Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jan. 31, 2016 | Apr. 15, 2016 | Jul. 31, 2015 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | STREAMLINE HEALTH SOLUTIONS INC. | ||
Entity Central Index Key | 1,008,586 | ||
Document Type | 10-K | ||
Document Period End Date | Jan. 31, 2016 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --01-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 45,488,878 | ||
Entity Common Stock, Shares Outstanding | 19,361,549 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jan. 31, 2016 | Jan. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 9,882,136 | $ 6,522,600 |
Accounts receivable, net of allowance for doubtful accounts of $155,407 and $665,962, respectively | 4,199,315 | 6,935,270 |
Contract receivables | 119,697 | 191,465 |
Prepaid hardware and third party software for future delivery | 5,858 | 55,173 |
Prepaid client maintenance contracts | 956,913 | 935,858 |
Other prepaid assets | 941,532 | 1,437,680 |
Deferred income taxes | 0 | 220,004 |
Other current assets | 97,986 | 207,673 |
Total current assets | 16,203,437 | 16,505,723 |
Property and equipment: | ||
Computer equipment | 2,647,135 | 2,381,923 |
Computer software | 801,895 | 964,857 |
Office furniture, fixtures and equipment | 683,443 | 683,443 |
Leasehold improvements | 729,348 | 724,015 |
Property and equipment, gross | 4,861,821 | 4,754,238 |
Accumulated depreciation and amortization | (2,407,746) | (1,617,423) |
Property and equipment, net | 2,454,075 | 3,136,815 |
Contract receivables, less current portion | 8,711 | 43,553 |
Capitalized software development costs, net of accumulated amortization of $14,919,948 and $11,846,468, respectively | 6,123,638 | 9,197,118 |
Intangible assets, net | 8,155,325 | 9,500,317 |
Deferred financing costs, net of accumulated amortization of $84,531 and $13,677, respectively | 270,147 | 387,199 |
Goodwill | 16,184,667 | 16,184,667 |
Other non-current assets | 746,018 | 823,723 |
Total non-current assets | 33,942,581 | 39,273,392 |
Total assets | 50,146,018 | 55,779,115 |
Current liabilities: | ||
Accounts payable | 1,136,779 | 2,298,851 |
Accrued compensation | 935,324 | 865,865 |
Accrued other expenses | 328,551 | 563,838 |
Current portion of term loan | 673,807 | 500,000 |
Deferred revenues | 10,447,280 | 9,289,076 |
Current portion of capital lease obligation | 592,642 | 781,961 |
Total current liabilities | 14,114,383 | 14,299,591 |
Non-current liabilities: | ||
Term loan | 7,861,084 | 9,500,000 |
Warrants liability | 205,113 | 1,834,380 |
Royalty liability | 2,291,888 | 2,385,826 |
Lease incentive liability, less current portion | 369,406 | 342,129 |
Capital lease obligation | 93,257 | 582,911 |
Deferred revenues, less current portion | 1,212,709 | 964,933 |
Deferred income tax liabilities | 0 | 229,579 |
Total non-current liabilities | 12,033,457 | 15,839,758 |
Total liabilities | 26,147,840 | 30,139,349 |
Series A 0% Convertible Redeemable Preferred Stock, $.01 par value per share, $8,849,985 redemption and liquidation value, 4,000,000 shares authorized, 2,949,995 issued and outstanding, net of unamortized preferred stock discount of $875,935 and $2,212,007, respectively | 7,974,050 | 6,637,978 |
Stockholders’ equity: | ||
Common stock, $.01 par value per share, 45,000,000 shares authorized; 18,783,540 and 18,553,389 shares issued and outstanding, respectively | 187,836 | 185,534 |
Additional paid in capital | 79,700,577 | 78,390,424 |
Accumulated deficit | (63,864,285) | (59,574,170) |
Total stockholders’ equity | 16,024,128 | 19,001,788 |
Total liability and stockholders' equity | $ 50,146,018 | $ 55,779,115 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Allowance for doubtful accounts | $ 155,407 | $ 665,962 |
Accumulated amortization of capitalized software development costs | 14,919,948 | 11,846,468 |
Deferred financing costs, net of accumulated amortization of $84,531 and $13,677, respectively | $ 84,531 | $ 13,677 |
Common stock, par value (USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 45,000,000 | 45,000,000 |
Common stock, shares issued | 18,783,540 | 18,553,389 |
Common stock, shares outstanding | 18,783,540 | 18,553,389 |
Series A Preferred Stock | ||
Preferred stock dividend rate (as a percent) | 0.00% | 0.00% |
Convertible redeemable preferred stock, par value (USD per share) | $ 0.01 | $ 0.01 |
Convertible redeemable preferred stock, liquidation and redemption value | $ 8,849,985 | $ 8,849,985 |
Convertible redeemable preferred stock, shares authorized | 4,000,000 | 4,000,000 |
Convertible redeemable preferred stock, shares issued | 2,949,995 | 2,949,995 |
Convertible redeemable preferred stock, shares outstanding | 2,949,995 | 2,949,995 |
Unamortized preferred stock discount | $ 875,935 | $ 2,212,007 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Revenues: | ||
Systems sales | $ 2,946,304 | $ 1,214,879 |
Professional services | 2,212,002 | 2,580,167 |
Maintenance and support | 15,145,480 | 16,157,371 |
Software as a service | 8,010,672 | 7,672,990 |
Total revenues | 28,314,458 | 27,625,407 |
Operating expenses: | ||
Cost of systems sales | 2,778,041 | 3,536,495 |
Cost of professional services | 3,143,881 | 3,458,984 |
Cost of maintenance and support | 3,036,550 | 3,087,842 |
Cost of software as a service | 2,442,143 | 2,920,403 |
Selling, general and administrative | 13,442,799 | 16,225,574 |
Research and development | 9,093,353 | 9,756,206 |
Impairment of intangible assets | 0 | 1,952,000 |
Total operating expenses | 33,936,767 | 40,937,504 |
Operating loss | (5,622,309) | (13,312,097) |
Other income (expense): | ||
Interest expense | (884,226) | (748,969) |
Loss on early extinguishment of debt | 0 | (429,849) |
Miscellaneous income | 2,224,423 | 1,592,449 |
Loss before income taxes | (4,282,112) | (12,898,466) |
Income tax (expense) benefit | (8,003) | 887,009 |
Net loss | (4,290,115) | (12,011,457) |
Less: deemed dividends on Series A Preferred Shares | (1,336,072) | (1,038,310) |
Net loss attributable to common shareholders | $ (5,626,187) | $ (13,049,767) |
Basic net loss per common share (in dollars per share) | $ (0.30) | $ (0.71) |
Number of shares used in basic per common share computation (shares) | 18,689,854 | 18,261,800 |
Diluted net loss per common share (in dollars per share) | $ (0.30) | $ (0.71) |
Number of shares used in diluted per common share computation (in shares) | 18,689,854 | 18,261,800 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (4,290,115) | $ (12,011,457) |
Other comprehensive gain (loss), net of tax: | ||
Fair value of interest rate swap liability | 0 | (3,436) |
Reclassification adjustment for loss on settlement of interest rate swap liability realized in net loss | 0 | 114,522 |
Other comprehensive income | 0 | 111,086 |
Comprehensive loss | $ (4,290,115) | $ (11,900,371) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) | Total | Common stock | Additional paid in capital | Accumulated deficit | Accumulated other comprehensive loss |
Shares, beginning balance at Jan. 31, 2014 | 18,175,787 | ||||
Stockholders' equity, beginning balance at Jan. 31, 2014 | $ 29,491,047 | $ 181,758 | $ 76,983,088 | $ (47,562,713) | $ (111,086) |
Statement of Changes in stockholders' equity | |||||
Stock issued pursuant to Employee Stock Purchase Plan and exercise of stock options, shares | 257,296 | ||||
Stock issued pursuant to Employee Stock Purchase Plan and exercise of stock options | 515,124 | $ 2,573 | 512,551 | ||
Restricted stock issued, shares | 120,306 | ||||
Restricted stock issued | 0 | $ 1,203 | (1,203) | ||
Interest rate swap | 111,086 | 111,086 | |||
Share-based compensation expense | 1,934,298 | 1,934,298 | |||
Deemed dividends on Series A Preferred Stock | (1,038,310) | (1,038,310) | |||
Net loss | (12,011,457) | (12,011,457) | |||
Shares, ending balance at Jan. 31, 2015 | 18,553,389 | ||||
Stockholders' equity, ending balance at Jan. 31, 2015 | 19,001,788 | $ 185,534 | 78,390,424 | (59,574,170) | 0 |
Statement of Changes in stockholders' equity | |||||
Stock issued pursuant to Employee Stock Purchase Plan and exercise of stock options, shares | 111,971 | ||||
Stock issued pursuant to Employee Stock Purchase Plan and exercise of stock options | 262,038 | $ 1,120 | 260,918 | ||
Restricted stock issued, shares | 118,180 | ||||
Restricted stock issued | $ 1,182 | (1,182) | |||
Interest rate swap | 0 | ||||
Share-based compensation expense | 2,386,489 | 2,386,489 | |||
Deemed dividends on Series A Preferred Stock | (1,336,072) | (1,336,072) | |||
Net loss | (4,290,115) | (4,290,115) | |||
Shares, ending balance at Jan. 31, 2016 | 18,783,540 | ||||
Stockholders' equity, ending balance at Jan. 31, 2016 | $ 16,024,128 | $ 187,836 | $ 79,700,577 | $ (63,864,285) | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Operating activities: | ||
Net loss | $ (4,290,115) | $ (12,011,457) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities, net of effect of acquisitions: | ||
Depreciation | 1,245,400 | 1,005,283 |
Amortization of capitalized software development costs | 3,073,479 | 3,677,991 |
Amortization of intangible assets | 1,344,992 | 1,396,317 |
Amortization of other deferred costs | 206,881 | 189,107 |
Amortization of debt discount | 0 | 47,552 |
Valuation adjustment for warrants liability | (1,629,267) | (2,283,345) |
Deferred tax expense (benefit) | (9,575) | (720,582) |
Other valuation adjustments | (39,299) | 128,855 |
Gain from early extinguishment of lease liability | (33,059) | 0 |
Loss on impairment of intangible assets | 0 | 1,952,000 |
Loss from early extinguishment of debt | 0 | 315,327 |
Loss on disposal of fixed assets | 92,448 | 180,793 |
Loss on exit of operating lease | 0 | 234,823 |
Share-based compensation expense | 2,386,490 | 1,934,298 |
Provision for accounts receivable | 124,235 | 440,771 |
Changes in assets and liabilities, net of assets acquired: | ||
Accounts and contract receivables | 2,718,330 | 2,157,977 |
Other assets | 575,774 | (637,348) |
Accounts payable | (1,117,986) | 600,263 |
Accrued expenses | (174,133) | (1,422,571) |
Deferred revenues | 1,405,980 | (197,698) |
Net cash provided by (used in) operating activities | 5,880,575 | (3,011,644) |
Investing activities: | ||
Purchases of property and equipment | (518,254) | (2,125,240) |
Capitalization of software development costs | 0 | (619,752) |
Payment for acquisition, net of cash acquired | 0 | (6,058,225) |
Net cash used in investing activities | (518,254) | (8,803,217) |
Financing activities: | ||
Proceeds from term loan | 0 | 10,000,000 |
Principal repayments on term loans | (1,465,109) | (8,297,620) |
Principal repayments on note payable | 0 | (900,000) |
Principal payments on capital lease obligation | (815,826) | (368,386) |
Recovery (payment) of deferred financing costs | 2,111 | (573,002) |
Proceeds from exercise of stock options and stock purchase plan | 276,039 | 551,583 |
Net cash (used in) provided by financing activities | (2,002,785) | 412,575 |
Increase (decrease) in cash and cash equivalents | 3,359,536 | (11,402,286) |
Cash and cash equivalents at beginning of year | 6,522,600 | 17,924,886 |
Cash and cash equivalents at end of year | 9,882,136 | 6,522,600 |
Supplemental cash flow disclosures: | ||
Interest paid | 917,212 | 518,919 |
Income taxes paid (received) | 35,861 | 80,467 |
Supplemental disclosure of non-cash financing activities: | ||
Deemed dividends on Series A Preferred Stock | $ 1,336,072 | $ 1,038,310 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Jan. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | ORGANIZATION AND DESCRIPTION OF BUSINESS Streamline Health Solutions, Inc. and subsidiary (“we”, “us”, “our”, or the “Company”) operates in one segment as a provider of healthcare information technology through the licensing of its Electronic Health Information Management, Patient Financial Services, Coding and Clinical Documentation Improvement and other Workflow software applications and the use of such applications by software as a service. The Company also provides implementation and consulting services to complement its software solutions. The Company’s software and services enable hospitals and integrated healthcare delivery systems in the United States and Canada to capture, store, manage, route, retrieve, and process vast amounts of patient clinical, financial and other healthcare provider information. Fiscal Year All references to a fiscal year refer to the fiscal year commencing February 1 in that calendar year and ending on January 31 of the following year. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Jan. 31, 2016 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The consolidated financial statements include the accounts of Streamline Health Solutions, Inc. and its wholly-owned subsidiary, Streamline Health, Inc. All significant intercompany transactions are eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Cash and Cash Equivalents Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash demand deposits. Cash deposits are placed in Federal Deposit Insurance Corporation (“FDIC”) insured financial institutions. Cash deposits may exceed FDIC insured levels from time to time. For purposes of the Consolidated Balance Sheets and Consolidated Statements of Cash Flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Receivables Accounts and contract receivables are comprised of amounts owed to the Company for licensed software, professional services, including maintenance services and software as a service and are presented net of the allowance for doubtful accounts. The timing of revenue recognition may not coincide with the billing terms of the client contract, resulting in unbilled receivables or deferred revenues; therefore certain contract receivables represent revenues recognized prior to client billings. Individual contract terms with clients or resellers determine when receivables are due. For billings where the criteria for revenue recognition have not been met, deferred revenue is recorded until all revenue recognition criteria have been met. Allowance for Doubtful Accounts In determining the allowance for doubtful accounts, aged receivables are analyzed monthly by management. Each identified receivable is reviewed based upon the most recent information available, including client comments, if any, and the status of any open or unresolved issues with the client preventing the payment thereof. Corrective action, if necessary, is taken by the Company to resolve open issues related to unpaid receivables. During these monthly reviews, the Company determines the required allowances for doubtful accounts for estimated losses resulting from the unwillingness or inability of its clients or resellers to make required payments. The allowance for doubtful accounts was approximately $155,000 and $666,000 at January 31, 2016 and 2015 , respectively. The Company believes that its reserve is adequate, however results may differ in future periods. Bad debt expense for fiscal years 2015 and 2014 was as follows: 2015 2014 Bad debt expense $ 124,000 $ 441,000 Concessions Accrual In determining the concession accrual, the Company evaluates historical concessions granted relative to revenue. The concession accrual included in accrued other expenses on the Company's consolidated balance sheet was $54,000 and $58,000 as of January 31, 2016 and 2015 , respectively. Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method, over the estimated useful lives of the related assets. Estimated useful lives are as follows: Computer equipment and software 3-4 years Office equipment 5 years Office furniture and fixtures 7 years Leasehold improvements Term of lease Depreciation expense for property and equipment in fiscal 2015 and 2014 was $1,245,000 and $1,005,000 , respectively. Normal repair and maintenance is expensed as incurred. Replacements are capitalized and the property and equipment accounts are relieved of the items being replaced or disposed of, if no longer of value. The related cost and accumulated depreciation of the disposed assets are eliminated and any gain or loss on disposition is included in the results of operations in the year of disposal. Leases On April 10, 2012, the Company entered into an amended lease obligation to lease 8,582 square feet of office space at 1230 Peachtree St. NE in Atlanta, Georgia. The lease commenced upon taking possession of the space and would have ended 72 months thereafter. The Company took possession of the space during the third quarter of fiscal 2012. Upon relocation, the Company completely vacated the previously leased premises within the same building. The provisions of the lease provided for rent abatement for the first four months of the lease term. Upon taking possession of the premises, the rent abatement was aggregated with the total expected rental payments, and was amortized on a straight-line basis over the term of the lease. On December 13, 2013, the Company entered into an amended lease obligation to lease 24,335 square feet of office space in the same building as the office space in Atlanta, Georgia. The lease commenced upon taking possession of the space and ends 102 months thereafter. The Company took possession of the new space during the second quarter of fiscal 2014. Upon relocation, the Company completely vacated the previously leased premises within the building. The provisions of the lease provided for rent abatement for the first eight months of the lease term. Upon taking possession of the premises, the rent abatement and the unamortized balance of deferred rent associated with the previously leased premises were aggregated with the total expected rental payments, and are being amortized on a straight-line basis over the term of the new lease. On August 16, 2012, as part of the acquisition of Meta Health Technology, the Company assumed a lease agreement for office space of approximately 10,000 square feet, at 330 Seventh Ave., New York, New York. This lease term expired on August 31, 2014. During the third quarter of fiscal 2014, the Company relocated its New York office to 105 Madison Avenue, New York, New York. The lease commenced upon taking possession of the space and ends 63 months thereafter. The provisions of the lease for the new office space of 10,350 square feet provided for rent abatement for the first two months of the lease term. Upon taking possession of the premises, the rent abatement was aggregated with the total expected rental payments, and is being amortized on a straight-line basis over the term of the lease. The Company has capital leases to finance office equipment and maintenance services purchases. The balance of fixed assets acquired under these capital leases is $1,652,000 and $1,515,000 as of January 31, 2016 and 2015 , respectively, and the balance of accumulated depreciation is $1,166,000 and $494,000 for the respective periods. The amortization expense of leased assets is included in depreciation expense. Debt Issuance Costs Costs related to the issuance of debt are capitalized and amortized to interest expense on a straight-line basis, which is not materially different from the effective interest method, over the term of the related debt. Interest Rate Swap In December 2013, the Company entered into an interest rate swap agreement to hedge against interest rate exposure of its variable rate debt obligation. The interest rate swap settled any accrued interest for cash on the first day of each calendar month until expiration. At such dates, the differences to be paid or received on the interest rate swaps was included in interest expense. The interest rate swap qualified for cash flow hedge accounting treatment and as such, the change in the fair values of the interest rate swap was recorded on the Company's consolidated balance sheet as an asset or liability with the effective portion of the interest rate swaps' gains or losses reported as a component of other comprehensive loss and the ineffective portion reported in net loss. The fair value of the Company's interest rate swap was based on Level 2 inputs as described in ASC Topic 820, Fair Value Measurements and Disclosures , which include observable inputs such as dealer-quoted prices for similar assets or liabilities, and represented the estimated amount the Company would receive or pay to terminate the agreement taking into consideration various factors, including current interest rates, credit risk and counterparty credit risk. During the third quarter of fiscal 2014, the interest rate swap was terminated prior to its maturity, and losses accumulated in other comprehensive loss were reclassified into earnings. Impairment of Long-Lived Assets The Company reviews the carrying value of long-lived assets whenever facts and circumstances exist that would suggest that assets might be impaired or that the useful lives should be modified. Among the factors the Company considers in making the evaluation are changes in market position and profitability. If facts and circumstances are present which may indicate impairment is probable, the Company will prepare a projection of the undiscounted cash flows of the specific asset and determine if the long-lived assets are recoverable based on these undiscounted cash flows. If impairment is indicated, an adjustment will be made to reduce the carrying amount of these assets to their fair value. Capitalized Software Development Costs Software development costs associated with the planning and designing phase of software development, including coding and testing activities necessary to establish technological feasibility, are classified as research and development and are expensed as incurred. Once technological feasibility has been determined, a portion of the costs incurred in development, including coding, testing, and quality assurance, are capitalized and subsequently reported at the lower of unamortized cost or net realizable value. The Company capitalized such costs, including interest, of $0 and $620,000 in fiscal 2015 and 2014 , respectively. The Company acquired $2,017,000 of internally developed software in 2014 through the acquisition of Unibased, which is described in Note 3 - Acquisitions, and $3,646,000 through the acquisition of Meta in 2012. Amortization for the Company's legacy software systems is provided on a solution-by-solution basis over the estimated economic life of the software, typically five years, using the straight-line method. Amortization commences when a solution is available for general release to clients. Acquired internally developed software from the Interpoint, Meta, and Unibased acquisitions is amortized using the straight-line method. Amortization expense on all internally developed software was $3,073,000 and $3,678,000 in fiscal 2015 and 2014 , respectively, and was included in the consolidated statements of operations as follows: Fiscal Year Amortization expense on internally developed software included in: 2015 2014 Cost of systems sales $ 2,747,000 $ 3,352,000 Cost of software as a service 326,000 326,000 Total amortization expense on internally developed software $ 3,073,000 $ 3,678,000 Research and development expense, net of capitalized amounts, was $9,093,000 and $9,756,000 in fiscal 2015 and 2014 , respectively. Fair Value of Financial Instruments The FASB’s authoritative guidance on fair value measurements establishes a framework for measuring fair value, and expands disclosure about fair value measurements. This guidance enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. Under this guidance, assets and liabilities carried at fair value must be classified and disclosed in one of the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value based on the short-term maturity of these instruments. Cash and cash equivalents are classified as Level 1. The carrying amount of the Company’s long-term debt approximates fair value since the variable interest rates being paid on the amounts approximate the market interest rate. Long-term debt is classified as Level 2. The table below provides information on our liabilities that are measured at fair value on a recurring basis: Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) At January 31, 2016 Warrants liability (1) $ 205,000 $ — $ — $ 205,000 Royalty liability (2) 2,292,000 — — 2,292,000 At January 31, 2015 Warrants liability (3) $ 1,834,000 $ — $ — $ 1,834,000 Royalty liability (2) 2,386,000 — — 2,386,000 _______________ (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. See Note 4 - Derivative Liabilities, and Note 14 - Private Placement Investment for further details. Changes in fair value of the warrants are recognized within miscellaneous income in the 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). Fair value adjustments are included within miscellaneous income in the consolidated statements of operations. (3) The fair value of warrants liability as of January 31, 2015 was determined by management with the assistance of an independent third-party valuation specialist using Monte-Carlo simulations. See Note 4 - Derivative Liabilities for further details. Revenue Recognition The Company derives revenue from the sale of internally developed software either by licensing or by software as a service (SaaS), through the direct sales force or through third-party resellers. Licensed, locally-installed, clients utilize the Company’s support and maintenance services for a separate fee, whereas SaaS fees include support and maintenance. The Company also derives revenue from professional services that support the implementation, configuration, training, and optimization of the applications. Additional revenues are also derived from reselling third-party software and hardware components. The Company recognizes revenue in accordance with ASC 985-605, Software-Revenue Recognition and ASC 605-25 Revenue Recognition — Multiple-Element Arrangements . The Company commences revenue recognition when the following criteria all have been met: • Persuasive evidence of an arrangement exists, • Delivery has occurred or services have been rendered, • The arrangement fees are fixed or determinable, and • Collection is considered probable. If we determine that any of the above criteria have not been met, we will defer recognition of the revenue until all the criteria have been met. Maintenance and support and SaaS agreements entered into are generally non-cancelable, or contain significant penalties for early cancellation, although clients typically have the right to terminate their contracts for cause if the Company fails to perform material obligations. However, if non-standard acceptance periods or non-standard performance criteria, cancellation or right of refund terms are required, revenue is recognized upon the satisfaction of such criteria, as applicable. Multiple Element Arrangements The Company applies the provisions of Accounting Standards Update No. 2009-13, Revenue Recognition (Topic 605), “Multiple-Deliverable Revenue Arrangements — a consensus of the FASB Emerging Issues Task Force” (“ASU 2009-13”). ASU 2009-13 amended the accounting standards for revenue recognition for multiple deliverable revenue arrangements to: • Provide updated guidance on how deliverables of an arrangement are separated, and how consideration is allocated; • Eliminate the residual method and require entities to allocate revenue using the relative selling price method and; • Require entities to allocate revenue to an arrangement using the estimated selling price (“ESP”) of deliverables if it does not have vendor specific objective evidence (“VSOE”) or third party evidence (“TPE”) of selling price. Terms used in evaluation are as follows: • 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 — the Company’s best estimate of the selling price of an element of the transaction The Company follows accounting guidance for revenue recognition of multiple-element arrangements to determine whether such arrangements contain more than one unit of accounting. Multiple-element arrangements require the delivery or performance of multiple solutions, services and/or rights to use assets. To qualify as a separate unit of accounting, the delivered item must have value to the client on a stand-alone basis. Stand-alone value to a client is defined in the guidance as those that can be sold separately by any vendor or the client could resell the item on a stand-alone basis. Additionally, if the arrangement includes a general right of return relative to the delivered item, delivery or performance of the undelivered item or items must be considered probable and substantially in the control of the vendor. The Company has a defined pricing methodology for all elements of the arrangement and proper review of pricing to ensure adherence to Company policies. Pricing decisions include cross-functional teams of senior management, which uses market conditions, expected contribution margin, size of the client’s organization, and pricing history for similar solutions when establishing the selling price. Software as a Service The Company uses ESP to determine the value for a software as a service arrangement as the Company cannot establish VSOE and TPE is not a practical alternative due to differences in functionality from the Company's competitors. Similar to proprietary license sales, pricing decisions rely on the relative size of the client purchasing the solution, and include calculating the equivalent value of maintenance and support on a present value basis over the term of the initial agreement period. Typically revenue recognition commences upon client go-live on the system, and is recognized ratably over the contract term. Systems Sales The Company uses the residual method to determine fair value for proprietary software licenses sold in a multi-element arrangement as the Company cannot establish fair value for all of the delivered elements. Typically pricing decisions for proprietary software rely on the relative size and complexity of the client purchasing the solution. Third-party components are resold at prices based on a cost plus margin analysis. The proprietary software and third-party components do not need any significant modification to achieve their intended use. When these revenues meet all the criteria for revenue recognition and are determined to be separate units of accounting, revenue is recognized. Typically, this is upon shipment of components or electronic download of software. Proprietary licenses are perpetual in nature, and license fees do not include rights to version upgrades, fixes or service packs. Maintenance and Support Services The maintenance and support components are not essential to the functionality of the software and clients renew maintenance contracts separately from software purchases at renewal rates materially similar to the initial rate charged for maintenance on the initial purchase of software. The Company uses VSOE of fair value to determine fair value of maintenance and support services. Generally, maintenance and support is calculated as a percentage of the list price of the proprietary license being purchased by a client. Clients have the option of purchasing additional annual maintenance service renewals each year for which rates are not materially different from the initial rate, but typically include a nominal rate increase based on the consumer price index. Annual maintenance and support agreements entitle clients to technology support, upgrades, bug fixes and service packs. Term Licenses We cannot establish VSOE of fair value of the undelivered element in term license arrangements. However, as the only undelivered element is post-contract customer support, the entire fee is recognized ratably over the contract term. Typically, revenue recognition commences once the client goes live on the system. Similar to proprietary license sales, pricing decisions rely on the relative size of the client purchasing the solution. The software portion of our coding and clinical documentation improvement solutions generally does not require material modification to achieve their contracted function. Professional Services Professional services components that are not essential to the functionality of the software, from time to time, are sold separately by the Company. Similar services are sold by other vendors, and clients can elect to perform similar services in-house. When professional services revenues are a separate unit of accounting, revenues are recognized as the services are performed based upon a proportional performance methodology. Professional services components that are essential to the functionality of the software, and are not considered a separate unit of accounting, are recognized in revenue ratably over the life of the client, which approximates the duration of the initial contract term. The Company defers the associated direct costs for salaries and benefits expense for professional services contracts. These deferred costs will be amortized over the identical term as the associated SaaS revenues. As of January 31, 2016 and 2015 , the Company had deferred costs of $ 571,000 and $570,000 , respectively, net of accumulated amortization of $265,000 and $275,000 , respectively. Amortization expense of these costs was $136,000 and $166,000 in fiscal 2015 and 2014 , respectively. The Company uses VSOE of fair value based on the hourly rate charged when services are sold separately, to determine fair value of professional services. The Company typically sells professional services on an hourly-fee basis. The Company monitors projects to assure that the expected and historical rate earned remains within a reasonable range to the established selling price. Concentrations Financial instruments, which potentially expose the Company to concentrations of credit risk, consist primarily of accounts receivable. The Company’s accounts receivable are concentrated in the healthcare industry. However, the Company’s clients typically are well-established hospitals, medical facilities, or major health information systems companies that resell the Company’s solutions that have good credit histories. Payments from clients have been received within normal time frames for the industry. However, some hospitals and medical facilities have experienced significant operating losses as a result of limits on third-party reimbursements from insurance companies and governmental entities and extended payment of receivables from these entities is not uncommon. To date, the Company has relied on a limited number of clients and remarketing partners for a substantial portion of its total revenues. The Company expects that a significant portion of its future revenues will continue to be generated by a limited number of clients and its remarketing partners. The Company currently buys all of its hardware and some major software components of its healthcare information systems from third-party vendors. Although there are a limited number of vendors capable of supplying these components, management believes that other suppliers could provide similar components on comparable terms. Business Combinations The assets acquired, liabilities assumed, and contingent consideration are recorded at their fair value on the acquisition date with subsequent changes recognized in earnings. These estimates are inherently uncertain and are subject to refinement. Management develops estimates based on assumptions as a part of the purchase price allocation process to value the assets acquired and liabilities assumed as of the business combination date. As a result, during the purchase price measurement period, which may be up to one year from the business combination date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. After the purchase price measurement period, the Company will record adjustments to assets acquired or liabilities assumed subsequent to the purchase price measurement period in operating expenses in the period in which the adjustments were determined. The Company records acquisition and transaction related expenses in the period in which they are incurred. Acquisition and transaction related expenses primarily consist of legal, banking, accounting and other advisory fees of third parties related to potential acquisitions. Goodwill and Intangible Assets Goodwill and other intangible assets were recognized in conjunction with the Interpoint, Meta, CLG, and Unibased acquisitions. Identifiable intangible assets include purchased intangible assets with finite lives, which primarily consist of internally developed software, client relationships, supplier agreements, non-compete agreements, customer contracts, and license agreements. Finite-lived purchased intangible assets are amortized over their expected period of benefit, which generally ranges from one to 15 years, using the straight-line and undiscounted expected future cash flows methods. The indefinite-lived intangible asset related to the Meta trade name was not amortized, but was tested for impairment on at least an annual basis. In fiscal 2014 , the Meta trade name was deemed impaired and its corresponding balance was fully written off (see Note 7 - Goodwill and Intangible Assets). The Company assesses the useful lives and possible impairment of existing recognized goodwill and intangible assets when an event occurs that may trigger such a review. Factors considered important which could trigger a review include: • significant under performance relative to historical or projected future operating results; • significant changes in the manner of use of the acquired assets or the strategy for the overall business; • identification of other impaired assets within a reporting unit; • disposition of a significant portion of an operating segment; • significant negative industry or economic trends; • significant decline in the Company's stock price for a sustained period; and • a decline in the market capitalization relative to the net book value. Determining whether a triggering event has occurred involves significant judgment by the Company. The Company assesses goodwill annually (as of November 1), or more frequently when events and circumstances, such as the ones mentioned above, occur indicating that the recorded goodwill may be impaired. The Company did not note any of the above qualitative factors, which would be considered a triggering event for impairment. In assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company assesses relevant events and circumstances that may impact the fair value and the carrying amount of a reporting unit. The identification of relevant events and circumstances and how these may impact a reporting unit's fair value or carrying amount involve significant judgments by management. These judgments include the consideration of macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, events which are specific to the Company, and trends in the market price of the Company's common stock. Each factor is assessed to determine whether it impacts the impairment test positively or negatively, and the magnitude of any such impact. The two-step goodwill impairment test requires the Company to identify its reporting units and to determine estimates of the fair values of those reporting units as of the impairment testing date. Reporting units are determined based on the organizational structure the entity has in place at the date of the impairment test. A reporting unit is an operating segment or component business unit with the following characteristics: (a) it has discrete financial information, (b) segment management regularly reviews its operating results (generally an operating segment has a segment manager who is directly accountable to and maintains regular contact with the chief operating decision maker to discuss operating activities, financial results, forecasts, or plans for the segment), and (c) its economic characteristics are dissimilar from other units (this contemplates the nature of the products and services, the nature of the production process, the type or class of customer for the products and services, and the methods used to distribute the products and services). The Company determined that it has one operating segment and one reporting unit. To conduct a quantitative two-step goodwill impairment test, the fair value of the reporting unit is first compared to its carrying value. If the reporting unit's carrying value exceeds its fair value, the Company performs the second step and records an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value. The Company estimates the fair value of its reporting unit using a blend of market and income approaches. The market approach consists of two separate methods, including reference to the Company's market capitalization, as well as the guideline publicly traded company method. The market capitalization valuation method is based on an analysis of the Company's stock price on and around the testing date, plus a control premium. The guideline publicly traded company method was made by reference to a list of publicly traded software companies providing services to healthcare organizations, as determined by management. The market value of common equity for each comparable company was derived by multiplying the price per share on the testing date by the total common shares outstanding, plus a control premium. Selected valuation multiples are then determined and applied to appropriate financial statistics based on the Company's historical and forecasted results. The Company estimates the fair value of its reporting unit using the income approach, via discounted cash flow valuation models which include, but are not limited to, assumptions such as a “risk-free” rate of return on an investment, the weighted average cost of capital of a market participant, and future revenue, operating margin, working capital and capital expenditure trends. Determining the fair values of reporting units and goodwill includes significant judgment by management, and different judgments could yield different results. The Company performed its annual assessment of goodwill during the fourth quarter of fiscal 2015 , using the two-step approach described above. The first step of the goodwill impairment test, used to identify potential impairment, compares the fair value of a reporting unit with its carrying amount, including goodwill. Based on the analysis performed for step one, the fair value of the reporting unit exceeded the carrying amount of the reporting unit, including goodwill, and, therefore, an impairment loss was not recognized. As the Company passed step one of the analysis, step two was not required. Severances From time to time, we will enter into termination agreements with associates that may include supplemental cash payments, as well as contributions to health and other benefits for a specific time period subsequent to termination. In fiscal 2015 and 2014 , we incurred $43,000 and $666,000 in severance expenses. At January 31, 2016 and 2015 , we had accrued for $26,000 and $159,000 in severances, respectively. Equity Awards The Company accounts for share-based payments |
Acquisitions
Acquisitions | 12 Months Ended |
Jan. 31, 2016 | |
Business Combinations [Abstract] | |
ACQUISITIONS | ACQUISITIONS On October 25, 2013, we entered into a Software License and Royalty Agreement (the “Royalty Agreement”) with Montefiore Medical Center (“Montefiore”) pursuant to which it entered into an agreement for an exclusive, worldwide 15 -year license of Montefiore’s proprietary clinical analytics platform solution, Clinical Looking Glass® (“CLG”), now known as our Looking Glass® Clinical Analytics solution. In addition, Montefiore assigned to us the existing license agreement with a customer using CLG. As consideration under the Royalty Agreement, Streamline paid Montefiore a one-time initial base royalty fee of $3,000,000 , and we are obligated to pay on-going quarterly royalty amounts related to future sublicensing of CLG by Streamline. Additionally, Streamline has committed that Montefiore will receive at least an additional $3,000,000 of on-going royalty payments within the first six and one-half years of the license term. As of January 31, 2016 and 2015 , the present value of this royalty liability was $2,292,000 and $2,386,000 , respectively. On February 3, 2014, we completed the acquisition of Unibased Systems Architecture, Inc. (“Unibased”), a provider of patient access solutions, including enterprise scheduling and surgery management software, for healthcare organizations throughout the United States, pursuant to an Agreement and Plan of Merger dated January 16, 2014 (the “Merger Agreement”). The total purchase price for Unibased was $6,500,000 , subject to net working capital and other customary adjustments. A portion of the total purchase price was withheld in escrow as described in the Merger Agreement for certain transaction and indemnification of claimed damages. In April 2015, the Company received $750,000 from the cash withheld in escrow, which is included in miscellaneous income. Pursuant to the Merger Agreement, we acquired all of the issued and outstanding common stock of Unibased, and Unibased became a wholly-owned subsidiary of Streamline. Under the terms of the Merger Agreement, Unibased stockholders received cash for each share of Unibased common stock held. The preliminary purchase price was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date as follows: Balance at February 3, 2014 Assets purchased: Cash $ 59,000 Accounts receivable 221,000 Other assets 61,000 Internally-developed software 2,017,000 Client relationships 647,000 Trade name 26,000 Goodwill (1) 4,251,000 Total assets purchased 7,282,000 Liabilities assumed: Accounts payable and accrued liabilities 362,000 Deferred revenue obligation, net 793,000 Deferred income taxes 9,000 Net assets acquired $ 6,118,000 Cash paid $ 6,118,000 _______________ (1) Goodwill represents the excess of purchase price over the estimated fair value of net tangible and intangible assets acquired, which is not deductible for tax purposes. The operating results of Unibased are not material for proforma disclosure. |
Derivative Liabilities
Derivative Liabilities | 12 Months Ended |
Jan. 31, 2016 | |
Other Liabilities Disclosure [Abstract] | |
DERIVATIVE LIABILITIES | DERIVATIVE LIABILITIES As discussed further in Note 14 - Private Placement Investment, in conjunction with the 2012 private placement investment, the Company issued common stock warrants exercisable for up to 1,200,000 of common stock at an exercise price of $3.99 per share. The warrants were initially classified in stockholders' equity as additional paid-in capital at the allocated amount, net of allocated transaction costs, of $1,425,000 . Effective October 31, 2012, upon stockholder approval of anti-dilution provisions that reset the warrant's exercise price if a dilutive issuance occurs, the warrants were reclassified as non-current derivative liabilities. The fair value of the warrants was $4,139,000 at October 31, 2012, with the difference between the fair value and carrying value recorded to additional paid-in capital. Effective as of the reclassification as derivative liabilities, the warrants are re-valued at each reporting date, with changes in fair value recognized in earnings each reporting period as a credit or charge to miscellaneous income (expense). The fair value of the warrants at January 31, 2016 and 2015 was $205,000 and $1,834,000 , respectively. The change in fiscal 2015 and 2014 reflects $1,629,000 and $2,283,000 , respectively, of miscellaneous income recognized in the consolidated statements of operations as a result of decreases in the fair value of the warrants. The estimated fair value of the warrant liabilities as of January 31, 2016 was computed using the Black-Scholes option pricing model based on the following assumptions: annual volatility of 60.1% ; risk-free rate of 0.6% , dividend yield of 0.0% and expected life of two years. The estimated fair value of the warrant liabilities as of January 31, 2015 was computed using Monte-Carlo simulations based on the following assumptions: annual volatility of 55% ; risk-free rate of 0.8% , dividend yield of 0.0% and expected life of three years. |
Operating Leases
Operating Leases | 12 Months Ended |
Jan. 31, 2016 | |
Leases [Abstract] | |
OPERATING LEASES | OPERATING LEASES The Company rents office and data center space and equipment under non-cancelable operating leases that expire at various times through fiscal year 2022 . Future minimum lease payments under non-cancelable operating leases for the next five fiscal years and thereafter are as follows: Facilities Equipment Fiscal Year Totals 2016 $ 969,000 $ 2,000 $ 971,000 2017 1,007,000 — 1,007,000 2018 1,039,000 — 1,039,000 2019 967,000 — 967,000 2020 504,000 — 504,000 Thereafter 964,000 — 964,000 Total $ 5,450,000 $ 2,000 $ 5,452,000 Rent and leasing expense for facilities and equipment was $1,274,000 and $1,652,000 for fiscal years 2015 and 2014 , respectively. |
Debt
Debt | 12 Months Ended |
Jan. 31, 2016 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Term Loan and Line of Credit In December 2013, we amended and restated our previously outstanding senior credit agreement and amended the subordinated credit agreement with Fifth Third Bank to increase the senior term loan to $ 8,500,000 , reduce the interest rates, and extend the maturity of the senior term loan and the $ 5,000,000 revolving line of credit to December 1, 2018 and December 1, 2015, respectively. In January 2014, we paid the subordinated term loan in full. The outstanding senior term loan was secured by substantially all of our assets. The senior term loan principal balance was payable in monthly installments of $101,000 , which started in January 2014 and would have continued through the maturity date, with the full remaining unpaid principal balance due at maturity. Borrowings under the senior term loan bore interest at a rate of LIBOR plus 5.25% . However, as a result of our interest rate swap, the interest rate was fixed at 6.42% until October 27, 2014, when the interest rate swap agreement was terminated. Accrued and unpaid interest on the senior term loan was due monthly through maturity. We paid $116,000 in closing fees in connection with this senior term loan, which was recorded as a debt discount and amortized to interest expense over the term of the loan using the effective interest method. Borrowings under the revolving line of credit bore interest at a rate equal to LIBOR plus 3.50% . We paid a commitment fee of 0.40% on the unused revolving line of credit on a quarterly basis. On November 21, 2014, we entered into a Credit Agreement (the “Credit Agreement”) with Wells Fargo Bank, N.A., as administrative agent, and other lender parties thereto. Pursuant to the Credit Agreement, the lenders agreed to provide a $10,000,000 senior term loan and a $5,000,000 revolving line of credit to our primary operating subsidiary. Amounts outstanding under the Credit Agreement bear interest at either LIBOR or the base rate, as elected by the Company, plus an applicable margin. Subject to the Company’s leverage ratio, the applicable LIBOR rate margin varies from 4.25% to 5.25% , and the applicable base rate margin varies from 3.25% to 4.25% . Pursuant to the terms of the amendment to the Credit Agreement entered into as of April 15, 2015, going forward the applicable LIBOR rate margin varies from 4.25% to 6.25% , and the applicable base rate margin varies from 3.25% to 5.25% . The term loan and line of credit mature on November 21, 2019 and provide support for working capital, capital expenditures and other general corporate purposes, including permitted acquisitions. At closing, the Company repaid indebtedness under its prior credit facility using approximately $7,400,000 of the proceeds provided by the term loan. The prior credit facility with Fifth Third Bank was terminated concurrent with the entry of the Credit Agreement and unamortized debt financing costs and discount of $315,000 associated with the terminated debt was included in loss on early extinguishment of debt. Financing costs of $355,000 associated with the new credit facility are being amortized over its term on a straight-line basis, which is not materially different from the effective interest method. The Credit Agreement includes customary financial covenants, including the requirements that the Company maintain minimum liquidity and achieve certain minimum EBITDA levels (as defined in the Credit Agreement). In addition, the credit facility prohibits the Company from paying dividends on the common and preferred stock. In addition to the changes to the rate margins referenced above, the April 2015 amendment to the Credit Agreement reset the financial covenants. As such, the Company is required to maintain minimum liquidity of at least (i) $5,000,000 through April 15, 2015, (ii) $6,500,000 from April 16, 2015 through and including July 30, 2015, (iii) $7,000,000 from July 31, 2015 through and including January 30, 2016, and (iv) $7,500,000 from January 31, 2016 through and including the maturity date of the credit facility. The following table shows our future minimum EBITDA covenant thresholds, as modified by the amendment to the Credit Agreement: For the four-quarter period ended Minimum EBITDA April 30, 2015 $ (2,500,000 ) July 31, 2015 (1,750,000 ) October 31, 2015 (750,000 ) January 31, 2016 500,000 For the four-quarter period ending April 30, 2016, and fiscal quarters thereafter, the minimum EBITDA will be determined within 30 days following delivery of, and based upon, the projections then most recently delivered by the Company. As of January 31, 2016 , the Company had no outstanding borrowings under the revolving line of credit, and had accrued $2,000 in unused balance commitment fees. Note Payable In November 2013, as part of the settlement of the earn-out consideration in connection with the 2011 Interpoint acquisition, we issued an unsecured, subordinated three -year note in the amount of $900,000 (“Note Payable”) that would have matured on November 1, 2016 and accrued interest on the unpaid principal amount outstanding at a per annum rate equal to 8% . Annual principal payments of $300,000 were due on November 1, 2014, 2015 and 2016. At closing of the Credit Agreement with Wells Fargo described above, we repaid our indebtedness under this note using approximately $600,000 of the proceeds provided by the term loan. Outstanding principal balances on debt consisted of the following at: January 31, 2016 January 31, 2015 Senior term loan $ 8,535,000 $ 10,000,000 Capital lease 686,000 1,365,000 Total 9,221,000 11,365,000 Less: Current portion 1,266,000 1,282,000 Non-current portion of long-term debt $ 7,955,000 $ 10,083,000 Future repayments of long-term debt by fiscal year consisted of the following at January 31, 2016 : Senior Term Loan Capital Lease (1) Total 2016 $ 674,000 $ 618,000 $ 1,292,000 2017 898,000 93,000 991,000 2018 898,000 — 898,000 2019 6,064,000 — 6,064,000 Total repayments $ 8,534,000 $ 711,000 $ 9,245,000 _______________ (1) Future minimum lease payments include principal plus interest. Interest Rate Swap As of January 31, 2014, the Company maintained one effective hedging relationship via one distinct interest rate swap agreement (maturing December 1, 2020), which required the Company to pay interest at a fixed rate of 6.42% and receive interest at a variable rate. This interest rate swap agreement was designated to hedge $ 8,500,000 of a variable rate debt obligation. The one-month LIBOR rate on each reset date determined the variable portion of the interest rate swap for the following month. The interest rate swap settled any accrued interest for cash on the first day of each calendar month, until expiration. At such dates, the differences to be paid or received on the interest rate swap were included in interest expense. No premium or discount was incurred upon the Company entering into the interest rate swap, because the pay and receive rates on the interest rate swap represented prevailing rates for the counterparty at the time the interest rate swap was entered into. The interest rate swap qualified for cash flow hedge accounting treatment and as such, the Company had effectively hedged its exposure to variability in the future cash flows attributable to the one-month LIBOR on its $ 8,500,000 of variable rate obligation. The change in the fair value of the interest rate swap was recorded on the Company’s consolidated balance sheet as an asset or liability with the effective portion of the interest rate swap’s gains or losses reported as a component of other comprehensive loss and the ineffective portion reported in earnings (interest expense). As of January 31, 2014, the Company had a fair value liability of approximately $111,000 for the effective portion of the interest rate swap. During the third quarter of fiscal 2014, the interest rate swap was terminated prior to its maturity, and losses accumulated in other comprehensive loss were reclassified into earnings. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Jan. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS The goodwill activity is summarized as follows: Goodwill Balance January 31, 2014 $ 11,934,000 Goodwill acquired during fiscal 2014 4,251,000 Balance January 31, 2015 and January 31, 2016 $ 16,185,000 Intangible assets, net, consist of the following: January 31, 2016 Estimated Useful Life Gross Assets Accumulated Amortization Net Assets Definite-lived assets: Trade name 1 year $ 26,000 $ 26,000 $ — Client relationships 10-15 years 5,932,000 2,220,000 3,712,000 Covenants not to compete 0.5-15 years 856,000 667,000 189,000 Supplier agreements 5 years 1,582,000 1,094,000 488,000 License agreement 15 years 4,431,000 665,000 3,766,000 Total $ 12,827,000 $ 4,672,000 $ 8,155,000 January 31, 2015 Estimated Useful Life Gross Assets Accumulated Amortization Net Assets Definite-lived assets: Trade name 1 year $ 26,000 $ 26,000 $ — Client relationships 10-15 years 5,932,000 1,548,000 4,384,000 Covenants not to compete 0.5-15 years 856,000 606,000 250,000 Supplier agreements 5 years 1,582,000 778,000 804,000 License agreement 15 years 4,431,000 369,000 4,062,000 Total $ 12,827,000 $ 3,327,000 $ 9,500,000 In fiscal 2014, management determined that the concerted effort to rebrand the Company’s solutions under a single, harmonized Looking Glass® marketing platform moving forward, eroded, in total, the value of the Meta Trade name. As a result, the Company recorded a $1,952,000 loss, which is reflected in Impairment of intangible assets on the Consolidated Statements of Operations. Amortization over the next five fiscal years for intangible assets is estimated as follows: Annual Amortization Expense 2016 $ 1,298,000 2017 1,088,000 2018 863,000 2019 826,000 2020 791,000 Thereafter 3,289,000 Total $ 8,155,000 |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income taxes consist of the following: Fiscal Year 2015 2014 Current tax (expense) benefit: Federal $ — $ 131,816 State (17,578 ) 34,611 (17,578 ) 166,427 Deferred tax benefit: Federal 8,838 663,681 State 737 56,901 9,575 720,582 Current and deferred tax (expense) benefit $ (8,003 ) $ 887,009 The income tax (expense) benefit for income taxes differs from the amount computed using the federal statutory income tax rate as follows: Fiscal Year 2015 2014 Federal tax benefit at statutory rate $ 1,455,816 $ 4,385,479 State and local taxes, net of federal benefit (expense) (267,997 ) 325,966 Change in valuation allowance (1,629,786 ) (4,030,864 ) Permanent items: Incentive stock options (513,708 ) (421,366 ) Transaction costs — (5,291 ) Escrow refund 255,000 — Change in fair value of warrants liability 553,951 776,337 Other (28,914 ) (44,719 ) Reserve for uncertain tax position — 164,127 Other 167,635 (262,660 ) Income tax (expense) benefit $ (8,003 ) $ 887,009 The Company provides deferred income taxes for temporary differences between assets and liabilities recognized for financial reporting and income tax purposes. The income tax effects of these temporary differences and credits are as follows: January 31, 2016 2015 Deferred tax assets: Allowance for doubtful accounts $ 58,379 $ 245,252 Deferred revenue 244,163 372,275 Accruals 203,291 174,658 Net operating loss carryforwards 15,179,685 14,905,174 Stock compensation expense 592,654 438,659 Property and equipment 78,295 — AMT credit 102,144 102,144 Other 17,794 8,912 Total deferred tax assets 16,476,405 16,247,074 Valuation allowance (14,184,030 ) (12,554,242 ) Net deferred tax assets 2,292,375 3,692,832 Deferred tax liabilities: Property and Equipment — (21,755 ) Definite-lived intangible assets (2,292,375 ) (3,671,077 ) Indefinite-lived intangibles — (9,575 ) Total deferred tax liabilities (2,292,375 ) (3,702,407 ) Net deferred tax liabilities $ — $ (9,575 ) At January 31, 2016 , the Company had U.S. federal net operating loss carry forwards of $ 44,347,000 , which expire at various dates through fiscal 2035. The Company also has an Alternative Minimum Tax net operating loss carry forward of $ 39,656,000 , which has an unlimited carry forward period. The Company also had state net operating loss carry forwards of $ 16,144,000 , which expire on or before fiscal 2035. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. The Company established a valuation allowance of $14,184,000 and $12,554,000 at January 31, 2016 and 2015 , respectively. The increase in the valuation allowance of $1,630,000 was driven primarily by losses incurred during the year ended January 31, 2016 . Management believes it is more likely than not the Company will realize the remaining deferred tax assets, net of existing valuation allowances, in future years. Due to the reporting requirements of ASC 718, $1,592,000 of the net operating loss carryforward (tax effected $588,000 ) is not recorded on the Company’s balance sheet because the loss was created by the tax benefits of stock option exercises, which cannot be recognized for book purposes until the benefit has been realized by actually reducing taxes payable. When recognized, the tax benefit of these losses will be accounted for as a credit to additional paid in capital rather than a reduction of the income tax provision. The Company and its subsidiary are subject to U.S. federal income tax as well as income taxes in multiple state and local jurisdictions. The Company has concluded all U.S. federal tax matters for years through January 31, 2011. All material state and local income tax matters have been concluded for years through January 31, 2010. The Company did not have a reserve for uncertain tax positions as of both January 31, 2016 and 2015 . As of both January 31, 2016 and 2015 , the Company had no accrued interest and penalties associated with unrecognized tax benefits. A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits (excluding interest and penalties) is as follows: 2015 2014 Beginning of fiscal year $ — $ 121,000 Additions for tax positions of prior years — — Reductions for tax positions of prior years — — Reductions attributable to lapse of statute of limitations — (121,000 ) End of fiscal year $ — $ — |
Major Clients
Major Clients | 12 Months Ended |
Jan. 31, 2016 | |
Segment Reporting [Abstract] | |
MAJOR CLIENTS | MAJOR CLIENTS During fiscal year 2015 , no individual client accounted for 10% or more of our total revenues. Two clients represented 13% and 12% , respectively, of total accounts receivable as of January 31, 2016 . During fiscal year 2014 , no individual client accounted for 10% or more of our total revenues. Two clients represented 16% and 10% , respectively, of total accounts receivable as of January 31, 2015 . |
Employee Retirement Plan
Employee Retirement Plan | 12 Months Ended |
Jan. 31, 2016 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
EMPLOYEE RETIREMENT PLAN | EMPLOYEE RETIREMENT PLAN The Company has established a 401(k) retirement plan that covers all associates. Company contributions to the plan may be made at the discretion of the board of directors. The Company matches 100% up to the first 4% of compensation deferred by each associate in the 401(k) plan. The total compensation expense for this matching contribution was $499,000 and $440,000 in fiscal 2015 and 2014 , respectively. |
Employee Stock Purchase Plan
Employee Stock Purchase Plan | 12 Months Ended |
Jan. 31, 2016 | |
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | |
EMPLOYEE STOCK PURCHASE PLAN | EMPLOYEE STOCK PURCHASE PLAN The Company has an Employee Stock Purchase Plan under which associates may purchase up to 1,000,000 shares of common stock. Under the plan, eligible associates may elect to contribute, through payroll deductions, up to 10% of their base pay to a trust during any plan year, i.e., January 1 through December 31 of the same year. Semi-annually, typically in January and July of each year, the plan issues for the benefit of the employees shares of common stock at the lesser of (a) 85% of the fair market value of the common stock on the first day of the vesting period, January 1 or July 1, or (b) 85% of the fair market value of the common stock on the last day of the vesting period, June 30 or December 31 of the same year. At January 31, 2016 , 528,164 shares remain that can be purchased under the plan. The Company recognized compensation expense of $20,000 and $14,000 for fiscal years 2015 and 2014 , respectively, under this plan. During fiscal 2015 , 27,071 shares were purchased at the price of $2.38 per share and 42,050 shares were purchased at the price of $1.20 per share; during fiscal 2014 , 11,141 shares were purchased at the price of $4.08 per share and 9,900 shares were purchased at the price of $3.68 per share. The cash received for shares purchased from the plan was $115,000 and $82,000 in fiscal 2015 and 2014 , respectively. The purchase price at June 30, 2016, will be 85% of the lower of (a) the closing price on January 4, 2016 ( $1.41 ) or (b) the closing price on June 30, 2016. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Jan. 31, 2016 | |
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | |
STOCK BASED COMPENSATION | STOCK BASED COMPENSATION Stock Option Plans The Company’s Amended and Restated 2013 Stock Incentive Plan (the “2013 Plan”) authorizes the Company to issue up to 4,500,000 equity awards (stock options, stock appreciation rights or “SAR’s”, and restricted stock) to directors and associates of the Company. The 2013 Plan replaced the 2005 Incentive Compensation Plan (the “2005 Plan”). Outstanding awards under the 2005 Plan continue to be governed by the terms of the 2005 Plan until exercised, expired or otherwise terminated or canceled, but no further equity awards are allowed to be granted under the 2005 Plan. The options granted under the 2013 Plan and 2005 Plan have terms of ten years or less, and typically vest and become fully exercisable ratably over three years of continuous service to the Company from the date of grant. At January 31, 2016 and 2015 , options to purchase 2,186,879 and 1,737,323 shares of the Company’s common stock, respectively, have been granted and are outstanding. There are no SAR’s outstanding. In fiscal 2015 and 2014, inducement grants were approved by the Company's Board of Directors pursuant to NASDAQ Marketplace Rule 5635(c)(4). The terms of the grants were nearly identical to the terms and conditions of the Company’s stock incentive plans in effect at the time of each inducement grant. For the year ended January 31, 2016 , no stock options were issued, 405,417 options expired, 69,583 options were forfeited, and no stock options were exercised. For the year ended January 31, 2015 , 300,000 stock options were issued, 125,694 options expired, 99,722 were forfeited, and 205,556 were exercised. At January 31, 2016 and 2015 , there were 225,000 and 700,000 options outstanding, respectively. Please see “Restricted Stock” section for information on the restricted shares. A summary of stock option activity follows: Options Weighted Average Exercise Price Remaining Life in Years Aggregate intrinsic value Outstanding as of February 1, 2015 2,437,323 $ 4.52 Granted 1,011,828 3.02 Exercised (75,000 ) 2.15 Expired (704,326 ) 3.67 Forfeited (257,946 ) 4.97 Outstanding as of January 31, 2016 2,411,879 $ 4.16 (1) 8.09 $ 4,003,719 Exercisable as of January 31, 2016 1,000,037 $ 4.75 (2) 6.82 $ 1,660,061 Vested or expected to vest as of January 31, 2016 1,990,872 $ 4.25 7.90 $ 3,304,848 _______________ (1) The exercise prices range from $1.53 to $8.17 , of which 207,924 shares are between $1.53 and $2.00 per share, 862,938 shares are between $2.08 and $4.00 per share, and 1,341,017 shares are between $4.02 and $8.17 per share. (2) The exercise prices range from $1.53 to $8.17 , of which 97,924 shares are between $1.53 and $2.00 per share, 268,356 shares are between $2.08 and $4.00 per share, and 633,757 shares are between $4.02 and $8.17 per share. For fiscal 2015 and 2014 , the weighted average grant date fair value of options granted during the year was $1.64 and $2.90 , respectively, and the total intrinsic value of options exercised during the year was $125,000 and $990,000 , respectively. The fiscal 2015 and 2014 stock-based compensation was estimated at the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions for each fiscal year: 2015 2014 Expected life 6 years 6 years Risk-free interest rate 1.51 % 1.35 % Weighted average volatility factor 0.59 0.60 Dividend yield — — Forfeiture rate 30 % 22 % At January 31, 2016 , there was $1,588,000 of unrecognized compensation cost related to non-vested stock-option awards. That cost is expected to be recognized over a remaining weighted average period of 1.8 years. The expense associated with stock option awards was $1,783,000 and $1,655,000 , respectively, for fiscal 2015 and 2014 . Cash received from the exercise of options and purchases pursuant to the Employee Stock Purchase Plan was $276,000 and $552,000 , respectively, in fiscal 2015 and 2014 . The 2005 Plan and the 2013 Plan contain change in control provisions whereby any outstanding equity awards under the plans subject to vesting, which have not fully vested as of the date of the change in control, shall automatically vest and become immediately exercisable. One of the change in control provisions is deemed to occur if there is a change in beneficial ownership, or authority to vote, directly or indirectly, securities representing 20% or more of the total of all of the Company’s then outstanding voting securities, unless through a transaction arranged by, or consummated with the prior approval of the Board of Directors. Other change in control provisions relate to mergers and acquisitions or a determination of change in control by the Company’s Board of Directors. Restricted Stock The Company is authorized to grant restricted stock awards to associates and directors under the 2013 Plan. The Company has also issued restricted stock as inducement grants to certain new employees. The restrictions on the shares granted generally lapse over a one -year term of continuous employment from the date of grant. The grant date fair value per share of restricted stock, which is based on the closing price of our common stock on the grant date, is expensed on a straight-line basis as the restriction period lapses. The shares represented by restricted stock awards are considered outstanding at the grant date, as the recipients are entitled to voting rights. A summary of restricted stock award activity for fiscal 2014 and 2015 is presented below: Non-vested Number of Shares Weighted Average Grant Date Fair Value Non-vested balance at January 31, 2014 29,698 $ 6.01 Granted 120,306 4.31 Vested (29,698 ) 6.65 Forfeited/expired — — Non-vested balance at January 31, 2015 120,306 $ 4.31 Granted 118,180 2.62 Vested (120,306 ) 4.31 Forfeited/expired (5,800 ) 4.31 Non-vested balance at January 31, 2016 112,380 $ 2.62 At January 31, 2016 , there was $77,000 of unrecognized compensation cost related to restricted stock awards. That cost is expected to be recognized over a remaining period of one year or less. The expense associated with restricted stock awards was $582,000 and $265,000 , respectively, for fiscal 2015 and 2014 . |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation The Company is, from time to time, a party to various legal proceedings and claims, which arise in the ordinary course of business. Other than the matter described below, the Company is not aware of any legal matters that could have a material adverse effect on the Company’s consolidated results of operations, financial position, or cash flows. On February 12, 2014, the Company entered into a strategic alliance agreement with CentraMed, Inc. (“CentraMed”). On May 6, 2014, the Company signed an asset purchase agreement with CentraMed. This purchase agreement provided for the Company’s purchase of substantially all of CentraMed’s assets related to its business of providing healthcare analytics and consulting services to hospitals, physicians, and other providers. The agreement provided the Company the right to terminate the agreement in a number of circumstances, including if the Company was not satisfied, in its sole and absolute discretion, with the results of its due diligence review; the Company’s senior lender did not consent to the transactions contemplated by the agreement; or the Company’s Board did not authorize the transactions contemplated by the agreement. On January 12, 2015, the Company terminated the purchase agreement in accordance with its termination rights. On March 9, 2015, CentraMed asserted claims against the Company for breach of contract, misrepresentation, tortious interference with contracts and prospective economic relationships and bad faith in connection with the strategic alliance agreement and the asset purchase agreement. On March 24, 2015, the Company rejected the aforementioned claims and denied any liability to CentraMed. The Company intends to contest vigorously any action instituted against it by CentraMed. Because of the many questions of fact and law that may arise, the outcome of this matter is uncertain at this point. Based on the information available to us at present, we cannot reasonably estimate a range of loss for this matter and, accordingly, we have not accrued any liability associated with this matter. |
Private Placement Investment
Private Placement Investment | 12 Months Ended |
Jan. 31, 2016 | |
Equity [Abstract] | |
PRIVATE PLACEMENT INVESTMENT | PRIVATE PLACEMENT INVESTMENT On August 16, 2012, the Company completed a $12,000,000 private placement investment (“private placement investment”) with affiliated funds and accounts of Great Point Partners, LLC, and Noro-Moseley Partners VI, L.P., and another investor. The investment consisted of the following instruments: issuance of 2,416,785 shares of a new Series A 0% Redeemable Convertible Preferred Stock (“Series A Preferred Stock”) at $3.00 per share, common stock warrants (“warrants”) exercisable for up to 1,200,000 shares of the Company's common stock at an exercise price of $3.99 per share, and convertible subordinated notes payable in the aggregate principal amount of $5,699,577 , which upon stockholder approval, converted into 1,583,210 shares of Series A Preferred Stock. The proceeds were allocated among the instruments based on their relative fair values as follows: Adjusted Fair Value at August 16, 2012 Proceeds Allocation at August 16, 2012 Instruments: Series A Preferred Stock $ 9,907,820 $ 6,546,146 (1) Convertible subordinated notes payable 5,699,577 3,765,738 (2) Warrants 2,856,000 1,688,116 (3) Total investment $ 18,463,397 $ 12,000,000 _______________ (1) The Series A Preferred Stock convert on a 1 :1 basis into common stock, but differ in value from common stock due to the downside protection relative to common stock in the event the Company liquidates, and the downside protection, if, after four years, the holder has not converted and the stock is below $3.00 . The fair value of Series A Preferred Stock was determined using a Monte-Carlo simulation following a Geometric Brownian Motion, using the following assumptions: annual volatility of 75% , risk-free rate of 0.9% and dividend yield of 0.0% . The model also utilized the following assumptions to account for the conditions within the agreement: after four years, if the simulated common stock price fell below a price of $3.00 per share, the convertible preferred stock would automatically convert to common stock on a 1 :1 basis moving forward at a price of exactly $3.00 per share and a forced conversion if the simulated stock price exceeded $8.00 per share. (2) The fair value of convertible subordinated notes payable was determined based on its current yield as compared to that of those currently outstanding in the marketplace. Management reviewed the convertible note agreement and determined that the note's interest rate is a reasonable representative of a market rate; therefore the face or principal amount of the loan is a reasonable estimate of its fair value. (3) The fair value of the common stock warrants was determined using a Monte-Carlo simulation following a Geometric Brownian motion, using the following assumptions: annual volatility of 75% , risk-free rate of 0.9% , dividend yield of 0.0% and expected life of 5 years. Because the dilutive down-round financing was subject to stockholder approval, which had not happened at the time of the valuation, the model utilized the assumption that the down-round financing would not occur within the simulation. The Company incurred legal, placement and other adviser fees of $1,894,000 , including $754,000 in costs for warrants issued to placement agents. The total transaction costs were allocated among the instruments of the private placement investment based on their relative fair values as follows: $611,000 to subordinated convertible notes as deferred financing costs, $1,020,000 to Series A Preferred Stock as discount on Series A Preferred Stock and $263,000 to warrants as a charge to additional paid in capital. Series A Convertible Preferred Stock In connection with the private placement investment, the Company issued 2,416,785 shares of Series A Preferred Stock at $3.00 per share. Each share of the Series A Preferred Stock is convertible into one share of the Company's common stock. The price per share of Series A Preferred Stock and the conversion price for the common stock was less than the “market value” of the common stock of $3.82 (as defined in the rules of the Nasdaq Stock Market) on the date of execution of the definitive agreements. The Series A Preferred Stock does not pay a dividend, however, the holders are entitled to receive dividends on shares of Preferred Stock equal (on an as-if-converted-to-common-stock basis) to and in the same form as dividends (other than dividends in the form of common stock) actually paid on shares of the common stock. The Series A Preferred Stock has voting rights on a modified as-if-converted-to-common-stock-basis. The Series A Preferred Stock has a non-participating liquidation right equal to the original issue price plus accrued unpaid dividends, which are senior to the Company’s common stock. The Series A Preferred Stock can be converted to common shares at any time by the holders, or at the option of the Company if the arithmetic average of the daily volume weighted average price of the common stock for the ten day period prior to the measurement date is greater than $8.00 per share, and the average daily trading volume for the sixty day period immediately prior to the measurement date exceeds 100,000 shares. The conversion price is $3.00 per share, subject to certain adjustments. The allocation of the proceeds and transaction costs based on relative fair values of the instruments resulted in recognition of a discount on the Series A Preferred Stock of $4,410,000 , including a discount attributable to a beneficial conversion feature of $2,686,000 , which is being amortized from the date of issuance to the earliest redemption date. For the years ended January 31, 2016 and 2015 , the Company recognized $1,336,000 and $1,038,000 , respectively, of amortization of the discount on Series A Preferred Stock as deemed dividends charged to additional paid in capital, computed under the effective interest rate method. The value of the beneficial conversion feature is calculated as the difference between the effective conversion price of the Series A Preferred Stock and the fair market value of the common stock into which the Series A Preferred Stock are convertible at the commitment date. On November 1, 2012, upon shareholder approval, the convertible subordinated notes were converted into shares of Series A Convertible Preferred Stock. The convertible subordinated notes had an aggregate principal amount of $5,699,577 and converted into an aggregate of 1,583,210 shares of Preferred Stock. The Company recorded a loss upon conversion of $5,913,000 , which represented the difference between the aggregate fair value of the Preferred Stock issued of $9,183,000 , based on a $5.80 fair value per share, and the total of carrying value of the notes and unamortized deferred financing cost of $ 3,270,000 . The shares of Series A Preferred Stock issued for the conversion of notes payable are recorded at their aggregate redemption value of $4,750,000 with the difference between the fair value and redemption value of $4,433,000 recorded as additional paid in capital. The fair value of the Preferred Stock was determined using a Monte-Carlo simulation based on the following assumptions: annual volatility of 75% , risk-free rate of 0.8% , and dividend yield of 0.0% . The model also utilized the following assumptions to account for the conditions within the agreement: after four years , if the simulated common stock price fell below a price of $3.00 per share, the convertible preferred stock would automatically convert to common stock on a 1 :1 basis moving forward at a price of exactly $3.00 per share and a forced conversion if the simulated stock price exceeded $8.00 per share. The following table sets forth the activity of the Series A Preferred Stock, classified as temporary equity, during the periods presented: Number of Shares Series A Preferred Stock Series A Preferred Stock, January 31, 2014 2,949,995 $ 5,599,668 Accretion of Preferred Stock discount — 1,038,310 Series A Preferred Stock, January 31, 2015 2,949,995 6,637,978 Accretion of Preferred Stock discount — 1,336,072 Series A Preferred Stock, January 31, 2016 2,949,995 $ 7,974,050 At any time following August 31, 2016, subject to the Subordination and Intercreditor among the preferred stockholders, the Company and Wells Fargo, each share of Series A Preferred Stock is redeemable at the option of the holder for an amount equal to the initial issuance price of $3.00 (adjusted to reflect stock splits, stock dividends or like events) plus any accrued and unpaid dividends thereon. The Series A Preferred Stock are classified as temporary equity as the securities are redeemable solely at the option of the holder. In fiscal 2013, 1,050,000 shares of the Company's Series A Convertible Preferred Stock were converted into Common Stock. As a result, Series A Convertible Preferred Stock was reduced by $3,150,000 , with the offsetting increase to Common Stock and Additional Paid-in Capital. As of January 31, 2016 and 2015 , 2,949,995 shares of Series A Convertible Preferred Stock remained outstanding. Common Stock Warrants In conjunction with the private placement investment, the Company issued common stock warrants exercisable for up to 1,200,000 of the Company's common stock at an exercise price of $3.99 per share. The warrants can be exercised in whole or in part until February 16, 2018 . The warrants also include a cashless exercise option which allows the holder to receive a number of shares of common stock based on an agreed upon formula in exchange for the warrant rather than paying cash to exercise. The proceeds, net of transaction costs, allocated to the warrants of $1,425,000 were classified as equity on August 16, 2012, the date of issuance. Effective October 31, 2012, upon shareholder approval of anti-dilution provisions that reset the warrants’ exercise price if a dilutive issuance occurs, the warrants were reclassified as derivative liabilities. The provisions require the exercise price to reset to the lower price at which the dilutive issuance is consummated, if the dilutive issuance occurs prior to the second anniversary of the warrants’ issuance. If a dilutive issuance occurs after the second anniversary of the warrants’ issuance, then the exercise price will be reset in accordance with a weighted average formula that provides for a partial reset, based on the number of shares raised in the dilutive issuance relative to the number of common stock equivalents outstanding at the time of the dilutive issuance. The change in fair value of the warrants was accounted for as an adjustment to stockholders’ equity for the period between the date of the contract’s last classification as equity to the date of reclassification to liability. The fair value of the warrants was $4,139,000 at October 31, 2012. These warrants have been accounted for as derivative liabilities effective October 31, 2012, and as such, are re-valued at each reporting date, with changes in fair value recognized in earnings each reporting period as a charge or credit to other expenses. On October 19, 2012, the Company also issued 200,000 warrants to its placement agents as a portion of the fees for services rendered in connection with the private placement investment. The warrants are exercisable through April 30, 2018 at a stated exercise price of $4.06 per share and can be exercised in whole or in part. The warrants also include a cashless exercise option that allows the holder to receive a number of shares of common stock based on an agreed upon formula in exchange for the warrants rather than paying cash to exercise. The warrants have no reset provisions. The warrants had a grant date fair value of $754,000 , and are classified as equity on the consolidated balance sheet. The estimated fair value of the warrants was determined by using Monte-Carlo simulations based on the following assumptions: annual volatility of 75% ; risk-free rate of 0.9% , dividend yield of 0.0% and expected life of five years. The following table sets forth the warrants issued and outstanding as of January 31, 2016 : Number of Shares Issuable Weighted Average Exercise Price Warrants - private placement 1,200,000 $ 3.99 Warrants - placement agent 200,000 4.06 Total 1,400,000 $ 4.00 The fair value of the private placement warrants was $205,000 and $1,834,000 at January 31, 2016 and 2015 , respectively. No warrants were exercised or canceled during fiscal 2015 and 2014. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jan. 31, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS We have evaluated subsequent events through April 20, 2016 and have determined that there are no subsequent events after January 31, 2016 for which disclosure is required. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts and Reserves | 12 Months Ended |
Jan. 31, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts and Reserves | Schedule II Valuation and Qualifying Accounts and Reserves Streamline Health Solutions, Inc. For the two years ended January 31, 2016 Additions Description Balance at Beginning of Period Charged to Costs and Expenses Charged to Other Accounts Deductions Balance at End of Period (in thousands) Year ended January 31, 2016: Allowance for doubtful accounts $ 666 $ 48 $ — $ (559 ) $ 155 Year ended January 31, 2015: Allowance for doubtful accounts $ 267 $ 441 $ 1 $ (43 ) $ 666 |
Significant Accounting Polici24
Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of Streamline Health Solutions, Inc. and its wholly-owned subsidiary, Streamline Health, Inc. All significant intercompany transactions are eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash demand deposits. Cash deposits are placed in Federal Deposit Insurance Corporation (“FDIC”) insured financial institutions. Cash deposits may exceed FDIC insured levels from time to time. For purposes of the Consolidated Balance Sheets and Consolidated Statements of Cash Flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. |
Receivables and Allowance for Doubtful Accounts | Receivables Accounts and contract receivables are comprised of amounts owed to the Company for licensed software, professional services, including maintenance services and software as a service and are presented net of the allowance for doubtful accounts. The timing of revenue recognition may not coincide with the billing terms of the client contract, resulting in unbilled receivables or deferred revenues; therefore certain contract receivables represent revenues recognized prior to client billings. Individual contract terms with clients or resellers determine when receivables are due. For billings where the criteria for revenue recognition have not been met, deferred revenue is recorded until all revenue recognition criteria have been met. Allowance for Doubtful Accounts In determining the allowance for doubtful accounts, aged receivables are analyzed monthly by management. Each identified receivable is reviewed based upon the most recent information available, including client comments, if any, and the status of any open or unresolved issues with the client preventing the payment thereof. Corrective action, if necessary, is taken by the Company to resolve open issues related to unpaid receivables. During these monthly reviews, the Company determines the required allowances for doubtful accounts for estimated losses resulting from the unwillingness or inability of its clients or resellers to make required payments. The allowance for doubtful accounts was approximately $155,000 and $666,000 at January 31, 2016 and 2015 , respectively. The Company believes that its reserve is adequate, however results may differ in future periods. |
Concessions Accrual | Concessions Accrual In determining the concession accrual, the Company evaluates historical concessions granted relative to revenue. The concession accrual included in accrued other expenses on the Company's consolidated balance sheet was $54,000 and $58,000 as of January 31, 2016 and 2015 , respectively |
Property and Equipment | Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method, over the estimated useful lives of the related assets. Estimated useful lives are as follows: Computer equipment and software 3-4 years Office equipment 5 years Office furniture and fixtures 7 years Leasehold improvements Term of lease Depreciation expense for property and equipment in fiscal 2015 and 2014 was $1,245,000 and $1,005,000 , respectively. Normal repair and maintenance is expensed as incurred. Replacements are capitalized and the property and equipment accounts are relieved of the items being replaced or disposed of, if no longer of value. The related cost and accumulated depreciation of the disposed assets are eliminated and any gain or loss on disposition is included in the results of operations in the year of disposal. |
Leases | Leases On April 10, 2012, the Company entered into an amended lease obligation to lease 8,582 square feet of office space at 1230 Peachtree St. NE in Atlanta, Georgia. The lease commenced upon taking possession of the space and would have ended 72 months thereafter. The Company took possession of the space during the third quarter of fiscal 2012. Upon relocation, the Company completely vacated the previously leased premises within the same building. The provisions of the lease provided for rent abatement for the first four months of the lease term. Upon taking possession of the premises, the rent abatement was aggregated with the total expected rental payments, and was amortized on a straight-line basis over the term of the lease. On December 13, 2013, the Company entered into an amended lease obligation to lease 24,335 square feet of office space in the same building as the office space in Atlanta, Georgia. The lease commenced upon taking possession of the space and ends 102 months thereafter. The Company took possession of the new space during the second quarter of fiscal 2014. Upon relocation, the Company completely vacated the previously leased premises within the building. The provisions of the lease provided for rent abatement for the first eight months of the lease term. Upon taking possession of the premises, the rent abatement and the unamortized balance of deferred rent associated with the previously leased premises were aggregated with the total expected rental payments, and are being amortized on a straight-line basis over the term of the new lease. On August 16, 2012, as part of the acquisition of Meta Health Technology, the Company assumed a lease agreement for office space of approximately 10,000 square feet, at 330 Seventh Ave., New York, New York. This lease term expired on August 31, 2014. During the third quarter of fiscal 2014, the Company relocated its New York office to 105 Madison Avenue, New York, New York. The lease commenced upon taking possession of the space and ends 63 months thereafter. The provisions of the lease for the new office space of 10,350 square feet provided for rent abatement for the first two months of the lease term. Upon taking possession of the premises, the rent abatement was aggregated with the total expected rental payments, and is being amortized on a straight-line basis over the term of the lease. The Company has capital leases to finance office equipment and maintenance services purchases. The balance of fixed assets acquired under these capital leases is $1,652,000 and $1,515,000 as of January 31, 2016 and 2015 , respectively, and the balance of accumulated depreciation is $1,166,000 and $494,000 for the respective periods. The amortization expense of leased assets is included in depreciation expense. |
Debt Issuance Costs | Debt Issuance Costs Costs related to the issuance of debt are capitalized and amortized to interest expense on a straight-line basis, which is not materially different from the effective interest method, over the term of the related debt. |
Interest Rate Swap | Interest Rate Swap In December 2013, the Company entered into an interest rate swap agreement to hedge against interest rate exposure of its variable rate debt obligation. The interest rate swap settled any accrued interest for cash on the first day of each calendar month until expiration. At such dates, the differences to be paid or received on the interest rate swaps was included in interest expense. The interest rate swap qualified for cash flow hedge accounting treatment and as such, the change in the fair values of the interest rate swap was recorded on the Company's consolidated balance sheet as an asset or liability with the effective portion of the interest rate swaps' gains or losses reported as a component of other comprehensive loss and the ineffective portion reported in net loss. The fair value of the Company's interest rate swap was based on Level 2 inputs as described in ASC Topic 820, Fair Value Measurements and Disclosures , which include observable inputs such as dealer-quoted prices for similar assets or liabilities, and represented the estimated amount the Company would receive or pay to terminate the agreement taking into consideration various factors, including current interest rates, credit risk and counterparty credit risk. During the third quarter of fiscal 2014, the interest rate swap was terminated prior to its maturity, and losses accumulated in other comprehensive loss were reclassified into earnings. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews the carrying value of long-lived assets whenever facts and circumstances exist that would suggest that assets might be impaired or that the useful lives should be modified. Among the factors the Company considers in making the evaluation are changes in market position and profitability. If facts and circumstances are present which may indicate impairment is probable, the Company will prepare a projection of the undiscounted cash flows of the specific asset and determine if the long-lived assets are recoverable based on these undiscounted cash flows. If impairment is indicated, an adjustment will be made to reduce the carrying amount of these assets to their fair value. |
Capitalized Software Development Costs | Capitalized Software Development Costs Software development costs associated with the planning and designing phase of software development, including coding and testing activities necessary to establish technological feasibility, are classified as research and development and are expensed as incurred. Once technological feasibility has been determined, a portion of the costs incurred in development, including coding, testing, and quality assurance, are capitalized and subsequently reported at the lower of unamortized cost or net realizable value. The Company capitalized such costs, including interest, of $0 and $620,000 in fiscal 2015 and 2014 , respectively. The Company acquired $2,017,000 of internally developed software in 2014 through the acquisition of Unibased, which is described in Note 3 - Acquisitions, and $3,646,000 through the acquisition of Meta in 2012. Amortization for the Company's legacy software systems is provided on a solution-by-solution basis over the estimated economic life of the software, typically five years, using the straight-line method. Amortization commences when a solution is available for general release to clients. Acquired internally developed software from the Interpoint, Meta, and Unibased acquisitions is amortized using the straight-line method. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The FASB’s authoritative guidance on fair value measurements establishes a framework for measuring fair value, and expands disclosure about fair value measurements. This guidance enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. Under this guidance, assets and liabilities carried at fair value must be classified and disclosed in one of the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value based on the short-term maturity of these instruments. Cash and cash equivalents are classified as Level 1. The carrying amount of the Company’s long-term debt approximates fair value since the variable interest rates being paid on the amounts approximate the market interest rate. Long-term debt is classified as Level 2. |
Revenue Recognition | Revenue Recognition The Company derives revenue from the sale of internally developed software either by licensing or by software as a service (SaaS), through the direct sales force or through third-party resellers. Licensed, locally-installed, clients utilize the Company’s support and maintenance services for a separate fee, whereas SaaS fees include support and maintenance. The Company also derives revenue from professional services that support the implementation, configuration, training, and optimization of the applications. Additional revenues are also derived from reselling third-party software and hardware components. The Company recognizes revenue in accordance with ASC 985-605, Software-Revenue Recognition and ASC 605-25 Revenue Recognition — Multiple-Element Arrangements . The Company commences revenue recognition when the following criteria all have been met: • Persuasive evidence of an arrangement exists, • Delivery has occurred or services have been rendered, • The arrangement fees are fixed or determinable, and • Collection is considered probable. If we determine that any of the above criteria have not been met, we will defer recognition of the revenue until all the criteria have been met. Maintenance and support and SaaS agreements entered into are generally non-cancelable, or contain significant penalties for early cancellation, although clients typically have the right to terminate their contracts for cause if the Company fails to perform material obligations. However, if non-standard acceptance periods or non-standard performance criteria, cancellation or right of refund terms are required, revenue is recognized upon the satisfaction of such criteria, as applicable. Multiple Element Arrangements The Company applies the provisions of Accounting Standards Update No. 2009-13, Revenue Recognition (Topic 605), “Multiple-Deliverable Revenue Arrangements — a consensus of the FASB Emerging Issues Task Force” (“ASU 2009-13”). ASU 2009-13 amended the accounting standards for revenue recognition for multiple deliverable revenue arrangements to: • Provide updated guidance on how deliverables of an arrangement are separated, and how consideration is allocated; • Eliminate the residual method and require entities to allocate revenue using the relative selling price method and; • Require entities to allocate revenue to an arrangement using the estimated selling price (“ESP”) of deliverables if it does not have vendor specific objective evidence (“VSOE”) or third party evidence (“TPE”) of selling price. Terms used in evaluation are as follows: • 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 — the Company’s best estimate of the selling price of an element of the transaction The Company follows accounting guidance for revenue recognition of multiple-element arrangements to determine whether such arrangements contain more than one unit of accounting. Multiple-element arrangements require the delivery or performance of multiple solutions, services and/or rights to use assets. To qualify as a separate unit of accounting, the delivered item must have value to the client on a stand-alone basis. Stand-alone value to a client is defined in the guidance as those that can be sold separately by any vendor or the client could resell the item on a stand-alone basis. Additionally, if the arrangement includes a general right of return relative to the delivered item, delivery or performance of the undelivered item or items must be considered probable and substantially in the control of the vendor. The Company has a defined pricing methodology for all elements of the arrangement and proper review of pricing to ensure adherence to Company policies. Pricing decisions include cross-functional teams of senior management, which uses market conditions, expected contribution margin, size of the client’s organization, and pricing history for similar solutions when establishing the selling price. Software as a Service The Company uses ESP to determine the value for a software as a service arrangement as the Company cannot establish VSOE and TPE is not a practical alternative due to differences in functionality from the Company's competitors. Similar to proprietary license sales, pricing decisions rely on the relative size of the client purchasing the solution, and include calculating the equivalent value of maintenance and support on a present value basis over the term of the initial agreement period. Typically revenue recognition commences upon client go-live on the system, and is recognized ratably over the contract term. Systems Sales The Company uses the residual method to determine fair value for proprietary software licenses sold in a multi-element arrangement as the Company cannot establish fair value for all of the delivered elements. Typically pricing decisions for proprietary software rely on the relative size and complexity of the client purchasing the solution. Third-party components are resold at prices based on a cost plus margin analysis. The proprietary software and third-party components do not need any significant modification to achieve their intended use. When these revenues meet all the criteria for revenue recognition and are determined to be separate units of accounting, revenue is recognized. Typically, this is upon shipment of components or electronic download of software. Proprietary licenses are perpetual in nature, and license fees do not include rights to version upgrades, fixes or service packs. Maintenance and Support Services The maintenance and support components are not essential to the functionality of the software and clients renew maintenance contracts separately from software purchases at renewal rates materially similar to the initial rate charged for maintenance on the initial purchase of software. The Company uses VSOE of fair value to determine fair value of maintenance and support services. Generally, maintenance and support is calculated as a percentage of the list price of the proprietary license being purchased by a client. Clients have the option of purchasing additional annual maintenance service renewals each year for which rates are not materially different from the initial rate, but typically include a nominal rate increase based on the consumer price index. Annual maintenance and support agreements entitle clients to technology support, upgrades, bug fixes and service packs. Term Licenses We cannot establish VSOE of fair value of the undelivered element in term license arrangements. However, as the only undelivered element is post-contract customer support, the entire fee is recognized ratably over the contract term. Typically, revenue recognition commences once the client goes live on the system. Similar to proprietary license sales, pricing decisions rely on the relative size of the client purchasing the solution. The software portion of our coding and clinical documentation improvement solutions generally does not require material modification to achieve their contracted function. Professional Services Professional services components that are not essential to the functionality of the software, from time to time, are sold separately by the Company. Similar services are sold by other vendors, and clients can elect to perform similar services in-house. When professional services revenues are a separate unit of accounting, revenues are recognized as the services are performed based upon a proportional performance methodology. Professional services components that are essential to the functionality of the software, and are not considered a separate unit of accounting, are recognized in revenue ratably over the life of the client, which approximates the duration of the initial contract term. The Company defers the associated direct costs for salaries and benefits expense for professional services contracts. These deferred costs will be amortized over the identical term as the associated SaaS revenues. As of January 31, 2016 and 2015 , the Company had deferred costs of $ 571,000 and $570,000 , respectively, net of accumulated amortization of $265,000 and $275,000 , respectively. Amortization expense of these costs was $136,000 and $166,000 in fiscal 2015 and 2014 , respectively. The Company uses VSOE of fair value based on the hourly rate charged when services are sold separately, to determine fair value of professional services. The Company typically sells professional services on an hourly-fee basis. The Company monitors projects to assure that the expected and historical rate earned remains within a reasonable range to the established selling price. |
Concentrations | Concentrations Financial instruments, which potentially expose the Company to concentrations of credit risk, consist primarily of accounts receivable. The Company’s accounts receivable are concentrated in the healthcare industry. However, the Company’s clients typically are well-established hospitals, medical facilities, or major health information systems companies that resell the Company’s solutions that have good credit histories. Payments from clients have been received within normal time frames for the industry. However, some hospitals and medical facilities have experienced significant operating losses as a result of limits on third-party reimbursements from insurance companies and governmental entities and extended payment of receivables from these entities is not uncommon. To date, the Company has relied on a limited number of clients and remarketing partners for a substantial portion of its total revenues. The Company expects that a significant portion of its future revenues will continue to be generated by a limited number of clients and its remarketing partners. The Company currently buys all of its hardware and some major software components of its healthcare information systems from third-party vendors. Although there are a limited number of vendors capable of supplying these components, management believes that other suppliers could provide similar components on comparable terms. |
Business Combinations | Business Combinations The assets acquired, liabilities assumed, and contingent consideration are recorded at their fair value on the acquisition date with subsequent changes recognized in earnings. These estimates are inherently uncertain and are subject to refinement. Management develops estimates based on assumptions as a part of the purchase price allocation process to value the assets acquired and liabilities assumed as of the business combination date. As a result, during the purchase price measurement period, which may be up to one year from the business combination date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. After the purchase price measurement period, the Company will record adjustments to assets acquired or liabilities assumed subsequent to the purchase price measurement period in operating expenses in the period in which the adjustments were determined. The Company records acquisition and transaction related expenses in the period in which they are incurred. Acquisition and transaction related expenses primarily consist of legal, banking, accounting and other advisory fees of third parties related to potential acquisitions. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill and other intangible assets were recognized in conjunction with the Interpoint, Meta, CLG, and Unibased acquisitions. Identifiable intangible assets include purchased intangible assets with finite lives, which primarily consist of internally developed software, client relationships, supplier agreements, non-compete agreements, customer contracts, and license agreements. Finite-lived purchased intangible assets are amortized over their expected period of benefit, which generally ranges from one to 15 years, using the straight-line and undiscounted expected future cash flows methods. The indefinite-lived intangible asset related to the Meta trade name was not amortized, but was tested for impairment on at least an annual basis. In fiscal 2014 , the Meta trade name was deemed impaired and its corresponding balance was fully written off (see Note 7 - Goodwill and Intangible Assets). The Company assesses the useful lives and possible impairment of existing recognized goodwill and intangible assets when an event occurs that may trigger such a review. Factors considered important which could trigger a review include: • significant under performance relative to historical or projected future operating results; • significant changes in the manner of use of the acquired assets or the strategy for the overall business; • identification of other impaired assets within a reporting unit; • disposition of a significant portion of an operating segment; • significant negative industry or economic trends; • significant decline in the Company's stock price for a sustained period; and • a decline in the market capitalization relative to the net book value. Determining whether a triggering event has occurred involves significant judgment by the Company. The Company assesses goodwill annually (as of November 1), or more frequently when events and circumstances, such as the ones mentioned above, occur indicating that the recorded goodwill may be impaired. The Company did not note any of the above qualitative factors, which would be considered a triggering event for impairment. In assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company assesses relevant events and circumstances that may impact the fair value and the carrying amount of a reporting unit. The identification of relevant events and circumstances and how these may impact a reporting unit's fair value or carrying amount involve significant judgments by management. These judgments include the consideration of macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, events which are specific to the Company, and trends in the market price of the Company's common stock. Each factor is assessed to determine whether it impacts the impairment test positively or negatively, and the magnitude of any such impact. The two-step goodwill impairment test requires the Company to identify its reporting units and to determine estimates of the fair values of those reporting units as of the impairment testing date. Reporting units are determined based on the organizational structure the entity has in place at the date of the impairment test. A reporting unit is an operating segment or component business unit with the following characteristics: (a) it has discrete financial information, (b) segment management regularly reviews its operating results (generally an operating segment has a segment manager who is directly accountable to and maintains regular contact with the chief operating decision maker to discuss operating activities, financial results, forecasts, or plans for the segment), and (c) its economic characteristics are dissimilar from other units (this contemplates the nature of the products and services, the nature of the production process, the type or class of customer for the products and services, and the methods used to distribute the products and services). The Company determined that it has one operating segment and one reporting unit. To conduct a quantitative two-step goodwill impairment test, the fair value of the reporting unit is first compared to its carrying value. If the reporting unit's carrying value exceeds its fair value, the Company performs the second step and records an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value. The Company estimates the fair value of its reporting unit using a blend of market and income approaches. The market approach consists of two separate methods, including reference to the Company's market capitalization, as well as the guideline publicly traded company method. The market capitalization valuation method is based on an analysis of the Company's stock price on and around the testing date, plus a control premium. The guideline publicly traded company method was made by reference to a list of publicly traded software companies providing services to healthcare organizations, as determined by management. The market value of common equity for each comparable company was derived by multiplying the price per share on the testing date by the total common shares outstanding, plus a control premium. Selected valuation multiples are then determined and applied to appropriate financial statistics based on the Company's historical and forecasted results. The Company estimates the fair value of its reporting unit using the income approach, via discounted cash flow valuation models which include, but are not limited to, assumptions such as a “risk-free” rate of return on an investment, the weighted average cost of capital of a market participant, and future revenue, operating margin, working capital and capital expenditure trends. Determining the fair values of reporting units and goodwill includes significant judgment by management, and different judgments could yield different results. The Company performed its annual assessment of goodwill during the fourth quarter of fiscal 2015 , using the two-step approach described above. The first step of the goodwill impairment test, used to identify potential impairment, compares the fair value of a reporting unit with its carrying amount, including goodwill. Based on the analysis performed for step one, the fair value of the reporting unit exceeded the carrying amount of the reporting unit, including goodwill, and, therefore, an impairment loss was not recognized. As the Company passed step one of the analysis, step two was not required. |
Severances | Severances From time to time, we will enter into termination agreements with associates that may include supplemental cash payments, as well as contributions to health and other benefits for a specific time period subsequent to termination. In fiscal 2015 and 2014 , we incurred $43,000 and $666,000 in severance expenses. At January 31, 2016 and 2015 , we had accrued for $26,000 and $159,000 in severances, respectively. |
Equity Awards | Equity Awards The Company accounts for share-based payments based on the grant-date fair value of the awards with compensation cost recognized as expense over the requisite vesting period. The Company incurred total annual compensation expense related to stock-based awards of $2,386,000 and $1,934,000 in fiscal 2015 and 2014 , respectively. The fair value of the stock options granted in fiscal 2015 and 2014 was estimated at the date of grant using a Black-Scholes option pricing model. Option pricing model input assumptions such as expected term, expected volatility, and risk-free interest rate impact the fair value estimate. Further, the forfeiture rate impacts the amount of aggregate compensation. These assumptions are subjective and are generally derived from external (such as, risk-free rate of interest) and historical data (such as, volatility factor, expected term, and forfeiture rates). Future grants of equity awards accounted for as stock-based compensation could have a material impact on reported expenses depending upon the number, value and vesting period of future awards. The Company issues restricted stock awards in the form of Company common stock. The fair value of these awards is based on the market close price per share on the day of grant. The Company expenses the compensation cost of these awards as the restriction period lapses, which is typically a one -year service period to the Company. |
Common Stock Warrants | Common Stock Warrants As of January 31, 2016 , the fair value of the common stock warrants was computed using the Black-Scholes option pricing model. The estimated fair value of the warrant liabilities as of January 31, 2015 was computed using Monte-Carlo simulations. Both valuations were based on assumptions regarding annual volatility, risk-free rate, dividend yield and expected life. The models also include assumptions to account for anti-dilutive provisions within the warrant agreement. |
Other Comprehensive Income | Other Comprehensive Income Total other comprehensive income for fiscal years 2015 and 2014 was approximately zero and $111,000 , respectively. Total other comprehensive income relates to the change in the unrealized loss on the Company's interest rate swap arrangement. The Company's interest rate swap arrangement is further described in Note 6 - Debt. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for tax credit and loss carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. In assessing net deferred tax assets, the Company considers whether it is more likely than not that some or all of the deferred tax assets will not be realized. The Company establishes a valuation allowance when it is more likely than not that all or a portion of deferred tax assets will not be realized. See Note 8 - Income Taxes for further details. The Company provides for uncertain tax positions and the related interest and penalties based upon management’s assessment of whether certain tax positions are more likely than not to be sustained upon examination by tax authorities. At January 31, 2016 , the Company believes it has appropriately accounted for any uncertain tax positions. As part of the Meta acquisition, the Company assumed a current liability for an uncertain tax position. The Company has recorded zero reserves for uncertain tax positions and corresponding interest and penalties as of both January 31, 2016 and January 31, 2015 . |
Net Loss Per Common Share | Net Loss Per Common Share The Company presents basic and diluted earnings per share (“EPS”) data for its common stock. Basic EPS is calculated by dividing the net loss attributable to shareholders of the Company by the weighted average number of shares of common stock outstanding during the period. Diluted EPS is calculated based on the profit or loss attributable to shareholders and the weighted average number of shares of common stock outstanding adjusted for the effects of all potential dilutive common stock issuances related to options, unvested restricted stock, warrants and convertible preferred stock. Potential common stock dilution related to outstanding stock options, unvested restricted stock and warrants is determined using the treasury stock method, while potential common stock dilution related to Series A Convertible Preferred Stock is determined using the “if converted” method. The Company's unvested restricted stock awards and Series A Convertible Preferred stock are considered participating securities under ASC 260, “Earnings Per Share” which means the security may participate in undistributed earnings with common stock. The Company's unvested restricted stock awards are considered participating securities because they entitle holders to non-forfeitable rights to dividends or dividend equivalents during the vesting term. The holders of the Series A Preferred Stock would be entitled to share in dividends, on an as-converted basis, if the holders of common stock were to receive dividends, other than dividends in the form of common stock. In accordance with ASC 260, a company is required to use the two-class method when computing EPS when a company has a security that qualifies as a “participating security.” The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings. In determining the amount of net earnings to allocate to common stock holders, earnings are allocated to both common and participating securities based on their respective weighted-average shares outstanding for the period. Diluted EPS for the Company's common stock is computed using the more dilutive of the two-class method or the if-converted method. In accordance with ASC 260, securities are deemed to not be participating in losses if there is no obligation to fund such losses. For the years ended January 31, 2016 and 2015 , the unvested restricted stock awards and the Series A Preferred Stock were deemed not to be participating since there was a net loss from operations for the years ended January 31, 2016 and 2015 . As of both January 31, 2016 and 2015 , there were 2,949,995 shares of preferred stock outstanding, each share is convertible into one share of the Company's common stock. For the years ended January 31, 2016 and 2015 , the Series A Convertible Preferred Stock would have an anti-dilutive effect if included in Diluted EPS and, therefore, was not included in the calculation. As of January 31, 2016 and 2015 , there were 112,380 and 120,306 unvested restricted shares of common stock outstanding, respectively. These unvested restricted shares were excluded from the calculation as their effect would have been antidilutive. |
Loss Contingencies | Loss Contingencies We are subject to the possibility of various loss contingencies arising in the course of business. We consider the likelihood of the loss or impairment of an asset or the incurrence of a liability as well as our ability to reasonably estimate the amount of loss in determining loss contingencies. An estimated loss contingency is accrued when it is probable that a liability has been incurred or an asset has been impaired and the amount of loss can be reasonably estimated. We regularly evaluate current information available to us to determine whether to accrue for a loss contingency and adjust any previous accrual. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2014, the FASB issued an accounting standard update relating to disclosures of uncertainties about an entity’s ability to continue as a going concern. The update provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures in the event that there is such substantial doubt. The update will be effective for us on February 1, 2017. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In July 2015, the FASB delayed the effective date by one year and the guidance will now be effective for us on February 1, 2018. Early adoption is permitted. The guidance is to be applied using one of two retrospective application methods. We are currently evaluating the impact of the adoption of this accounting standard update on our internal processes, operating results, and financial reporting. In April 2015, the FASB issued an accounting standard update relating to simplifying the presentation of debt issuance costs. The amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The update will be effective for us on February 1, 2016. In September 2015, the FASB issued an accounting standard update relating to the accounting for business combinations. The amendments in this update require that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments in this update require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The amendments in this update require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The update will be effective for us on February 1, 2016. In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , to simplify the presentation of the deferred income taxes. The ASU requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. The guidance does not change the existing requirement that only permits offsetting within a tax-paying component of an entity. This guidance is effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods, but may be adopted earlier. The Company elected to early adopt ASU 2015-17 prospectively in the fourth quarter of fiscal 2015. As a result, all deferred tax assets and liabilities will be presented as noncurrent on the consolidated balance sheet as of January 31, 2016. There was no impact on our results of operations as a result of the adoption of ASU 2015-17. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The ASU is effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. The update will be effective for us on February 1, 2019. Early adoption of the update is permitted. The Company is evaluating the impact of the adoption of this update on our consolidated financial statements and related disclosures. |
Significant Accounting Polici25
Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Bad Debt Expense | Bad debt expense for fiscal years 2015 and 2014 was as follows: 2015 2014 Bad debt expense $ 124,000 $ 441,000 |
Property, Plant and Equipment | Property and equipment are stated at cost. Depreciation is computed using the straight-line method, over the estimated useful lives of the related assets. Estimated useful lives are as follows: Computer equipment and software 3-4 years Office equipment 5 years Office furniture and fixtures 7 years Leasehold improvements Term of lease |
Fair Value of Liabilities on a Recurring Basis | The table below provides information on our liabilities that are measured at fair value on a recurring basis: Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) At January 31, 2016 Warrants liability (1) $ 205,000 $ — $ — $ 205,000 Royalty liability (2) 2,292,000 — — 2,292,000 At January 31, 2015 Warrants liability (3) $ 1,834,000 $ — $ — $ 1,834,000 Royalty liability (2) 2,386,000 — — 2,386,000 _______________ (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. See Note 4 - Derivative Liabilities, and Note 14 - Private Placement Investment for further details. Changes in fair value of the warrants are recognized within miscellaneous income in the 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). Fair value adjustments are included within miscellaneous income in the consolidated statements of operations. (3) The fair value of warrants liability as of January 31, 2015 was determined by management with the assistance of an independent third-party valuation specialist using Monte-Carlo simulations. See Note 4 - Derivative Liabilities for further details. |
Schedule of Capitalized Software Development Costs | Amortization expense on all internally developed software was $3,073,000 and $3,678,000 in fiscal 2015 and 2014 , respectively, and was included in the consolidated statements of operations as follows: Fiscal Year Amortization expense on internally developed software included in: 2015 2014 Cost of systems sales $ 2,747,000 $ 3,352,000 Cost of software as a service 326,000 326,000 Total amortization expense on internally developed software $ 3,073,000 $ 3,678,000 |
Schedule of Earnings Per Share, Basic and Diluted | The following is the calculation of the basic and diluted net loss per share of common stock: Fiscal Year 2015 2014 Net loss $ (4,290,115 ) $ (12,011,457 ) Less: deemed dividends on Series A Preferred Stock (1,336,072 ) (1,038,310 ) Net loss attributable to common shareholders $ (5,626,187 ) $ (13,049,767 ) Weighted average shares outstanding used in basic per common share computations 18,689,854 18,261,800 Stock options and restricted stock — — Number of average shares used in diluted per common share computation 18,689,854 18,261,800 Basic net loss per share of common stock $ (0.30 ) $ (0.71 ) Diluted net loss per share of common stock $ (0.30 ) $ (0.71 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The preliminary purchase price was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date as follows: Balance at February 3, 2014 Assets purchased: Cash $ 59,000 Accounts receivable 221,000 Other assets 61,000 Internally-developed software 2,017,000 Client relationships 647,000 Trade name 26,000 Goodwill (1) 4,251,000 Total assets purchased 7,282,000 Liabilities assumed: Accounts payable and accrued liabilities 362,000 Deferred revenue obligation, net 793,000 Deferred income taxes 9,000 Net assets acquired $ 6,118,000 Cash paid $ 6,118,000 _______________ (1) Goodwill represents the excess of purchase price over the estimated fair value of net tangible and intangible assets acquired, which is not deductible for tax purposes. |
Operating Leases (Tables)
Operating Leases (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Leases [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments under non-cancelable operating leases for the next five fiscal years and thereafter are as follows: Facilities Equipment Fiscal Year Totals 2016 $ 969,000 $ 2,000 $ 971,000 2017 1,007,000 — 1,007,000 2018 1,039,000 — 1,039,000 2019 967,000 — 967,000 2020 504,000 — 504,000 Thereafter 964,000 — 964,000 Total $ 5,450,000 $ 2,000 $ 5,452,000 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Minimum EBITDA Levels | The following table shows our future minimum EBITDA covenant thresholds, as modified by the amendment to the Credit Agreement: For the four-quarter period ended Minimum EBITDA April 30, 2015 $ (2,500,000 ) July 31, 2015 (1,750,000 ) October 31, 2015 (750,000 ) January 31, 2016 500,000 |
Summary of Term Loan and Line of Credit | Outstanding principal balances on debt consisted of the following at: January 31, 2016 January 31, 2015 Senior term loan $ 8,535,000 $ 10,000,000 Capital lease 686,000 1,365,000 Total 9,221,000 11,365,000 Less: Current portion 1,266,000 1,282,000 Non-current portion of long-term debt $ 7,955,000 $ 10,083,000 |
Schedule of Future Principal Repayments of Long-Term Debt | Future repayments of long-term debt by fiscal year consisted of the following at January 31, 2016 : Senior Term Loan Capital Lease (1) Total 2016 $ 674,000 $ 618,000 $ 1,292,000 2017 898,000 93,000 991,000 2018 898,000 — 898,000 2019 6,064,000 — 6,064,000 Total repayments $ 8,534,000 $ 711,000 $ 9,245,000 _______________ (1) Future minimum lease payments include principal plus interest. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill Activity | The goodwill activity is summarized as follows: Goodwill Balance January 31, 2014 $ 11,934,000 Goodwill acquired during fiscal 2014 4,251,000 Balance January 31, 2015 and January 31, 2016 $ 16,185,000 |
Schedule of Intangible Asset Components | Intangible assets, net, consist of the following: January 31, 2016 Estimated Useful Life Gross Assets Accumulated Amortization Net Assets Definite-lived assets: Trade name 1 year $ 26,000 $ 26,000 $ — Client relationships 10-15 years 5,932,000 2,220,000 3,712,000 Covenants not to compete 0.5-15 years 856,000 667,000 189,000 Supplier agreements 5 years 1,582,000 1,094,000 488,000 License agreement 15 years 4,431,000 665,000 3,766,000 Total $ 12,827,000 $ 4,672,000 $ 8,155,000 January 31, 2015 Estimated Useful Life Gross Assets Accumulated Amortization Net Assets Definite-lived assets: Trade name 1 year $ 26,000 $ 26,000 $ — Client relationships 10-15 years 5,932,000 1,548,000 4,384,000 Covenants not to compete 0.5-15 years 856,000 606,000 250,000 Supplier agreements 5 years 1,582,000 778,000 804,000 License agreement 15 years 4,431,000 369,000 4,062,000 Total $ 12,827,000 $ 3,327,000 $ 9,500,000 |
Amortization Schedule of Intangible Assets | Amortization over the next five fiscal years for intangible assets is estimated as follows: Annual Amortization Expense 2016 $ 1,298,000 2017 1,088,000 2018 863,000 2019 826,000 2020 791,000 Thereafter 3,289,000 Total $ 8,155,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | Income taxes consist of the following: Fiscal Year 2015 2014 Current tax (expense) benefit: Federal $ — $ 131,816 State (17,578 ) 34,611 (17,578 ) 166,427 Deferred tax benefit: Federal 8,838 663,681 State 737 56,901 9,575 720,582 Current and deferred tax (expense) benefit $ (8,003 ) $ 887,009 |
Schedule of Effective Income Tax Rate Reconciliation | The income tax (expense) benefit for income taxes differs from the amount computed using the federal statutory income tax rate as follows: Fiscal Year 2015 2014 Federal tax benefit at statutory rate $ 1,455,816 $ 4,385,479 State and local taxes, net of federal benefit (expense) (267,997 ) 325,966 Change in valuation allowance (1,629,786 ) (4,030,864 ) Permanent items: Incentive stock options (513,708 ) (421,366 ) Transaction costs — (5,291 ) Escrow refund 255,000 — Change in fair value of warrants liability 553,951 776,337 Other (28,914 ) (44,719 ) Reserve for uncertain tax position — 164,127 Other 167,635 (262,660 ) Income tax (expense) benefit $ (8,003 ) $ 887,009 |
Schedule of Deferred Tax Assets and Liabilities | The income tax effects of these temporary differences and credits are as follows: January 31, 2016 2015 Deferred tax assets: Allowance for doubtful accounts $ 58,379 $ 245,252 Deferred revenue 244,163 372,275 Accruals 203,291 174,658 Net operating loss carryforwards 15,179,685 14,905,174 Stock compensation expense 592,654 438,659 Property and equipment 78,295 — AMT credit 102,144 102,144 Other 17,794 8,912 Total deferred tax assets 16,476,405 16,247,074 Valuation allowance (14,184,030 ) (12,554,242 ) Net deferred tax assets 2,292,375 3,692,832 Deferred tax liabilities: Property and Equipment — (21,755 ) Definite-lived intangible assets (2,292,375 ) (3,671,077 ) Indefinite-lived intangibles — (9,575 ) Total deferred tax liabilities (2,292,375 ) (3,702,407 ) Net deferred tax liabilities $ — $ (9,575 ) |
Summary of Income Tax Contingencies | A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits (excluding interest and penalties) is as follows: 2015 2014 Beginning of fiscal year $ — $ 121,000 Additions for tax positions of prior years — — Reductions for tax positions of prior years — — Reductions attributable to lapse of statute of limitations — (121,000 ) End of fiscal year $ — $ — |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | |
Schedule of Stock Option Activity | A summary of stock option activity follows: Options Weighted Average Exercise Price Remaining Life in Years Aggregate intrinsic value Outstanding as of February 1, 2015 2,437,323 $ 4.52 Granted 1,011,828 3.02 Exercised (75,000 ) 2.15 Expired (704,326 ) 3.67 Forfeited (257,946 ) 4.97 Outstanding as of January 31, 2016 2,411,879 $ 4.16 (1) 8.09 $ 4,003,719 Exercisable as of January 31, 2016 1,000,037 $ 4.75 (2) 6.82 $ 1,660,061 Vested or expected to vest as of January 31, 2016 1,990,872 $ 4.25 7.90 $ 3,304,848 _______________ (1) The exercise prices range from $1.53 to $8.17 , of which 207,924 shares are between $1.53 and $2.00 per share, 862,938 shares are between $2.08 and $4.00 per share, and 1,341,017 shares are between $4.02 and $8.17 per share. (2) The exercise prices range from $1.53 to $8.17 , of which 97,924 shares are between $1.53 and $2.00 per share, 268,356 shares are between $2.08 and $4.00 per share, and 633,757 shares are between $4.02 and $8.17 per share. |
Schedule of Weighted-Average Assumptions | The fiscal 2015 and 2014 stock-based compensation was estimated at the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions for each fiscal year: 2015 2014 Expected life 6 years 6 years Risk-free interest rate 1.51 % 1.35 % Weighted average volatility factor 0.59 0.60 Dividend yield — — Forfeiture rate 30 % 22 % |
Schedule of Restricted Stock Award Activity | A summary of restricted stock award activity for fiscal 2014 and 2015 is presented below: Non-vested Number of Shares Weighted Average Grant Date Fair Value Non-vested balance at January 31, 2014 29,698 $ 6.01 Granted 120,306 4.31 Vested (29,698 ) 6.65 Forfeited/expired — — Non-vested balance at January 31, 2015 120,306 $ 4.31 Granted 118,180 2.62 Vested (120,306 ) 4.31 Forfeited/expired (5,800 ) 4.31 Non-vested balance at January 31, 2016 112,380 $ 2.62 |
Private Placement Investment (T
Private Placement Investment (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
Equity [Abstract] | |
Schedule of Investment Allocation | The proceeds were allocated among the instruments based on their relative fair values as follows: Adjusted Fair Value at August 16, 2012 Proceeds Allocation at August 16, 2012 Instruments: Series A Preferred Stock $ 9,907,820 $ 6,546,146 (1) Convertible subordinated notes payable 5,699,577 3,765,738 (2) Warrants 2,856,000 1,688,116 (3) Total investment $ 18,463,397 $ 12,000,000 _______________ (1) The Series A Preferred Stock convert on a 1 :1 basis into common stock, but differ in value from common stock due to the downside protection relative to common stock in the event the Company liquidates, and the downside protection, if, after four years, the holder has not converted and the stock is below $3.00 . The fair value of Series A Preferred Stock was determined using a Monte-Carlo simulation following a Geometric Brownian Motion, using the following assumptions: annual volatility of 75% , risk-free rate of 0.9% and dividend yield of 0.0% . The model also utilized the following assumptions to account for the conditions within the agreement: after four years, if the simulated common stock price fell below a price of $3.00 per share, the convertible preferred stock would automatically convert to common stock on a 1 :1 basis moving forward at a price of exactly $3.00 per share and a forced conversion if the simulated stock price exceeded $8.00 per share. (2) The fair value of convertible subordinated notes payable was determined based on its current yield as compared to that of those currently outstanding in the marketplace. Management reviewed the convertible note agreement and determined that the note's interest rate is a reasonable representative of a market rate; therefore the face or principal amount of the loan is a reasonable estimate of its fair value. (3) The fair value of the common stock warrants was determined using a Monte-Carlo simulation following a Geometric Brownian motion, using the following assumptions: annual volatility of 75% , risk-free rate of 0.9% , dividend yield of 0.0% and expected life of 5 years. Because the dilutive down-round financing was subject to stockholder approval, which had not happened at the time of the valuation, the model utilized the assumption that the down-round financing would not occur within the simulation. |
Series A Preferred Stock Activity | The following table sets forth the activity of the Series A Preferred Stock, classified as temporary equity, during the periods presented: Number of Shares Series A Preferred Stock Series A Preferred Stock, January 31, 2014 2,949,995 $ 5,599,668 Accretion of Preferred Stock discount — 1,038,310 Series A Preferred Stock, January 31, 2015 2,949,995 6,637,978 Accretion of Preferred Stock discount — 1,336,072 Series A Preferred Stock, January 31, 2016 2,949,995 $ 7,974,050 |
Schedule of Warrants Issued and Outstanding | The following table sets forth the warrants issued and outstanding as of January 31, 2016 : Number of Shares Issuable Weighted Average Exercise Price Warrants - private placement 1,200,000 $ 3.99 Warrants - placement agent 200,000 4.06 Total 1,400,000 $ 4.00 |
Organization and Description 33
Organization and Description of Business (Details) | 12 Months Ended |
Jan. 31, 2016segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 1 |
Significant Accounting Polici34
Significant Accounting Policies - Additional Information (Details) | Dec. 13, 2013ft² | Aug. 16, 2012ft² | Apr. 10, 2012ft² | Jan. 31, 2016USD ($)segmentshares | Jan. 31, 2015USD ($)shares | Feb. 03, 2014USD ($) | Jan. 31, 2013USD ($) |
Allowance for Doubtful Accounts | |||||||
Allowance for doubtful accounts | $ 155,407 | $ 665,962 | |||||
Concessions Accrual | |||||||
Concessions Costs | 54,000 | 58,000 | |||||
Bad debt expense | 124,235 | 440,771 | |||||
Leases | |||||||
Property and equipment, net | 2,454,075 | 3,136,815 | |||||
Accumulated depreciation and amortization | 2,407,746 | 1,617,423 | |||||
Capitalized Software Development Costs | |||||||
Capitalized computer software, additions | $ 0 | 620,000 | |||||
Useful life of capitalized computer software | 5 years | ||||||
Capitalized computer software, amortization | $ 3,073,479 | 3,677,991 | |||||
Research and development expense | 9,093,353 | 9,756,206 | |||||
Revenue Recognition | |||||||
Deferred professional costs | 571,000 | 570,000 | |||||
Accumulated amortization, deferred finance costs | 265,000 | 275,000 | |||||
Amortization of professional expenses | $ 136,000 | 166,000 | |||||
Goodwill and Intangible Assets | |||||||
Number of operating segments | segment | 1 | ||||||
Number of reportable segments | segment | 1 | ||||||
Severances | |||||||
Severance expenses | $ 43,000 | 666,000 | |||||
Equity Awards | |||||||
Share-based compensation expense | 2,386,490 | 1,934,298 | |||||
Comprehensive Loss | |||||||
Other comprehensive income (loss) | 0 | 111,086 | |||||
Income Taxes | |||||||
Reserves for uncertain tax positions and corresponding interest and penalties | $ 0 | $ 0 | |||||
Convertible Preferred Stock | |||||||
Net Earnings (Loss) Per Common Share | |||||||
Antidilutive securities | shares | 2,949,995 | 2,949,995 | |||||
Restricted Stock | |||||||
Net Earnings (Loss) Per Common Share | |||||||
Antidilutive securities | shares | 112,380 | 120,306 | |||||
Warrant | |||||||
Net Earnings (Loss) Per Common Share | |||||||
Antidilutive securities | shares | 1,400,000 | 1,400,000 | |||||
Employee Severance | |||||||
Severances | |||||||
Accrued severances | $ 26,000 | $ 159,000 | |||||
Minimum | |||||||
Goodwill and Intangible Assets | |||||||
Estimated useful life | 1 year | ||||||
Maximum | |||||||
Goodwill and Intangible Assets | |||||||
Estimated useful life | 15 years | ||||||
Interpoint Partners, LLC | |||||||
Leases | |||||||
Area under lease (sq. ft.) | ft² | 24,335 | 8,582 | |||||
Lease duration | 102 months | 72 months | |||||
Duration of rent allowance | 8 months | 4 months | |||||
Meta | |||||||
Leases | |||||||
Area under lease (sq. ft.) | ft² | 10,350 | ||||||
Lease duration | 2 months | ||||||
Duration of rent allowance | 63 months | ||||||
Assets Held under Capital Leases | |||||||
Leases | |||||||
Property and equipment, net | $ 1,652,000 | 1,515,000 | |||||
Accumulated depreciation and amortization | $ 1,166,000 | $ 494,000 | |||||
Restricted Stock Award | |||||||
Equity Awards | |||||||
Required service period | 1 year | ||||||
Stock Options | |||||||
Net Earnings (Loss) Per Common Share | |||||||
Options outstanding | shares | 2,411,879 | 2,437,323 | |||||
Internally-developed software | Meta | |||||||
Capitalized Software Development Costs | |||||||
Intangible assets | $ 3,646,000 | ||||||
Internally-developed software | Unibased | |||||||
Capitalized Software Development Costs | |||||||
Intangible assets | $ 2,017,000 | $ 2,017,000 |
Significant Accounting Polici35
Significant Accounting Policies - Property, Plant, and Equipment (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Property, Plant and Equipment | ||
Depreciation expense | $ 1,245,400 | $ 1,005,283 |
Computer Equipment and Software | Minimum | ||
Property, Plant and Equipment | ||
Property, plant and equipment, useful life | 3 years | |
Computer Equipment and Software | Maximum | ||
Property, Plant and Equipment | ||
Property, plant and equipment, useful life | 4 years | |
Office Equipment | ||
Property, Plant and Equipment | ||
Property, plant and equipment, useful life | 5 years | |
Office Furniture and Fixtures | ||
Property, Plant and Equipment | ||
Property, plant and equipment, useful life | 7 years |
Significant Accounting Polici36
Significant Accounting Policies - Capitalized Software Development Costs (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Accounting Policies [Abstract] | ||
Cost of systems sales | $ 2,747,000 | $ 3,352,000 |
Cost of software as a service | 326,000 | 326,000 |
Total amortization expense on internally developed software | $ 3,073,479 | $ 3,677,991 |
Significant Accounting Polici37
Significant Accounting Policies Significant Accounting Policies - Fair Value of Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2016 | Jan. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Royalty liability | $ 2,292 | $ 2,386 |
Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Royalty liability | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Royalty liability | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Royalty liability | 2,292 | 2,386 |
Warrant | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrants liability | 205 | 1,834 |
Warrant | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrants liability | 0 | 0 |
Warrant | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrants liability | 0 | 0 |
Warrant | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrants liability | $ 205 | $ 1,834 |
Significant Accounting Polici38
Significant Accounting Policies - Earnings Per Share (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Accounting Policies [Abstract] | ||
Net loss | $ (4,290,115) | $ (12,011,457) |
Less: deemed dividends on Series A Preferred Shares | (1,336,072) | (1,038,310) |
Net loss attributable to common shareholders | $ (5,626,187) | $ (13,049,767) |
Basic and diluted weighted average shares outstanding (shares) | 18,689,854 | 18,261,800 |
Stock options and restricted stock | 0 | 0 |
Number of average shares used in diluted per common share computation | 18,689,854 | 18,261,800 |
Basic net loss per common share (in dollars per share) | $ (0.30) | $ (0.71) |
Diluted net loss per common share (in dollars per share) | $ (0.30) | $ (0.71) |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) | Feb. 03, 2014 | Oct. 25, 2013 | Jan. 31, 2016 | Jan. 31, 2015 |
Business Acquisition [Line Items] | ||||
Cash paid | $ 0 | $ 6,058,225 | ||
Royalty liability | $ 2,291,888 | $ 2,385,826 | ||
Montefiore Medical Center | ||||
Business Acquisition [Line Items] | ||||
Proprietary lease term | 15 years | |||
Cash paid | $ 3,000,000 | |||
Periodic royalty payment term | 6 years 6 months | |||
Ongoing royalty payments | $ 3,000,000 | |||
Unibased | ||||
Business Acquisition [Line Items] | ||||
Cash paid | $ 6,118,000 | |||
Total purchase price | 6,500,000 | |||
Proceeds received from escrow | $ 750,000 |
Acquisitions - Assets Acquired
Acquisitions - Assets Acquired and Liabilities Assumed (Details) - USD ($) | Feb. 03, 2014 | Jan. 31, 2016 | Jan. 31, 2015 | Jan. 31, 2014 |
Assets purchased: | ||||
Goodwill | $ 16,184,667 | $ 16,184,667 | $ 11,934,000 | |
Liabilities assumed: | ||||
Cash paid | $ 0 | 6,058,225 | ||
Unibased | ||||
Assets purchased: | ||||
Cash | $ 59,000 | |||
Accounts receivable | 221,000 | |||
Other assets | 61,000 | |||
Goodwill | 4,251,000 | |||
Total assets purchased | 7,282,000 | |||
Liabilities assumed: | ||||
Accounts payable and accrued liabilities | 362,000 | |||
Deferred revenue obligation, net | 793,000 | |||
Deferred income taxes | 9,000 | |||
Net assets acquired | 6,118,000 | |||
Cash paid | 6,118,000 | |||
Client relationships | Unibased | ||||
Assets purchased: | ||||
Intangible assets | 647,000 | |||
Internally-developed software | Unibased | ||||
Assets purchased: | ||||
Intangible assets | 2,017,000 | $ 2,017,000 | ||
Trade name | Unibased | ||||
Assets purchased: | ||||
Intangible assets | $ 26,000 |
Derivative Liabilities (Details
Derivative Liabilities (Details) - USD ($) | Oct. 19, 2012 | Aug. 31, 2012 | Jan. 31, 2016 | Jan. 31, 2015 | Oct. 31, 2012 | Aug. 16, 2012 |
Derivative [Line Items] | ||||||
Warrants exercisable (in shares) (up to) | 1,200,000 | |||||
Exercise price (USD per share) | $ 3.99 | |||||
Net of transaction costs, allocated to the warrants | $ 1,425,000 | |||||
Warrants liability | $ 205,113 | $ 1,834,380 | ||||
Valuation adjustment for warrants liability | $ 1,629,267 | 2,283,345 | ||||
Annual volatility | 60.10% | |||||
Risk-free rate | 0.60% | |||||
Dividend yield | 0.00% | |||||
Expected life | 2 years | |||||
Annual volatility | 55.00% | |||||
Risk-free rate | 0.80% | |||||
Dividend yield | $ 0 | |||||
Expected life | 3 years | |||||
Estimate of Fair Value | ||||||
Derivative [Line Items] | ||||||
Warrants liability | $ 205,000 | 1,834,000 | ||||
Common Stock Warrant | ||||||
Derivative [Line Items] | ||||||
Warrants exercisable (in shares) (up to) | 1,400,000 | |||||
Exercise price (USD per share) | $ 4 | |||||
Common Stock Warrant | Estimate of Fair Value | ||||||
Derivative [Line Items] | ||||||
Warrant liability at fair value | $ 205,000 | $ 1,834,000 | ||||
Placement Agent | Common Stock Warrant | ||||||
Derivative [Line Items] | ||||||
Warrants exercisable (in shares) (up to) | 200,000 | |||||
Exercise price (USD per share) | $ 4.06 | |||||
Annual volatility | 75.00% | |||||
Risk-free rate | 0.90% | |||||
Expected life | 5 years | |||||
Placement Agent | Common Stock Warrant | Estimate of Fair Value | ||||||
Derivative [Line Items] | ||||||
Warrant liability at fair value | $ 4,139,000 |
Operating Leases (Details)
Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2,016 | $ 971 | |
2,017 | 1,007 | |
2,018 | 1,039 | |
2,019 | 967 | |
2,020 | 504 | |
Thereafter | 964 | |
Total | 5,452 | |
Rent and leasing expense | 1,274 | $ 1,652 |
Facilities | ||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2,016 | 969 | |
2,017 | 1,007 | |
2,018 | 1,039 | |
2,019 | 967 | |
2,020 | 504 | |
Thereafter | 964 | |
Total | 5,450 | |
Equipment | ||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2,016 | 2 | |
2,017 | 0 | |
2,018 | 0 | |
2,019 | 0 | |
2,020 | 0 | |
Thereafter | 0 | |
Total | $ 2 |
Debt - Term Loan and Line of Cr
Debt - Term Loan and Line of Credit Narrative (Details) - USD ($) | Apr. 15, 2015 | Nov. 21, 2014 | Dec. 31, 2013 | Jan. 31, 2016 | Feb. 03, 2014 |
Debt Instrument [Line Items] | |||||
Revolving line of credit | $ 5,000,000 | ||||
Subordinated Debt | |||||
Debt Instrument [Line Items] | |||||
Accrues interest rate | 6.42% | ||||
Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior term loan | $ 8,500,000 | ||||
Installment payments due | $ 101,000 | ||||
Borrowing under the revolving loan bears interest at a rate equal to LIBOR plus | 5.25% | ||||
Closing fee | $ 116,000 | ||||
Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Commitment fee in connection with the term loan | $ 2,000 | ||||
Borrowing under the revolving loan bears interest at a rate equal to LIBOR plus | 3.50% | ||||
Commitment fee percentage | 0.40% | ||||
Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Repayment of credit facility | $ 7,400,000 | ||||
Debt discount | $ 315,000 | ||||
Amortization of financing costs | 355,000 | ||||
Credit Agreement | Senior term loan | |||||
Debt Instrument [Line Items] | |||||
Revolving line of credit | 10,000,000 | ||||
Credit Agreement | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Revolving line of credit | $ 5,000,000 | ||||
Minimum | LIBOR | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Borrowing under the revolving loan bears interest at a rate equal to LIBOR plus | 4.25% | 4.25% | |||
Minimum | Base Rate | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Borrowing under the revolving loan bears interest at a rate equal to LIBOR plus | 3.25% | 3.25% | |||
Maximum | LIBOR | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Borrowing under the revolving loan bears interest at a rate equal to LIBOR plus | 6.25% | 5.25% | |||
Maximum | Base Rate | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Borrowing under the revolving loan bears interest at a rate equal to LIBOR plus | 5.25% | 4.25% | |||
April 15, 2015 | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Minimum liquidity | 5,000,000 | ||||
April 16, 2015 through and including July 30, 2015 | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Minimum liquidity | 6,500,000 | ||||
July 31, 2015 through and including January 30, 2016 | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Minimum liquidity | 7,000,000 | ||||
January 31, 2016 through and including the maturity date | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Minimum liquidity | $ 7,500,000 |
Debt - Minimum EBITDA Levels (
Debt - Minimum EBITDA Levels (Details) - Credit Agreement | 12 Months Ended |
Jan. 31, 2016USD ($) | |
April 30, 2015 | |
Debt Instrument [Line Items] | |
Minimum EBITDA level | $ (2,500,000) |
July 31, 2015 | |
Debt Instrument [Line Items] | |
Minimum EBITDA level | (1,750,000) |
October 31, 2015 | |
Debt Instrument [Line Items] | |
Minimum EBITDA level | (750,000) |
January 31, 2016 | |
Debt Instrument [Line Items] | |
Minimum EBITDA level | $ 500,000 |
Debt - Note Payable Narrative (
Debt - Note Payable Narrative (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Nov. 30, 2013 | Jan. 31, 2016 | Jan. 31, 2015 | Dec. 31, 2013 | |
Debt Instrument [Line Items] | ||||
Repayments of debt | $ 1,465,109 | $ 8,297,620 | ||
Subordinated Debt | ||||
Debt Instrument [Line Items] | ||||
Accrues interest rate | 6.42% | |||
Subordinated Debt | Unsecured Subordinated Notes Due November, 2016 | ||||
Debt Instrument [Line Items] | ||||
Debt term | 3 years | |||
Convertible Note | $ 900,000 | |||
Accrues interest rate | 8.00% | |||
Principal payments | $ 300,000 | |||
Repayments of debt | $ 600,000 |
Debt - Summary of Term Loan and
Debt - Summary of Term Loan and Line of Credit (Details) - USD ($) $ in Thousands | Jan. 31, 2016 | Jan. 31, 2015 |
Debt Instrument [Line Items] | ||
Total | $ 9,221 | $ 11,365 |
Less: Current portion | 1,266 | 1,282 |
Non-current portion of long-term debt | 7,955 | 10,083 |
Senior Notes | ||
Debt Instrument [Line Items] | ||
Senior term loan | 8,535 | 10,000 |
Capital Lease Obligations | ||
Debt Instrument [Line Items] | ||
Capital lease | $ 686 | $ 1,365 |
Debt - Schedule of Future Princ
Debt - Schedule of Future Principal Repayments of Long-Term Debt (Details) $ in Thousands | Jan. 31, 2016USD ($) |
Debt Instrument [Line Items] | |
Capital Leases, Payments Due by 2016 | $ 618 |
Total Payments Due by 2016 | 1,292 |
Capital Leases, Payments Due by 2017 | 93 |
Total Payments Due by 2017 | 991 |
Capital Leases, Payments Due by 2018 | 0 |
Total Payments Due by 2018 | 898 |
Capital Leases, Payments Due by 2019 | 0 |
Total Payments Due by 2019 | 6,064 |
Capital Lease | 711 |
Total | 9,245 |
Senior Notes | |
Debt Instrument [Line Items] | |
Debt Payments Due by 2016 | 674 |
Debt Payments Due by 2017 | 898 |
Debt Payments Due by 2018 | 898 |
Payments Due by 2019 | 6,064 |
Long-term Debt | $ 8,534 |
Debt - Interest Rate Swap Narra
Debt - Interest Rate Swap Narrative (Details) - Interest Rate Swap | Jan. 31, 2016USD ($) | Jan. 31, 2014effective_hedging_relationshipinterest_rate_derivative |
Derivative [Line Items] | ||
Number of effective hedging relationships | effective_hedging_relationship | 1 | |
Number of interest rate swaps | interest_rate_derivative | 1 | |
Fixed interest rate | 6.42% | |
Notional amount | $ 8,500,000 | |
Derivative liability | $ 111,000 |
Goodwill and Intangible Asset49
Goodwill and Intangible Assets - Schedule of Goodwill Activity (Details) | 12 Months Ended |
Jan. 31, 2015USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning of period | $ 11,934,000 |
Goodwill acquired during fiscal 2014 | 4,251,000 |
Goodwill, end of period | $ 16,184,667 |
Goodwill and Intangible Asset50
Goodwill and Intangible Assets - Schedule of Intangibles (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Gross Assets | $ 12,827,000 | $ 12,827,000 |
Accumulated Amortization | 4,672,000 | 3,327,000 |
Net Assets | 8,155,000 | 9,500,000 |
Loss on impairment of intangible assets | $ 0 | $ 1,952,000 |
Maximum | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 15 years | |
Minimum | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 1 year | |
Trade name | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 1 year | 1 year |
Gross Assets | $ 26,000 | $ 26,000 |
Accumulated Amortization | 26,000 | 26,000 |
Net Assets | 0 | 0 |
Client relationships | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Gross Assets | 5,932,000 | 5,932,000 |
Accumulated Amortization | 2,220,000 | 1,548,000 |
Net Assets | $ 3,712,000 | $ 4,384,000 |
Client relationships | Maximum | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 15 years | 15 years |
Client relationships | Minimum | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 10 years | 10 years |
Covenants not to compete | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Gross Assets | $ 856,000 | $ 856,000 |
Accumulated Amortization | 667,000 | 606,000 |
Net Assets | $ 189,000 | $ 250,000 |
Covenants not to compete | Maximum | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 15 years | 15 years |
Covenants not to compete | Minimum | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 6 months | 6 months |
Supplier agreements | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 5 years | 5 years |
Gross Assets | $ 1,582,000 | $ 1,582,000 |
Accumulated Amortization | 1,094,000 | 778,000 |
Net Assets | $ 488,000 | $ 804,000 |
License agreement | ||
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Estimated Useful Life | 15 years | 15 years |
Gross Assets | $ 4,431,000 | $ 4,431,000 |
Accumulated Amortization | 665,000 | 369,000 |
Net Assets | $ 3,766,000 | $ 4,062,000 |
Goodwill and Intangible Asset51
Goodwill and Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($) $ in Thousands | Jan. 31, 2016 | Jan. 31, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,016 | $ 1,298 | |
2,017 | 1,088 | |
2,018 | 863 | |
2,019 | 826 | |
2,020 | 791 | |
Thereafter | 3,289 | |
Net Assets | $ 8,155 | $ 9,500 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Current tax (expense) benefit: | ||
Federal | $ 0 | $ 131,816 |
State | (17,578) | 34,611 |
Total current tax expense | (17,578) | 166,427 |
Deferred tax benefit: | ||
Federal | 8,838 | 663,681 |
State | 737 | 56,901 |
Total deferred tax benefit (expense) | 9,575 | 720,582 |
Income tax (expense) benefit | $ (8,003) | $ 887,009 |
Income Taxes - Tax Provision at
Income Taxes - Tax Provision at Statutory Rate Reconciliation (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Income Tax Expense (Benefit), Continuing Operations, Income Tax Reconciliation [Abstract] | ||
Federal tax benefit at statutory rate | $ 1,455,816 | $ 4,385,479 |
State and local taxes, net of federal benefit (expense) | (267,997) | 325,966 |
Change in valuation allowance | (1,629,786) | (4,030,864) |
Incentive stock options | (513,708) | (421,366) |
Transaction costs | 0 | (5,291) |
Escrow refund | 255,000 | 0 |
Change in fair value of warrants liability | 553,951 | 776,337 |
Other | (28,914) | (44,719) |
Reserve for uncertain tax position | 0 | 164,127 |
Other | 167,635 | (262,660) |
Income tax (expense) benefit | $ (8,003) | $ 887,009 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Tax Carryforwards (Details) - USD ($) | Jan. 31, 2016 | Jan. 31, 2015 |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 58,379 | $ 245,252 |
Deferred revenue | 244,163 | 372,275 |
Accruals | 203,291 | 174,658 |
Net operating loss carryforwards | 15,179,685 | 14,905,174 |
Stock compensation expense | 592,654 | 438,659 |
Property and equipment | 78,295 | 0 |
AMT credit | 102,144 | 102,144 |
Other | 17,794 | 8,912 |
Total deferred tax assets | 16,476,405 | 16,247,074 |
Valuation allowance | (14,184,030) | (12,554,242) |
Net deferred tax assets | 2,292,375 | 3,692,832 |
Deferred tax liabilities: | ||
Property and Equipment | 0 | (21,755) |
Definite-lived intangible assets | (2,292,375) | (3,671,077) |
Indefinite-lived intangibles | 0 | (9,575) |
Total deferred tax liabilities | (2,292,375) | (3,702,407) |
Net deferred tax liabilities | $ 0 | $ (9,575) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Income Tax Contingency [Line Items] | ||
Valuation allowance | $ 14,184,030 | $ 12,554,242 |
Change in valuation allowance | 1,629,786 | $ 4,030,864 |
Unrecognized operating loss carryforwards for stock options | 1,592,000 | |
Unrecognized deferred tax asset for operating loss carryforwards for stock options | 588,000 | |
Internal Revenue Service (IRS) | ||
Income Tax Contingency [Line Items] | ||
Operating loss carryforwards | 44,347,000 | |
Change in valuation allowance | 1,630,000 | |
Internal Revenue Service (IRS) | Alternative Minimum Tax | ||
Income Tax Contingency [Line Items] | ||
Operating loss carryforwards | 39,656,000 | |
State | ||
Income Tax Contingency [Line Items] | ||
Operating loss carryforwards, subject to expire next twenty fiscal years | $ 16,144,000 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | ||
Beginning of fiscal year | $ 0 | $ 121 |
Additions for tax positions of prior years | 0 | 0 |
Reductions for tax positions of prior years | 0 | 0 |
Reductions attributable to lapse of statute of limitations | 0 | (121) |
End of fiscal year | $ 0 | $ 0 |
Major Clients - (Details)
Major Clients - (Details) - Customer Concentration Risk - customers | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Revenue | ||
Concentration Risk | ||
Concentration risk, number of customers | 0 | 0 |
Accounts Receivable | ||
Concentration Risk | ||
Concentration risk, number of customers | 2 | 2 |
Accounts Receivable | Customer A | ||
Concentration Risk | ||
Concentration risk, percentage | 13.00% | 16.00% |
Accounts Receivable | Customer B | ||
Concentration Risk | ||
Concentration risk, percentage | 12.00% | 10.00% |
Employee Retirement Plan (Detai
Employee Retirement Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | ||
Matching contribution percent (up to) | 100.00% | |
Maximum contribution as a percent of participant compensation | 4.00% | |
Defined contribution plan, cost recognized | $ 499 | $ 440 |
Employee Stock Purchase Plan Em
Employee Stock Purchase Plan Employee Stock Purchase Plan (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 30, 2016 | Jan. 04, 2016 | Jan. 31, 2016 | Jan. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Shares remaining available for grant | 528,164 | |||
Closing price | $ 1.41 | |||
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Number of shares authorized to be purchased under Employee Stock Purchase Plan | 1,000,000 | |||
Employee Stock Purchase Plan, maximum annual contribution per employee, percent | 10.00% | |||
Employee Stock Purchase Plan, percent of fair market value, prior year | 85.00% | |||
Employee Stock Purchase Plan, percent of fair market value, current year | 85.00% | |||
Allocated share-based compensation expense | $ 20 | $ 14 | ||
Cash received from purchase of shares under Employee Stock Purchase Plan | $ 115 | $ 82 | ||
Employee Stock Purchase Plan | $2.38 per share | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock purchased during period, shares, Employee Stock Purchase Plan | 27,071 | |||
Stock purchased during period, price per share, Employee Stock Purchase Plan | $ 2.38 | |||
Employee Stock Purchase Plan | $1.20 per share | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock purchased during period, shares, Employee Stock Purchase Plan | 42,050 | |||
Stock purchased during period, price per share, Employee Stock Purchase Plan | $ 1.20 | |||
Employee Stock Purchase Plan | $4.08 per share | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock purchased during period, shares, Employee Stock Purchase Plan | 11,141 | |||
Stock purchased during period, price per share, Employee Stock Purchase Plan | $ 4.08 | |||
Employee Stock Purchase Plan | $3.68 per share | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock purchased during period, shares, Employee Stock Purchase Plan | 9,900 | |||
Stock purchased during period, price per share, Employee Stock Purchase Plan | $ 3.68 | |||
Scenario, Forecast [Member] | Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Purchase price discount | 85.00% |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) | Jan. 04, 2016$ / shares | Jan. 31, 2016USD ($)$ / sharesshares | Jan. 31, 2015USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercise price range, lower range limit (in USD per share) | $ / shares | $ 1.41 | ||
Exercise price range, upper range limit (in USD per share) | $ / shares | $ 8.17 | ||
Weighted average period of recognition for compensation cost | 1 year 9 months 18 days | ||
Proceeds from exercise of stock options and stock purchase plan | $ | $ 276,039 | $ 551,583 | |
Change in control percentage | 0.2 | ||
$1.65 to $8.17 | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercise price range, lower range limit (in USD per share) | $ / shares | $ 1.53 | ||
Exercise price range, upper range limit (in USD per share) | $ / shares | $ 8.17 | ||
$1.65 to $2.00 | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Options outstanding | 207,924 | ||
Exercise price range, lower range limit (in USD per share) | $ / shares | $ 1.53 | ||
Exercise price range, upper range limit (in USD per share) | $ / shares | $ 2 | ||
Options exercisable | 97,924 | ||
$2.08 to $4.00 | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Options outstanding | 862,938 | ||
Exercise price range, lower range limit (in USD per share) | $ / shares | $ 2.08 | ||
Exercise price range, upper range limit (in USD per share) | $ / shares | $ 4 | ||
Options exercisable | 268,356 | ||
$4.08 to $8.17 | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Options outstanding | 1,341,017 | ||
Exercise price range, lower range limit (in USD per share) | $ / shares | $ 4.02 | ||
Options exercisable | 633,757 | ||
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Options outstanding | 2,411,879 | 2,437,323 | |
Options issued | 1,011,828 | ||
Options expired | 704,326 | ||
Options forfeited | 257,946 | ||
Options exercised | 75,000 | ||
Options exercisable | 1,000,037 | ||
Compensation cost not yet recognized | $ | $ 1,588,000 | ||
Allocated share-based compensation expense | $ | 1,783,000 | $ 1,655,000 | |
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Allocated share-based compensation expense | $ | 582,000 | $ 265,000 | |
Compensation cost not yet recognized | $ | $ 77,000 | ||
2013 Incentive Compensation Plan | Blended Equity Awards (Stock Options, Stock Appreciation Rights, Resticted Stock) | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Equity awards authorized (up to) | 4,500,000 | ||
Term of options granted (or less) | 10 years | ||
Vesting period | 3 years | ||
Options outstanding | 2,186,879 | 1,737,323 | |
2013 Incentive Compensation Plan | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Vesting period | 1 year | ||
Executive Inducement Grants | Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Options outstanding | 225,000 | 700,000 | |
Options issued | 0 | 300,000 | |
Options expired | 405,417 | 125,694 | |
Options forfeited | 69,583 | 99,722 | |
Options exercised | 0 | 205,556 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Stock Option Activity (Details) - Stock Options - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Stock Option Activity | ||
Options, Outstanding - beginning of year | 2,437,323 | |
Options, Granted | 1,011,828 | |
Options, Exercised | (75,000) | |
Options, Expired | (704,326) | |
Options, Forfeited | (257,946) | |
Options, Outstanding - end of year | 2,411,879 | 2,437,323 |
Options exercisable | 1,000,037 | |
Options, vested or expected to vest - end of year | 1,990,872 | |
Weighted Average Exercise Price Activity | ||
Weighted Average Exercise Price, Outstanding - beginning of year (USD per share) | $ 4.52 | |
Weighted Average Exercise Price, Granted (USD per share) | 3.02 | |
Weighted Average Exercise Price, Exercised (USD per share) | 2.15 | |
Weighted Average Exercise Price, Expired (USD per share) | 3.67 | |
Weighted Average Exercise Price, Forfeited (USD per share) | 4.97 | |
Weighted Average Exercise Price, Outstanding - end of year (USD per share) | 4.16 | $ 4.52 |
Weighted Average Exercise Price, Exercisable - end of year (USD per share) | 4.75 | |
Weighted Average Exercise Price, Vested or expected to vest - end of year (USD per share) | $ 4.25 | |
Remaining Life in Years, Outstanding | 8 years 1 month 2 days | |
Remaining Life in Years, Exercisable | 6 years 9 months 26 days | |
Remaining Life in Years, Vested or expected to vest | 7 years 10 months 25 days | |
Aggregate intrinsic value of outstanding options at year end | $ 4,003,719 | |
Aggregate intrinsic value of exercisable options at year end | 1,660,061 | |
Aggregate intrinsic value of options vested or expected to vest at year end | $ 3,304,848 | |
Weighted average grant date fair value of options granted during year (USD per share) | $ 1.64 | $ 2.90 |
Total intrinsic value of options exercised during the year | $ 125,000 | $ 990,000 |
Stock Based Compensation - Weig
Stock Based Compensation - Weighted Average Assumptions (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | ||
Expected life | 6 years | 6 years |
Risk-free interest rate | 1.51% | 1.35% |
Weighted average volatility factor | 59.00% | 60.00% |
Dividend yield | $ 0 | $ 0 |
Forfeiture rate | 30.00% | 22.00% |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Restricted Stock Award Activity (Details) - Restricted Stock - $ / shares | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Restricted Stock Award Activity | ||
Non-vested number of shares, beginning of period | 120,306 | 29,698 |
Shares granted | 118,180 | 120,306 |
Shares vested | (120,306) | (29,698) |
Shares forfeited/expired | (5,800) | 0 |
Non-vested number of shares, end of period | 112,380 | 120,306 |
Weighted Average Fair Value Activity | ||
Weighted average grant date fair vale, at beginning of period (USD per share) | $ 4.31 | $ 6.01 |
Weighted average grant date fair value, granted (USD per share) | 2.62 | 4.31 |
Weighted average grant date fair value, vested (USD per share) | 4.31 | 6.65 |
Weighted average grant date fair value, forfeited/expired (USD per share) | 4.31 | 0 |
Weighted average grant date fair vale, at end of period (USD per share) | $ 2.62 | $ 4.31 |
Private Placement Investment -
Private Placement Investment - Additional Information (Details) - USD ($) | Nov. 01, 2012 | Aug. 16, 2012 | Jan. 31, 2016 | Jan. 31, 2015 |
Class of Stock [Line Items] | ||||
Warrants exercisable (in shares) | 1,200,000 | |||
Exercise price (USD per share) | $ 3.99 | |||
Placement and other advisor fees | $ 1,894,000 | |||
Cost of warrants issued | 754,000 | |||
Deferred finance costs | 611,000 | $ 270,147 | $ 387,199 | |
Issuance of common stock warrants | 263,000 | |||
Common Stock Warrant | ||||
Class of Stock [Line Items] | ||||
Warrants exercisable (in shares) | 1,400,000 | |||
Exercise price (USD per share) | $ 4 | |||
Private Placement | ||||
Class of Stock [Line Items] | ||||
Proceeds allocation | $ 12,000,000 | |||
Common shares issued for convertible note and accrued interest (in shares) | 1,583,210 | 1,583,210 | ||
Private Placement | Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Proceeds allocation | $ 6,546,146 | |||
Issuance of common stock | 2,416,785 | |||
Preferred stock dividend rate (as a percent) | 0.00% | |||
Share price (USD per share) | $ 3 | $ 8 | ||
Preferred stock, discount on shares | $ 1,020,000 | $ 4,410,000 | ||
Private Placement | Common Stock Warrant | ||||
Class of Stock [Line Items] | ||||
Proceeds allocation | $ 1,688,116 | |||
Warrants exercisable (in shares) | 1,200,000 | |||
Exercise price (USD per share) | $ 3.99 | |||
Private Placement | Convertible Subordinated Notes Payable | ||||
Class of Stock [Line Items] | ||||
Proceeds allocation | $ 3,765,738 | |||
Convertible notes payable | $ 5,699,577 | $ 5,699,577 |
Private Placement Investment 65
Private Placement Investment - Schedule of Investment Allocation (Details) - USD ($) | Nov. 01, 2012 | Aug. 16, 2012 | Jan. 31, 2016 |
Instruments: | |||
Annual volatility | 55.00% | ||
Risk-free rate | 0.80% | ||
Expected life | 3 years | ||
Private Placement | |||
Instruments: | |||
Total investment, Fair Value | $ 18,463,397 | ||
Proceeds allocation | 12,000,000 | ||
Private Placement | Common Stock Warrant | |||
Instruments: | |||
Warrants, Fair Value | 2,856,000 | ||
Proceeds allocation | $ 1,688,116 | ||
Annual volatility | 75.00% | ||
Risk-free rate | 0.90% | ||
Dividend yield | 0.00% | ||
Expected life | 5 years | ||
Private Placement | Convertible Subordinated Notes Payable | |||
Instruments: | |||
Convertible subordinated notes payable, Fair Value | $ 5,699,577 | ||
Proceeds allocation | 3,765,738 | ||
Private Placement | Series A Preferred Stock | |||
Instruments: | |||
Series A Preferred Stock, Fair Value | 9,907,820 | ||
Proceeds allocation | $ 6,546,146 | ||
Conversion basis | 1 | ||
Maximum conversion period | 4 years | 4 years | |
Stock price at time of conversion (USD per share) | $ 3 | ||
Annual volatility | 75.00% | ||
Risk-free rate | 0.90% | ||
Dividend yield | 0.00% | ||
Private Placement | Minimum | Series A Preferred Stock | |||
Instruments: | |||
Stock price at time of conversion (USD per share) | $ 3 | ||
Private Placement | Maximum | Series A Preferred Stock | |||
Instruments: | |||
Stock price at time of conversion (USD per share) | $ 8 |
Private Placement Investment 66
Private Placement Investment - Series A Convertible Preferred Stock Narrative (Details) - USD ($) | Nov. 01, 2012 | Aug. 16, 2012 | Jan. 31, 2016 | Jan. 31, 2015 | Jan. 31, 2014 |
Class of Stock [Line Items] | |||||
Period over which share price is evaluated | 10 days | ||||
Accretion of preferred stock discount | $ 0 | $ (47,552) | |||
Annual volatility | 55.00% | ||||
Risk-free rate | 0.80% | ||||
Redemption price per share (USD per share) | $ 3 | ||||
Common stock | |||||
Class of Stock [Line Items] | |||||
Common stock, market value per share (USD per share) | $ 3.82 | ||||
Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Accretion of preferred stock discount | $ 1,336,072 | ||||
Convertible redeemable preferred stock, shares outstanding | 2,949,995 | 2,949,995 | 2,949,995 | ||
Shares converted | 1,050,000 | ||||
Amount converted | $ (3,150,000) | ||||
Convertible Notes to Preferred Stock | Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Preferred stock, par value (USD per share) | $ 5.80 | ||||
Conversion basis | 1 | ||||
Loss upon conversion | $ 5,913,000 | ||||
Issuance of shares at redemption value for conversion of notes payable | 9,183,000 | ||||
Carrying value and unamortized deferred financing costs | 3,270,000 | ||||
Difference between fair value and redemption value recorded as additional paid in capital | $ 4,433,000 | ||||
Annual volatility | 75.00% | ||||
Risk-free rate | 0.80% | ||||
Dividend yield | 0.00% | ||||
Private Placement | |||||
Class of Stock [Line Items] | |||||
Common shares issued for convertible note and accrued interest (in shares) | 1,583,210 | 1,583,210 | |||
Private Placement | Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
New issuance of series A convertible preferred stock | 2,416,785 | ||||
Preferred stock, par value (USD per share) | $ 3 | ||||
Conversion basis | 1 | ||||
Share price (USD per share) | $ 3 | $ 8 | |||
Period over which trade volume is evaluated | 60 days | ||||
Average daily trading volume for period (in shares) | 100,000 | ||||
Stock price at time of conversion (USD per share) | $ 3 | ||||
Preferred stock, discount on shares | $ 1,020,000 | $ 4,410,000 | |||
Beneficial conversion feature | 2,686,000 | ||||
Accretion of preferred stock discount | $ 1,336,000 | $ (1,038,310) | |||
Annual volatility | 75.00% | ||||
Risk-free rate | 0.90% | ||||
Dividend yield | 0.00% | ||||
Maximum conversion period | 4 years | 4 years | |||
Private Placement | Convertible Subordinated Notes Payable | |||||
Class of Stock [Line Items] | |||||
Convertible notes payable | $ 5,699,577 | $ 5,699,577 | |||
Private Placement | Convertible Notes to Preferred Stock | Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Aggregate redemption value | $ 4,750,000 | ||||
Minimum | Convertible Notes to Preferred Stock | Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Stock price at time of conversion (USD per share) | $ 3 | ||||
Minimum | Private Placement | Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Stock price at time of conversion (USD per share) | $ 3 | ||||
Maximum | Convertible Notes to Preferred Stock | Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Stock price at time of conversion (USD per share) | $ 8 | ||||
Maximum | Private Placement | Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Stock price at time of conversion (USD per share) | $ 8 |
Private Placement Investment 67
Private Placement Investment - Schedule of Series A Preferred Stock Activity (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||
Accretion of Preferred Stock discount | $ 0 | $ (47,552) |
Series A Preferred Stock | ||
Increase (Decrease) in Shares of Temporaty Equity [Roll Forward] | ||
Beginning Balance (in shares) | 2,949,995 | 2,949,995 |
Period End Balance (in shares) | 2,949,995 | 2,949,995 |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||
Beginning balance | $ 6,637,978 | $ 5,599,668 |
Accretion of Preferred Stock discount | 1,336,072 | |
Period end balance | 7,974,050 | 6,637,978 |
Private Placement | Series A Preferred Stock | ||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||
Accretion of Preferred Stock discount | $ 1,336,000 | $ (1,038,310) |
Private Placement Investment 68
Private Placement Investment - Common Stock Warrants Narrative (Details) - USD ($) | Oct. 19, 2012 | Aug. 16, 2012 | Aug. 31, 2012 | Jan. 31, 2016 | Jan. 31, 2015 | Oct. 31, 2012 |
Class of Stock [Line Items] | ||||||
Warrants exercisable (in shares) | 1,200,000 | |||||
Weighted average exercise price (USD per share) | $ 3.99 | |||||
Net of transaction costs, allocated to the warrants | $ 1,425,000 | |||||
Annual volatility | 55.00% | |||||
Risk-free rate | 0.80% | |||||
Expected life | 3 years | |||||
Common Stock Warrant | ||||||
Class of Stock [Line Items] | ||||||
Warrants exercisable (in shares) | 1,400,000 | |||||
Weighted average exercise price (USD per share) | $ 4 | |||||
Private Placement | Common Stock Warrant | ||||||
Class of Stock [Line Items] | ||||||
Warrants exercisable (in shares) | 1,200,000 | |||||
Weighted average exercise price (USD per share) | $ 3.99 | |||||
Net of transaction costs, allocated to the warrants | $ 1,425,000 | |||||
Fair value of warrants | $ 2,856,000 | |||||
Annual volatility | 75.00% | |||||
Risk-free rate | 0.90% | |||||
Dividend yield | 0.00% | |||||
Expected life | 5 years | |||||
Placement Agent | Common Stock Warrant | ||||||
Class of Stock [Line Items] | ||||||
Warrants exercisable (in shares) | 200,000 | |||||
Weighted average exercise price (USD per share) | $ 4.06 | |||||
Fair value of warrants | $ 754,000 | |||||
Annual volatility | 75.00% | |||||
Risk-free rate | 0.90% | |||||
Dividend yield | 0.00% | |||||
Expected life | 5 years | |||||
Estimate of Fair Value | Common Stock Warrant | ||||||
Class of Stock [Line Items] | ||||||
Derivative liability | $ 205,000 | $ 1,834,000 | ||||
Estimate of Fair Value | Placement Agent | Common Stock Warrant | ||||||
Class of Stock [Line Items] | ||||||
Derivative liability | $ 4,139,000 |
Private Placement Investment 69
Private Placement Investment - Schedule of Warrants Issued and Outstanding (Details) - $ / shares | Jan. 31, 2016 | Aug. 16, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Number of shares issuable (in shares) | 1,200,000 | |
Weighted average exercise price (USD per share) | $ 3.99 | |
Common Stock Warrant | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Number of shares issuable (in shares) | 1,400,000 | |
Weighted average exercise price (USD per share) | $ 4 | |
Placement Agent | Common Stock Warrant | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Number of shares issuable (in shares) | 200,000 | |
Weighted average exercise price (USD per share) | $ 4.06 | |
Private Placement | Common Stock Warrant | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Number of shares issuable (in shares) | 1,200,000 | |
Weighted average exercise price (USD per share) | $ 3.99 |
Schedule II - Valuation and Q70
Schedule II - Valuation and Qualifying Accounts and Reserves (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Jan. 31, 2015 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at Beginning of Period | $ 665,962 | |
Charged to Costs and Expenses | 1,629,267 | $ 2,283,345 |
Balance at End of Period | 155,407 | 665,962 |
Allowance for doubtful accounts | ||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at Beginning of Period | 666,000 | 267,000 |
Charged to Costs and Expenses | 48,000 | 441,000 |
Charged to Other Accounts | 0 | 1,000 |
Deductions | (559,000) | (43,000) |
Balance at End of Period | $ 155,000 | $ 666,000 |