Delaware
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1-10185
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26-1331503
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(State or other jurisdiction
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(Commission
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(I.R.S. Employer
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of incorporation)
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File Number)
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Identification No.)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common
Stock, par value $0.001
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ISDR
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NYSE American
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Exhibit
No.
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Description
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Press Release issued by the Company on July 30,
2020.
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Issuer
Direct Corporation
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Date: July 30,
2020
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By:
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/s/ Brian R.
Balbirnie
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Brian R.
Balbirnie
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Chief Executive
Officer
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Three Months
ended June 30,
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|
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2020
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2019
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Amount
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Amount
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|
|
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Net
income:
|
$772
|
$212
|
Adjustments:
|
|
|
Depreciation and
amortization
|
353
|
419
|
Interest expense
(income)
|
(1)
|
(114)
|
Income tax
expense
|
230
|
33
|
EBITDA:
|
$1,354
|
$550
|
|
Six Months ended
June 30,
|
|
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2020
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2019
|
|
Amount
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Amount
|
|
|
|
Net
income:
|
$998
|
$417
|
Adjustments:
|
|
|
Depreciation and
amortization
|
727
|
831
|
Interest expense
(income)
|
(59)
|
(186)
|
Income tax
expense
|
310
|
46
|
EBITDA:
|
$1,976
|
$1,108
|
|
Three Months
ended June 30,
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|||
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2020
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2019
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||
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Amount
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Per diluted
share
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Amount
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Per diluted
share
|
|
|
|
|
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Net
income:
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$772
|
$0.20
|
$212
|
$0.05
|
Adjustments:
|
|
|
|
|
Amortization of
intangible assets (1)
|
172
|
0.05
|
191
|
0.05
|
Stock-based
compensation (2)
|
84
|
0.02
|
131
|
0.03
|
Tax impact of
adjustments (4)
|
(54)
|
(0.01)
|
(68)
|
(0.02)
|
Impact of discrete
items impacting income tax expense (5)
|
—
|
—
|
11
|
0.01
|
Non-GAAP net
income:
|
$974
|
$0.26
|
$477
|
$0.12
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|
Six Months ended
June 30,
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|||
|
2020
|
2019
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||
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Amount
|
Per diluted
share
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Amount
|
Per diluted
share
|
|
|
|
|
|
Net
income:
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$998
|
$0.27
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$417
|
$0.11
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Adjustments:
|
|
|
|
|
Amortization of
intangible assets (1)
|
344
|
0.09
|
382
|
0.10
|
Stock-based
compensation (2)
|
129
|
0.03
|
268
|
0.07
|
Integration and
acquisition costs (3)
|
—
|
—
|
112
|
0.03
|
Tax impact of
adjustments (4)
|
(99)
|
(0.03)
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(160)
|
(0.04)
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Impact of discrete
items impacting income tax expense (5)
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—
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—
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(24)
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(0.01)
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Non-GAAP net
income:
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$1,372
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$0.36
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$995
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$0.26
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June 30,
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December 31,
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2020
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2019
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ASSETS
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(unaudited)
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|
Current
assets:
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Cash
and cash equivalents
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$17,097
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$15,766
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Accounts
receivable (net of allowance for doubtful accounts of $601 and
$700, respectively)
|
2,599
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2,051
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Income
tax receivable
|
—
|
48
|
Other
current assets
|
273
|
141
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Total
current assets
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19,969
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18,006
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Capitalized
software (net of accumulated amortization of $2,472 and $2,153,
respectively)
|
815
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1,134
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Fixed
assets (net of accumulated amortization of $245 and $181,
respectively)
|
839
|
899
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Right-of-use asset
– leases
|
1,979
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2,127
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Deferred tax
asset
|
292
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256
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Other
long-term assets
|
64
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77
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Goodwill
|
6,376
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6,376
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Intangible
assets (net of accumulated amortization of $5,281 and $4,937,
respectively)
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3,171
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3,515
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Total assets
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$33,505
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$32,390
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current
liabilities:
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Accounts
payable
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$430
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$266
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Accrued
expenses
|
1,385
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1,151
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Note payable
– short-term (net of discount of $6 and $19,
respectively)
|
314
|
301
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Income
taxes payable
|
614
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310
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Deferred
revenue
|
2,015
|
1,812
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Total
current liabilities
|
4,758
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3,840
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Deferred
income tax liability
|
130
|
141
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Lease liabilities
– long-term
|
2,138
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2,309
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Total liabilities
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7,026
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6,290
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Commitments
and contingencies
|
|
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Stockholders'
equity:
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Preferred
stock, $0.001 par value, 1,000,000 shares authorized, no shares
issued and outstanding as of June 30, 2020 and December 31, 2019,
respectively.
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—
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—
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Common stock $0.001 par value,
20,000,000 shares authorized, 3,734,502 and 3,786,398 shares issued and outstanding as
of June 30, 2020 and December 31, 2019,
respectively.
|
4
|
4
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Additional
paid-in capital
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21,619
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22,275
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Other
accumulated comprehensive income (loss)
|
21
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(16)
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Retained
earnings
|
4,835
|
3,837
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Total stockholders' equity
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26,479
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26,100
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Total liabilities and stockholders’ equity
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$33,505
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$32,390
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For the Three
Months Ended
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For the Six
Months Ended
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||
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June
30,
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June
30,
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June
30,
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June
30,
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2020
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2019
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2020
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2019
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Revenues
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$4,884
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$4,138
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$8,900
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$8,317
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Cost of
revenues
|
1,362
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1,250
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2,615
|
2,552
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Gross
profit
|
3,522
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2,888
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6,285
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5,765
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Operating costs and
expenses:
|
|
|
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General and
administrative
|
1,197
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1,322
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2,413
|
2,683
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Sales and marketing
expenses
|
950
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875
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1,846
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1,695
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Product
development
|
165
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343
|
359
|
680
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Depreciation and
amortization
|
209
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218
|
418
|
430
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Total operating
costs and expenses
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2,521
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2,758
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5,036
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5,488
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Operating
income
|
1,001
|
130
|
1,249
|
277
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Interest income
(expense), net
|
1
|
115
|
59
|
186)
|
Income before
income taxes
|
1,002
|
245
|
1,308
|
463
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Income tax
expense
|
230
|
33
|
310
|
46
|
Net
income
|
$772
|
$212
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$998
|
$417
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Income per share
– basic
|
$0.21
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$0.05
|
$0.27
|
$0.11
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Income per share
– fully diluted
|
$0.21
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$0.05
|
$0.26
|
$0.11
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Weighted average
number of common shares outstanding – basic
|
3,736
|
3,857
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3,762
|
3,854
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Weighted average
number of common shares outstanding – fully
diluted
|
3,761
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3,873
|
3,789
|
3,871
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For the Six Months Ended
|
|
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June 30,
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June 30,
|
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2020
|
2019
|
Cash flows from operating activities:
|
|
|
Net
income
|
$998
|
$417
|
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
|
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Depreciation
and amortization
|
727
|
831
|
Bad
debt expense
|
182
|
555
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Deferred
income taxes
|
(51)
|
6
|
Non-cash
interest expense
|
13
|
13
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Stock-based
compensation expense
|
129
|
268
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Changes
in operating assets and liabilities:
|
|
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Decrease
(increase) in accounts receivable
|
(730)
|
(1,384)
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Decrease
(increase) in other assets
|
77
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(266)
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Increase
(decrease) in accounts payable
|
164
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67
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Increase
(decrease) in accrued expenses and other liabilities
|
367
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(87)
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Increase
(decrease) in deferred revenue
|
203
|
375
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Net
cash provided by operating activities
|
2,079
|
795
|
|
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Cash flows from investing activities:
|
|
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Purchase
of VisualWebcaster Platform
|
—
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(2,788)
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Capitalized
software
|
—
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(20)
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Purchase
of fixed assets
|
(4)
|
(6)
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Net
cash used in investing activities
|
(4)
|
(2,814)
|
|
|
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Cash flows from financing activities:
|
|
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Payment
for stock repurchase and retirement
|
(785)
|
—
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Net
cash used in financing activities
|
(785)
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—
|
|
|
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Net
change in cash
|
1,290
|
(2,019)
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Cash
– beginning
|
15,766
|
17,222
|
Currency
translation adjustment
|
41
|
(7)
|
Cash
– ending
|
$17,097
|
$15,196
|
|
|
|
Supplemental disclosures:
|
|
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Cash
paid for income taxes
|
$12
|
$128
|
Non-cash activities:
|
|
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Right-of-use
assets obtained in exchange for lease liabilities
|
$—
|
$260
|