
|
|
19,616,000
|
|
||
Software as a service
|
14,820,000
|
|
|
21,465,000
|
|
||
Total
|
$
|
62,703,000
|
|
|
$
|
74,587,000
|
|
•
|
EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;
|
•
|
EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
|
•
|
EBITDA does not reflect the interest expense, or the cash requirements to service interest or principal payments under our credit agreement;
|
•
|
EBITDA does not reflect income tax payments that we may be required to make; and
|
•
|
Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements.
|
|
Three Months Ended
|
||||||
In thousands, except per share data
|
April 30, 2016
|
|
April 30, 2015
|
||||
Net loss
|
$
|
(1,478
|
)
|
|
$
|
(1,866
|
)
|
Interest expense
|
162
|
|
|
244
|
|
||
Income tax expense (benefit)
|
2
|
|
|
(4
|
)
|
||
Depreciation
|
321
|
|
|
314
|
|
||
Amortization of capitalized software development costs
|
716
|
|
|
782
|
|
||
Amortization of intangible assets
|
325
|
|
|
337
|
|
||
Amortization of other costs
|
43
|
|
|
43
|
|
||
EBITDA
|
91
|
|
|
(150
|
)
|
||
Share-based compensation expense
|
477
|
|
|
652
|
|
||
Loss on disposal of fixed assets
|
1
|
|
|
34
|
|
||
Associate severances and other costs relating to transactions or corporate restructuring
|
—
|
|
|
140
|
|
||
Non-cash valuation adjustments to assets and liabilities
|
8
|
|
|
(1,223
|
)
|
||
Transaction related professional fees, advisory fees, and other internal direct costs
|
19
|
|
|
12
|
|
||
Other non-recurring income
|
—
|
|
|
(750
|
)
|
||
Adjusted EBITDA
|
$
|
596
|
|
|
$
|
(1,285
|
)
|
Adjusted EBITDA margin (1)
|
9
|
%
|
|
(21
|
)%
|
||
|
|
|
|
||||
Loss per share — diluted
|
$
|
(0.10
|
)
|
|
$
|
(0.12
|
)
|
Adjusted EBITDA per adjusted diluted share (2)
|
$
|
0.03
|
|
|
$
|
(0.07
|
)
|
Diluted weighted average shares
|
18,995,289
|
|
|
18,600,957
|
|
||
Includable incremental shares — adjusted EBITDA (3)
|
3,251,455
|
|
|
—
|
|
||
Adjusted diluted shares
|
22,246,744
|
|
|
18,600,957
|
|
(1)
|
Adjusted EBITDA as a percentage of GAAP net revenues.
|
(2)
|
Adjusted EBITDA per adjusted diluted share for our common stock is computed using the more dilutive of the two-class method or the if-converted method.
|
(3)
|
The number of incremental shares that would be dilutive under profit assumption, only applicable under a GAAP net loss. If GAAP profit is earned in the current period, no additional incremental shares are assumed.
|
(in thousands)
|
April 30, 2016
|
|
January 31, 2016
|
||||
Term loans (1)
|
$
|
8,114
|
|
|
$
|
8,535
|
|
Capital leases (1)
|
469
|
|
|
686
|
|
||
Royalty liability (2)
|
2,327
|
|
|
2,292
|
|
(1)
|
See Note 5 to the condensed consolidated financial statements for additional information.
|
(2)
|
See Note 3 to the condensed consolidated financial statements for additional information.
|
(in thousands)
|
Three Months Ended
|
||||||
April 30, 2016
|
|
April 30, 2015
|
|||||
Net loss
|
$
|
(1,478
|
)
|
|
$
|
(1,866
|
)
|
Non-cash adjustments to net loss
|
1,981
|
|
|
1,027
|
|
||
Cash impact of changes in assets and liabilities
|
(2,962
|
)
|
|
(220
|
)
|
||
Operating cash flow
|
$
|
(2,459
|
)
|
|
$
|
(1,059
|
)
|
(in thousands)
|
Three Months Ended
|
||||||
April 30, 2016
|
|
April 30, 2015
|
|||||
Purchases of property and equipment
|
$
|
(12
|
)
|
|
$
|
(16
|
)
|
Capitalized software development costs
|
(498
|
)
|
|
—
|
|
||
Investing cash flow
|
$
|
(510
|
)
|
|
$
|
(16
|
)
|
(in thousands)
|
Three Months Ended
|
||||||
April 30, 2016
|
|
April 30, 2015
|
|||||
Principal repayments on term loan
|
$
|
(168
|
)
|
|
$
|
(125
|
)
|
Principal payments on capital lease obligations
|
(217
|
)
|
|
(199
|
)
|
||
Return of shares of common stock in connection with the vesting or exercise of equity incentive awards
|
(12
|
)
|
|
—
|
|
||
Recovery of deferred financing costs
|
—
|
|
|
2
|
|
||
Proceeds from the exercise of stock options and stock purchase plans
|
—
|
|
|
143
|
|
||
Financing cash flow
|
$
|
(397
|
)
|
|
$
|
(179
|
)
|
•
|
the potential failure to achieve the expected benefits of the acquisition, including the inability to generate sufficient revenue to offset acquisition costs, or the inability to achieve expected synergies or cost savings;
|
•
|
unanticipated expenses related to acquired businesses or technologies and their integration into our existing businesses or technology;
|
•
|
the diversion of financial, managerial, and other resources from existing operations;
|
•
|
the risks of entering into new markets in which we have little or no experience or where competitors may have stronger positions;
|
•
|
potential write-offs or amortization of acquired assets or investments;
|
•
|
the potential loss of key employees, clients, or partners of an acquired business;
|
•
|
delays in client purchases due to uncertainty related to any acquisition;
|
•
|
potential unknown liabilities associated with an acquisition; and
|
•
|
the tax effects of any such acquisitions.
|
•
|
General economic and market conditions;
|
•
|
Actual or anticipated variations in annual or quarterly operating results;
|
•
|
Lack of or negative research coverage by securities analysts;
|
•
|
Conditions or trends in the healthcare information technology industry;
|
•
|
Changes in the market valuations of other companies in our industry;
|
•
|
Announcements by us or our competitors of significant acquisitions, strategic partnerships, divestitures, joint ventures or other strategic initiatives;
|
•
|
Announced or anticipated capital commitments;
|
•
|
Ability to maintain listing of our common stock on The Nasdaq Stock Market;
|
•
|
Additions or departures of key personnel; and
|
•
|
Sales and repurchases of our common stock by us, our officers and directors or our significant stockholders, if any.
|
|
|
STREAMLINE HEALTH SOLUTIONS, INC.
|
DATE: June 8, 2016
|
By:
|
/
S
/ David W. Sides
|
|
|
David W. Sides
Chief Executive Officer
|
DATE: June 8, 2016
|
By:
|
/
S
/ Nicholas A. Meeks
|
|
|
Nicholas A. Meeks
Chief Financial Officer
|
Exhibit No.
|
Description of Exhibit
|
10.1*
|
Second Amendment to Credit Agreement dated as of April 29, 2016 by and among Wells Fargo Bank, N.A., the lenders party thereto, Streamline Health Solutions, Inc. and Streamline Health, Inc.
|
31.1*
|
Certification by Chief Executive Officer pursuant to Rule 13a-14(a) of the Exchange Act.
|
31.2*
|
Certification by Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act.
|
32.1*
|
Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
|
32.2*
|
Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350.
|
101
|
The following financial information from Streamline Health Solutions, Inc.’s Quarterly Report on Form 10-Q for the three-month period ended April 30, 2016 filed with the SEC on June 8, 2016, formatted in XBRL includes: (i) Condensed Consolidated Balance Sheets at April 30, 2016 and January 31, 2016, (ii) Condensed Consolidated Statements of Operations for three-month periods ended April 30, 2016 and 2015, (iii) Condensed Consolidated Statements of Comprehensive Loss for three-month periods ended April 30, 2016 and 2015, (iv) Condensed Consolidated Statements of Cash Flows for the three-month periods ended April 30, 2016 and 2015, and (v) Notes to the Condensed Consolidated Financial Statements.
|
*
|
Filed herewith.
|
Applicable Amount
|
Applicable Period
|
$3,000,000
|
For the 4-quarter period
ending April 30, 2016
|
$1,500,000
|
For the 4- quarter period
ending July 31, 2016
|
$250,000
|
For the 4-quarter period
ending October 31, 2016
|
$0
|
For the 4-quarter period
ending January 31, 2017
|
Such amount as is agreed to by Borrower and Required Lenders within 30 days following delivery of, and based upon, the Projections then most recently delivered pursuant to Section 5.1 and approved by Required Lenders;
provided
, that if not approved by Required Lenders or if Borrower and Required Lenders have not agreed to such amounts for the remainder of the term of this Agreement, then an immediate breach of this Section 7(a) shall be deemed to have occurred.
|
For the 4-quarter period ending April 30, 2017 and for the 4-quarter period ending on each July 31, October 31, January 31 and April 30 thereafter
|
7627757v9 5/2/2016 3:46 PM
|
1989.395
|
STREAMLINE HEALTH SOLUTIONS, INC.
, a Delaware corporation, as Parent
By:
/s/ Nicholas Meeks
Name: Nicholas Meeks
Title: Senior Vice President & Chief Financial Officer
|
STREAMLINE HEALTH, INC.
, an Ohio corporation, as Borrower
By:
/s/ Nicholas Meeks
Name: Nicholas Meeks
Title: Senior Vice President & Chief Financial Officer
|
WELLS FARGO BANK, NATIONAL ASSOCIATION
, a national banking association, as Agent and as a Lender
By:
/s/ Andrea Bernard
Name: Andrea Bernard
Title: Managing Director
Its Authorized Signatory
|
June 8, 2016
|
/s/ David W. Sides
|
|
Chief Executive Officer and
President
|
June 8, 2016
|
/s/ Nicholas A. Meeks
|
|
Chief Financial Officer
|
|
(1)
|
The quarterly report on Form 10-Q of the Company for the quarter ended April 30, 2016 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition, and results of operations of the Company.
|
|
(1)
|
The quarterly report on Form 10-Q of the Company for the quarter ended April 30, 2016 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition, and results of operations of the Company.
|