Delaware
|
|
7372
|
|
52-2263942
|
(State
or other jurisdiction of
incorporation
or organization)
|
|
(Primary
Standard Industrial
Classification
Code Number)
|
|
(IRS
Employer
Identification
Number)
|
Carl
F. Barnes, Esq.
Joseph
C. Marrow, Esq.
Morse,
Barnes-Brown & Pendleton, P.C.
1601
Trapelo Road
Waltham,
Massachusetts 02451
(781)
622-5930
(781)
622-5933 (fax)
|
Ralph
V. De Martino, Esq.
F.
Alec Orudjev, Esq.
Cozen
O’Connor
1627
I Street, N.W., Suite 1100
Washington,
D.C. 20006
(202) 912-4800
(202) 912-4830
(fax)
|
|
|
Price
to the Public
|
|
|
Underwriting
Discounts
and
Commissions
|
|
|
Proceeds,
Before
Expenses,
to
the Company
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Per
Share
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
·
|
To
increase sales by developing Web applications such as on-line
ordering
systems and proactive integrated marketing tools with lead generation
capabilities.
|
·
|
To
improve customer service and customer loyalty by developing Web
applications that provide self-service portals that automate
interactions
between the customers and their partners. These types of portals
reduce
their administrative and operational
costs.
|
·
|
To
enhance employee communication and training by developing on-line
training
applications allowing our customers to create topic-based training
programs such as orientation training for new hires and new policy
rollout
training for current employees. These types of on-line training
applications reduce their administrative and operational
costs.
|
·
|
Content
Management
|
·
|
eCommerce
Management
|
·
|
Relationship
Management
|
·
|
eMarketing
Management
|
·
|
Grants
Management
|
·
|
User
experience development
|
·
|
Web
application development
|
·
|
Search
engine optimization
|
·
|
In
December 2000, we acquired Streamline Communications, a Boston,
Massachusetts-based company.
|
·
|
In
February 2002, we acquired Lead Dog Digital, Inc., a New York,
New
York-based company.
|
·
|
In
December 2004, we acquired Interactive Applications Group, Inc.
(“iapps”®),
a
Washington, D.C.-based company.
|
·
|
In
April 2006, we acquired New Tilt, Inc. (“New Tilt”), a Cambridge,
Massachusetts-based company.
|
·
|
our
limited operating history on which to evaluate our
operations;
|
·
|
we
have suffered losses since inception which may recur in the future
as we
expand;
|
·
|
our
licenses are renewable on a monthly basis and a reduction in our
license
renewal rate could significantly reduce our revenues;
|
·
|
our
inability to manage our future growth efficiently or
profitably;
|
·
|
our
inability to complete the Objectware acquisition or to efficiently
integrate Objectware into our operations;
|
·
|
if
our products fail to perform properly due to undetected errors
or similar
problems, our business
|
|
could
suffer, and we could face product liability
exposure;
|
·
|
if
the security of our software, in particular the hosted Internet
solutions
products we have developed, is breached, our business and reputation
could
suffer;
|
·
|
if
we undertake future business combinations and acquisitions, they
may be
difficult to integrate into our existing operations, may disrupt
our
business, dilute stockholder value or divert management’s
attention;
|
·
|
our
external auditors have identified material weaknesses in our internal
controls;
|
·
|
our
dependence on our management team and key personnel and the loss
or
inability to retain these individuals could harm our business;
and
|
·
|
intense
and growing competition, which could result in price reductions,
reduced
operating margins and loss of market
share.
|
Securities
Offered
|
3,000,000
shares of our common stock.
|
|
|
Over-Allotment
Option
|
450,000
shares of our common stock.
|
|
|
Common
Stock to be Outstanding After This Offering
|
7,273,833
shares (7,723,833 shares if the over-allotment option is exercised
in full
by the underwriters), of which 3,000,000 shares or approximately
41.2%
would be held by persons purchasing in this offering (3,450,000
shares or
approximately 44.7%, if the over-allotment option is exercised
in full by
the underwriters).
|
|
|
Use
of Proceeds
|
We
intend to use the net proceeds from this offering as follows:
·
Approximately $2,800,000 to repay all of our
indebtedness;
·
Approximately $2,955,000 to pay the cash portion of
the acquisition
of Objectware, together with expenses associated with that
acquisition;
·
Approximately $2,000,000 over the next four years to
complete
future acquisitions; and
·
$6,426,000 for general corporate purposes, including
working
capital. See “Use of Proceeds” for additional
information.
|
|
|
Trading
Symbols
|
We
have applied for listing of our common stock on the Nasdaq
Capital Market
and the Boston Stock Exchange under the symbols “BLSW” and “BLS,”
respectively.
|
|
|
Risk
Factors
|
You
should consider carefully all of the information set forth
in this
prospectus, and, in particular, the specific factors set forth
under “Risk
Factors” beginning at page 10, before deciding whether to invest in
our
shares.
|
·
|
490,909
shares issuable upon the acquisition of Objectware and an indeterminate
number of additional shares we may issue quarterly over three
years after
we acquire Objectware, the issuance of which is contingent upon
the
achievement by Objectware of certain operating results;
|
·
|
903,606
shares issuable upon the exercise of outstanding options at a
weighted
average price of $3.13 per
share;
|
·
|
578,269
shares issuable upon the exercise of outstanding warrants;
and
|
·
|
150,000
shares issuable upon exercise of underwriters’ warrants at a price equal
to 125% of the offering price of the
shares.
|
|
Unaudited
|
|
|
|||||||||||||
|
Three
Months Ended December 31,
|
Year
Ended September 30,
|
||||||||||||||
|
2006
|
2005
|
2006
|
2005
|
||||||||||||
Historical
Statements of Operations Data:
|
|
|
|
|
||||||||||||
Revenue
|
$ |
2,309,000
|
$ |
1,713,000
|
$ |
8,235,000
|
$ |
5,769,000
|
||||||||
Cost
of revenue
|
1,141,000
|
867,000
|
3,809,000
|
3,113,000
|
||||||||||||
Gross
profit
|
1,168,000
|
846,000
|
4,426,000
|
2,656,000
|
||||||||||||
Operating
loss
|
(285,000 | ) | (147,000 | ) | (810,000 | ) | (461,000 | ) |
Net
loss
|
(630,000 | ) | (174,000 | ) | (1,448,000 | ) | (517,000 | ) | ||||||||
Basic
and diluted loss per share
|
$ | (0.15 | ) | $ | (0.04 | ) | $ | (0.36 | ) | $ | (0.14 | ) | ||||
Weighted
average shares
|
4,273,833
|
3,903,833
|
4,046,278
|
3,804,527
|
|
Three
Months Ended
December
31, 2006
|
Year
Ended
September
30, 2006 (a)
|
||||||
Unaudited
Proforma Statements of Operations Data:
|
|
|
||||||
Revenue
|
$ |
3,423.000
|
$ |
13,056,000
|
||||
Cost
of revenue
|
1,684,000
|
6,653,000
|
||||||
Gross
profit
|
1,739,000
|
6,403,000
|
||||||
Operating
income (loss)
|
(32,000 | ) |
54,000
|
|||||
Net
income (loss)
|
(34,000 | ) |
48,000
|
|||||
Earnings
(loss) per share:
|
||||||||
Basic
|
$ |
0.00
|
$ |
0.01
|
||||
Diluted
|
$ |
0.00
|
$ |
0.01
|
||||
Weighted
average shares:
|
||||||||
Basic
|
7,764,742
|
8,039,409
|
||||||
Diluted
|
7,764,742
|
8,638,387
|
As
of December 31, 2006
|
||||||||
Historical
|
Pro
Forma (b)
|
|||||||
Balance
Sheet Data:
|
|
|
||||||
Working
capital
|
$ | (2,660,000 | ) | $ |
9,646,000
|
|||
Total
assets
|
$ |
9,810,000
|
$ |
24,146,000
|
||||
Total
liabilities
|
$ |
4,717,000
|
$ |
2,503,000
|
||||
Total
shareholders’ equity
|
$ |
5,093,000
|
$ |
21,643,000
|
·
|
it
does not reflect cash expenditures for capital asset
purchases
|
·
|
it
does not reflect the non-cash impact of stock compensation
expenses
|
·
|
it
does not reflect the cash impact of changes in deferred
revenues
|
·
|
it
does not reflect the cash impact of the changes in deferred assets
and
liabilities
|
|
Unaudited
|
|
|
|||||||||||||
|
Three
Months Ended December 31,
|
Year
Ended September 30,
|
||||||||||||||
Other
Financial Data:
|
2006
|
2005
|
2006
|
2005
|
||||||||||||
Net loss
|
$ | (630,000 | ) | $ | (174,000 | ) | $ | (1,448,000 | ) | $ | (517,000 | ) | ||||
Interest
expense
|
345,000
|
27,000
|
638,000
|
56
,000
|
||||||||||||
Depreciation
|
48,000
|
23,000
|
186,000
|
106,000
|
||||||||||||
Amortization
of intangibles
|
32,000
|
28,000
|
119,000
|
94
,000
|
||||||||||||
EBITDA
|
$ | (205,000 | ) | $ | (96,000 | ) | $ | (505,000 | ) | $ | (261,000 | ) | ||||
Other
Unaudited Proforma Financial Data:
|
Three
Months Ended
December
31, 2006 (b)
|
Year
Ended
September
30, 2006 (a)
|
||||||
Net
income
|
$ | (34,000 | ) | $ |
48,000
|
|||
Income
tax provision
|
16,000
|
57,000
|
||||||
Interest
expense
|
5,000
|
17,000
|
||||||
Depreciation
|
55,000
|
166,000
|
||||||
Amortization
of intangibles
|
33,000
|
212,000
|
||||||
EBITDA
|
$ |
75,000
|
$ |
500,000
|
(a)
|
On
April 24, 2006 and December 15, 2004 we acquired New Tilt and iapps®,
respectively. The results of operations of New Tilt and iapps are
included in our consolidated financial statements from the dates
of the
acquisitions. Subsequent to the sale of 3,000,000 shares of our common
stock in this offering, we intend to acquire Objectware. A portion
of the
proceeds of this offering will be used to retire indebtedness. The
accompanying summary financial data reflect the effect of these
transactions as if they occurred at the beginning of the most recent
fiscal year on October 1, 2005.
|
(b)
|
Subsequent
to the sale of 3,000,000 shares of our common stock in this offering,
we
intend to acquire Objectware. A portion of the proceeds of this
offering
will be used to retire indebtedness. The accompanying summary financial
data reflect the effect of these transactions as if they occurred
at the
beginning of the fiscal year on October 1,
2006.
|
·
|
harm
to our reputation;
|
·
|
lost
sales;
|
·
|
delays
in commercial release;
|
·
|
product
liability claims;
|
·
|
contractual
disputes;
|
·
|
negative
publicity;
|
·
|
delays
in or loss of market acceptance of our products;
|
·
|
license
terminations or renegotiations; or
|
·
|
unexpected
expenses and diversion of resources to remedy
errors.
|
·
|
be
expensive and time consuming to defend;
|
·
|
result
in negative publicity;
|
·
|
force
us to stop licensing our products that incorporate the challenged
intellectual property;
|
·
|
require
us to redesign our products;
|
·
|
divert
management’s attention and our other resources; or
|
·
|
require
us to enter into royalty or licensing agreements in order to obtain
the
right to use necessary technologies, which may not be available on
terms
acceptable to us, if at all.
|
·
|
user
privacy;
|
·
|
the
pricing and taxation of goods and services offered over the
Internet;
|
·
|
the
content of Websites;
|
·
|
copyrights;
|
·
|
consumer
protection, including the potential application of “do not call” registry
requirements on customers and consumer backlash in general to direct
marketing efforts of customers;
|
·
|
the
online distribution of specific material or content over the Internet;
or
|
·
|
the
characteristics and quality of products and services offered over
the
Internet.
|
·
|
variations
in our operating results;
|
·
|
changes
in the general economy and in the local economies in which we
operate;
|
·
|
the
departure of any of our key executive officers and
directors;
|
·
|
the
level and quality of securities analysts’ coverage for our common
stock;
|
·
|
announcements
by us or our competitors of significant acquisitions, strategic
partnerships, joint ventures or capital
commitments;
|
·
|
changes
in the federal, state, and local laws and regulations to which we
are
subject; and
|
·
|
future
sales of our common stock.
|
·
|
Our
inability to attract new customers at a steady or increasing
rate;
|
·
|
Our
inability to provide and maintain customer
satisfaction;
|
·
|
Price
competition or higher prices in the industry;
|
·
|
Higher
than expected costs of operating our
business;
|
·
|
The
amount and timing of operating costs and capital expenditures relating
to
the expansion of our business, operations and infrastructure are
greater
and higher than expected;
|
·
|
Technical,
legal and regulatory difficulties with respect to our business
occur; and
|
·
|
General
downturn in economic conditions that are specific to our market,
such as a
decline in information technology
spending.
|
·
|
authorizing
the issuance of preferred stock that can be created and issued by
our
Board of Directors without prior shareholder approval, commonly referred
to as “blank check” preferred stock, with rights senior to those of our
common stock;
|
·
|
limiting
the persons who can call special shareholder
meetings;
|
·
|
establishing
advance notice requirements to nominate persons for election to our
Board
of Directors or to propose matters that can be acted on by shareholders
at
shareholder meetings;
|
·
|
the
lack of cumulative voting in the election of
directors;
|
·
|
requiring
an advance notice of any shareholder business before the annual meeting
of
our shareholders;
|
·
|
filling
vacancies on our Board of Directors by action of a majority of the
directors and not by the
shareholders, and
|
·
|
the
division of our Board of Directors into three classes with each class
of
directors elected for a staggered three year term. In addition, our
organizational documents will contain a supermajority voting requirement
for any amendments of the staggered board
provisions.
|
Use
|
Amount
(in
thousands)
|
Percent
|
||||||
Repayment
of indebtedness
|
$ |
2,800
|
19.8 | % | ||||
Payment
of cash portion in connection with the acquisition of Objectware,
together
with expenses associated with that acquisition
|
2,955
|
20.8 | % | |||||
Other
potential acquisitions (approximate)
|
2,000
|
14.1 | % | |||||
General
corporate purposes, including working capital
|
6,426
|
45.3 | % | |||||
Total
|
$ |
14,181
|
100.0 | % |
·
|
“Actual”
is based on our unaudited financial statements as of December 31,
2006.
|
·
|
“Adjustments”
gives the effect of the sale of shares in this offering and the
application of the net proceeds from this offering as described
under “Use
of Proceeds” on page 21 and assumes that the underwriters do not exercise
their over-allotment option and is further adjusted for issuances
of
shares and options pursuant to the completion of the acquisition
of
Objectware.
|
·
|
“As
Adjusted” gives the net effect of the adjustments to actual for the sale
of shares in this offering and the application of the net proceeds
from
this offering as described under “Use of Proceeds” on page
21 assuming that the underwriters do not exercise their
over-allotment option, and the effect for issuances of shares and
options
pursuant to the completion of the acquisition of
Objectware.
|
|
December
31, 2006
(Dollars
in thousands)
|
|||||||||||
|
Actual
|
Adjustments
(a)
|
As
Adjusted
|
|||||||||
Long-term
obligations, including current maturities
|
$ |
2,766
|
$ | (2,633 | ) | $ |
133
|
|||||
Shareholders’
equity:
|
||||||||||||
Common
stock $.001 par value: 20,000,000 shares authorized, 4,273,833 shares
issued and outstanding (actual) and 7,273,833 shares issued and
outstanding (as adjusted)
|
4
|
3
|
7
|
|||||||||
Preferred
stock, $.001 par value: 1,000,000 shares authorized, no shares issued
and outstanding
|
—
|
—
|
—
|
|||||||||
Additional
paid-in capital
|
9,882
|
16,865
|
26,747
|
|||||||||
Accumulated
deficit
|
(4,793 | ) | (318 | )(b) | (5,111 | ) | ||||||
Total
equity
|
5,093
|
16,550
|
21,643
|
|||||||||
|
||||||||||||
Total
capitalization
|
$ |
7,859
|
$ |
13,917
|
$ |
21,776
|
||||||
|
(a)
|
Gives
effect to the sale of an aggregate 3,000,000 shares of common stock
in
this offering resulting in net proceeds to us of $14,181,000 net
of
underwriters discount of 10.75% and other expenses of the
offering, assuming no exercise of the underwriters’ over-allotment
option, and issuance of an additional 490,909 shares of common
stock upon
the completion of the acquisition of Objectware at an assumed price
of
$5.50 per share combined with $174,000 representing conversion
of
Objectware options to Bridgeline
options.
|
(b)
|
Includes
expensing the unamortized debt discount of $167,000 and unamortized
financing fees of $151,000.
|
|
Unaudited
Three Months Ended December 31,
|
Year
Ended September 30,
|
||||||||||||||||||||||
|
|
|
|
|
Unaudited
|
|
||||||||||||||||||
|
Historical
|
Pro
Forma
|
Historical
|
Historical
|
Pro
Forma
|
Historical
|
||||||||||||||||||
|
2006
|
2006
(b)
|
2005
|
2006
|
2006
(a)
|
2005
|
||||||||||||||||||
Income
Statement Data:
|
|
|
|
|
|
|
||||||||||||||||||
Revenues
|
$ |
2,309
|
$ |
3,423
|
$ |
1,713
|
$ |
8,235
|
$ |
13,056
|
$ |
5,769
|
||||||||||||
Cost
of revenue
|
1,141
|
1,684
|
867
|
3,809
|
6,653
|
3,113
|
||||||||||||||||||
Gross
profit
|
1,168
|
1,739
|
846
|
4,426
|
6,403
|
2,656
|
||||||||||||||||||
Income
(loss) from operations
|
$ | (285 | ) | $ | (32 | ) | $ | (147 | ) | $ | (810 | ) | $ |
54
|
$ | (461 | ) | |||||||
Net
income (loss)
|
$ | (630 | ) | $ | (34 | ) | $ | (174 | ) | $ | (1,448 | ) | $ |
48
|
$ | (517 | ) | |||||||
|
||||||||||||||||||||||||
Net
income (loss) per share:
|
||||||||||||||||||||||||
Basic
|
$ | (0.15 | ) | $ |
0.00
|
$ | (0.04 | ) | $ | (0.36 | ) | $ |
0.01
|
$ | (0.14 | ) | ||||||||
Diluted
|
$ | (0.15 | ) | $ |
0.00
|
$ | (0.04 | ) | $ | (0.36 | ) | $ |
0.01
|
$ | (0.14 | ) | ||||||||
|
Unaudited
Three Months Ended December 31,
|
Year
Ended September 30,
|
||||||||||||||||||||||
|
|
|
|
|
Unaudited
|
|
||||||||||||||||||
|
Historical
|
Pro
Forma
|
Historical
|
Historical
|
Pro
Forma
|
Historical
|
||||||||||||||||||
|
2006
|
2006
(b)
|
2005
|
2006
|
2006
(a)
|
2005
|
Number
of weighted average shares:
|
||||||||||||||||||||||||
Basic
|
4,273,833
|
7,764,742
|
3,903,833
|
4,046,278
|
8,039,409
|
3,804,527
|
||||||||||||||||||
Diluted
|
4,273,833
|
7,764,742
|
3,903,833
|
4,046,278
|
8,638,387
|
3,804,527
|
||||||||||||||||||
|
||||||||||||||||||||||||
Balance
Sheet Data:
|
||||||||||||||||||||||||
Current
assets
|
$ |
1,971
|
$ |
12,054
|
$ |
1,714
|
$ |
2,073
|
$ |
11,453
|
$ |
935
|
||||||||||||
Total
assets
|
$ |
9,810
|
$ |
24,146
|
$ |
7,592
|
$ |
9,824
|
$ |
23,729
|
$ |
6,739
|
||||||||||||
|
||||||||||||||||||||||||
Current
liabilities
|
$ |
4,631
|
$ |
2,408
|
$ |
2,106
|
$ |
4,093
|
$ |
1,948
|
$ |
1,114
|
||||||||||||
Total
liabilities
|
$ |
4,717
|
$ |
2,503
|
$ |
2,172
|
$ |
4,192
|
$ |
2,056
|
$ |
1,147
|
||||||||||||
|
||||||||||||||||||||||||
Total
shareholders’ equity
|
$ |
5,093
|
$ |
21,643
|
$ |
5,420
|
$ |
5,632
|
$ |
21,673
|
$ |
5,592
|
||||||||||||
|
||||||||||||||||||||||||
Total
liabilities and shareholders’ equity
|
$ |
9,810
|
$ |
24,146
|
$ |
7,592
|
$ |
9,824
|
$ |
23,729
|
$ |
6,739
|
|
Unaudited
Three Months Ended December 31,
|
Year
Ended September 30,
|
||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
|
Historical
|
|
Historical
|
Historical
|
Historical
|
|||||||||||||||||||
|
2006
|
2005
|
2006
|
2005
|
Cash
Flow Data:
|
||||||||||||||||||||||||
Net
cash (used in) provided by operating activities
|
$ | (320 | ) | $ |
302
|
$ | (733 | ) | $ | (430 | ) | |||||||||||||
Acquisitions,
net of cash acquired
|
$ |
—
|
$ |
—
|
$ | (553 | ) | $ | (310 | ) | ||||||||||||||
Net
cash used in investing activities
|
$ | (91 | ) | $ | (63 | ) | $ | (842 | ) | $ | (545 | ) | ||||||||||||
Proceeds
from issuance of short-term debt
|
$ |
—
|
$ |
323
|
$ |
2,434
|
$ |
—
|
||||||||||||||||
Net
increase (decrease) in cash for the period
|
$ | (422 | ) | $ |
518
|
$ |
453
|
$ | (818 | ) |
(a)
|
Reflects
the April 24, 2006
acquisition of New Tilt, the probable acquisition of Objectware and
this
offering.
|
(b)
|
Reflects
the probable
acquisition of Objectware and this
offering.
|
|
Without
giving effect
to
the release of the
closing
escrow in
connection
with the
acquisition
of
Objectware
|
After
giving effect
to
the release of the
closing
escrow in
connection
with the
acquisition
of
Objectware
|
||||||
Assumed
initial public offering price per share
|
$ |
5.50
|
$ |
5.50
|
||||
Net
tangible book value (deficit) per share before the
offering
|
(0.52 | ) | (0.52 | ) | ||||
Reduction
in deficit in net tangible book value per share attributable
to the
offering
|
2.21
|
2.21
|
||||||
Increase
in deficit in net tangible book value per share attributable
to the
acquisition of Objectware
|
—
|
(0.27
|
) | |||||
Pro
forma net tangible book value per share after the offering
|
1.69
|
1.42
|
||||||
Dilution
per share to new investors
|
$ |
3.81
|
$ |
4.08
|
|
|
|
|
Consideration
|
||||||||||||||||
|
Shares
|
Purchased
|
Total
|
|
Price/Share
|
|||||||||||||||
|
Number
|
Percent
|
Amount
|
Percent
|
Average
|
|||||||||||||||
Officers,
directors, promoters and affiliated persons
|
2,479,216
|
32.35 | % | $ |
5,014,605
|
(1)
|
18.02 | % | $ |
2.02
|
||||||||||
Other
existing shareholders
|
2,184,908
|
28.51 | % |
6,313,915
|
(2)
|
22.69 | % | $ |
2.89
|
|||||||||||
New
Investors
|
3,000,000
|
39.14 | % |
16,500,000
|
59.29 | % | $ |
5.50
|
||||||||||||
Total
|
7,664,124
|
100.00 | % | $ |
27,828,520
|
100.00 | % | $ |
3.63
|
|||||||||||
|
(1)
|
The
total consideration paid by officers, directors, promoters and
affiliated
persons includes: (i) $2,467,082 received in the form of stock
of companies we acquired; (ii) $1,227,919 in cash consideration
received
or which may be received upon the exercise of options or warrants
previously exercised, currently exercisable or exercisable within
60 days
after February 1, 2007; (iii) $2,600 in cash consideration received
in
return for shares of common stock issued to our founder upon our
organization; and (iv) $1,317,003 in cash consideration received
in
several private placements.
|
(2)
|
The
total consideration paid by all other existing shareholders
includes: (i) $3,257,125 received in the form of stock of
companies we acquired; and (ii) $3,056,790 in cash consideration
received
in several private
placements.
|
|
Unaudited
Three Months
Ended
December 31,
|
Year
Ended September 30,
|
||||||||||||||
|
(in
thousands)
|
(in
thousands)
|
||||||||||||||
|
|
|
|
|
||||||||||||
|
2006
(a)
|
2005
|
2006
|
2005
|
||||||||||||
Income
Statement Data:
|
|
|
|
|
||||||||||||
Revenues
|
$ |
2,309
|
$ |
1,713
|
$ |
8,235
|
$ |
5,769
|
||||||||
Cost
of revenue
|
1,141
|
867
|
3,809
|
3,113
|
||||||||||||
Gross
profit
|
1,168
|
846
|
4,426
|
2,656
|
||||||||||||
Loss
from operations
|
$ | (285 | ) | $ | (147 | ) | $ | (810 | ) | $ | (461 | ) | ||||
|
||||||||||||||||
Net
loss
|
$ | (630 | ) | $ | (174 | ) | $ | (1,448 | ) | $ | (517 | ) | ||||
|
||||||||||||||||
Net
loss per share:
|
||||||||||||||||
Basic
and diluted
|
$ | (0.15 | ) | $ | (0.04 | ) | $ | (0.36 | ) | $ | (0.14 | ) | ||||
|
||||||||||||||||
Balance
Sheet Data:
|
||||||||||||||||
Current
assets
|
$ |
1,971
|
$ |
1,714
|
$ |
2,073
|
$ |
935
|
||||||||
Definite-lived
intangible assets, net
|
$ |
271
|
$ |
303
|
$ |
303
|
$ |
331
|
||||||||
Goodwill
|
$ |
6,409
|
$ |
5,122
|
$ |
6,346
|
$ |
5,097
|
||||||||
Total
assets
|
$ |
9,810
|
$ |
7,592
|
$ |
9,824
|
$ |
6,739
|
||||||||
|
||||||||||||||||
Senior
notes payable, net of discount
|
$ |
2,633
|
$ |
—
|
$ |
2,497
|
$ |
—
|
||||||||
Current
liabilities
|
$ |
4,631
|
$ |
2,106
|
$ |
4,093
|
$ |
1,114
|
Total
liabilities
|
$ |
4,717
|
$ |
2,172
|
$ |
4,192
|
$ |
1,147
|
||||||||
|
||||||||||||||||
Total
shareholders’ equity
|
$ |
5,093
|
$ |
5,420
|
$ |
5,632
|
$ |
5,592
|
||||||||
|
||||||||||||||||
Total
liabilities and shareholders’ equity
|
$ |
9,810
|
$ |
7,592
|
$ |
9,824
|
$ |
6,739
|
Actual
|
Proforma
|
|||||||||||
|
Unaudited
Three
|
Unaudited
Three
|
Unaudited
|
|||||||||
|
Months
Ended
|
Months
Ended
|
Year
Ended
|
|||||||||
|
December
31, 2006
|
December
31, 2006 (b)
|
September
30, 2006 (c)
|
|||||||||
Income
Statement Data:
|
|
|
||||||||||
Revenues
|
$ |
2,309
|
$ |
3,423
|
$ |
13,056
|
||||||
Cost
of revenue
|
1,141
|
1,684
|
6,653
|
|||||||||
Gross
profit
|
1,168
|
1,739
|
6,403
|
|||||||||
Sales
and marketing expense
|
837
|
837
|
3,304
|
|||||||||
Technology
development
|
155
|
155
|
176
|
|||||||||
General
and administrative expense
|
461
|
779
|
2,869
|
|||||||||
Income (loss)
from operations
|
$ | (285 | ) | $ | (32 | ) | $ |
54
|
||||
|
||||||||||||
Net
income (loss)
|
$ | (630 | ) | $ | (34 | ) | $ |
48
|
||||
|
||||||||||||
Net
income per share:
|
||||||||||||
Basic
|
$ | (0.15 | ) | $ |
0.00
|
$ |
0.01
|
|||||
Diluted
|
$ | (0.15 | ) | $ |
0.00
|
$ |
0.01
|
|||||
Weighted
Average Shares:
|
||||||||||||
Basic
|
4,273,833
|
7,764,742
|
8,039,409
|
|||||||||
Diluted
|
4,273,833
|
7,764,742
|
8,638,387
|
|||||||||
|
||||||||||||
Balance
Sheet Data:
|
||||||||||||
Current
assets
|
$ |
1,971
|
$ |
12,054
|
$ |
11,453
|
||||||
Definite-lived
intangible assets, net
|
$ |
271
|
$ |
680
|
$ |
712
|
||||||
Goodwill
|
$ |
6,409
|
$ |
10,346
|
$ |
10,386
|
||||||
Total
assets
|
$ |
9,810
|
$ |
24,146
|
$ |
23,729
|
||||||
|
||||||||||||
Short-term
debt, net of discount
|
$ |
2,633
|
$ |
—
|
$ |
—
|
||||||
Current
liabilities
|
$ |
4,631
|
$ |
2,408
|
$ |
1,948
|
||||||
Total
liabilities
|
$ |
4,717
|
$ |
2,503
|
$ |
2,056
|
||||||
|
||||||||||||
Total
shareholders’ equity
|
$ |
5,093
|
$ |
21,643
|
$ |
21,673
|
||||||
|
||||||||||||
Total
liabilities and shareholders’ equity
|
$ |
9,810
|
$ |
24,146
|
$ |
23,729
|
(a)
|
On
April 25, 2006, we acquired New Tilt. The operations of New Tilt
have been
included in our consolidated financial statements from the date of
acquisition.
|
(b)
|
Reflects
the probable acquisition of Objectware and the
offering.
|
|
|
Three
Months Ended
December 31,
|
|
Years
Ended September
30,
|
||||
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
Web
Services
|
|
81.5%
|
|
77.8%
|
|
79.2%
|
|
72.5%
|
Managed
Services
|
|
13.3
|
|
15.6
|
|
15.1
|
|
21.6
|
Subscription
|
|
5.2
|
|
6.6
|
|
5.7
|
|
5.9
|
|
|
100.0%
|
|
100.0%
|
|
100.0%
|
|
100.0%
|
·
|
economic
conditions affecting the budget priorities of our
customers;
|
·
|
the
acquisition or cancellation of significant
clients;
|
·
|
worldwide
acts of terrorism effecting U.S. markets; and
|
·
|
seasonality.
|
·
|
Allowance
for doubtful accounts;
|
·
|
Revenue
recognition;
|
·
|
Accounting
for goodwill and other intangible assets; and
|
·
|
Accounting
for stock-based compensation.
|