Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2015 | Dec. 01, 2015 | Mar. 31, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Sep. 30, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | SOFO | ||
Entity Registrant Name | SONIC FOUNDRY INC | ||
Entity Central Index Key | 1,029,744 | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 4,363,740 | ||
Entity Public Float | $ 37,382,000 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 1,976 | $ 4,344 |
Accounts receivable, net of allowances of $150 | 12,659 | 8,449 |
Inventories | 2,385 | 1,960 |
Prepaid expenses and other current assets | 927 | 1,305 |
Total current assets | 17,947 | 16,058 |
Property and equipment: | ||
Leasehold improvements | 904 | 911 |
Computer equipment | 5,852 | 5,440 |
Furniture and fixtures | 837 | 720 |
Total property and equipment | 7,593 | 7,071 |
Less accumulated depreciation and amortization | 4,785 | 3,675 |
Property and equipment, net | 2,808 | 3,396 |
Other assets: | ||
Goodwill | 10,853 | 11,185 |
Customer relationships, net of amortization of $457 and $191 | 1,872 | 2,471 |
Software development costs, net of amortization of $429 and $252 | 104 | 281 |
Product rights, net of amortization of $164 and $41 | 508 | 631 |
Other intangibles, net of amortization of $190 and $162 | 112 | 37 |
Other long-term assets | 599 | 564 |
Total assets | 34,803 | 34,623 |
Current liabilities: | ||
Revolving line of credit | 1,818 | |
Accounts payable | 2,026 | 1,183 |
Accrued liabilities | 1,666 | 2,512 |
Unearned revenue | 11,359 | 9,079 |
Current portion of capital lease and financing arrangements | 211 | 196 |
Current portion of notes payable and warrant debt, net of discounts | 1,299 | 974 |
Current portion of subordinated note payable | 186 | 2,096 |
Total current liabilities | 18,565 | 16,040 |
Long-term portion of unearned revenue | 1,325 | 929 |
Long-term portion of capital lease and financing arrangements | 196 | 173 |
Long-term portion of notes payable and warrant debt, net of discounts | 2,080 | 1,139 |
Long-term portion of subordinated note payable | 92 | 314 |
Derivative liability, at fair value | 109 | |
Other liabilities | 311 | 401 |
Deferred tax liability | 4,322 | 4,312 |
Total liabilities | $ 27,000 | $ 23,308 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock | ||
Common stock, $.01 par value, authorized 10,000,000 shares; 4,376,456 and 4,276,470 shares issued and 4,363,740 and 4,263,754 shares outstanding | $ 44 | $ 43 |
Additional paid-in capital | 195,973 | 194,260 |
Accumulated deficit | (186,897) | (182,372) |
Accumulated other comprehensive loss | (1,122) | (421) |
Receivable for common stock issued | (26) | (26) |
Treasury stock, at cost, 12,716 shares | (169) | (169) |
Total stockholders' equity | 7,803 | 11,315 |
Total liabilities and stockholders' equity | $ 34,803 | $ 34,623 |
5% Preferred Stock, Series B, Voting, Cumulative, Convertible [Member] | ||
Stockholders' equity: | ||
Preferred stock |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Accounts receivable, allowances | $ 150 | $ 150 |
Customer relationships, amortization | 457 | 191 |
Software development costs, amortization | 429 | 252 |
Product rights, amortization | 164 | 41 |
Other intangibles, amortization | $ 190 | $ 162 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 500,000 | 500,000 |
Preferred stock, issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 4,376,456 | 4,276,470 |
Common stock, shares outstanding | 4,363,740 | 4,263,754 |
Treasury stock, shares | 12,716 | 12,716 |
5% Preferred Stock, Series B, Voting, Cumulative, Convertible [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, dividend rate | 5.00% | 5.00% |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Revenue: | ||
Product | $ 15,884 | $ 16,773 |
Services | 20,160 | 18,649 |
Other | 415 | 408 |
Total revenue | 36,459 | 35,830 |
Cost of revenue: | ||
Product | 7,406 | 7,350 |
Services | 3,229 | 2,925 |
Total cost of revenue | 10,635 | 10,275 |
Gross margin | 25,824 | 25,555 |
Operating expenses: | ||
Selling and marketing | 18,016 | 16,551 |
General and administrative | 5,635 | 5,623 |
Product development | 6,265 | 5,545 |
Patent settlement | 428 | |
Acquisition costs | 490 | |
Total operating expenses | 29,916 | 28,637 |
Loss from operations | (4,092) | (3,082) |
Non-operating income (expenses): | ||
Gain on investment in Mediasite KK | 1,390 | |
Equity in earnings from investment in Mediasite KK | 38 | |
Interest expense, net | (372) | (231) |
Other income, net | 46 | 173 |
Total non-operating income (expenses) | (326) | 1,370 |
Loss before income taxes | (4,418) | (1,712) |
Provision for income taxes | (107) | (1,104) |
Net loss | $ (4,525) | $ (2,816) |
Loss per common share: | ||
Basic net loss per common share | $ (1.04) | $ (0.67) |
Diluted net loss per common share | $ (1.04) | $ (0.67) |
Weighted average common shares | ||
- Basic | 4,332,576 | 4,174,191 |
- Diluted | 4,332,576 | 4,174,191 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (4,525) | $ (2,816) |
Foreign currency translation adjustment | (701) | (183) |
Comprehensive loss | $ (5,226) | $ (2,999) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Receivable for Common Stock Issued [Member] | Treasury Stock [Member] |
Beginning balance at Sep. 30, 2013 | $ 10,704 | $ 40 | $ 190,653 | $ (179,556) | $ (238) | $ (26) | $ (169) |
Stock compensation | 921 | 921 | |||||
Issuance of common stock | 2,403 | 2,403 | |||||
Exercise of common stock options | 286 | 3 | 283 | ||||
Foreign currency translation adjustment | (183) | (183) | |||||
Net loss | (2,816) | (2,816) | |||||
Ending balance at Sep. 30, 2014 | 11,315 | 43 | 194,260 | (182,372) | (421) | (26) | (169) |
Stock compensation | 963 | 963 | |||||
Issuance of common stock | 710 | 1 | 709 | ||||
Exercise of common stock options | 41 | 41 | |||||
Foreign currency translation adjustment | (701) | (701) | |||||
Net loss | (4,525) | (4,525) | |||||
Ending balance at Sep. 30, 2015 | $ 7,803 | $ 44 | $ 195,973 | $ (186,897) | $ (1,122) | $ (26) | $ (169) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities | ||
Net loss | $ (4,525) | $ (2,816) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Gain and equity in earnings on investment in Mediasite KK | (1,429) | |
Amortization of other intangibles | 343 | 244 |
Amortization of software development costs | 177 | 177 |
Amortization of product rights | 123 | 41 |
Amortization of debt discount | 26 | |
Depreciation of property and equipment | 1,599 | 1,268 |
Provision for doubtful accounts | 57 | 60 |
Deferred taxes | 53 | 1,064 |
Stock-based compensation expense related to stock options | 963 | 921 |
Remeasurement gain on subordinated debt | (202) | (157) |
Remeasurement gain on derivative liability | (11) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (4,379) | (597) |
Inventories | (344) | 20 |
Prepaid expenses and other current assets | 169 | (308) |
Accounts payable and accrued liabilities | 111 | (810) |
Other long-term liabilities | (86) | (94) |
Unearned revenue | 2,800 | 2,329 |
Net cash used in operating activities | (3,126) | (87) |
Investing activities | ||
Purchases of property and equipment | (722) | (862) |
Cash received in Mediasite KK acquisition, net of cash paid | 1,281 | |
Cash paid for MediaMission acquisition, net of cash acquired | (119) | |
Net cash provided by (used in) investing activities | (722) | 300 |
Financing activities | ||
Proceeds from notes payable | 2,336 | 1,954 |
Proceeds from line of credit | 8,535 | |
Payments on notes payable | (2,894) | (1,199) |
Payments on line of credit | (6,727) | |
Payment of debt issuance costs | (122) | (49) |
Proceeds from issuance of common stock and warrants | 710 | 98 |
Proceeds from exercise of common stock options | 41 | 286 |
Payments on capital lease and financing arrangements | (252) | (229) |
Net cash provided by financing activities | 1,627 | 861 |
Changes in cash and cash equivalents due to changes in foreign currency | (147) | (212) |
Net increase (decrease) in cash and cash equivalents | (2,368) | 862 |
Cash and cash equivalents at beginning of period | 4,344 | 3,482 |
Cash and cash equivalents at end of period | 1,976 | 4,344 |
Supplemental cash flow information: | ||
Interest paid | 310 | 128 |
Income taxes paid, foreign | 31 | 171 |
Non-cash financing and investing activities: | ||
Property and equipment financed by capital lease | 292 | 207 |
Debt discount and warrant | $ 179 | |
Acquired product rights | 672 | |
Subordinated note payable issuance for purchase of MediaMission | 2,567 | |
Common stock issued for purchase of MediaMission and MSKK | $ 2,305 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies Business Sonic Foundry, Inc. (the Company) is in the business of providing enterprise solutions and services for the web communications market. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Sonic Foundry Media Systems, Inc., MediaMission B.V. (formerly Media Mission Holding B.V.) and Mediasite KK. All significant intercompany transactions and balances have been eliminated. Prior to January 2014, the Company owned approximately 26% of Mediasite KK and accounted for its investment under the equity method of accounting. On January 14, 2014, the Company purchased the remaining 74% of Mediasite KK. Reclassifications Reclassifications have been made to the September 30, 2014 financial statements to conform to the September 30, 2015 presentation. These reclassifications had no effect on the Company’s net loss or stockholders’ equity as previously reported. Use of Estimates In preparing financial statements in conformity with accounting principles generally accepted in the United States of America (US GAAP), management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expense during the period. Actual results could differ from those estimates. Revenue Recognition General Revenue is recognized when persuasive evidence of an arrangement exists, delivery occurs or services are rendered, the sales price is fixed or determinable and collectability is reasonably assured. Revenue is deferred when undelivered products or services are essential to the functionality of delivered products, customer acceptance is uncertain, significant obligations remain, or the fair value of undelivered elements is unknown. Typically, the Company does not offer customers the right to return product, other than for exchange or repair pursuant to a warranty or stock rotation. The Company’s policy is to reduce revenue if it incurs an obligation for price rebates or other such programs during the period the obligation is reasonably estimated to occur. The following policies apply to the Company’s major categories of revenue transactions. Products Products are considered delivered, and revenue is recognized, when title and risk of loss have been transferred to the customer or upon customer acceptance if non-delivered products or services are essential to the functionality of delivered products. Under the terms and conditions of the sale, this occurs at the time of shipment to the customer. Product revenue currently represents sales of our Mediasite recorder and Mediasite related products such as our server software and other software licenses. If a license is time-based, the revenue is recognized over the term of the license agreement. Services The Company sells support and content hosting contracts to our customers, typically one year in length, and records the related revenue ratably over the contractual period. Our support contracts cover phone and electronic technical support availability over and above the level provided by our distributors, software upgrades on a when and if available basis, advance hardware replacement and an extension of the standard hardware warranty from 90 days to one year. The manufacturers the Company contracts with to build the units provide a limited one-year warranty on the hardware. The Company also sells installation, training, event webcasting, and customer content hosting services. Revenue for those services is recognized when performed in the case of installation, training and event webcasting services. Occasionally, the Company will sell customization services to enhance the server software. Revenue from those services is recognized when performed, if perfunctory, or under contract accounting. Service amounts invoiced to customers in excess of revenue recognized are recorded as deferred revenue until the revenue recognition criteria are met. Revenue Arrangements that Include Multiple Elements Sales of software, with or without installation, training, and post customer support fall within the scope of the software revenue recognition rules. Under the software revenue recognition rules, the fee from a multiple-deliverable arrangement is allocated to each of the undelivered elements based upon vendor-specific objective evidence (VSOE), which is limited to the price charged when the same deliverable is sold separately, with the residual value from the arrangement allocated to the delivered element. The portion of the fee that is allocated to each deliverable is then recognized as revenue when the criteria for revenue recognition are met with respect to that deliverable. If VSOE does not exist for all of the undelivered elements, then all revenue from the arrangement is typically deferred until all elements have been delivered to the customer. In the case of the Company’s hardware products with embedded software, the Company has determined that the hardware and software components function together to deliver the product’s essential functionality, and therefore, the revenue from the sale of these products is accounted for under the revenue recognition rules for tangible products whereby the fee from a multiple-deliverable arrangement is allocated to each of the deliverables based upon their relative selling prices as determined by a selling-price hierarchy. A deliverable in an arrangement qualifies as a separate unit of accounting if the delivered item has value to the customer on a stand-alone basis. A delivered item that does not qualify as a separate unit of accounting is combined with the other undelivered items in the arrangement and revenue is recognized for those combined deliverables as a single unit of accounting. The selling price used for each deliverable is based upon VSOE if available, from third-party evidence (TPE) if VSOE is not available, and best estimate of selling price (ESP) if neither VSOE nor TPE are available. TPE is the price of the Company’s or any competitor’s largely interchangeable products or services in stand-alone sales to similarly situated customers. ESP is the price at which the Company would sell the deliverable if it were sold regularly on a stand-alone basis, considering market conditions and entity-specific factors. All revenue arrangements, excluding the sale of all software-only products and associated services, have been accounted for under this guidance. The selling prices used in the relative selling price allocation method are as follows: (1) the Company’s products and services are based upon VSOE and (2) hardware products with embedded software, for which VSOE does not exist, are based upon ESP. The Company does not believe TPE exists for any of these products and services because they are differentiated from competing products and services in terms of functionality and performance and there are no competing products or services that are largely interchangeable. Management establishes ESP for hardware products with embedded software using a cost plus margin approach with consideration for market conditions, such as the impact of competition and geographic considerations, and entity-specific factors, such as the cost of the product and the Company’s profit objectives. Management believes that ESP is reflective of reasonable pricing of that deliverable as if priced on a stand-alone basis. When a sales transaction includes deliverables that are divided between Accounting Standards Codification (ASC) Topic 605 and ASC Subtopic 985-605, the Company allocates the selling price using the relative selling price method whereas value is allocated using an ESP for software developed using a percent of list price approach. The other deliverables are valued using ESP or VSOE as previously discussed. While the pricing model, currently in use, captures all critical variables, unforeseen changes due to external market forces may result in a revision of the inputs. These modifications may result in the consideration allocation differing from the one presently in use. Absent a significant change in the pricing inputs or the way in which the industry structures its transactions, future changes in the pricing model are not expected to materially affect our allocation of arrangement consideration. Management has established VSOE for hosting services. Billings for hosting are spread ratably over the term of the hosting agreement, with the typical hosting agreement having a term of 12 months, with renewal on an annual basis. The Company sells most hosting contracts without the inclusion of products. When the hosting arrangement is sold in conjunction with product, the product revenue is recognized immediately while the remaining hosting revenue is spread ratably over the term of the hosting agreement. The selling price is allocated between these elements using the relative selling price method. The Company uses ESP for development of the selling price for hardware products with embedded software. The Company also offers hosting services bundled with events services. The Company uses VSOE to establish relative selling prices for its events services. The Company recognizes events revenue when the event takes place and recognizes the hosting revenue over the term of the hosting agreement. The total amount of the arrangement is allocated to each element based on the relative selling price method. Reserves The Company reserves for stock rotations, price adjustments, rebates, and sales incentives to reduce revenue and accounts receivable for these and other credits granted to customers. Such reserves are recorded at the time of sale and are calculated based on historical information (such as rates of product stock rotations) and the specific terms of sales programs, taking into account any other known information about likely customer behavior. If actual customer behavior differs from our expectations, it may compromise our ability to recognize revenue to these distributors at the time of shipment. Also, if the Company determines that it can no longer accurately estimate amounts for stock rotations and sales incentives, the Company would not be able to recognize revenue until resellers sell the inventory to the final end user. Shipping and Handling The Company’s shipping and handling costs billed to customers are included in other revenue. Costs related to shipping and handling are included in cost of revenue and are recorded at the time of shipment to the customer. Concentration of Credit Risk and Other Risks and Uncertainties As of September 30, 2015, of the $2.0 million in cash and cash equivalents, $106 thousand is deposited with two major U.S. financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on such amounts and believes that it is not exposed to any significant credit risk on these balances. The remaining $1.9 million of cash and cash equivalents is held by our foreign subsidiaries in financial institutions in Japan and the Netherlands and held in their local currency. The cash held in foreign financial institutions is not guaranteed. We assess the realization of our receivables by performing ongoing credit evaluations of our customers’ financial condition. Through these evaluations, we may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings or bankruptcy. Our reserve requirements are based on the best facts available to us and are reevaluated and adjusted as additional information is received. Our reserves are also based on amounts determined by using percentages applied to certain aged receivable categories. These percentages are determined by a variety of factors including, but not limited to, current economic trends, historical payment and bad debt write-off experience. Allowance for doubtful accounts for accounts receivable was $150,000 at September 30, 2015 and September 30, 2014, respectively. We had billings for Mediasite product and support services as a percentage of total billings to one distributor of approximately 10% in 2015 and 15% in 2014 and to a second distributor of approximately 14% in 2015 and 15% in 2014. At September 30, 2015 and 2014, these two distributors represented 24% and 47% of total accounts receivable, respectively. Currently all of our product inventory purchases are from one third-party contract manufacturer. Although we believe there are multiple sources of supply from other contract manufacturers as well as multiple suppliers of component parts required by the contract manufacturers, a disruption of supply of component parts or completed products, even if short term, would have a material negative impact on our revenues. At September 30, 2015 and 2014, this supplier represented 49% and 27%, respectively, of total accounts payable. We also license technology from third parties that is embedded in our software. We believe there are alternative sources of similar licensed technology from other third parties that we could also embed in our software, although it could create potential programming related issues that might require engineering resources. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of September 30, 2015, of the $2.0 million aggregate cash and cash equivalents held by the Company, the amount of cash and cash equivalents held by our foreign subsidiaries was $1.9 million. If the funds held by our foreign subsidiaries were needed for our operations in the United States, the repatriation of some of these funds to the United States could require payment of additional U.S. taxes. Trade Accounts Receivable The majority of the Company’s accounts receivable are due from entities in, or distributors or value added resellers to, the education, corporate and government sectors. Credit is extended based on evaluation of a customer’s financial condition and, generally, collateral is not required. Accounts receivable are typically due within 30 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered to be past due. The Company determines its allowance by considering a number of factors, including the length of time trade accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes-off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. Interest is not accrued on past due receivables. Inventory Valuation Inventory consists of raw materials and supplies used in the assembly of Mediasite recorders and finished units. Inventory of completed units and spare parts are carried at the lower of cost or market, with cost determined on a first-in, first-out basis. Inventory consists of the following (in thousands): September 30, 2015 2014 Raw materials and supplies $ 254 $ 549 Finished goods 2,131 1,411 $ 2,385 $ 1,960 Capitalized Software Development Costs Software development costs incurred in conjunction with product development are charged to research and development expense until technological feasibility is established. Thereafter, until the product is released for sale, software development costs are capitalized and reported at the net realizable value of the related product. Typically the period between achieving technological feasibility of the Company’s products and the general availability of the products has been short. Consequently, software development costs qualifying for capitalization are typically immaterial and are generally expensed to research and development costs. During 2013, the Company’s My Mediasite product release required software capitalization since there was a longer period between technological feasibility and the general availability of the product. Upon product release, the amortization of software development costs is determined annually as the greater of the amount computed using the ratio of current gross revenues for the products to their total of current and anticipated future gross revenues or the straight-line method over the estimated economic life of the products, expected to be three years. Amortization expense of software development costs of $178 thousand is included in Cost of Revenue – Product for each of the years ending September 30, 2015 and 2014, respectively. The gross amount of capitalized external and internal development costs was $533 thousand at September 30, 2015 and 2014. There were no software development efforts that qualified for capitalization for the years ended September 30, 2015 or 2014, respectively. Valuation of Assets and Liabilities in Business Combinations The assets acquired and the liabilities assumed in a business combination are measured at fair value. Fair value is based on the definition in ASC 820-10-20 as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. Variations of the cost and market approaches are used to measure the fair value of components of working capital (e.g. accounts receivable, inventory and accounts payable) and tangible assets, such as property plant and equipment. When measuring the fair value of acquired intangible assets, the income approach is generally considered. Financial assets and liabilities are valued based on a quoted price in an active market. In the absence of a quoted market price a valuation technique is used to determine fair value, such as a market approach or an income approach. Non-financial liabilities may be valued based on a transfer approach. These measures require significant judgment including estimates of expected cash flow, or discount rates among others. Gain from investment in Mediasite KK The Company’s investment in Mediasite KK was accounted for under the equity method of accounting using a one quarter timing lag through December 31, 2013. On January 14, 2014, the Company’s ownership percentage increased from approximately 26% of their common stock to 100%. In connection with the acquisition, the one quarter lag in reporting their results was eliminated. The Company upon obtaining control of Mediasite KK recorded a “step-up” in the value of its previously owned interest in Mediasite KK to fair value. The gain amounted to approximately $1.4 million and was partially offset by $901 thousand of tax expense related to such investment. The Company recorded equity in earnings of $38 thousand for the year ended September 30, 2014. The recorded value of this investment is zero at September 30, 2015 and 2014, respectively, due to elimination in the consolidated financial statements. Property and Equipment Property and equipment are recorded at cost and are depreciated using the straight-line method for financial reporting purposes. The estimated useful lives used to calculate depreciation are as follows: Years Leasehold improvements 5 to 10 years Computer equipment 3 to 5 years Furniture and fixtures 5 to 7 years Impairment of Long-Lived Assets Goodwill has an indefinite useful life and is recorded at cost and not amortized but, instead, tested at least annually for impairment. We assess the impairment of goodwill on an annual basis or whenever events or changes in circumstances indicate that the fair value of these assets is less than the carrying value. If a qualitative assessment is used and the Company determines that the fair value of goodwill is more likely than not (i.e., a likelihood of more than 50%) less than its carrying amount, a quantitative impairment test will be performed. If goodwill is quantitatively assessed for impairment, a two-step approach is applied. First, the Company compares the estimated fair value of the goodwill to its carrying value. The second step, if necessary, measures the amount of impairment, if any, by comparing the implied fair value of goodwill to its carrying value. In fiscal 2015 and 2014, we performed the two-step goodwill test and determined that the fair value of goodwill is more than the carrying value. For purposes of the fiscal 2015 and 2014 tests, goodwill balances are evaluated within three separate reporting units. The Company has recognized no impairment charges as of September 30, 2015 or as of September 30, 2014. If we had determined that the fair value of goodwill was less than its carrying value, based upon the annual test or the existence of one or more indicators of impairment, we would then measure impairment based on a comparison of the implied fair value of goodwill with the carrying amount of goodwill. To the extent the carrying amount of goodwill is greater than the implied fair value of goodwill, we would record an impairment charge for the difference. Long-lived assets and intangible assets other than goodwill are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based on expected undiscounted cash flows attributable to that asset. For the years ended September 30, 2015 and 2014, no events or changes in circumstances occurred that required this analysis. Comprehensive Loss Comprehensive loss includes disclosure of financial information that historically has not been recognized in the calculation of net income. Our comprehensive loss encompasses net loss and foreign currency translation adjustments. Assets and liabilities of international operations that have a functional currency that is not in U.S. dollars are translated into U.S. dollars at year-end exchange rates, and revenue and expense items are translated using weighted average exchange rates. Any adjustments arising on translation are included in shareholders’ equity as an element of accumulated other comprehensive loss. Advertising Expense Advertising costs included in selling and marketing, are expensed when the advertising first takes place. Advertising expense was $655 and $240 thousand for years ended September 30, 2015 and 2014, respectively. The increase is a result of increasing spend on internet advertisements as well as $259 thousand of additional advertising in Japan. Research and Development Costs Research and development costs are expensed in the period incurred, unless they meet the criteria for capitalized software development costs. Income Taxes Deferred tax assets and liabilities are determined based on differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. We do not provide for U.S. income taxes on the undistributed earnings of our foreign subsidiaries, which we consider to be permanently invested outside of the U.S. We make judgments regarding the realizability of our deferred tax assets. The balance sheet carrying value of our net deferred tax assets is based on whether we believe that it is more likely than not that we will generate sufficient future taxable income to realize these deferred tax assets after consideration of all available evidence. We regularly review our deferred tax assets for recoverability considering historical profitability, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. In assessing the need for a valuation allowance, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses. Generally, cumulative loss in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed. As of September 30, 2015 and 2014, valuation allowances have been established for all U.S. and for certain foreign deferred tax assets which we believe do not meet the “more likely than not” criteria for recognition. If we are subsequently able to utilize all or a portion of the deferred tax assets for which a valuation allowance has been established, then we may be required to recognize these deferred tax assets through the reduction of the valuation allowance which could result in a material benefit to our results of operations in the period in which the benefit is determined. The Company also accounts for the uncertainty in income taxes related to the recognition and measurement of a tax position and measurement of a tax position taken or expected to be taken in an income tax return. The Company follows the applicable accounting guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure related to the uncertainty in income tax positions. Fair Value of Financial Instruments Nonfinancial Assets Measured at Fair Value on a Nonrecurring Basis The Company’s goodwill, intangible assets and other long-lived assets are nonfinancial assets that were acquired either as part of a business combination, individually or with a group of other assets. These nonfinancial assets were initially measured and recognized at amounts equal to the fair value determined as of the date of acquisition. Fair value measurements of reporting units are estimated using an income approach involving discounted or undiscounted cash flow models that contain certain Level 3 inputs requiring management judgment, including projections of economic conditions and customer demand, revenue and margins, changes in competition, operating costs, working capital requirements, and new product introductions. Fair value measurements of the reporting units associated with the Company’s goodwill balances are estimated at least annually at the beginning of the fourth quarter of each fiscal year for purposes of impairment testing. Fair value measurements associated with the Company’s intangible assets and other long-lived assets are estimated when events or changes in circumstances such as market value, asset utilization, physical change, legal factors, or other matters indicate that the carrying value may not be recoverable. In determining the fair value of financial assets and liabilities, the Company currently utilizes market data or other assumptions that it believes market participants would use in pricing the asset or liability in the principal or most advantageous market, and adjusts for non-performance and/or other risk associated with the Company as well as counterparties, as appropriate. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: Level 1 Inputs: Unadjusted quoted prices which are available in active markets for identical assets or liabilities accessible to the Company at the measurement date. Level 2 Inputs: Inputs other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. The hierarchy gives the highest priority to Level 1, as this level provides the most reliable measure of fair value, while giving the lowest priority to Level 3. Financial Liabilities Measured at Fair Value on Recurring Basis The initial fair values of PFG debt and warrant debt (see Note 3) were based on the present value of expected future cash flows and assumptions about current interest rates and the creditworthiness of the Company (Level 3). The fair value of the bifurcated conversion feature represented by the warrant derivative liability which is measured at fair value on a recurring basis is based on a Black Scholes option pricing model with assumptions for stock price, exercise price, volatility, expected term, risk free interest rate and dividend yield similar to those described for share-based compensation which were generally observable (Level 2). Financial liabilities measured at fair value on a recurring basis are summarized below (in thousands): September 30, 2015 Level 1 Level 2 Level 3 Total PFG debt, net of discount $ — $ — $ 1,347 $ 1,347 Warrant debt — — 63 63 Derivative liability — 109 — 109 $ — $ 109 $ 1,410 $ 1,519 September 30, 2014 Level 1 Level 2 Level 3 Total None $ — $ — $ — $ — Included below is a summary of the changes in our Level 3 fair value measurements (in thousands): PFG Debt, net Warrant Balance as of September 30, 2014 $ — $ — Initial fair value 1,322 58 Change in fair value 25 5 Balance as of September 30, 2015 $ 1,347 $ 63 Financial Instruments Not Measured at Fair Value The Company’s other financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable and debt instruments, excluding the PFG debt. The book values of cash and cash equivalents, accounts receivable, debt (excluding the PFG debt) and accounts payable are considered to be representative of their respective fair values. The carrying value of capital lease obligations and debt (excluding the PFG debt), including the current portion, approximates fair market value as the variable and fixed rate approximates the current market rate of interest available to the Company. Legal Contingencies In June 2014, the Company entered into a settlement agreement with Astute Technology, LLC (“Astute”). The key terms of the agreement were: 1) a grant of a non-revocable license of Astute patents to the Company; 2) a grant of a fully paid, non-refundable license of certain Sonic Foundry patents to Astute; 3) both Astute and our customer agreed to identify three meetings they currently capture that the other party will not seek or respond to any request for proposal; and 4) a payment of $1.35 million to Astute. Pursuant to the settlement agreement, the payments were made in three equal amounts with the first paid in June 2014, the second paid in October 2014 and the final installment paid in March 2015. The Company contributed $1.1 million of the $1.35 million payable to Astute with our customer paying the residual amount. Of the $1.1 million, $428 thousand related to prior use and was recorded as a charge to income during fiscal 2014. The remaining $672 thousand was recorded as a product right asset, which is being amortized, on a straight-line basis, over the remaining life of the patents, through 2020. Future amounts due to Astute were accrued for as of the time of settlement. No legal contingencies were recorded for the year ended September 30, 2015. Except as reported above, no legal contingencies were recorded for the year ended September 30, 2014. Stock-Based Compensation The Company uses a lattice valuation model to account for all employee stock options granted. The lattice valuation model is a more flexible analysis to value options because of its ability to incorporate inputs that change over time, such as actual exercise behavior of option holders. The Company uses historical data to estimate the option exercise and employee departure behavior in the lattice valuation model. Expected volatility is based on historical volatility of the Company’s stock. The Company considers all employees to have similar exercise behavior and therefore has not identified separate homogenous groups for valuation. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods th |
Commitments
Commitments | 12 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | 2. Commitments The Company leases certain equipment under capital lease and financing agreements expiring through April 2018. Such leases are included in fixed assets with a cost of $949 thousand and accumulated depreciation of $551 thousand at September 30, 2015. Minimum lease payments, including principal and interest, are summarized in the table below. Fiscal Year (in thousands) Capital 2016 $ 230 2017 161 2018 42 Total payments 433 Less interest (26 ) Total $ 407 The Company leases certain facilities and equipment under operating lease agreements expiring at various times through January 31, 2019. Total rent expense on all operating leases was approximately $1.1 million and $1.0 million for the years ended September 30, 2015 and 2014, respectively. In November 2011, the Company occupied office space related to a lease agreement entered into on June 28, 2011. The lease term is from November 2011 through December 2018. The lease includes a tenant improvement allowance of $613 thousand that was recorded as a leasehold improvement liability and is being amortized as a credit to rent expense on a straight-line basis over the lease term. At September 30, 2015, the unamortized balance was $270 thousand. The following is a schedule by year of future minimum lease payments under operating leases: Fiscal Year (in thousands) Operating 2016 $ 1,113 2017 1,096 2018 734 2019 186 2020 — Thereafter — Total $ 3,129 The Company enters into unconditional purchase commitments on a regular basis for the supply of Mediasite product. At September 30, 2015, the Company has an obligation to purchase $1.2 million of Mediasite product, which is not recorded on the Company’s Consolidated Balance Sheet. The Company enters into license agreements that generally provide indemnification against intellectual property claims for its customers as well as indemnification agreements with certain service providers, landlords and other parties in the normal course of business. The Company has not incurred any material costs as a result of such indemnifications, except as noted above related to Astute, and has not accrued any liabilities related to such obligations in the consolidated financial statements, except as noted above related to Astute. |
Credit Arrangements
Credit Arrangements | 12 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Credit Arrangements | 3. Credit Arrangements Silicon Valley Bank The Company and its wholly owned subsidiary, Sonic Foundry Media Systems, Inc. (the “Companies”) entered into that certain Second Amended and Restated Loan and Security Agreement with Silicon Valley Bank, dated as of June 27, 2011, as amended by that certain First Amendment, dated as of May 31, 2013, as further amended by that certain Second Amendment, dated as of January 10, 2014, and as further amended by that certain Third Amendment, dated as of March 31, 2014 (the Second Amended and Restated Loan Agreement, as amended by the First, Second and Third Amendments, collectively, the “Second Amended and Restated Loan Agreement”). The Second Amended and Restated Loan Agreement provided for a revolving line of credit in the maximum principal amount of $3,000,000. Interest accrued on the revolving line of credit at the per annum rate of three quarters of one percent (0.75%) above the Prime Rate (as defined), provided that Sonic Foundry maintained an Adjusted Quick Ratio (as defined) of greater than 2.0 to 1.0, or one-and-one quarter percent (1.25%) above the Prime Rate, if Sonic Foundry did not maintain an Adjusted Quick Ratio of greater than 2.0 to 1.0. The Second Amended and Restated Loan Agreement does not provide for a minimum interest rate on the revolving loan. The Second Amended and Restated Loan Agreement provides for an advance rate on domestic receivables of 80%. The maturity date of the revolving credit facility was October 1, 2015. Under the Second Amended and Restated Loan Agreement, a term loan was entered into on January 14, 2014 in the original principal amount of $2,500,000 which accrued interest at the per annum rate equal to the Prime Rate (as defined) plus two and one-quarter percent (which equated to an interest rate of 5.5%), and was to be repaid in 36 equal monthly principal payments. The Second Amended and Restated Loan Agreement also required Sonic Foundry to continue to comply with certain financial covenants, including covenants to maintain an Adjusted Quick Ratio (as defined) of at least 1.50 to 1.00 (except for each of the months ended February 28, 2014, April 30, 2014, May 31, 2014, July 31, 2014, August 31, 2014, October 31, 2014, and November 30, 2014, the minimum required Adjusted Quick ratio was reduced to 1:25 to 1:00), and a quarterly Debt Service Coverage Ratio of at least 1.25 to 1.00, the latter of which would be waived if certain funds were reserved against the availability under the revolving line of credit. On January 27, 2015, the Companies entered into a Fourth Amendment to Second Amended and Restated Loan and Security Agreement (the “Fourth Amendment”) with Silicon Valley Bank. Under the Fourth Amendment: (i) the balance of the term loan payable to Silicon Valley of approximately $1,665,000 was repaid and replaced by a new term loan of $2,500,000 to be repaid in 36 equal principal payments, beginning in February 2015, with interest at the Prime Rate (as defined) plus two and one quarter percent (5.5%), (ii) the limit of the revolving line of credit was increased from $3.0 million to $4.0 million and the maturity date was extended to January 31, 2017, (iii) the annual commitment fee on the revolving line of credit was increased from $20,000 to $26,667, and there was also payable a term loan commitment fee of $20,000 and an amendment fee of $5,000, (iv) the covenant that required the Minimum Adjusted Quick ratio be at or greater than 1.25:1.0 on an intra-quarter basis and 1.5:1 at quarter end was reduced to 1.1:1 on an intra-quarter basis and 1.25:1 at quarter end, (v) the covenant that required the Debt Service Coverage ratio to be at or greater than 1.25:1 was changed to include the change in deferred revenue in the numerator of the ratio, and the ratio was reduced to 1.0:1 for the quarters ending December 31, 2014 and March 31, 2015, to 1.25:1 for the quarter ending June 30, 2015 and to 1.5:1 for the quarter ending September 30, 2015 and thereafter, and (vi) the definition of Permitted Liens was amended to include no more than $800,000 in the aggregate amount of outstanding obligations for purchases of equipment, which was increased from the then-current limit of $400,000. On May 13, 2015, the Companies entered into a Fifth Amendment to the Second Amended and Restated Loan and Security Agreement (the “Fifth Amendment”), with Silicon Valley Bank. Under the Fifth Amendment: (i) interest accrues on the revolving line of credit at the per annum rate of one and one-quarter percent (1.25%) above the Prime Rate (as defined); (ii) interest accrues on the term loan at the per annum rate of two and three-quarters percent (2.75%) above the Prime Rate; (iii) the Adjusted Quick Ratio financial covenant was eliminated and replaced by a Liquidity financial covenant, which requires, commencing with the monthly compliance period ended March 31, 2015, and thereafter, minimum Liquidity (as defined), tested with respect to Sonic Foundry only, of at least (x) 1:35:1.00 for each month-end that is not the last day of a fiscal quarter, and (y) 1.50:1.00 for each month-end that is the last day of a fiscal quarter; (iv) provides for an advance rate on foreign receivables of the lesser of (x) 75% of Eligible Foreign Accounts (as defined) or (y) $1,000,000; (v) allows for certain subordinated debt to be issued to Partners for Growth IV, L.P.; (vi) waives existing defaults under the Second Amended and Restated Loan Agreement by virtue of the Company’s failure to comply with (x) the Adjusted Quick Ratio financial covenant for the compliance periods ended February 28, 2015 and March 31, 2015, and (y) the Debt Service Coverage Ratio financial covenant for the compliance period ended March 31, 2015; and (vii) the Debt Service Coverage ratio was reduced to 1.0:1 for the quarter ended June 30, 2015, to 1.25:1 for the quarter ended September 30, 2015 and remains at 1.50:1 for the quarter ending December 31, 2015 and thereafter. On October 5, 2015, the Companies entered into a Sixth Amendment to the Second Amended and Restated Loan and Security Agreement (the “Sixth Amendment”), with Silicon Valley Bank. Under the Sixth Amendment: (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. At September 30, 2015, a balance of $1.9 million was outstanding on the term loans with Silicon Valley Bank, with an effective interest rate of six percent (6.0%). At September 30, 2015, a balance of $1.4 million was outstanding on the revolving line of credit with Silicon Valley Bank, with an effective interest rate of four-and-one-half percent (4.5%). At September 30, 2014, a balance of $1.9 million was outstanding on the term loans with Silicon Valley Bank and no balance was outstanding on the revolving line of credit. At September 30, 2015, there was a remaining amount of $2.6 million available under the line of credit facility for advances. The Second Amended Agreement, as amended, contains events of default that include, among others, non-payment of principal or interest, inaccuracy of any representation or warranty, violation of covenants, bankruptcy and insolvency events, material judgments, cross defaults to certain other indebtedness, and material adverse changes. The occurrence of an event of default could result in the acceleration of the Companies’ obligations under the Second Amended Agreement, as amended. At September 30, 2015, the Company was in compliance with all covenants in the Second Amended Agreement, as amended. Pursuant to the Second Amended Agreement, as amended, the Companies pledged as collateral to Silicon Valley Bank substantially all non-intellectual property business assets. The Companies also entered into an Intellectual Property Security Agreement with respect to intellectual property assets. Partners for Growth IV, L.P. On May 13, 2015, Sonic Foundry, Inc., entered into a Loan and Security Agreement (the “Loan and Security Agreement”) with Partners for Growth IV, L.P. (“PFG”), (the “Loan and Security Agreement”). The Loan and Security Agreement provides for a Term Loan in the amount of $2,000,000, which can be disbursed in two (2) Tranches as follows: Tranche 1 was drawn in the amount of $1,500,000 shortly after execution thereof; and Tranche 2 in the amount of $500,000, and can be disbursed at any time, at Sonic Foundry’s discretion, following disbursement of Tranche 1 and on or before December 31, 2015, so long as at no Default or Event of Default (as defined) shall have occurred and be continuing. Each tranche of the Term Loan bears interest at 10.75% per annum. Tranche 1 of the Term Loan is payable interest only until November 30, 2015. Thereafter, principal is due in 30 equal monthly principal installments, plus accrued interest, beginning December 1, 2015 and continuing until May 1, 2018, when the principal balance is to be paid in full. Tranche 2 of the Term Loan is payable using the same repayment schedule as Tranche 1. The principal of the Term Loan may be prepaid at any time, provided that Sonic Foundry pays to PFG a prepayment fee equal to 1% of the principal amount prepaid, if the prepayment occurs in the first year from disbursement of Tranche 1. Coincident with execution of the Loan and Security Agreement, the Company entered into a Warrant Agreement (“Warrant”) with PFG. Pursuant to the terms of the Warrant, the Company issued to PFG a warrant to purchase up to 50,000 shares of common stock of the Company at an exercise price of $9.66 per share, subject to certain adjustments, of which 37,500 were exercisable with the disbursement of Tranche 1 and 12,500 become exercisable upon a disbursement under Tranche 2. Pursuant to the Warrant, PFG is also entitled, under certain conditions, to require the Company to exchange the Warrant for the sum of $200,000 (or $150,000, if the Company does not draw on Tranche 2 of the Term Loan). Each warrant issued has an exercise term of 5 years from the date of issuance. The warrants could be settled for cash in the event of acquisition of the company, any liquidation of the company, or expiration of the warrant. The Company has determined the cash payment date to be the expiration date (May 14, 2020). Due to the fixed payment amount on the expiration date, the warrant structure is in substance a debt arrangement (the “Warrant Debt”) with a zero interest rate, a fixed maturity date and a feature that makes the debt convertible to common stock. The Warrant Debt had a fair value of $58 thousand. The derivative had a fair value of $120 thousand. The conversion feature is an embedded derivative; thus, for accounting purposes, the conversion feature is bifurcated and accounted for separately from the PFG Debt and Warrant Debt as a derivative liability measured at fair value at each reporting period. As of September 30, 2015, the estimated fair value of the derivative liability associated with the warrants issued in connection with the Loan and Security Agreement, was $109 thousand. The change in the fair value of the derivative liability between the issuance date and September 30, 2015, was recorded as a gain of $12 thousand included in the other income (expense). The proceeds from the Loan and Security Agreement were allocated between the PFG Debt and the Warrant Debt (inclusive of its conversion feature) based on their relative fair value on the date of issuance which resulted in initial carrying values of $1.322 million and $178 thousand, respectively. The conversion feature of $178 thousand is treated together as a debt discount on the PFG Debt and will be accreted to interest expense under the effective interest method over the three-year term of the PFG Debt and the five-year term of the Warrant Debt. For fiscal 2015, the Company recorded accretion of discount expense associated with the warrants issued with the PFG loan of $5 thousand as well as $22 thousand related to amortization of the debt discount. There was no accretion of discount expense or related amortization expense recorded in fiscal 2014 as the loan was funded in the third quarter of fiscal 2015. The fair values of term debt and warrant debt are based on the present value of expected future cash flows and assumptions about current interest rates and the creditworthiness of the Company (Level 3). At May 13, 2015, the carrying amounts of the Company’s term debt and warrant debt totaled $1.322 million and $178 thousand, respectively. At May 13, 2015, the Company’s term debt and warrant debt were recorded at fair value. At September 30, 2015, the derivative liability was remeasured at fair value. The fair value of the bifurcated conversion feature represented by the warrant derivative liability is based on a Black Scholes option pricing model with assumptions for stock price, exercise price, volatility, expected term, risk free interest rate and dividend yield similar to those described previously for share-based compensation which were generally observable (Level 2). On August 12, 2015, the Company and PFG entered into a waiver agreement to waive the existing covenant default and to change the exercise price of the aforementioned warrants from $9.66 per share to $6.80 per share. The non-cash financial statement impact of this transaction was recorded during the quarter ending September 30, 2015. On October 5, 2015, the Company and PFG entered into a Modification No. 1 to the Loan and Security Agreement (“Modification No. 1”). Under Modification No. 1: (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. At September 30, 2015, a balance of $1.5 million was outstanding on the term debt with PFG, with an effective interest rate of ten-and-three-quarters percent (10.75%). At September 30, 2014, no balance was outstanding with PFG. The Term Loan is collateralized by substantially all the Company’s assets, including intellectual property, subject to a first lien held by Silicon Valley Bank, The Term Loan requires compliance with the same financial covenants as set forth in the loan from Silicon Valley Bank. At September 30, 2015, the Company was in compliance with all covenants in the Loan and Security Agreement, as amended. Other Indebtedness At September 30, 2015, a balance of $25 thousand was outstanding on the notes payable to Mitsui Sumitomo Bank. The outstanding balance was $170 thousand at September 30, 2014. At September 30, 2015, a balance of $418 thousand was outstanding on the line of credit with Mitsui Sumitomo Bank. There was no outstanding balance on the line of credit at September 30, 2014. The notes and credit facility are both related to Mediasite K.K., and both accrue an annual interest rate of approximately one-and-one half percent (1.575%). At September 30, 2015, a balance of $278 thousand was outstanding on the subordinated note payable related to the acquisition of MediaMission, with an annual interest rate of six-and-one half percent (6.5%). The outstanding balance was $628 thousand at September 30, 2014. At September 30, 2015, no balance was outstanding on the subordinated payable related to the acquisition of Mediasite KK after paying off the outstanding balance in January 2015. The outstanding balance was $1.8 million at September 30, 2014. In the twelve months ended September 30, 2015, a foreign currency gain of $202 was realized related to re-measurement of the subordinated notes payable related to the Company’s foreign subsidiaries. In the twelve months ended September 30, 2014, a foreign currency gain of $157 thousand was recorded related to the remeasurement. The annual principal payments on the notes payable to SVB, PFG and Mitsui Sumitomo Bank are as follows: Fiscal Year (in thousands) 2016 $ 1,359 2017 1,433 2018 678 Less warrant debt & discount (91 ) Total $ 3,379 The annual principal payments on the subordinated notes payable related to the acquisition of MediaMission are as follows: Fiscal Year (in thousands) 2016 $ 186 2017 92 Total $ 278 |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Sep. 30, 2015 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | 4. Accrued Liabilities Accrued liabilities consists of the following (in thousands): September 30, 2015 2014 Accrued compensation $ 1,166 $ 1,173 Accrued expenses 221 903 Accrued interest & taxes 186 288 Other accrued liabilities 93 148 Total $ 1,666 $ 2,512 The Company accrues expenses as they are incurred. Accrued compensation includes wages, vacation, commissions and bonuses. Accrued expenses is mainly related to stock compensation, professional fees and amounts owed to suppliers. Other accrued liabilities is made up of employee-related expenses, including $87 thousand in dividends payable to the sellers and current employees of its wholly owned subsidiary, MediaMission B.V. These amounts were accrued prior to the Company’s acquisition. |
Stock Options and Employee Stoc
Stock Options and Employee Stock Purchase Plan | 12 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Stock Options and Employee Stock Purchase Plan | 5. Stock Options and Employee Stock Purchase Plan On March 5, 2009, Stockholders approved adoption of the 2009 Stock Incentive Plan (the “2009 Plan”). The 2009 Plan, beginning October 1, 2009, replaced two former employee stock option plans that terminated coincident with the effectiveness of the 2009 Plan. On March 7, 2012, Stockholders approved an amendment to increase the number of shares of common stock subject to this plan by 600,000 and to increase the number of shares for the directors’ stock option plan by 50,000 shares. On March 6, 2014, Stockholders approved an amendment to increase the number of shares of common stock subject to the 2009 Plan by 800,000 to an aggregated total of 1,800,000 shares of common stock. The Company maintains a directors’ stock option plan under which options may be issued to purchase up to an aggregate of 100,000 shares of common stock. Each non-employee director, who is re-elected or who continues as a member of the board of directors on each annual meeting date and on each subsequent meeting of Stockholders, will be granted options to purchase 2,000 shares of common stock under the directors’ plan, or at other times or amounts at the discretion of the Board of Directors. Each option entitles the holder to purchase one share of common stock at the specified option price. The exercise price of each option granted under the plans was set at the fair market value of the Company’s common stock at the respective grant date. Options vest at various intervals and expire at the earlier of termination of employment, discontinuance of service on the board of directors, ten years from the grant date or at such times as are set by the Company at the date of grant. The Company has applied a graded (tranche-by-tranche) attribution method and expenses share-based compensation on an accelerated basis over the vesting period of the share award, net of estimated forfeitures. The number of shares available for grant under these plans at September 30 is as follows: Qualified Employee Director Shares available for grant at September 30, 2013 357,605 32,000 Stockholder approval to increase shares 800,000 — Options granted (328,760 ) (12,500 ) Options forfeited 24,921 — Shares available for grant at September 30, 2014 853,766 19,500 Options granted (307,119 ) (10,500 ) Options forfeited 39,384 8,000 Shares available for grant at September 30, 2015 586,031 17,000 The following table summarizes information with respect to outstanding stock options. Years Ended September 30, 2015 2014 Options Weighted Options Weighted Outstanding at beginning of year 1,240,941 $ 10.31 997,045 $ 10.54 Granted 317,619 9.22 341,260 10.11 Exercised (11,117 ) 7.27 (38,143 ) 7.43 Forfeited (98,034 ) 11.27 (59,221 ) 14.90 Outstanding at end of year 1,449,409 $ 10.03 1,240,941 $ 10.31 Exercisable at end of year 885,777 700,922 Weighted average fair value of options granted during the year $ 3.18 $ 3.41 The options outstanding at September 30, 2015 have been segregated into four ranges for additional disclosure as follows: Options Outstanding Options Exercisable Exercise Prices Options Weighted Weighted Options Weighted $ 4.50 to $9.90 1,037,217 7.2 $ 8.41 575,793 $ 7.94 10.00 to 14.83 282,469 7.0 11.35 180,261 11.76 15.00 to 19.00 94,965 3.0 15.78 94,965 15.78 21.40 to 46.90 34,758 1.1 30.47 34,758 30.47 1,449,409 885,777 At September 30, 2015, there was $676 thousand of total unrecognized compensation cost related to non-vested stock-based compensation, including $98 thousand of estimated forfeitures. The cost is expected to be recognized over a weighted-average life of 1.8 years. A summary of the status of the Company’s non-vested shares at September 30, 2015 and for the year then ended is presented below: Shares Weighted Average Grant Date Fair Value Non-vested shares at October 1, 2014 539,519 $ 3.29 Granted 317,619 3.18 Vested (268,217 ) 2.70 Forfeited (25,289 ) 1.94 Non-vested shares at September 30, 2015 563,632 $ 3.35 Stock-based compensation recorded in the year ended September 30, 2015 of $963 thousand was allocated $606 thousand to selling and marketing expenses, $101 thousand to general and administrative expenses and $256 thousand to product development expenses. Stock-based compensation recorded in the year ended September 30, 2014 of $921 thousand was allocated $617 thousand to selling and marketing expenses, $54 thousand to general and administrative expenses and $250 thousand to product development expenses. Cash received from exercises under all stock option plans and warrants for the years ended September 30, 2015 and 2014 was $41 thousand and $286 thousand, respectively. There were no tax benefits realized for tax deductions from option exercises for the years ended September 30, 2015 and 2014. The Company currently expects to satisfy stock-based awards with registered shares available to be issued. The Company also has an Employee Stock Purchase Plan (Purchase Plan) under which an aggregate of 150,000 common shares may be issued. The Shareholders approved an amendment to increase the number of shares of common stock subject to the plan from 100,000 to 150,000 at the Company’s annual meeting in March 2014. All employees who have completed 90 days of employment with the Company on the first day of each offering period and customarily work twenty hours per week or more are eligible to participate in the Purchase Plan. An employee who, after the grant of an option to purchase, would hold common stock and/or hold outstanding options to purchase stock possessing 5% or more of the total combined voting power or value of the Company will not be eligible to participate. Eligible employees may make contributions through payroll deductions of up to 10% of their compensation. No participant in the Purchase Plan is permitted to purchase common stock under the Purchase Plan if such option would permit his or her rights to purchase stock under the Purchase Plan to accrue at a rate that exceeds $25,000 of the fair market value of such shares, or that exceeds 1,000 shares, for each calendar year. The Company makes a bi-annual offering to eligible employees of options to purchase shares of common stock under the Purchase Plan on the first trading day of January and July. Each offering period is for a period of six months from the date of the offering, and each eligible employee as of the date of offering is entitled to purchase shares of common stock at a purchase price equal to the lower of 85% of the fair market value of common stock on the first or last trading day of the offering period. A total of 38,416 shares are available to be issued under the plan. There were 14,067 and 11,863 shares purchased by employees during fiscal 2015 and 2014, respectively. The Company recorded stock compensation expense under this plan of $22 and $21 thousand during fiscal 2015 and 2014, respectively. Cash received from issuance of stock under this plan was $85 and $75 thousand during fiscal 2015 and 2014, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 6. Income Taxes The provision for income taxes consists of the following (in thousands): Years Ended 2015 2014 Current tax expense $ 107 $ 40 Deferred income tax expense — 1,064 Provision for income taxes $ 107 $ 1,104 The reconciliation of income tax expense (benefit) computed at the appropriate country specific rate to income tax expense (benefit) is as follows (in thousands): Years Ended 2015 2014 Income tax expense (benefit) at statutory rate $ (1,502 ) $ (582 ) State income tax expense (benefit) (131 ) (53 ) Foreign tax activity 56 40 R&D tax credit expiration — 82 Permanent differences, net 189 212 Adjustment of temporary differences to income tax returns 523 121 Change in valuation allowance 972 1,284 Income tax expense $ 107 $ 1,104 The significant components of the deferred tax accounts recognized for financial reporting purposes are as follows (in thousands): September 30, 2015 2014 Deferred tax assets: Net operating loss and other carryforwards $ 36,372 $ 35,556 Common stock warrants 961 811 Allowance for doubtful accounts 59 59 Unearned revenue 439 319 Other — 1 Total deferred tax assets 37,831 36,746 Deferred tax liabilities: Fixed assets (149 ) (129 ) Other (157 ) (64 ) Total deferred tax liabilities (306 ) (193 ) Net deferred tax asset 37,525 36,553 Valuation allowance (37,525 ) (36,553 ) Equity gains on investment in Mediasite KK (916 ) (916 ) Customer relationships (716 ) (946 ) Goodwill amortization (2,690 ) (2,450 ) Deferred tax liability for goodwill and intangible assets amortization $ (4,322 ) $ (4,312 ) In addition to the deferred tax liability detailed above, the Company has a $124 thousand deferred tax asset. The amount is recorded within the prepaid expenses and other current assets line on the consolidated balance sheet and is primarily related to net operating losses of MSKK. At September 30, 2015, the Company had net operating loss carryforwards of approximately $93 million for U.S. Federal and $52 million for state tax purposes. For Federal tax purposes, the carryforwards expire in varying amounts between 2019 and 2035. For state tax purposes, the carryforwards expire in varying amounts between 2015 and 2034. Utilization of the Company’s net operating loss may be subject to substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code and similar state provisions. Such an annual limitation could result in the expiration of the net operating loss carryforwards before utilization. In addition, the Company has research and development tax credit carryforwards of approximately $418 thousand, which expire in varying amounts between 2019 and 2020. The Company maintains an additional paid-in-capital (APIC) pool which represents the excess tax benefits related to share-based compensation that are available to absorb future tax deficiencies. If the amount of future tax deficiencies is greater than the available APIC pool, the Company records the excess as income tax expense in its consolidated statements of income. For fiscal 2015 and fiscal 2014, the Company had a sufficient APIC pool to cover any tax deficiencies recorded and as a result, these deficiencies did not affect its results of operations. At September 30, 2015, the Company has $1.1 million of net operating loss carry forwards for which a benefit would be recorded in APIC when realized. Earnings of the Company’s foreign subsidiaries are generally subject to U.S. taxation upon repatriation to the U.S. and the Company’s tax provision reflects the related incremental U.S. tax except for certain foreign subsidiaries whose unremitted earnings are considered to be indefinitely reinvested. At September 30, 2015, unremitted earnings of foreign subsidiaries were deemed to be indefinitely reinvested. No deferred tax liability has been recognized with regard to the remittance of such earnings after MSKK and MediaMission BV acquisitions were completed during the year. Because of the availability of U.S. foreign tax credits, it is likely no U.S. tax would be due if such earnings were repatriated. Beginning with an acquisition in fiscal year 2002, the Company has amortized Goodwill for tax purposes over a 15 year life. Goodwill is not amortized for book purposes. Tax amortization is not applicable to the goodwill from the foreign acquisitions that took place during fiscal 2015 since the foreign goodwill is non-deductible for US federal tax purposes. The difference between the book and tax balance of certain of the company’s goodwill creates a deferred tax liability and an annual tax expense. Because of the long term nature of the goodwill timing difference, tax planning strategies cannot be utilized with respect to the deferred tax liability. The Company’s tax rate differs from the expected tax rate each reporting period as a result of the aforementioned items. The balance of the Deferred Tax Liability was $4.3 million at September 30, 2015 and September 30, 2014, respectively. The Company recorded a deferred tax liability related to the Customer Relationship intangibles value acquired as part of the purchase of MediaMission BV and Mediasite KK. The Company also recorded tax expense related to the “step-up” gain on its original equity investment in Mediasite KK. The Company has some other temporary differences related to its Mediasite KK subsidiary. In accordance with accounting guidance for uncertainty in income taxes, the Company has concluded that a reserve for income tax contingencies is not necessary. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had no accruals for interest and penalties on the Company’s Condensed Consolidated Balance Sheets at September 30, 2015 or September 30, 2014 and has not recognized any interest or penalties in the Condensed Consolidated Statements of Operations for either of the twelve month periods ended September 30, 2015 or 2014. The Company is subject to taxation in the U.S., Netherlands, Japan and various state jurisdictions. All of the Company’s tax years are subject to examination by the U.S., Dutch, Japanese and state tax authorities due to the carryforward of unutilized net operating losses. |
Acquisition
Acquisition | 12 Months Ended |
Sep. 30, 2015 | |
Mediasite KK [Member] | |
Acquisition | 8. Acquisition of MSKK On January 14, 2014, Sonic Foundry paid approximately $5.7 million for the remaining stock in Mediasite KK, comprised of equal components of approximately $1.9 million cash, subordinated note payable in one year (interest rate of 5%) and value in shares of Sonic Foundry. The stock portion of the purchase price consisted of 189,222 shares of Sonic Foundry common stock. Assets acquired include cash, accounts receivable, inventory, fixed assets and customer relationship and other intangibles and liabilities assumed include accounts payable, debt, taxes payable and unearned revenues. Prior to completion of this acquisition, the Company owned a minority interest of approximately 26% of Mediasite KK. In connection with the acquisition, the one quarter lag in reporting their results was eliminated. The Company determined that the acquisition was deemed to be a material business combination. During the second fiscal quarter of 2014, this initial investment was valued at the same amount as the value when control was achieved which resulted in a non-cash gain of approximately $1.4 million. This amount was partially offset by a $901 thousand tax expense associated with the gain. As a result of the acquisition, the Company increased its presence in the Japanese market. The goodwill of $2.9 million arising from the acquisition consists largely of the synergies expected from combining the operations of the Company and Mediasite KK. None of the goodwill recognized is deductible for income tax purposes. The Company recorded the acquired tangible and intangible assets and liabilities assumed based on their estimated fair values. The fair value of the customer relationships was estimated by applying the income approach. That measure is based on significant inputs that are not observable in the market, and therefore represents Level 3 inputs. Key assumptions include a discount rate of 30 percent, estimated effective tax rate of 35.5 percent, and estimated customer attrition rate of 15 percent. The Company believes that the information provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed. The customer relationship intangible is amortized on a straight line basis over ten year years and amortization is categorized as a selling and marketing expense. The following table summarizes the fair values of the assets acquired and liabilities assumed on the date of the acquisition (in thousands): Fair Value Assets acquired: Cash $ 3,163 Other current assets 1,792 Property and equipment 240 Customer relationships 2,071 Goodwill 2,906 Total assets acquired 10,172 Liabilities assumed: Current liabilities (1,590 ) Deferred tax liability (808 ) Total liabilities assumed (2,398 ) Less ownership basis of original 26% investment (2,053 ) Total purchase price for 74% remaining stock $ 5,721 Mediasite KK contributed revenue of $5.3 million and a net loss of $104 thousand for the twelve months ended September 30, 2015. Mediasite KK contributed revenue of $4.3 million and net income of $48 thousand for the period from the date of acquisition to September 30, 2014. |
MediaMission Holding B.V. [Member] | |
Acquisition | 7. Acquisition of MediaMission Holding B.V. On December 16, 2013, Sonic Foundry completed its acquisition of all of the outstanding stock of MediaMission Holding B.V., the owner of 100% of the outstanding stock in MediaMission B.V., (“MediaMission”) and MediaMission Hosting B.V. Sonic Foundry paid $1.493 million for all the outstanding stock in MediaMission Holding B.V., comprised of $458,000 cash, $687,000 subordinated note payable over three years (interest rate of 6.5%) and $348,000 in shares of Sonic Foundry stock. The stock portion of the purchase price consisted of 37,608 shares of Sonic Foundry common stock. In connection with the acquisition of MediaMission Holding B.V., the Company entered into employment agreements with the two managing principals of MediaMission. As a result of the acquisition, the Company further increased its presence in the European market. The goodwill of $932 thousand arising from the acquisition consists largely of the synergies expected from combining the operations of the Company and MediaMission. None of the goodwill recognized is deductible for income tax purposes. The Company recorded the acquired tangible and intangible assets and liabilities assumed based on their estimated fair values. The fair value of the customer relationships was estimated by applying the income approach. That measure is based on significant inputs that are not observable in the market, and therefore represents Level 3 inputs. Key assumptions include a discount rate of 28 percent, estimated effective tax rate of 20 percent, and estimated customer attrition rate of 15 percent. The Company believes that the information provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed. The customer relationship intangible is amortized on a straight line basis over ten year years and amortization is categorized as a selling and marketing expense. The following table summarizes the fair values of the assets acquired and liabilities assumed on the date of the acquisition (in thousands): Fair Value Assets acquired: Cash $ 339 Other current assets 923 Property and equipment 49 Customer relationships 591 Goodwill 932 Total assets acquired 2,834 Liabilities assumed: Current liabilities (1,111 ) Deferred tax liability (230 ) Total liabilities assumed (1,341 ) Total purchase price $ 1,493 MediaMission contributed revenue of $827 thousand and a net loss of $229 thousand for the twelve months ended September 30, 2015. MediaMission contributed revenue of $1.0 million and a net loss of $147 thousand for the period from the date of acquisition to September 30, 2014. |
Pro Forma Financial Information
Pro Forma Financial Information (Unaudited) | 12 Months Ended |
Sep. 30, 2015 | |
Text Block [Abstract] | |
Pro Forma Financial Information (Unaudited) | 9. Pro Forma Financial Information (Unaudited) The following table represents the net loss (in thousands) for the Company on a pro forma basis, assuming the acquisitions of MediaMission and Mediasite KK had each occurred as of October 1, 2013. The table sets forth unaudited pro forma results for the twelve months ended September 30, 2015 and 2014, respectively and has been compiled from historical financial statements and other information, but is not necessarily indicative of the results that actually would have been achieved had the transaction occurred on the dates indicated or that may be achieved in the future. Years Ended Sept 30, 2015 2014 Revenue $ 36,459 $ 37,575 Net income/(loss) (4,525 ) (2,694 ) Basic income/(loss) per share $ (1.04 ) $ (0.61 ) |
Savings Plan
Savings Plan | 12 Months Ended |
Sep. 30, 2015 | |
Postemployment Benefits [Abstract] | |
Savings Plan | 10. Savings Plan The Company’s defined contribution 401(k) savings plan covers substantially all employees meeting certain minimum eligibility requirements. Participating employees can elect to defer a portion of their compensation and contribute it to the plan on a pretax basis. The Company may also match certain amounts and/or provide additional discretionary contributions, as defined. The Company made matching contributions of $402 and $375 thousand during the years ended September 30, 2015 and 2014, respectively. The Company made no additional discretionary contributions during 2015 and 2014. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | 11. Related-Party Transactions The Company incurred fees of $122 and $236 thousand during the years ended September 30, 2015 and 2014, respectively, to a law firm whose partner is a director and stockholder of the Company. The Company had accrued liabilities for unbilled services to the same law firm of $25 and $15 thousand at September 30, 2015 and 2014, respectively. As of September 30, 2015 and 2014, the Company had a loan outstanding to an executive totaling $26 thousand. The loan is collateralized by Company stock. On December 22, 2014, the company issued 74,802 warrants to two individuals in combination with the sale of a like number of shares of common stock, one of which is the Chairman of the Company’s Board of Directors. These warrants were immediately exercisable, expire five years after the date of issuance and have an exercise price of $14.00. As of September 30, 2015, the Company had outstanding amounts due for management fees and dividends payable to the sellers of and current employees of its wholly-owned subsidiary, MediaMission B.V. totaling $114 thousand. The outstanding balance was $370 thousand at September 30, 2014. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 12. Goodwill and Other Intangible Assets Goodwill and intangible assets that have indefinite useful lives are recorded at cost and are not amortized but, instead, tested at least annually for impairment. The Company assesses the impairment of goodwill on an annual basis or whenever events or changes in circumstances indicate that the fair value of these assets is less than the carrying value. The Company performs annual goodwill impairment test as of July 1, and tested goodwill recognized in connection with the acquisitions of Mediasite, MediaMission and Mediasite KK and determined it was not impaired. For purposes of the test, goodwill on the Company’s books is evaluated within three separate reporting units. The changes in the carrying amount of goodwill for the years ended September 30, 2015 and 2014, respectively, are as follows: Balance as of September 30, 2013 $ 7,576 Goodwill acquired during year: Mediasite KK 2,906 MediaMission 933 Foreign currency translation adjustment (230 ) Balance as of September 30, 2014 11,185 Foreign currency translation adjustment (332 ) Balance as of September 30, 2015 $ 10,853 The following tables present details of the Company’s total intangible assets at September 30, 2015 and 2014: (in thousands) Life (years) Gross Accumulated Amortization at September 30, Balance at Amortizable: Loan origination fees 3 $ 302 $ 190 $ 112 Customer relationships 10 2,329 457 1,872 Software development costs 3 533 429 104 Product rights 6 672 164 508 3,836 1,240 2,596 Non-amortizable goodwill 10,853 — 10,853 Total $ 14,689 $ 1,240 $ 13,449 (in thousands) Life (years) Gross Accumulated Amortization at September 30, Balance at Amortizable: Loan origination fees 3 $ 199 $ 162 $ 37 Customer relationships 10 2,662 191 2,471 Software development costs 3 533 252 281 Product rights 6 672 41 631 4,066 646 3,420 Non-amortizable goodwill 11,185 — 11,185 Total $ 15,251 $ 646 $ 14,605 Estimated amortization expense for each of the five subsequent fiscal years is expected to be (in thousands): Fiscal Year (in thousands) 2016 $ 563 2017 432 2018 390 2019 362 2020 302 Thereafter 547 Total $ 2,596 |
Segment Information
Segment Information | 12 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | 13. Segment Information We have determined that in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 280-10, Segment Reporting The following summarizes revenue by geographic region (in thousands): Years Ended 2015 2014 United States $ 20,396 $ 22,175 Europe and Middle East 7,594 6,446 Asia 6,518 5,813 Other 1,951 1,396 Total $ 36,459 $ 35,830 |
Customer Concentration
Customer Concentration | 12 Months Ended |
Sep. 30, 2015 | |
Text Block [Abstract] | |
Customer Concentration | 14. Customer Concentration In the fiscal year ended September 30, 2015 and 2014, two distributors represented 24% and 30% of total revenue. At September 30, 2015 and 2014, these two distributors represented 24% and 47% of total accounts receivable, respectively. |
Legal Proceedings
Legal Proceedings | 12 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | 15. Legal Proceedings From time to time, the Company is subject to legal proceedings or claims arising from its normal course of operations. The Company accrues for costs related to loss contingencies when such costs are probable and reasonably estimable. As of September 30, 2015, the Company is not aware of any material pending legal proceedings or threatened litigation that would have a material adverse effect on the Company’s financial condition or results of operations, although no assurance can be given with respect to the ultimate outcome of pending actions. On October 26, 2012, a complaint was filed by Astute Technology, LLC (“Astute”) against one of our customers in the United States District Court for the Eastern District of Texas (Case No. 2:012-cv-689). The complaint alleges patent infringement. Because we agreed to indemnify our customers from costs and damages in connection with infringement we defended the complaint. On February 5, 2013, we filed a complaint against Astute in the Western District of Wisconsin (Case No. 13-cv-87). The complaint is for declaratory judgment of non-infringement and invalidity of three Unites States patents held by Astute. In June 2014, the Company entered into a settlement agreement with Astute Technology, LLC (“Astute”). The key terms of the agreement were: 1) a grant of a non-revocable license of Astute patents to the Company; 2) a grant of a fully paid, non-refundable license of certain Sonic Foundry patents to Astute; 3) both Astute and our customer agreed to identify three meetings they currently capture that the other party will not seek or respond to any request for proposal; and 4) a payment of $1.35 million to Astute. Pursuant to the settlement agreement, the payments were made in three equal amounts with the first paid in June 2014, the second paid in October 2014 and the final installment paid in March 2015. The Company contributed $1.1 million of the $1.35 million payable to Astute with our customer paying the residual amount. Of the $1.1 million, $428 thousand related to prior use and was recorded as a charge to income during fiscal 2014. The remaining $672 thousand was recorded as a product right asset, which is being amortized, on a straight-line basis, over the remaining life of the patents, through 2020. Future amounts due to Astute were accrued for at the time of settlement. |
Quarterly Financial Data (unaud
Quarterly Financial Data (unaudited) | 12 Months Ended |
Sep. 30, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (unaudited) | 16. Quarterly Financial Data (unaudited) The following table sets forth selected quarterly financial information for the years ended September 30, 2015 and 2014. The operating results are not necessarily indicative of results for any future period. Quarterly Financial Data (in thousands except per share data) Q4-’15 Q3-’15 Q2-’15 Q1-’15 Q4-’14 Q3-’14 Q2-’14 Q1-’14 Revenue $ 9,056 $ 10,556 $ 8,106 $ 8,741 $ 8,479 $ 11,267 $ 8,878 $ 7,206 Gross margin 6,450 7,088 6,216 6,070 5,871 7,789 6,499 5,396 Loss from operations (908 ) (885 ) (1,072 ) (1,227 ) (1,357 ) (77 ) (1,022 ) (626 ) Equity in earnings from investment in Mediasite KK — — — — — — 15 23 Net income (loss) (1,222 ) (921 ) (1,350 ) (1,032 ) (1,288 ) 33 (871 ) (690 ) Basic and diluted net income (loss) per share $ (0.28 ) $ (0.21 ) $ (0.31 ) $ (0.24 ) $ (0.30 ) $ 0.01 $ (0.21 ) $ (0.17 ) |
Subsequent Events
Subsequent Events | 12 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events On October 5, 2015, the Companies entered into a Sixth Amendment to the Second Amended and Restated Loan and Security Agreement (the “Sixth Amendment”), with Silicon Valley Bank. Under the Sixth Amendment: (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. On October 5, 2015, the Company and PFG entered into a Modification No. 1 to the Loan and Security Agreement (“Modification No. 1”). Under Modification No. 1: (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. |
Basis of Presentation and Sig24
Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Business | Business Sonic Foundry, Inc. (the Company) is in the business of providing enterprise solutions and services for the web communications market. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Sonic Foundry Media Systems, Inc., MediaMission B.V. (formerly Media Mission Holding B.V.) and Mediasite KK. All significant intercompany transactions and balances have been eliminated. Prior to January 2014, the Company owned approximately 26% of Mediasite KK and accounted for its investment under the equity method of accounting. On January 14, 2014, the Company purchased the remaining 74% of Mediasite KK. |
Reclassifications | Reclassifications Reclassifications have been made to the September 30, 2014 financial statements to conform to the September 30, 2015 presentation. These reclassifications had no effect on the Company’s net loss or stockholders’ equity as previously reported. |
Use of Estimates | Use of Estimates In preparing financial statements in conformity with accounting principles generally accepted in the United States of America (US GAAP), management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expense during the period. Actual results could differ from those estimates. |
Revenue Recognition | Revenue Recognition General Revenue is recognized when persuasive evidence of an arrangement exists, delivery occurs or services are rendered, the sales price is fixed or determinable and collectability is reasonably assured. Revenue is deferred when undelivered products or services are essential to the functionality of delivered products, customer acceptance is uncertain, significant obligations remain, or the fair value of undelivered elements is unknown. Typically, the Company does not offer customers the right to return product, other than for exchange or repair pursuant to a warranty or stock rotation. The Company’s policy is to reduce revenue if it incurs an obligation for price rebates or other such programs during the period the obligation is reasonably estimated to occur. The following policies apply to the Company’s major categories of revenue transactions. Products Products are considered delivered, and revenue is recognized, when title and risk of loss have been transferred to the customer or upon customer acceptance if non-delivered products or services are essential to the functionality of delivered products. Under the terms and conditions of the sale, this occurs at the time of shipment to the customer. Product revenue currently represents sales of our Mediasite recorder and Mediasite related products such as our server software and other software licenses. If a license is time-based, the revenue is recognized over the term of the license agreement. Services The Company sells support and content hosting contracts to our customers, typically one year in length, and records the related revenue ratably over the contractual period. Our support contracts cover phone and electronic technical support availability over and above the level provided by our distributors, software upgrades on a when and if available basis, advance hardware replacement and an extension of the standard hardware warranty from 90 days to one year. The manufacturers the Company contracts with to build the units provide a limited one-year warranty on the hardware. The Company also sells installation, training, event webcasting, and customer content hosting services. Revenue for those services is recognized when performed in the case of installation, training and event webcasting services. Occasionally, the Company will sell customization services to enhance the server software. Revenue from those services is recognized when performed, if perfunctory, or under contract accounting. Service amounts invoiced to customers in excess of revenue recognized are recorded as deferred revenue until the revenue recognition criteria are met. Revenue Arrangements that Include Multiple Elements Sales of software, with or without installation, training, and post customer support fall within the scope of the software revenue recognition rules. Under the software revenue recognition rules, the fee from a multiple-deliverable arrangement is allocated to each of the undelivered elements based upon vendor-specific objective evidence (VSOE), which is limited to the price charged when the same deliverable is sold separately, with the residual value from the arrangement allocated to the delivered element. The portion of the fee that is allocated to each deliverable is then recognized as revenue when the criteria for revenue recognition are met with respect to that deliverable. If VSOE does not exist for all of the undelivered elements, then all revenue from the arrangement is typically deferred until all elements have been delivered to the customer. In the case of the Company’s hardware products with embedded software, the Company has determined that the hardware and software components function together to deliver the product’s essential functionality, and therefore, the revenue from the sale of these products is accounted for under the revenue recognition rules for tangible products whereby the fee from a multiple-deliverable arrangement is allocated to each of the deliverables based upon their relative selling prices as determined by a selling-price hierarchy. A deliverable in an arrangement qualifies as a separate unit of accounting if the delivered item has value to the customer on a stand-alone basis. A delivered item that does not qualify as a separate unit of accounting is combined with the other undelivered items in the arrangement and revenue is recognized for those combined deliverables as a single unit of accounting. The selling price used for each deliverable is based upon VSOE if available, from third-party evidence (TPE) if VSOE is not available, and best estimate of selling price (ESP) if neither VSOE nor TPE are available. TPE is the price of the Company’s or any competitor’s largely interchangeable products or services in stand-alone sales to similarly situated customers. ESP is the price at which the Company would sell the deliverable if it were sold regularly on a stand-alone basis, considering market conditions and entity-specific factors. All revenue arrangements, excluding the sale of all software-only products and associated services, have been accounted for under this guidance. The selling prices used in the relative selling price allocation method are as follows: (1) the Company’s products and services are based upon VSOE and (2) hardware products with embedded software, for which VSOE does not exist, are based upon ESP. The Company does not believe TPE exists for any of these products and services because they are differentiated from competing products and services in terms of functionality and performance and there are no competing products or services that are largely interchangeable. Management establishes ESP for hardware products with embedded software using a cost plus margin approach with consideration for market conditions, such as the impact of competition and geographic considerations, and entity-specific factors, such as the cost of the product and the Company’s profit objectives. Management believes that ESP is reflective of reasonable pricing of that deliverable as if priced on a stand-alone basis. When a sales transaction includes deliverables that are divided between Accounting Standards Codification (ASC) Topic 605 and ASC Subtopic 985-605, the Company allocates the selling price using the relative selling price method whereas value is allocated using an ESP for software developed using a percent of list price approach. The other deliverables are valued using ESP or VSOE as previously discussed. While the pricing model, currently in use, captures all critical variables, unforeseen changes due to external market forces may result in a revision of the inputs. These modifications may result in the consideration allocation differing from the one presently in use. Absent a significant change in the pricing inputs or the way in which the industry structures its transactions, future changes in the pricing model are not expected to materially affect our allocation of arrangement consideration. Management has established VSOE for hosting services. Billings for hosting are spread ratably over the term of the hosting agreement, with the typical hosting agreement having a term of 12 months, with renewal on an annual basis. The Company sells most hosting contracts without the inclusion of products. When the hosting arrangement is sold in conjunction with product, the product revenue is recognized immediately while the remaining hosting revenue is spread ratably over the term of the hosting agreement. The selling price is allocated between these elements using the relative selling price method. The Company uses ESP for development of the selling price for hardware products with embedded software. The Company also offers hosting services bundled with events services. The Company uses VSOE to establish relative selling prices for its events services. The Company recognizes events revenue when the event takes place and recognizes the hosting revenue over the term of the hosting agreement. The total amount of the arrangement is allocated to each element based on the relative selling price method. Reserves The Company reserves for stock rotations, price adjustments, rebates, and sales incentives to reduce revenue and accounts receivable for these and other credits granted to customers. Such reserves are recorded at the time of sale and are calculated based on historical information (such as rates of product stock rotations) and the specific terms of sales programs, taking into account any other known information about likely customer behavior. If actual customer behavior differs from our expectations, it may compromise our ability to recognize revenue to these distributors at the time of shipment. Also, if the Company determines that it can no longer accurately estimate amounts for stock rotations and sales incentives, the Company would not be able to recognize revenue until resellers sell the inventory to the final end user. Shipping and Handling The Company’s shipping and handling costs billed to customers are included in other revenue. Costs related to shipping and handling are included in cost of revenue and are recorded at the time of shipment to the customer. |
Concentration of Credit Risk and Other Risks and Uncertainties | Concentration of Credit Risk and Other Risks and Uncertainties As of September 30, 2015, of the $2.0 million in cash and cash equivalents, $106 thousand is deposited with two major U.S. financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on such amounts and believes that it is not exposed to any significant credit risk on these balances. The remaining $1.9 million of cash and cash equivalents is held by our foreign subsidiaries in financial institutions in Japan and the Netherlands and held in their local currency. The cash held in foreign financial institutions is not guaranteed. We assess the realization of our receivables by performing ongoing credit evaluations of our customers’ financial condition. Through these evaluations, we may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings or bankruptcy. Our reserve requirements are based on the best facts available to us and are reevaluated and adjusted as additional information is received. Our reserves are also based on amounts determined by using percentages applied to certain aged receivable categories. These percentages are determined by a variety of factors including, but not limited to, current economic trends, historical payment and bad debt write-off experience. Allowance for doubtful accounts for accounts receivable was $150,000 at September 30, 2015 and September 30, 2014, respectively. We had billings for Mediasite product and support services as a percentage of total billings to one distributor of approximately 10% in 2015 and 15% in 2014 and to a second distributor of approximately 14% in 2015 and 15% in 2014. At September 30, 2015 and 2014, these two distributors represented 24% and 47% of total accounts receivable, respectively. Currently all of our product inventory purchases are from one third-party contract manufacturer. Although we believe there are multiple sources of supply from other contract manufacturers as well as multiple suppliers of component parts required by the contract manufacturers, a disruption of supply of component parts or completed products, even if short term, would have a material negative impact on our revenues. At September 30, 2015 and 2014, this supplier represented 49% and 27%, respectively, of total accounts payable. We also license technology from third parties that is embedded in our software. We believe there are alternative sources of similar licensed technology from other third parties that we could also embed in our software, although it could create potential programming related issues that might require engineering resources. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of September 30, 2015, of the $2.0 million aggregate cash and cash equivalents held by the Company, the amount of cash and cash equivalents held by our foreign subsidiaries was $1.9 million. If the funds held by our foreign subsidiaries were needed for our operations in the United States, the repatriation of some of these funds to the United States could require payment of additional U.S. taxes. |
Trade Accounts Receivable | Trade Accounts Receivable The majority of the Company’s accounts receivable are due from entities in, or distributors or value added resellers to, the education, corporate and government sectors. Credit is extended based on evaluation of a customer’s financial condition and, generally, collateral is not required. Accounts receivable are typically due within 30 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered to be past due. The Company determines its allowance by considering a number of factors, including the length of time trade accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes-off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. Interest is not accrued on past due receivables. |
Inventory Valuation | Inventory Valuation Inventory consists of raw materials and supplies used in the assembly of Mediasite recorders and finished units. Inventory of completed units and spare parts are carried at the lower of cost or market, with cost determined on a first-in, first-out basis. Inventory consists of the following (in thousands): September 30, 2015 2014 Raw materials and supplies $ 254 $ 549 Finished goods 2,131 1,411 $ 2,385 $ 1,960 |
Capitalized Software Development Costs | Capitalized Software Development Costs Software development costs incurred in conjunction with product development are charged to research and development expense until technological feasibility is established. Thereafter, until the product is released for sale, software development costs are capitalized and reported at the net realizable value of the related product. Typically the period between achieving technological feasibility of the Company’s products and the general availability of the products has been short. Consequently, software development costs qualifying for capitalization are typically immaterial and are generally expensed to research and development costs. During 2013, the Company’s My Mediasite product release required software capitalization since there was a longer period between technological feasibility and the general availability of the product. Upon product release, the amortization of software development costs is determined annually as the greater of the amount computed using the ratio of current gross revenues for the products to their total of current and anticipated future gross revenues or the straight-line method over the estimated economic life of the products, expected to be three years. Amortization expense of software development costs of $178 thousand is included in Cost of Revenue – Product for each of the years ending September 30, 2015 and 2014, respectively. The gross amount of capitalized external and internal development costs was $533 thousand at September 30, 2015 and 2014. There were no software development efforts that qualified for capitalization for the years ended September 30, 2015 or 2014, respectively. |
Valuation of Assets and Liabilities in Business Combinations | Valuation of Assets and Liabilities in Business Combinations The assets acquired and the liabilities assumed in a business combination are measured at fair value. Fair value is based on the definition in ASC 820-10-20 as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. Variations of the cost and market approaches are used to measure the fair value of components of working capital (e.g. accounts receivable, inventory and accounts payable) and tangible assets, such as property plant and equipment. When measuring the fair value of acquired intangible assets, the income approach is generally considered. Financial assets and liabilities are valued based on a quoted price in an active market. In the absence of a quoted market price a valuation technique is used to determine fair value, such as a market approach or an income approach. Non-financial liabilities may be valued based on a transfer approach. These measures require significant judgment including estimates of expected cash flow, or discount rates among others. |
Gain from investment in Mediasite KK | Gain from investment in Mediasite KK The Company’s investment in Mediasite KK was accounted for under the equity method of accounting using a one quarter timing lag through December 31, 2013. On January 14, 2014, the Company’s ownership percentage increased from approximately 26% of their common stock to 100%. In connection with the acquisition, the one quarter lag in reporting their results was eliminated. The Company upon obtaining control of Mediasite KK recorded a “step-up” in the value of its previously owned interest in Mediasite KK to fair value. The gain amounted to approximately $1.4 million and was partially offset by $901 thousand of tax expense related to such investment. The Company recorded equity in earnings of $38 thousand for the year ended September 30, 2014. The recorded value of this investment is zero at September 30, 2015 and 2014, respectively, due to elimination in the consolidated financial statements. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost and are depreciated using the straight-line method for financial reporting purposes. The estimated useful lives used to calculate depreciation are as follows: Years Leasehold improvements 5 to 10 years Computer equipment 3 to 5 years Furniture and fixtures 5 to 7 years |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Goodwill has an indefinite useful life and is recorded at cost and not amortized but, instead, tested at least annually for impairment. We assess the impairment of goodwill on an annual basis or whenever events or changes in circumstances indicate that the fair value of these assets is less than the carrying value. If a qualitative assessment is used and the Company determines that the fair value of goodwill is more likely than not (i.e., a likelihood of more than 50%) less than its carrying amount, a quantitative impairment test will be performed. If goodwill is quantitatively assessed for impairment, a two-step approach is applied. First, the Company compares the estimated fair value of the goodwill to its carrying value. The second step, if necessary, measures the amount of impairment, if any, by comparing the implied fair value of goodwill to its carrying value. In fiscal 2015 and 2014, we performed the two-step goodwill test and determined that the fair value of goodwill is more than the carrying value. For purposes of the fiscal 2015 and 2014 tests, goodwill balances are evaluated within three separate reporting units. The Company has recognized no impairment charges as of September 30, 2015 or as of September 30, 2014. If we had determined that the fair value of goodwill was less than its carrying value, based upon the annual test or the existence of one or more indicators of impairment, we would then measure impairment based on a comparison of the implied fair value of goodwill with the carrying amount of goodwill. To the extent the carrying amount of goodwill is greater than the implied fair value of goodwill, we would record an impairment charge for the difference. Long-lived assets and intangible assets other than goodwill are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based on expected undiscounted cash flows attributable to that asset. For the years ended September 30, 2015 and 2014, no events or changes in circumstances occurred that required this analysis. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss includes disclosure of financial information that historically has not been recognized in the calculation of net income. Our comprehensive loss encompasses net loss and foreign currency translation adjustments. Assets and liabilities of international operations that have a functional currency that is not in U.S. dollars are translated into U.S. dollars at year-end exchange rates, and revenue and expense items are translated using weighted average exchange rates. Any adjustments arising on translation are included in shareholders’ equity as an element of accumulated other comprehensive loss. |
Advertising Expense | Advertising Expense Advertising costs included in selling and marketing, are expensed when the advertising first takes place. Advertising expense was $655 and $240 thousand for years ended September 30, 2015 and 2014, respectively. The increase is a result of increasing spend on internet advertisements as well as $259 thousand of additional advertising in Japan. |
Research and Development Costs | Research and Development Costs Research and development costs are expensed in the period incurred, unless they meet the criteria for capitalized software development costs. |
Income Taxes | Income Taxes Deferred tax assets and liabilities are determined based on differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. We do not provide for U.S. income taxes on the undistributed earnings of our foreign subsidiaries, which we consider to be permanently invested outside of the U.S. We make judgments regarding the realizability of our deferred tax assets. The balance sheet carrying value of our net deferred tax assets is based on whether we believe that it is more likely than not that we will generate sufficient future taxable income to realize these deferred tax assets after consideration of all available evidence. We regularly review our deferred tax assets for recoverability considering historical profitability, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. In assessing the need for a valuation allowance, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses. Generally, cumulative loss in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed. As of September 30, 2015 and 2014, valuation allowances have been established for all U.S. and for certain foreign deferred tax assets which we believe do not meet the “more likely than not” criteria for recognition. If we are subsequently able to utilize all or a portion of the deferred tax assets for which a valuation allowance has been established, then we may be required to recognize these deferred tax assets through the reduction of the valuation allowance which could result in a material benefit to our results of operations in the period in which the benefit is determined. The Company also accounts for the uncertainty in income taxes related to the recognition and measurement of a tax position and measurement of a tax position taken or expected to be taken in an income tax return. The Company follows the applicable accounting guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure related to the uncertainty in income tax positions. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Nonfinancial Assets Measured at Fair Value on a Nonrecurring Basis The Company’s goodwill, intangible assets and other long-lived assets are nonfinancial assets that were acquired either as part of a business combination, individually or with a group of other assets. These nonfinancial assets were initially measured and recognized at amounts equal to the fair value determined as of the date of acquisition. Fair value measurements of reporting units are estimated using an income approach involving discounted or undiscounted cash flow models that contain certain Level 3 inputs requiring management judgment, including projections of economic conditions and customer demand, revenue and margins, changes in competition, operating costs, working capital requirements, and new product introductions. Fair value measurements of the reporting units associated with the Company’s goodwill balances are estimated at least annually at the beginning of the fourth quarter of each fiscal year for purposes of impairment testing. Fair value measurements associated with the Company’s intangible assets and other long-lived assets are estimated when events or changes in circumstances such as market value, asset utilization, physical change, legal factors, or other matters indicate that the carrying value may not be recoverable. In determining the fair value of financial assets and liabilities, the Company currently utilizes market data or other assumptions that it believes market participants would use in pricing the asset or liability in the principal or most advantageous market, and adjusts for non-performance and/or other risk associated with the Company as well as counterparties, as appropriate. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: Level 1 Inputs: Unadjusted quoted prices which are available in active markets for identical assets or liabilities accessible to the Company at the measurement date. Level 2 Inputs: Inputs other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. The hierarchy gives the highest priority to Level 1, as this level provides the most reliable measure of fair value, while giving the lowest priority to Level 3. Financial Liabilities Measured at Fair Value on Recurring Basis The initial fair values of PFG debt and warrant debt (see Note 3) were based on the present value of expected future cash flows and assumptions about current interest rates and the creditworthiness of the Company (Level 3). The fair value of the bifurcated conversion feature represented by the warrant derivative liability which is measured at fair value on a recurring basis is based on a Black Scholes option pricing model with assumptions for stock price, exercise price, volatility, expected term, risk free interest rate and dividend yield similar to those described for share-based compensation which were generally observable (Level 2). Financial liabilities measured at fair value on a recurring basis are summarized below (in thousands): September 30, 2015 Level 1 Level 2 Level 3 Total PFG debt, net of discount $ — $ — $ 1,347 $ 1,347 Warrant debt — — 63 63 Derivative liability — 109 — 109 $ — $ 109 $ 1,410 $ 1,519 September 30, 2014 Level 1 Level 2 Level 3 Total None $ — $ — $ — $ — Included below is a summary of the changes in our Level 3 fair value measurements (in thousands): PFG Debt, net Warrant Balance as of September 30, 2014 $ — $ — Initial fair value 1,322 58 Change in fair value 25 5 Balance as of September 30, 2015 $ 1,347 $ 63 Financial Instruments Not Measured at Fair Value The Company’s other financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable and debt instruments, excluding the PFG debt. The book values of cash and cash equivalents, accounts receivable, debt (excluding the PFG debt) and accounts payable are considered to be representative of their respective fair values. The carrying value of capital lease obligations and debt (excluding the PFG debt), including the current portion, approximates fair market value as the variable and fixed rate approximates the current market rate of interest available to the Company. |
Legal Contingencies | Legal Contingencies In June 2014, the Company entered into a settlement agreement with Astute Technology, LLC (“Astute”). The key terms of the agreement were: 1) a grant of a non-revocable license of Astute patents to the Company; 2) a grant of a fully paid, non-refundable license of certain Sonic Foundry patents to Astute; 3) both Astute and our customer agreed to identify three meetings they currently capture that the other party will not seek or respond to any request for proposal; and 4) a payment of $1.35 million to Astute. Pursuant to the settlement agreement, the payments were made in three equal amounts with the first paid in June 2014, the second paid in October 2014 and the final installment paid in March 2015. The Company contributed $1.1 million of the $1.35 million payable to Astute with our customer paying the residual amount. Of the $1.1 million, $428 thousand related to prior use and was recorded as a charge to income during fiscal 2014. The remaining $672 thousand was recorded as a product right asset, which is being amortized, on a straight-line basis, over the remaining life of the patents, through 2020. Future amounts due to Astute were accrued for as of the time of settlement. No legal contingencies were recorded for the year ended September 30, 2015. Except as reported above, no legal contingencies were recorded for the year ended September 30, 2014. |
Stock-Based Compensation | Stock-Based Compensation The Company uses a lattice valuation model to account for all employee stock options granted. The lattice valuation model is a more flexible analysis to value options because of its ability to incorporate inputs that change over time, such as actual exercise behavior of option holders. The Company uses historical data to estimate the option exercise and employee departure behavior in the lattice valuation model. Expected volatility is based on historical volatility of the Company’s stock. The Company considers all employees to have similar exercise behavior and therefore has not identified separate homogenous groups for valuation. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods the options are expected to be outstanding is based on the U.S. Treasury yields in effect at the time of grant. Forfeitures are based on actual behavior patterns. The fair value of each option grant is estimated using the assumptions in the following table: Years Ending September 30, 2015 2014 Expected life 4.8 – 5.0 years 4.8 –5.1 years Risk-free interest rate 0.96%-1.05% 0.60%-0.89% Expected volatility 45.5%-50.0% 46.3%-47.2% Expected forfeiture rate 10.7 %-12.0% 10.5%-12.2% Expected exercise factor 1.40-1.43 1.39-1.45 Expected dividend yield 0% 0% |
Common Stock Warrants | Common Stock Warrants On December 22, 2014, the company issued 74,802 warrants to two individuals, one of which is the Chairman of the Company’s Board of Directors, in combination with the sale of a like number of shares of common stock. These warrants were immediately exercisable, expire five years after the date of issuance and have an exercise price of $14.00. The remaining contractual life of these outstanding warrants as of September 30, 2015 was 4.23 years. The fair value of the warrants was determined using the lattice model and the same inputs as those used for valuing the Company’s stock option fair value. The fair value of the warrants was $133 thousand at the date of issuance. The Company determined that the warrants are freestanding and do not fall within the scope of ASC 480 or ASC 815. The warrants were recorded in conjunction with the stock issued. See Note 3, Credit Arrangements for disclosures on additional warrants issued during fiscal 2015. |
Per Share Computation | Per Share Computation Basic earnings (loss) per share has been computed using the weighted-average number of shares of common stock outstanding during the period, less shares that may be repurchased, and excludes any dilutive effects of options and warrants. In periods where the Company reports net income, diluted net income per share is computed using common equivalent shares related to outstanding options and warrants to purchase common stock. The numerator for the calculation of basic and diluted earnings per share is net income (loss). The following table sets forth the computation of basic and diluted weighted average shares used in the earnings per share calculations: Years Ending 2015 2014 Denominator for basic earnings per share - weighted average common shares 4,332,576 4,174,191 Effect of dilutive options and warrants (treasury method) — — Denominator for diluted earnings per share - adjusted weighted average common shares 4,332,576 4,174,191 Options and warrants outstanding during each year, but not included in the computation of diluted earnings per share because they are antidilutive 1,560,211 1,240,941 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”. The guidance substantially converges final standards on revenue recognition between the FASB and the International Accounting Standards Board providing a framework on addressing revenue recognition issues and, upon its effective date, replaces almost all exiting revenue recognition guidance, including industry-specific guidance, in current U.S. generally accepted accounting principles. In 2015, the FASB subsequently issued a one-year deferral of the effective date for the new revenue reporting standard for entities reporting under U.S. GAAP. In accordance with the deferral, the guidance is effective for annual reporting periods beginning after December 15, 2017. We are currently evaluating the impact of adopting ASU 2014-09 to determine the impact, if any, it may have on our financial statements. In November 2014, the FASB issued Accounting Standards Update No. 2014-17, “Business Combinations (Topic 805) – Pushdown Accounting” (“ASU 2014-17”). ASU 2014-17 is intended to provide guidance on whether and at what threshold an acquired entity that is a business or nonprofit activity can apply pushdown accounting in its separate financial statement. The amendments should reduce diversity in the timing and content of footnote disclosure. ASU 2014-17 is effective after November 18, 2014. The Company has adopted this guidance, but it does not have an impact on previous acquisitions. In April 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”), which amends the current presentation of debt issuance costs in the financial statements. ASU 2015-03 requires 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, instead of as an asset. The amendments are to be applied retrospectively and are effective for public business entities for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015, but early adoption is permitted. The Company does not believe the adoption of the new guidance will result in a material impact to its financial statements. In April 2015, the FASB issued ASU 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement” (“ASU 2015-05”). The amendments in ASU 2015-05 provide guidance to customers about whether a cloud computing arrangement includes a software license. The amendments in ASU 2015-05 are effective for fiscal years beginning after December 15, 2015, and interim periods within those years. Early adoption is permitted. The guidance may be applied either prospectively to all arrangements entered into or materially modified after the effective date or retrospectively. The Company does not believe the implementation of this standard will result in a material impact to its financial statements. In May 2015, the FASB issued ASU 2015-08, “Business Combinations (Topic 805) – Pushdown Accounting” (“ASU 2015-08”). ASU 2015-08 amends various SEC paragraphs pursuant to the issuance of SEC Staff Accounting Bulletin No. 115. The Company does not believe the implementation of this standard will result in a material impact to its financial statements. In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330)” (“ASU 2015-11”). The amendments in ASU 2015-11 require an entity to measure inventory at the lower of cost and net realizable value. The amendments in ASU 2015-11 are effective for fiscal years beginning after December 15, 2016 and interim periods within those years. Early adoption is permitted. The amendments should be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. The Company does not believe the implementation of this standard will result in a material impact to its financial statements. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805)” (“ASU 2015-16”). ASU 2015-16 simplifies the accounting for measurement-period adjustments. This amendments in ASU 2015-16 are effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date of the ASU with earlier application permitted for financial statements that have not been issued. The Company is currently evaluating this guidance, but it does not have an impact on previous acquisitions. Accounting standards that have been issued but are not yet effective by the FASB or other standards-setting bodies that do not require adoption until a future date, which are not discussed above, are not expected to have a material impact on the Company’s financial statements upon adoption. |
Basis of Presentation and Sig25
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Inventory | Inventory consists of the following (in thousands): September 30, 2015 2014 Raw materials and supplies $ 254 $ 549 Finished goods 2,131 1,411 $ 2,385 $ 1,960 |
Estimated Useful Lives of Property and Equipment | The estimated useful lives used to calculate depreciation are as follows: Years Leasehold improvements 5 to 10 years Computer equipment 3 to 5 years Furniture and fixtures 5 to 7 years |
Summary of Financial Liabilities Measured at Fair Value on Recurring Basis | Financial liabilities measured at fair value on a recurring basis are summarized below (in thousands): September 30, 2015 Level 1 Level 2 Level 3 Total PFG debt, net of discount $ — $ — $ 1,347 $ 1,347 Warrant debt — — 63 63 Derivative liability — 109 — 109 $ — $ 109 $ 1,410 $ 1,519 September 30, 2014 Level 1 Level 2 Level 3 Total None $ — $ — $ — $ — |
Summary of Changes in Level 3 Fair Value Measurements | Included below is a summary of the changes in our Level 3 fair value measurements (in thousands): PFG Debt, net Warrant Balance as of September 30, 2014 $ — $ — Initial fair value 1,322 58 Change in fair value 25 5 Balance as of September 30, 2015 $ 1,347 $ 63 |
Fair Value Assumptions for Stock Options Granted | The fair value of each option grant is estimated using the assumptions in the following table: Years Ending September 30, 2015 2014 Expected life 4.8 – 5.0 years 4.8 –5.1 years Risk-free interest rate 0.96%-1.05% 0.60%-0.89% Expected volatility 45.5%-50.0% 46.3%-47.2% Expected forfeiture rate 10.7 %-12.0% 10.5%-12.2% Expected exercise factor 1.40-1.43 1.39-1.45 Expected dividend yield 0% 0% |
Computation of Basic and Diluted Weighted Average Shares Used in Earnings Per Share Calculations | The following table sets forth the computation of basic and diluted weighted average shares used in the earnings per share calculations: Years Ending 2015 2014 Denominator for basic earnings per share - weighted average common shares 4,332,576 4,174,191 Effect of dilutive options and warrants (treasury method) — — Denominator for diluted earnings per share - adjusted weighted average common shares 4,332,576 4,174,191 Options and warrants outstanding during each year, but not included in the computation of diluted earnings per share because they are antidilutive 1,560,211 1,240,941 |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Minimum Lease Payments Under Capital Lease, Including Principal and Interest | Minimum lease payments, including principal and interest, are summarized in the table below. Fiscal Year (in thousands) Capital 2016 $ 230 2017 161 2018 42 Total payments 433 Less interest (26 ) Total $ 407 |
Minimum Lease Payments Under Operating Leases | The following is a schedule by year of future minimum lease payments under operating leases: Fiscal Year (in thousands) Operating 2016 $ 1,113 2017 1,096 2018 734 2019 186 2020 — Thereafter — Total $ 3,129 |
Credit Arrangements (Tables)
Credit Arrangements (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Subordinated Notes [Member] | MediaMission Holding B.V. [Member] | |
Schedule of Annual Principal Payments | The annual principal payments on the subordinated notes payable related to the acquisition of MediaMission are as follows: Fiscal Year (in thousands) 2016 $ 186 2017 92 Total $ 278 |
Notes Payable [Member] | SVB, PFG and Mitsui Sumitomo Bank [Member] | |
Schedule of Annual Principal Payments | The annual principal payments on the notes payable to SVB, PFG and Mitsui Sumitomo Bank are as follows: Fiscal Year (in thousands) 2016 $ 1,359 2017 1,433 2018 678 Less warrant debt & discount (91 ) Total $ 3,379 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consists of the following (in thousands): September 30, 2015 2014 Accrued compensation $ 1,166 $ 1,173 Accrued expenses 221 903 Accrued interest & taxes 186 288 Other accrued liabilities 93 148 Total $ 1,666 $ 2,512 |
Stock Options and Employee St29
Stock Options and Employee Stock Purchase Plan (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Schedule of Number of Shares Available for Grant | The number of shares available for grant under these plans at September 30 is as follows: Qualified Employee Director Shares available for grant at September 30, 2013 357,605 32,000 Stockholder approval to increase shares 800,000 — Options granted (328,760 ) (12,500 ) Options forfeited 24,921 — Shares available for grant at September 30, 2014 853,766 19,500 Options granted (307,119 ) (10,500 ) Options forfeited 39,384 8,000 Shares available for grant at September 30, 2015 586,031 17,000 |
Summary of Options Activity | The following table summarizes information with respect to outstanding stock options. Years Ended September 30, 2015 2014 Options Weighted Options Weighted Outstanding at beginning of year 1,240,941 $ 10.31 997,045 $ 10.54 Granted 317,619 9.22 341,260 10.11 Exercised (11,117 ) 7.27 (38,143 ) 7.43 Forfeited (98,034 ) 11.27 (59,221 ) 14.90 Outstanding at end of year 1,449,409 $ 10.03 1,240,941 $ 10.31 Exercisable at end of year 885,777 700,922 Weighted average fair value of options granted during the year $ 3.18 $ 3.41 |
Summary of Options Outstanding Segregated By Range | The options outstanding at September 30, 2015 have been segregated into four ranges for additional disclosure as follows: Options Outstanding Options Exercisable Exercise Prices Options Weighted Weighted Options Weighted $ 4.50 to $9.90 1,037,217 7.2 $ 8.41 575,793 $ 7.94 10.00 to 14.83 282,469 7.0 11.35 180,261 11.76 15.00 to 19.00 94,965 3.0 15.78 94,965 15.78 21.40 to 46.90 34,758 1.1 30.47 34,758 30.47 1,449,409 885,777 |
Summary of Status of Company's Non-Vested Shares | A summary of the status of the Company’s non-vested shares at September 30, 2015 and for the year then ended is presented below: Shares Weighted Average Grant Date Fair Value Non-vested shares at October 1, 2014 539,519 $ 3.29 Granted 317,619 3.18 Vested (268,217 ) 2.70 Forfeited (25,289 ) 1.94 Non-vested shares at September 30, 2015 563,632 $ 3.35 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | The provision for income taxes consists of the following (in thousands): Years Ended 2015 2014 Current tax expense $ 107 $ 40 Deferred income tax expense — 1,064 Provision for income taxes $ 107 $ 1,104 |
Reconciliation of Income Tax Expense (Benefit) Computed at Country Specific Rate | The reconciliation of income tax expense (benefit) computed at the appropriate country specific rate to income tax expense (benefit) is as follows (in thousands): Years Ended 2015 2014 Income tax expense (benefit) at statutory rate $ (1,502 ) $ (582 ) State income tax expense (benefit) (131 ) (53 ) Foreign tax activity 56 40 R&D tax credit expiration — 82 Permanent differences, net 189 212 Adjustment of temporary differences to income tax returns 523 121 Change in valuation allowance 972 1,284 Income tax expense $ 107 $ 1,104 |
Components of Deferred Tax Accounts Recognized for Financial Purposes | The significant components of the deferred tax accounts recognized for financial reporting purposes are as follows (in thousands): September 30, 2015 2014 Deferred tax assets: Net operating loss and other carryforwards $ 36,372 $ 35,556 Common stock warrants 961 811 Allowance for doubtful accounts 59 59 Unearned revenue 439 319 Other — 1 Total deferred tax assets 37,831 36,746 Deferred tax liabilities: Fixed assets (149 ) (129 ) Other (157 ) (64 ) Total deferred tax liabilities (306 ) (193 ) Net deferred tax asset 37,525 36,553 Valuation allowance (37,525 ) (36,553 ) Equity gains on investment in Mediasite KK (916 ) (916 ) Customer relationships (716 ) (946 ) Goodwill amortization (2,690 ) (2,450 ) Deferred tax liability for goodwill and intangible assets amortization $ (4,322 ) $ (4,312 ) |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Mediasite KK [Member] | |
Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed on the date of the acquisition (in thousands): Fair Value Assets acquired: Cash $ 3,163 Other current assets 1,792 Property and equipment 240 Customer relationships 2,071 Goodwill 2,906 Total assets acquired 10,172 Liabilities assumed: Current liabilities (1,590 ) Deferred tax liability (808 ) Total liabilities assumed (2,398 ) Less ownership basis of original 26% investment (2,053 ) Total purchase price for 74% remaining stock $ 5,721 |
MediaMission Holding B.V. [Member] | |
Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed on the date of the acquisition (in thousands): Fair Value Assets acquired: Cash $ 339 Other current assets 923 Property and equipment 49 Customer relationships 591 Goodwill 932 Total assets acquired 2,834 Liabilities assumed: Current liabilities (1,111 ) Deferred tax liability (230 ) Total liabilities assumed (1,341 ) Total purchase price $ 1,493 |
Pro Forma Financial Informati32
Pro Forma Financial Information (Unaudited) (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Text Block [Abstract] | |
Summary of Pro Forma Financial Information | The following table represents the net loss (in thousands) for the Company on a pro forma basis, assuming the acquisitions of MediaMission and Mediasite KK had each occurred as of October 1, 2013. The table sets forth unaudited pro forma results for the twelve months ended September 30, 2015 and 2014, respectively and has been compiled from historical financial statements and other information, but is not necessarily indicative of the results that actually would have been achieved had the transaction occurred on the dates indicated or that may be achieved in the future. Years Ended Sept 30, 2015 2014 Revenue $ 36,459 $ 37,575 Net income/(loss) (4,525 ) (2,694 ) Basic income/(loss) per share $ (1.04 ) $ (0.61 ) |
Goodwill and Other Intangible33
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the years ended September 30, 2015 and 2014, respectively, are as follows: Balance as of September 30, 2013 $ 7,576 Goodwill acquired during year: Mediasite KK 2,906 MediaMission 933 Foreign currency translation adjustment (230 ) Balance as of September 30, 2014 11,185 Foreign currency translation adjustment (332 ) Balance as of September 30, 2015 $ 10,853 |
Summary of Company's Total Intangible Assets | The following tables present details of the Company’s total intangible assets at September 30, 2015 and 2014: (in thousands) Life (years) Gross Accumulated Amortization at September 30, Balance at Amortizable: Loan origination fees 3 $ 302 $ 190 $ 112 Customer relationships 10 2,329 457 1,872 Software development costs 3 533 429 104 Product rights 6 672 164 508 3,836 1,240 2,596 Non-amortizable goodwill 10,853 — 10,853 Total $ 14,689 $ 1,240 $ 13,449 (in thousands) Life (years) Gross Accumulated Amortization at September 30, Balance at Amortizable: Loan origination fees 3 $ 199 $ 162 $ 37 Customer relationships 10 2,662 191 2,471 Software development costs 3 533 252 281 Product rights 6 672 41 631 4,066 646 3,420 Non-amortizable goodwill 11,185 — 11,185 Total $ 15,251 $ 646 $ 14,605 |
Schedule of Estimated Amortization Expense | Estimated amortization expense for each of the five subsequent fiscal years is expected to be (in thousands): Fiscal Year (in thousands) 2016 $ 563 2017 432 2018 390 2019 362 2020 302 Thereafter 547 Total $ 2,596 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Summary of Revenue by Geographic Region | The following summarizes revenue by geographic region (in thousands): Years Ended September 30, 2015 2014 United States $ 20,396 $ 22,175 Europe and Middle East 7,594 6,446 Asia 6,518 5,813 Other 1,951 1,396 Total $ 36,459 $ 35,830 |
Quarterly Financial Data (una35
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data Information | The following table sets forth selected quarterly financial information for the years ended September 30, 2015 and 2014. The operating results are not necessarily indicative of results for any future period. Quarterly Financial Data (in thousands except per share data) Q4-’15 Q3-’15 Q2-’15 Q1-’15 Q4-’14 Q3-’14 Q2-’14 Q1-’14 Revenue $ 9,056 $ 10,556 $ 8,106 $ 8,741 $ 8,479 $ 11,267 $ 8,878 $ 7,206 Gross margin 6,450 7,088 6,216 6,070 5,871 7,789 6,499 5,396 Loss from operations (908 ) (885 ) (1,072 ) (1,227 ) (1,357 ) (77 ) (1,022 ) (626 ) Equity in earnings from investment in Mediasite KK — — — — — — 15 23 Net income (loss) (1,222 ) (921 ) (1,350 ) (1,032 ) (1,288 ) 33 (871 ) (690 ) Basic and diluted net income (loss) per share $ (0.28 ) $ (0.21 ) $ (0.31 ) $ (0.24 ) $ (0.30 ) $ 0.01 $ (0.21 ) $ (0.17 ) |
Basis of Presentation and Sig36
Basis of Presentation and Significant Accounting Policies - Additional Information (Detail) | Dec. 22, 2014USD ($)Individual$ / sharesshares | Jan. 14, 2014 | Jun. 30, 2014USD ($) | Sep. 30, 2015USD ($)Financial_Institution | Sep. 30, 2014USD ($) | Dec. 31, 2013 | Sep. 30, 2013USD ($) |
Basis of Presentation and Significant Accounting Policies [Line Items] | |||||||
Hosting agreement term | 1 year | ||||||
Standard product warranty term minimum | 90 days | ||||||
Standard product warranty term maximum | 1 year | ||||||
Period of hosting contracts to customers | 1 year | ||||||
Cash and cash equivalents | $ 1,976,000 | $ 4,344,000 | $ 3,482,000 | ||||
Cash and cash equivalents with us financial institutions | $ 106,000 | ||||||
Number of major financial institutions with which cash and cash equivalents are deposited | Financial_Institution | 2 | ||||||
Cash and cash equivalents with foreign subsidiary financial institutions | $ 1,900,000 | ||||||
Accounts receivable, allowances | $ 150,000 | $ 150,000 | |||||
Percentage of product and service of aggregate billing to one distributor | 10.00% | 15.00% | |||||
Percentage of product and service of aggregate billing to second distributor | 14.00% | 15.00% | |||||
Percentage of accounts receivable represented by two distributors | 24.00% | 47.00% | |||||
Percentage of accounts payable represented by two suppliers | 49.00% | 27.00% | |||||
Original maturity of cash and cash equivalents | 3 months | ||||||
Credit period of accounts receivable | 30 days | ||||||
Estimated economic life of the product | 3 years | ||||||
Capitalized internal and external development costs, gross | $ 533,000 | $ 533,000 | |||||
Total amortization expense of software development costs | 178,000 | 178,000 | |||||
Gain on investment | 1,390,000 | ||||||
Tax expense on investment | 901,000 | ||||||
Equity in earnings from investment in Mediasite KK | 38,000 | ||||||
Value of the equity method investment | 0 | 0 | |||||
Impairment loss on goodwill | 0 | 0 | |||||
Advertising Expense | $ 655,000 | 240,000 | |||||
Legal contingency settlement terms | The key terms of the agreement were 1) a grant of a non-revocable license of Astute patents to the Company; 2) a grant of a fully paid, non-refundable license of certain Sonic Foundry patents to Astute; 3) both Astute and our customer agreed to identify three meetings they currently capture that the other party will not seek or respond to any request for proposal; and 4) a payment of $1.35 million to Astute. | ||||||
Legal contingencies expense | $ 428,000 | 428,000 | |||||
Product right asset related to legal settlement | 672,000 | ||||||
Legal contingencies amount | 0 | $ 0 | |||||
Japan [Member] | |||||||
Basis of Presentation and Significant Accounting Policies [Line Items] | |||||||
Advertising Expense | 259,000 | ||||||
Mediasite KK [Member] | |||||||
Basis of Presentation and Significant Accounting Policies [Line Items] | |||||||
Equity method investment, ownership percentage | 26.00% | 26.00% | |||||
Remaining percent of stock purchased | 74.00% | ||||||
Percent of stock | 100.00% | ||||||
The Company [Member] | |||||||
Basis of Presentation and Significant Accounting Policies [Line Items] | |||||||
Payment for legal settlements | $ 1,100,000 | $ 1,100,000 | |||||
Customer Related Litigation [Member] | |||||||
Basis of Presentation and Significant Accounting Policies [Line Items] | |||||||
Payment for legal settlements | $ 1,350,000 | ||||||
Warrant [Member] | |||||||
Basis of Presentation and Significant Accounting Policies [Line Items] | |||||||
Warrants issued to individuals | shares | 74,802 | ||||||
Number of individual issued warrants | Individual | 2 | ||||||
Warrants expiration period | 5 years | ||||||
Exercise price of warrant | $ / shares | $ 14 | ||||||
Remaining contractual life of warrants outstanding | 4 years 2 months 23 days | ||||||
Fair value of warrants | $ 133,000 |
Basis of Presentation and Sig37
Basis of Presentation and Significant Accounting Policies - Inventory (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Inventory, Net [Abstract] | ||
Raw materials and supplies | $ 254 | $ 549 |
Finished goods | 2,131 | 1,411 |
Inventory, Net | $ 2,385 | $ 1,960 |
Basis of Presentation and Sig38
Basis of Presentation and Significant Accounting Policies - Estimated Useful Lives of Property and Equipment (Detail) | 12 Months Ended |
Sep. 30, 2015 | |
Leasehold Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 years |
Leasehold Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 10 years |
Computer Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 3 years |
Computer Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 7 years |
Basis of Presentation and Sig39
Basis of Presentation and Significant Accounting Policies - Summary of Financial Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) | Sep. 30, 2015 | May. 12, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | $ 109,000 | |
Financial liabilities | 1,519,000 | |
PFG Debt [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
PFG debt, net of discount | 1,347,000 | $ 1,322,000 |
Warrant Debt [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
PFG debt, net of discount | 178,000 | $ 178,000 |
Warrant debt | 63,000 | |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 109,000 | |
Financial liabilities | 109,000 | |
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial liabilities | 1,410,000 | |
Level 3 [Member] | PFG Debt [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
PFG debt, net of discount | 1,347,000 | |
Level 3 [Member] | Warrant Debt [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant debt | $ 63,000 |
Basis of Presentation and Sig40
Basis of Presentation and Significant Accounting Policies - Summary of Changes in Level 3 Fair Value Measurements (Detail) - Level 3 [Member] $ in Thousands | 12 Months Ended |
Sep. 30, 2015USD ($) | |
PFG Debt [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Initial fair value | $ 1,322 |
Change in fair value | 25 |
Balance | 1,347 |
Warrant Debt [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Initial fair value | 58 |
Change in fair value | 5 |
Balance | $ 63 |
Basis of Presentation and Sig41
Basis of Presentation and Significant Accounting Policies - Fair Value Assumptions for Stock Options Granted (Detail) | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected dividend yield | 0.00% | 0.00% |
Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life | 4 years 9 months 18 days | 4 years 9 months 18 days |
Risk-free interest rate | 0.96% | 0.60% |
Expected volatility | 45.50% | 46.30% |
Expected forfeiture rate | 10.70% | 10.50% |
Expected exercise factor | 1.40 | 1.39 |
Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life | 5 years | 5 years 1 month 6 days |
Risk-free interest rate | 1.05% | 0.89% |
Expected volatility | 50.00% | 47.20% |
Expected forfeiture rate | 12.00% | 12.20% |
Expected exercise factor | 1.43 | 1.45 |
Basis of Presentation and Sig42
Basis of Presentation and Significant Accounting Policies - Computation of Basic and Diluted Weighted Average Shares Used in Earnings per Share Calculations (Detail) - shares | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Denominator for basic earnings per share - weighted average common shares | 4,332,576 | 4,174,191 |
Effect of dilutive options and warrants (treasury method) | 0 | 0 |
Denominator for diluted earnings per share - adjusted weighted average common shares | 4,332,576 | 4,174,191 |
Options and warrants outstanding during each year, but not included in the computation of diluted earnings per share because they are antidilutive | 1,560,211 | 1,240,941 |
Commitments - Additional Inform
Commitments - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Jun. 28, 2011 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Capital Lease agreement expiry date | 2018-04 | ||
Portion of leases in fixed assets | $ 949 | ||
Portion of leases in accumulated depreciation | $ 551 | ||
Operating lease agreement expiry date | Jan. 31, 2019 | ||
Operating leases rent expense | $ 1,100 | $ 1,000 | |
Lease Term | November 2011 through December 2018 | ||
Leasehold improvement liability | $ 613 | ||
Unamortized balance of lease | $ 270 | ||
Purchase which is not recorded on Company's Balance Sheet | $ 1,200 |
Commitments - Minimum Lease Pay
Commitments - Minimum Lease Payments Under Capital Lease, Including Principal and Interest (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,016 | $ 230 |
2,017 | 161 |
2,018 | 42 |
Total payments | 433 |
Less interest | (26) |
Total | $ 407 |
Commitments - Minimum Lease P45
Commitments - Minimum Lease Payments Under Operating Leases (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,016 | $ 1,113 |
2,017 | 1,096 |
2,018 | 734 |
2,019 | 186 |
2,020 | 0 |
Thereafter | 0 |
Total | $ 3,129 |
Credit Arrangements - Additiona
Credit Arrangements - Additional Information (Detail) | Oct. 05, 2015USD ($) | May. 13, 2015USD ($)$ / sharesshares | Jan. 27, 2015USD ($) | Mar. 24, 2014 | Jan. 10, 2014 | Jun. 27, 2011USD ($) | Sep. 30, 2015USD ($)Installment | Sep. 30, 2014USD ($) | Aug. 12, 2015$ / shares | May. 12, 2015USD ($) | Jan. 14, 2014 | Dec. 16, 2013 |
Line of Credit Facility [Line Items] | ||||||||||||
Warrant debt expiration date | May 14, 2020 | |||||||||||
Derivative fair value | $ 109,000 | |||||||||||
Fair value of the derivative liability | 109,000 | |||||||||||
Change in the fair value of the derivative liability, Gain recorded | 11,000 | |||||||||||
Amortization of debt discount | $ 26,000 | |||||||||||
Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Adjusted quick ratio as above Silicon Valley Bank's prime rate | 0.75% | |||||||||||
Adjusted quick ratio | 1.35 | |||||||||||
Advance rate on foreign receivables | 75.00% | |||||||||||
Foreign receivables accounts | $ 1,000,000 | |||||||||||
Debt instrument covenant description | (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. | |||||||||||
Notes payable outstanding | $ 1,900,000 | $ 1,900,000 | ||||||||||
Annual interest rate | 6.00% | |||||||||||
Credit facility for advances | $ 2,600,000 | |||||||||||
Silicon Valley Bank [Member] | For the Quarters Ending June 30, 2015 [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service coverage ratio | 1 | |||||||||||
Silicon Valley Bank [Member] | For the Quarter Ending September 30, 2015 [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service coverage ratio | 1.25 | |||||||||||
Silicon Valley Bank [Member] | For the Quarter Ending December 31, 2015 [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service coverage ratio | 1.50 | |||||||||||
Partners for Growth IV, L.P. [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Carrying value of debt | $ 2,000,000 | |||||||||||
Warrant issued to purchase shares of common stock | shares | 50,000 | |||||||||||
Exercise price of warrant | $ / shares | $ 9.66 | $ 6.80 | ||||||||||
Exchange price of warrants | $ 200,000 | |||||||||||
Warrant exercise term | 5 years | |||||||||||
Change in the fair value of the derivative liability, Gain recorded | $ 12,000 | |||||||||||
Secured Revolving Line of Credit [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Borrowing capacity under secured revolving line of credit | $ 4,000,000 | $ 3,000,000 | ||||||||||
Adjusted quick ratio | 1.25 | 1.5 | ||||||||||
Basis spread on variable rate | 2.25% | |||||||||||
Repayment of loan | $ 1,665,000 | |||||||||||
New term loan | $ 2,500,000 | |||||||||||
Repayment terms | 36 months | |||||||||||
Interest rate payable on subordinate note | 5.50% | |||||||||||
Revolving loan maturity date | Jan. 31, 2017 | |||||||||||
Term loan commitment fee payable | $ 20,000 | |||||||||||
Amendment fee payable | $ 5,000 | |||||||||||
Adjusted quick ratio | 1.25 | |||||||||||
Adjusted quick ratio | 1.1 | |||||||||||
Notes payable outstanding | $ 1,400,000 | 0 | ||||||||||
Annual interest rate | 4.50% | |||||||||||
Secured Revolving Line of Credit [Member] | For the Quarters Ending December 31, 2014 [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service ratio | 1.25 | |||||||||||
Secured Revolving Line of Credit [Member] | For the Quarters Ending March 31, 2015 [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service ratio | 1 | |||||||||||
Secured Revolving Line of Credit [Member] | For the Quarters Ending June 30, 2015 [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service ratio | 1.25 | |||||||||||
Secured Revolving Line of Credit [Member] | For the Quarter Ending September 30, 2015 [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service ratio | 1.5 | |||||||||||
Secured Revolving Line of Credit [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest accrued on revolving line of credit | 1.25% | |||||||||||
Prior to Second Amendment [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Adjusted quick ratio as above Silicon Valley Bank's prime rate | 1.25% | |||||||||||
Second Amended Agreement [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Description of adjusted quick ratio | Greater than 2.0 to 1.0 | |||||||||||
Adjusted quick ratio | 2 | |||||||||||
Total term loan | $ 2,500,000 | |||||||||||
Percentage of advance rate on domestic receivables | 80.00% | |||||||||||
Basis spread on variable rate | 2.25% | |||||||||||
Interest accrued on revolving line of credit | 5.50% | |||||||||||
Amortization period of term loan | 36 months | |||||||||||
Term Loan [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest accrued on revolving line of credit | 2.75% | |||||||||||
Last Day Of Fiscal Quarter [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Adjusted quick ratio | 1.50 | |||||||||||
Tranche One [Member] | Partners for Growth IV, L.P. [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Revolving loan maturity date | May 1, 2018 | |||||||||||
Carrying value of debt | $ 1,500,000 | |||||||||||
Term loan interest rate | 10.75% | |||||||||||
Number of monthly installments | Installment | 30 | |||||||||||
Term loan payment terms | 30 equal monthly principal installments, plus accrued interest, beginning December 1, 2015 and continuing until May 1, 2018 | |||||||||||
Warrant issued to purchase shares of common stock | shares | 37,500 | |||||||||||
Tranche One [Member] | Partners for Growth IV, L.P. [Member] | First Year [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Term loan prepayment fee percentage | 1.00% | |||||||||||
Tranche Two [Member] | Partners for Growth IV, L.P. [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Revolving loan maturity date | May 1, 2018 | |||||||||||
Carrying value of debt | $ 500,000 | |||||||||||
Warrant issued to purchase shares of common stock | shares | 12,500 | |||||||||||
Exchange price of warrants | $ 150,000 | |||||||||||
Minimum [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Adjusted quick ratio | 1.50 | |||||||||||
Debt service coverage ratio | 1.25 | |||||||||||
Minimum [Member] | Secured Revolving Line of Credit [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Annual commitment fee on the revolving line of credit | $ 20,000 | |||||||||||
Lien limit | 400,000 | |||||||||||
Minimum [Member] | Second Amended Agreement [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Adjusted quick ratio | 1.25 | |||||||||||
Maximum [Member] | Secured Revolving Line of Credit [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Annual commitment fee on the revolving line of credit | 26,667 | |||||||||||
Lien limit | $ 800,000 | |||||||||||
Warrant [Member] | Partners for Growth IV, L.P. [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Fair value of the derivative liability | $ 109,000 | |||||||||||
Warrant Debt [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Carrying value of debt | 178,000 | $ 178,000 | ||||||||||
Warrant debt fair value | $ 63,000 | |||||||||||
Warrant debt interest rate | 0.00% | |||||||||||
Debt discount accreted as interest expense | $ 178,000 | |||||||||||
Debt interest expense term | 5 years | |||||||||||
PFG Debt [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Annual interest rate | 10.75% | |||||||||||
Carrying value of debt | $ 1,347,000 | $ 1,322,000 | ||||||||||
Debt interest expense term | 3 years | |||||||||||
Accretion of discount expense | $ 5,000 | 0 | ||||||||||
Amortization of debt discount | 22,000 | 0 | ||||||||||
Debt instrument, outstanding amount | $ 1,500,000 | 0 | ||||||||||
Modification No. 1 to Loan and Security Agreement [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument covenant description | (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. | |||||||||||
Subsequent Event [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service net change in deferred revenue | $ 1 | |||||||||||
Subsequent Event [Member] | Silicon Valley Bank [Member] | Monthly Basis [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument covenant liquidity minimum ratio | 1.5 | |||||||||||
Subsequent Event [Member] | Silicon Valley Bank [Member] | Each Month-End that is Not the Last Day of Fiscal Quarter [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument covenant liquidity minimum ratio | 1.35 | |||||||||||
Subsequent Event [Member] | Silicon Valley Bank [Member] | Each Month-End that is the Last Day of Fiscal Quarter [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument covenant liquidity minimum ratio | 1.5 | |||||||||||
Subsequent Event [Member] | Minimum [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service net change in deferred revenue | $ 1 | |||||||||||
Subsequent Event [Member] | Modification No. 1 to Loan and Security Agreement [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service net change in deferred revenue | $ 1 | |||||||||||
Subsequent Event [Member] | Modification No. 1 to Loan and Security Agreement [Member] | Silicon Valley Bank [Member] | Monthly Basis [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument covenant liquidity minimum ratio | 1.5 | |||||||||||
Subsequent Event [Member] | Modification No. 1 to Loan and Security Agreement [Member] | Silicon Valley Bank [Member] | Each Month-End that is Not the Last Day of Fiscal Quarter [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument covenant liquidity minimum ratio | 1.35 | |||||||||||
Subsequent Event [Member] | Modification No. 1 to Loan and Security Agreement [Member] | Silicon Valley Bank [Member] | Each Month-End that is the Last Day of Fiscal Quarter [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument covenant liquidity minimum ratio | 1.5 | |||||||||||
Subsequent Event [Member] | Modification No. 1 to Loan and Security Agreement [Member] | Minimum [Member] | Silicon Valley Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt service net change in deferred revenue | $ 1 | |||||||||||
Mitsui Sumitomo Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Notes payable outstanding | $ 418,000 | 0 | ||||||||||
Annual interest rate | 1.575% | |||||||||||
Notes Payable [Member] | Mitsui Sumitomo Bank [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Notes payable outstanding | $ 25,000 | 170,000 | ||||||||||
Subordinated Note Payable [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Gain on foreign currency | 202,000 | 157,000 | ||||||||||
Subordinated Note Payable [Member] | MediaMission Holding B.V. [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest rate payable on subordinate note | 6.50% | |||||||||||
Notes payable outstanding | $ 278,000 | 628,000 | ||||||||||
Annual interest rate | 6.50% | |||||||||||
Subordinated Note Payable [Member] | Mediasite KK [Member] | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest rate payable on subordinate note | 5.00% | |||||||||||
Notes payable outstanding | $ 0 | $ 1,800,000 |
Credit Arrangements - Summary o
Credit Arrangements - Summary of Annual Principal Payments (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
SVB, PFG and Mitsui Sumitomo Bank [Member] | |
Debt Instrument [Line Items] | |
2,016 | $ 1,359 |
2,017 | 1,433 |
2,018 | 678 |
Less warrant debt & discount | (91) |
Total | 3,379 |
Subordinated Notes [Member] | MediaMission Holding B.V. [Member] | |
Debt Instrument [Line Items] | |
2,016 | 186 |
2,017 | 92 |
Total | $ 278 |
Accrued Liabilities - Schedule
Accrued Liabilities - Schedule of Accrued Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Payables and Accruals [Abstract] | ||
Accrued compensation | $ 1,166 | $ 1,173 |
Accrued expenses | 221 | 903 |
Accrued interest & taxes | 186 | 288 |
Other accrued liabilities | 93 | 148 |
Total | $ 1,666 | $ 2,512 |
Accrued Liabilities - Additiona
Accrued Liabilities - Additional Information (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Dividends payable to sellers and current employees | $ 87 |
Stock Options and Employee St50
Stock Options and Employee Stock Purchase Plan - Additional Information (Detail) - USD ($) | Mar. 06, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Mar. 05, 2014 | Sep. 30, 2013 |
Employee Stock Purchase Plan [Line Items] | |||||
Employee stock purchase plan aggregate number of shares | 1,449,409 | 1,240,941 | 997,045 | ||
Number of shares that holder entitles to purchase at specified option price | 1 | ||||
Duration of termination for stock plan | 10 years | ||||
Unrecognized non vested stock based compensation | $ 676,000 | ||||
Estimated forfeitures for unrecognized non vested stock based compensation | $ 98,000 | ||||
Expected weighted average life of forfeited cost | 1 year 9 months 18 days | ||||
Share-based Compensation | $ 963,000 | $ 921,000 | |||
Cash received from exercises under all stock option plans | 41,000 | 286,000 | |||
Tax benefits realized for tax deductions from option exercises | $ 0 | $ 0 | |||
Expected shares issued | 150,000 | ||||
Number of complete employment days on first day of each offering period | 90 days | ||||
Employee not eligible to participate | 5.00% | ||||
Eligible employees contribution to purchase price | 10.00% | ||||
Restricted participant under purchase plan that exceeds rate of fair value of shares | $ 25,000 | ||||
Restricted participant under purchase plan that exceeds number of shares | 1,000 | ||||
Offering period | 6 months | ||||
Purchase shares of common stock at a purchase price fair market | 85.00% | ||||
Shares available to issue | 38,416 | ||||
Shares purchased by employees | 14,067 | 11,863 | |||
Stock-based compensation | $ 22,000 | $ 21,000 | |||
Cash received from issuance of stock under purchase plan | $ 710,000 | $ 98,000 | |||
Minimum [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Increase in number of shares under the plan | 100,000 | ||||
Maximum [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Increase in number of shares under the plan | 150,000 | ||||
Qualified Employee Stock Option Plans [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Employee stock purchase plan increase in number of shares | 800,000 | 600,000 | |||
Employee stock purchase plan aggregate number of shares | 1,800,000 | 586,031 | 853,766 | 357,605 | |
Director Stock Option Plans [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Directors stock option plan increase in purchased limit | 50,000 | ||||
Employee stock purchase plan aggregate number of shares | 17,000 | 19,500 | 32,000 | ||
Employee Stock Purchase Plan [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Number of additional shares issued under stockholder approval | 100,000 | ||||
Number of shares to be granted on each meeting under directors plan | 2,000 | ||||
Selling and Marketing Expenses [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Share-based Compensation | $ 606,000 | $ 617,000 | |||
General and Administrative Expenses [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Share-based Compensation | 101,000 | 54,000 | |||
Product Development Expenses [Member] | |||||
Employee Stock Purchase Plan [Line Items] | |||||
Share-based Compensation | $ 256,000 | $ 250,000 |
Stock Options and Employee St51
Stock Options and Employee Stock Purchase Plan - Schedule of Number of Shares Available for Grant (Detail) - shares | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Employee Stock Purchase Plan [Line Items] | ||
Options, Outstanding Beginning Balance | 1,240,941 | 997,045 |
Options granted | (317,619) | (341,260) |
Options forfeited | 98,034 | 59,221 |
Options, Outstanding Ending Balance | 1,449,409 | 1,240,941 |
Qualified Employee Stock Option Plans [Member] | ||
Employee Stock Purchase Plan [Line Items] | ||
Options, Outstanding Beginning Balance | 853,766 | 357,605 |
Stockholder approval to increase shares | 800,000 | |
Options granted | (307,119) | (328,760) |
Options forfeited | 39,384 | 24,921 |
Options, Outstanding Ending Balance | 586,031 | 853,766 |
Director Stock Option Plans [Member] | ||
Employee Stock Purchase Plan [Line Items] | ||
Options, Outstanding Beginning Balance | 19,500 | 32,000 |
Options granted | (10,500) | (12,500) |
Options forfeited | 8,000 | |
Options, Outstanding Ending Balance | 17,000 | 19,500 |
Stock Options and Employee St52
Stock Options and Employee Stock Purchase Plan - Summary of Options Activity (Detail) - $ / shares | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Options, Outstanding Beginning Balance | 1,240,941 | 997,045 |
Options, Granted | 317,619 | 341,260 |
Options, Exercised | (11,117) | (38,143) |
Options, Forfeited | (98,034) | (59,221) |
Options, Outstanding Ending Balance | 1,449,409 | 1,240,941 |
Options, Exercisable Ending Balance | 885,777 | 700,922 |
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 10.31 | $ 10.54 |
Weighted Average Exercise Price, Granted | 9.22 | 10.11 |
Weighted Average Exercise Price, Exercised | 7.27 | 7.43 |
Weighted Average Exercise Price, Forfeited | 11.27 | 14.90 |
Weighted Average Exercise Price, Outstanding Ending Balance | 10.03 | 10.31 |
Weighted average fair value of options granted during the year | $ 3.18 | $ 3.41 |
Stock Options and Employee St53
Stock Options and Employee Stock Purchase Plan - Summary of Options Outstanding Segregated By Range (Detail) - $ / shares | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Line Items] | |||
Outstanding Options, Weighted Average Exercise Price | $ 10.03 | $ 10.31 | $ 10.54 |
Option Outstanding at September 30, 2015 | 1,449,409 | 1,240,941 | 997,045 |
Options Exercisable at September 30, 2015 | 885,777 | 700,922 | |
Range I [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Line Items] | |||
Outstanding Options, Weighted Average Exercise Price | $ 8.41 | ||
Options Exercisable, Weighted Average Exercise Price | $ 7.94 | ||
Option Outstanding, Weighted Average Remaining Contractual Life | 7 years 2 months 12 days | ||
Option Outstanding at September 30, 2015 | 1,037,217 | ||
Options Exercisable at September 30, 2015 | 575,793 | ||
Exercise Price, Lower range | $ 4.50 | ||
Exercise Price, Upper range | 9.90 | ||
Range II [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Line Items] | |||
Outstanding Options, Weighted Average Exercise Price | 11.35 | ||
Options Exercisable, Weighted Average Exercise Price | $ 11.76 | ||
Option Outstanding, Weighted Average Remaining Contractual Life | 7 years | ||
Option Outstanding at September 30, 2015 | 282,469 | ||
Options Exercisable at September 30, 2015 | 180,261 | ||
Exercise Price, Lower range | $ 10 | ||
Exercise Price, Upper range | 14.83 | ||
Range III [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Line Items] | |||
Outstanding Options, Weighted Average Exercise Price | 15.78 | ||
Options Exercisable, Weighted Average Exercise Price | $ 15.78 | ||
Option Outstanding, Weighted Average Remaining Contractual Life | 3 years | ||
Option Outstanding at September 30, 2015 | 94,965 | ||
Options Exercisable at September 30, 2015 | 94,965 | ||
Exercise Price, Lower range | $ 15 | ||
Exercise Price, Upper range | 19 | ||
Range IV [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Line Items] | |||
Outstanding Options, Weighted Average Exercise Price | 30.47 | ||
Options Exercisable, Weighted Average Exercise Price | $ 30.47 | ||
Option Outstanding, Weighted Average Remaining Contractual Life | 1 year 1 month 6 days | ||
Option Outstanding at September 30, 2015 | 34,758 | ||
Options Exercisable at September 30, 2015 | 34,758 | ||
Exercise Price, Lower range | $ 21.40 | ||
Exercise Price, Upper range | $ 46.90 |
Stock Options and Employee St54
Stock Options and Employee Stock Purchase Plan - Summary of Status of Company's Non-Vested Shares (Detail) - $ / shares | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options, Outstanding Beginning Balance | 1,240,941 | 997,045 |
Shares, Granted | 317,619 | 341,260 |
Options, Forfeited | (98,034) | (59,221) |
Options, Outstanding Ending Balance | 1,449,409 | 1,240,941 |
Weighted-Average Grant Date Fair Value, Granted | $ 3.18 | $ 3.41 |
Non-Vested Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options, Outstanding Beginning Balance | 539,519 | |
Shares, Granted | 317,619 | |
Shares, Vested | (268,217) | |
Options, Forfeited | (25,289) | |
Options, Outstanding Ending Balance | 563,632 | 539,519 |
Weighted-Average Grant Date Fair Value, Non-vested Beginning Balance | $ 3.29 | |
Weighted-Average Grant Date Fair Value, Granted | 3.18 | |
Weighted-Average Grant Date Fair Value, Vested | 2.70 | |
Weighted-Average Grant Date Fair Value, Forfeited | 1.94 | |
Weighted-Average Grant Date Fair Value, Non-vested Ending Balance | $ 3.35 | $ 3.29 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||
Current tax expense | $ 107 | $ 40 |
Deferred income tax expense | 1,064 | |
Income tax expense | $ 107 | $ 1,104 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Tax Expense (Benefit) Computed at Country Specific Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) at statutory rate | $ (1,502) | $ (582) |
State income tax expense (benefit) | (131) | (53) |
Foreign tax activity | 56 | 40 |
R&D tax credit expiration | 82 | |
Permanent differences, net | 189 | 212 |
Adjustment of temporary differences to income tax returns | 523 | 121 |
Change in valuation allowance | 972 | 1,284 |
Income tax expense | $ 107 | $ 1,104 |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Accounts Recognized for Financial Purposes (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Deferred tax assets: | ||
Net operating loss and other carryforwards | $ 36,372 | $ 35,556 |
Common stock warrants | 961 | 811 |
Allowance for doubtful accounts | 59 | 59 |
Unearned revenue | 439 | 319 |
Other | 1 | |
Total deferred tax assets | 37,831 | 36,746 |
Deferred tax liabilities: | ||
Fixed assets | (149) | (129) |
Other | (157) | (64) |
Total deferred tax liabilities | (306) | (193) |
Net deferred tax asset | 37,525 | 36,553 |
Valuation allowance | (37,525) | (36,553) |
Equity gains on investment in Mediasite KK | (916) | (916) |
Customer relationships | (716) | (946) |
Goodwill amortization | (2,690) | (2,450) |
Deferred tax liability for goodwill and intangible assets amortization | $ (4,322) | $ (4,312) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Schedule Of Income Taxes [Line Items] | ||
Deferred tax asset | $ 37,831,000 | $ 36,746,000 |
Research and development tax credit carryforwards | 418,000 | |
Net operating loss and other carryforwards | 36,372,000 | 35,556,000 |
Deferred tax liability, unremitted earnings of foreign subsidiaries | 0 | |
Deferred tax liabilities, undistributed foreign earnings | $ 0 | |
Goodwill for tax purposes amortization period | 15 years | |
Deferred tax liability | $ 4,322,000 | 4,312,000 |
Accruals of interest and penalties | 0 | 0 |
Recognized interest or penalties | 0 | $ 0 |
Additional Paid-in Capital [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Net operating loss and other carryforwards | 1,100,000 | |
Prepaid Expenses and Other Current Assets [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Deferred tax asset | 124,000 | |
Federal Tax [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Operating loss carryforwards | $ 93,000,000 | |
Federal Tax [Member] | Minimum [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Operating loss carryforwards for federal tax purposes | 2,019 | |
Federal Tax [Member] | Maximum [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Operating loss carryforwards for federal tax purposes | 2,035 | |
State tax [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Operating loss carryforwards | $ 52,000,000 | |
State tax [Member] | Minimum [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Operating loss carryforwards for federal tax purposes | 2,015 | |
State tax [Member] | Maximum [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Operating loss carryforwards for federal tax purposes | 2,034 | |
Research Tax Credit Carryforward [Member] | Minimum [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Research and development tax credit carryforwards expire date | 2,019 | |
Research Tax Credit Carryforward [Member] | Maximum [Member] | ||
Schedule Of Income Taxes [Line Items] | ||
Research and development tax credit carryforwards expire date | 2,020 |
Acquisition of MediaMission Hol
Acquisition of MediaMission Holding B.V. - Additional Information (Detail) - USD ($) | Dec. 16, 2013 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 |
Business Acquisition [Line Items] | ||||||||||||
Subordinated note payable issuance for purchase of MediaMission | $ 2,567,000 | |||||||||||
Common stock issued for purchase of MediaMission | 2,305,000 | |||||||||||
Goodwill | $ 10,853,000 | $ 11,185,000 | $ 10,853,000 | 11,185,000 | $ 7,576,000 | |||||||
Contributed revenue | 9,056,000 | $ 10,556,000 | $ 8,106,000 | $ 8,741,000 | 8,479,000 | $ 11,267,000 | $ 8,878,000 | $ 7,206,000 | 36,459,000 | 35,830,000 | ||
Net income (loss) for acquisition period | $ (1,222,000) | $ (921,000) | $ (1,350,000) | $ (1,032,000) | $ (1,288,000) | $ 33,000 | $ (871,000) | $ (690,000) | (4,525,000) | (2,816,000) | ||
MediaMission Holding B.V. [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 1,493,000 | |||||||||||
Common stock issued for purchase of MediaMission | 348,000 | |||||||||||
Business acquisition, cash paid | $ 458,000 | |||||||||||
Business acquisition, number of shares issued | 37,608 | |||||||||||
Ownership percentage | 100.00% | |||||||||||
Goodwill | $ 932,000 | |||||||||||
Amortization period for customer relationship intangible | 10 years | |||||||||||
Contributed revenue | 827,000 | 1,000,000 | ||||||||||
Net income (loss) for acquisition period | $ (229,000) | $ (147,000) | ||||||||||
MediaMission Holding B.V. [Member] | Income Approach Valuation Technique [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Fair value assumptions discount rate | 28.00% | |||||||||||
Estimated effective tax rate | 20.00% | |||||||||||
Estimated customer attrition rate | 15.00% | |||||||||||
MediaMission Holding B.V. [Member] | Subordinated Note Payable [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Subordinated note payable issuance for purchase of MediaMission | $ 687,000 | |||||||||||
Notes payable interest rate | 6.50% | |||||||||||
Subordinated note payable maturity period | 3 years |
Acquisition of MediaMission H60
Acquisition of MediaMission Holding B.V. - Fair Values of Assets Acquired and Liabilities Assumed (Detail) - MediaMission Holding B.V. [Member] $ in Thousands | Dec. 16, 2013USD ($) |
Assets acquired: | |
Cash | $ 339 |
Other current assets | 923 |
Property and equipment | 49 |
Customer relationships | 591 |
Goodwill | 932 |
Total assets acquired | 2,834 |
Liabilities assumed: | |
Current liabilities | (1,111) |
Deferred tax liability | (230) |
Total liabilities assumed | (1,341) |
Total purchase price | $ 1,493 |
Acquisition of MSKK - Additiona
Acquisition of MSKK - Additional Information (Detail) - USD ($) $ in Thousands | Jan. 14, 2014 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 |
Business Acquisition [Line Items] | ||||||||||||
Goodwill | $ 10,853 | $ 11,185 | $ 10,853 | $ 11,185 | $ 7,576 | |||||||
Contributed revenue | 9,056 | $ 10,556 | $ 8,106 | $ 8,741 | 8,479 | $ 11,267 | $ 8,878 | $ 7,206 | 36,459 | 35,830 | ||
Net income (loss) for acquisition period | $ (1,222) | $ (921) | $ (1,350) | $ (1,032) | $ (1,288) | $ 33 | (871) | $ (690) | $ (4,525) | (2,816) | ||
Mediasite KK [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 5,721 | |||||||||||
Business acquisition, cash paid | $ 1,900 | |||||||||||
Business acquisition, number of shares issued | 189,222 | |||||||||||
Percentage of minority interest | 26.00% | |||||||||||
Non cash gain | 1,400 | |||||||||||
Tax expense associated with non cash gain | $ 901 | |||||||||||
Goodwill | $ 2,900 | |||||||||||
Amortization period for customer relationship intangible | 10 years | |||||||||||
Contributed revenue | $ 5,300 | 4,300 | ||||||||||
Net income (loss) for acquisition period | $ (104) | $ 48 | ||||||||||
Mediasite KK [Member] | Income Approach Valuation Technique [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Fair value assumptions discount rate | 30.00% | |||||||||||
Estimated effective tax rate | 35.50% | |||||||||||
Estimated customer attrition rate | 15.00% | |||||||||||
Mediasite KK [Member] | Subordinated Note Payable [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Notes payable interest rate | 5.00% | |||||||||||
Subordinated note payable maturity period | 1 year |
Acquisition of MSKK - Fair Valu
Acquisition of MSKK - Fair Values of Assets Acquired and Liabilities Assumed (Detail) - Mediasite KK [Member] $ in Thousands | Jan. 14, 2014USD ($) |
Assets acquired: | |
Cash | $ 3,163 |
Other current assets | 1,792 |
Property and equipment | 240 |
Customer relationships | 2,071 |
Goodwill | 2,906 |
Total assets acquired | 10,172 |
Liabilities assumed: | |
Current liabilities | (1,590) |
Deferred tax liability | (808) |
Total liabilities assumed | (2,398) |
Less ownership basis of original 26% investment | (2,053) |
Total purchase price | $ 5,721 |
Acquisition of MSKK - Fair Va63
Acquisition of MSKK - Fair Values of Assets Acquired and Liabilities Assumed (Parenthetical) (Detail) - Mediasite KK [Member] | Jan. 14, 2014 | Dec. 31, 2013 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Equity method investment ownership percentage | 26.00% | 26.00% |
Remaining percent of stock purchased | 74.00% | |
Percent of stock | 100.00% |
Pro Forma Financial Informati64
Pro Forma Financial Information (Unaudited) - Summary of Pro Forma Financial Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Business Acquisition, Pro Forma Information [Abstract] | ||
Revenue | $ 36,459 | $ 37,575 |
Net income/(loss) | $ (4,525) | $ (2,694) |
Basic income/(loss) per share | $ (1.04) | $ (0.61) |
Savings Plan - Additional Infor
Savings Plan - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Schedule Of Sale Of Subsidiary [Abstract] | ||
Defined savings plan contributions | $ 402,000 | $ 375,000 |
Additional discretionary contributions | $ 0 | $ 0 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) $ / shares in Units, $ in Thousands | Dec. 22, 2014Individual$ / sharesshares | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) |
Related Party Transaction [Line Items] | |||
Fees incurred to law firm | $ 122 | $ 236 | |
Accrued liabilities for unbilled services | 25 | 15 | |
Outstanding loan amount | 26 | 26 | |
Warrant [Member] | |||
Related Party Transaction [Line Items] | |||
Number of individual issued warrants | Individual | 2 | ||
Warrants issued to individuals | shares | 74,802 | ||
Exercise price of warrant | $ / shares | $ 14 | ||
Warrants expiration date | 5 years | ||
MediaMission Holding B.V. [Member] | |||
Related Party Transaction [Line Items] | |||
Amount payable, total | $ 114 | $ 370 |
Goodwill and Other Intangible67
Goodwill and Other Intangible Assets - Additional Information (Detail) | Jul. 01, 2015Reporting_Unit |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Number of reporting units | 3 |
Goodwill and Other Intangible68
Goodwill and Other Intangible Assets - Schedule of Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Goodwill [Line Items] | ||
Beginning balance | $ 11,185 | $ 7,576 |
Foreign currency translation adjustment | (332) | (230) |
Ending balance | $ 10,853 | 11,185 |
Mediasite KK [Member] | ||
Goodwill [Line Items] | ||
Goodwill acquired during year | 2,906 | |
MediaMission Holding B.V. [Member] | ||
Goodwill [Line Items] | ||
Goodwill acquired during year | $ 933 |
Goodwill and Other Intangible69
Goodwill and Other Intangible Assets - Total Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Goodwill [Line Items] | |||
Intangible Assets, Gross | $ 3,836 | $ 4,066 | |
Non-amortizable goodwill, Gross | 10,853 | 11,185 | |
Total Intangible assets, Gross | 14,689 | 15,251 | |
Intangible Assets, Accumulated Amortization | 190 | 162 | |
Intangible Assets, Net | 2,596 | 3,420 | |
Non-amortizable goodwill, Net | 10,853 | 11,185 | $ 7,576 |
Total Intangible assets, Net | $ 13,449 | $ 14,605 | |
Loan Origination Fees [Member] | |||
Goodwill [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 3 years | 3 years | |
Intangible Assets, Gross | $ 302 | $ 199 | |
Intangible Assets, Accumulated Amortization | 190 | 162 | |
Intangible Assets, Net | $ 112 | $ 37 | |
Customer Relationships [Member] | |||
Goodwill [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | 10 years | |
Intangible Assets, Gross | $ 2,329 | $ 2,662 | |
Intangible Assets, Accumulated Amortization | 457 | 191 | |
Intangible Assets, Net | $ 1,872 | $ 2,471 | |
Software Development Costs [Member] | |||
Goodwill [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 3 years | 3 years | |
Intangible Assets, Gross | $ 533 | $ 533 | |
Intangible Assets, Accumulated Amortization | 429 | 252 | |
Intangible Assets, Net | $ 104 | $ 281 | |
Product Rights [Member] | |||
Goodwill [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 6 years | 6 years | |
Intangible Assets, Gross | $ 672 | $ 672 | |
Intangible Assets, Accumulated Amortization | 164 | 41 | |
Intangible Assets, Net | $ 508 | $ 631 |
Goodwill and Other Intangible70
Goodwill and Other Intangible Assets - Schedule of Estimated Amortization Expense (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2,016 | $ 563 |
2,017 | 432 |
2,018 | 390 |
2,019 | 362 |
2,020 | 302 |
Thereafter | 547 |
Total | $ 2,596 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 12 Months Ended |
Sep. 30, 2015Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
Number of reportable segments | 1 |
Segment Information - Summarize
Segment Information - Summarizes Revenue by Geographic Region (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | |
Segment Information [Line Items] | ||||||||||
Revenues | $ 9,056 | $ 10,556 | $ 8,106 | $ 8,741 | $ 8,479 | $ 11,267 | $ 8,878 | $ 7,206 | $ 36,459 | $ 35,830 |
Other [Member] | ||||||||||
Segment Information [Line Items] | ||||||||||
Revenues | 1,951 | 1,396 | ||||||||
United States [Member] | ||||||||||
Segment Information [Line Items] | ||||||||||
Revenues | 20,396 | 22,175 | ||||||||
Europe and Middle East [Member] | ||||||||||
Segment Information [Line Items] | ||||||||||
Revenues | 7,594 | 6,446 | ||||||||
Asia [Member] | ||||||||||
Segment Information [Line Items] | ||||||||||
Revenues | $ 6,518 | $ 5,813 |
Customer Concentration - Additi
Customer Concentration - Additional Information (Detail) | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of account receivables represented by two distributors | 24.00% | 30.00% |
Accounts Receivable [Member] | ||
Concentration Risk [Line Items] | ||
Percentage of account receivables represented by two distributors | 24.00% | 47.00% |
Legal Proceedings - Additional
Legal Proceedings - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | |
Jun. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Loss Contingencies [Line Items] | |||
Legal contingency settlement terms | The key terms of the agreement were 1) a grant of a non-revocable license of Astute patents to the Company; 2) a grant of a fully paid, non-refundable license of certain Sonic Foundry patents to Astute; 3) both Astute and our customer agreed to identify three meetings they currently capture that the other party will not seek or respond to any request for proposal; and 4) a payment of $1.35 million to Astute. | ||
Legal settlement payment description | Pursuant to the settlement agreement, the payments were made in three equal amounts with the first paid in June 2014, the second paid in October 2014 and the final installment paid in March 2015. | ||
Legal contingencies expense | $ 428,000 | $ 428,000 | |
Product right asset related to legal settlement | 672,000 | ||
Accrued liability related to legal settlement | 672,000 | ||
The Company [Member] | |||
Loss Contingencies [Line Items] | |||
Payment for legal settlements | $ 1,100,000 | $ 1,100,000 | |
Customer Related Litigation [Member] | |||
Loss Contingencies [Line Items] | |||
Payment for legal settlements | $ 1,350,000 |
Quarterly Financial Data - Quar
Quarterly Financial Data - Quarterly Financial Data Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Statement [Abstract] | ||||||||||
Revenue | $ 9,056 | $ 10,556 | $ 8,106 | $ 8,741 | $ 8,479 | $ 11,267 | $ 8,878 | $ 7,206 | $ 36,459 | $ 35,830 |
Gross margin | 6,450 | 7,088 | 6,216 | 6,070 | 5,871 | 7,789 | 6,499 | 5,396 | 25,824 | 25,555 |
Loss from operations | (908) | (885) | (1,072) | (1,227) | (1,357) | (77) | (1,022) | (626) | (4,092) | (3,082) |
Equity in earnings from investment in Mediasite KK | 15 | 23 | ||||||||
Net income (loss) | $ (1,222) | $ (921) | $ (1,350) | $ (1,032) | $ (1,288) | $ 33 | $ (871) | $ (690) | $ (4,525) | $ (2,816) |
Basic and diluted net income (loss) per share | $ (0.28) | $ (0.21) | $ (0.31) | $ (0.24) | $ (0.30) | $ 0.01 | $ (0.21) | $ (0.17) |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - Silicon Valley Bank [Member] | Oct. 05, 2015USD ($) | Sep. 30, 2015 |
Subsequent Event [Line Items] | ||
Debt instrument covenant description | (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. | |
Modification No. 1 to Loan and Security Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Debt instrument covenant description | (i) the Liquidity covenant was modified to require minimum Liquidity (as defined) with respect to the Company only, on a monthly basis, of at least 1.5:1.0 at the last day of each month, replacing the previous Liquidity requirement of 1.35:1.0 for each month-end that is not the last day of a fiscal quarter, and 1.5:1.0 for each month-end that is the last day of a fiscal quarter, and (ii) the Minimum Debt Service covenant was replaced with a requirement to maintain, commencing September 30, 2015, a Minimum EBITDA, as defined, on a trailing six month period, of at least $1.00 plus the net change in Deferred Revenue, as defined, with such covenant measured as of the last day of each fiscal quarter. | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Debt service covenant net change in deferred revenue | $ 1 | |
Subsequent Event [Member] | Modification No. 1 to Loan and Security Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Debt service covenant net change in deferred revenue | 1 | |
Subsequent Event [Member] | Minimum [Member] | ||
Subsequent Event [Line Items] | ||
Debt service covenant net change in deferred revenue | 1 | |
Subsequent Event [Member] | Minimum [Member] | Modification No. 1 to Loan and Security Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Debt service covenant net change in deferred revenue | $ 1 | |
Subsequent Event [Member] | Monthly Basis [Member] | ||
Subsequent Event [Line Items] | ||
Debt instrument covenant liquidity minimum ratio | 1.5 | |
Subsequent Event [Member] | Monthly Basis [Member] | Modification No. 1 to Loan and Security Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Debt instrument covenant liquidity minimum ratio | 1.5 | |
Subsequent Event [Member] | Each Month-End that is Not the Last Day of Fiscal Quarter [Member] | ||
Subsequent Event [Line Items] | ||
Debt instrument covenant liquidity minimum ratio | 1.35 | |
Subsequent Event [Member] | Each Month-End that is Not the Last Day of Fiscal Quarter [Member] | Modification No. 1 to Loan and Security Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Debt instrument covenant liquidity minimum ratio | 1.35 | |
Subsequent Event [Member] | Each Month-End that is the Last Day of Fiscal Quarter [Member] | ||
Subsequent Event [Line Items] | ||
Debt instrument covenant liquidity minimum ratio | 1.5 | |
Subsequent Event [Member] | Each Month-End that is the Last Day of Fiscal Quarter [Member] | Modification No. 1 to Loan and Security Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Debt instrument covenant liquidity minimum ratio | 1.5 |