Company Quick10K Filing
iSIGN Solutions
Price0.38 EPS-0
Shares6 P/E-3
MCap2 P/FCF-8
Net Debt-0 EBIT-1
TEV2 TEV/EBIT-3
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-08-14
10-Q 2020-03-31 Filed 2020-05-15
10-K 2019-12-31 Filed 2020-03-30
10-Q 2019-09-30 Filed 2019-11-14
10-Q 2019-06-30 Filed 2019-08-14
10-Q 2019-03-31 Filed 2019-05-15
10-K 2018-12-31 Filed 2019-04-01
10-Q 2018-09-30 Filed 2018-11-14
10-Q 2018-06-30 Filed 2018-08-14
10-Q 2018-03-31 Filed 2018-05-15
10-K 2017-12-31 Filed 2018-04-02
10-Q 2017-09-30 Filed 2017-11-14
10-Q 2017-06-30 Filed 2017-08-14
10-Q 2017-03-31 Filed 2017-05-15
10-K 2016-12-31 Filed 2017-03-31
10-Q 2016-09-30 Filed 2016-11-14
10-Q 2016-06-30 Filed 2016-08-15
10-Q 2016-03-31 Filed 2016-05-16
10-K 2015-12-31 Filed 2016-04-06
10-Q 2015-09-30 Filed 2015-11-16
10-Q 2015-06-30 Filed 2015-08-14
10-Q 2015-03-31 Filed 2015-05-15
10-K 2014-12-31 Filed 2015-03-31
10-Q 2014-09-30 Filed 2014-11-14
10-Q 2014-06-30 Filed 2014-08-14
10-Q 2014-03-31 Filed 2014-05-15
10-K 2013-12-31 Filed 2014-03-31
10-Q 2013-09-30 Filed 2013-11-14
10-Q 2013-06-30 Filed 2013-08-14
10-Q 2013-03-31 Filed 2013-05-15
10-K 2012-12-31 Filed 2013-04-01
10-Q 2012-06-30 Filed 2012-08-14
10-Q 2012-03-31 Filed 2012-05-15
10-K 2011-12-31 Filed 2012-03-30
10-Q 2011-09-30 Filed 2011-11-14
10-Q 2011-06-30 Filed 2011-08-15
10-Q 2011-03-31 Filed 2011-05-16
10-K 2010-12-31 Filed 2011-03-30
10-Q 2010-09-30 Filed 2010-11-12
10-Q 2010-06-30 Filed 2010-08-16
10-Q 2010-03-31 Filed 2010-05-17
10-K 2009-12-31 Filed 2010-03-31
8-K 2020-06-22 Accountant, Exhibits
8-K 2020-06-19 Enter Agreement, Sale of Shares
8-K 2020-05-06
8-K 2020-03-25
8-K 2018-12-27
8-K 2018-08-01

ISGN 10Q Quarterly Report

Part I - Financial Information
Item 1. Financial Statements
Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations.
Item 3.Quantitative and Qualitative Disclosures About Market Risk.
Item 4.Controls and Procedures.
Part II - Other Information
Item 1.Legal Proceedings.
Item 1A.Risk Factors
Item 2.Unregistered Sale of Securities and Use of Proceeds.
Item 3.Defaults Upon Senior Securities.
Item 4.Mine Safety Disclosures
Item 5.Other Information.
Item 6.Exhibits.
EX-31.1 f10q0620ex31-1_isignsolu.htm
EX-31.2 f10q0620ex31-2_isignsolu.htm
EX-32.1 f10q0620ex32-1_isignsolu.htm
EX-32.2 f10q0620ex32-2_isignsolu.htm

iSIGN Solutions Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
3.00.4-2.2-4.8-7.4-10.02012201420172020
Assets, Equity
0.6-0.2-0.9-1.7-2.4-3.22012201420172020
Rev, G Profit, Net Income
1.30.80.4-0.1-0.5-1.02012201420172020
Ops, Inv, Fin

10-Q 1 f10q0620_isignsolutions.htm QUARTERLY REPORT

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: June 30, 2020

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from                 to                

 

Commission File Number:     000-19301   

 

iSign Solutions Inc.

(Exact name of registrant as specified in its charter)

 

Delaware   94-2790442
(State or other jurisdiction of   (I.R.S. Employer
incorporation or organization)   Identification No.)

 

2033 Gateway Place, Suite 659, San Jose,   CA 95110
(Address of principal executive offices)   (Zip Code)

 

(650) 802-7888

Registrant’s telephone number, including area code

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
         

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

  Yes   No  

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

 

  Yes   No  

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

large accelerated filer accelerated filer ☐  non-accelerated filer

Smaller reporting Company

 

Emerging growth company

 

Indicate by check mark whether the registrant is a shell company (as defined in Section 12b-2 of the exchange Act)

 

  Yes ☐    No  

 

Number of shares outstanding of the issuer’s Common Stock, as of August 14, 2020: 5,761,980

 

 

 

 

 

 

INDEX

 

    Page No.
PART I. FINANCIAL INFORMATION  
Item 1. Financial Statements 1
  Condensed Consolidated Balance Sheets at June 30, 2020 (unaudited) and December 31, 2019 1
  Condensed Consolidated Statements of Operations for the Three and Six-Month Periods Ended June 30, 2020 and 2019 (unaudited) 2
  Condensed Consolidated Statements of Stockholders’ Deficit for the Three and Six-Month Periods Ended June 30, 2020 and 2019 (unaudited) 3
  Condensed Consolidated Statements of Cash Flows for the Six-Month Periods Ended June 30, 2020 (unaudited) and 2019 (unaudited) 4
  Notes to Unaudited Condensed Consolidated Financial Statements 6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 12
Item 3. Quantitative and Qualitative Disclosures About Market Risk 16
Item 4. Controls and Procedures 16
PART II. OTHER INFORMATION  
Item 1. Legal Proceedings 17
Item 1A. Risk Factors 17
Item 2. Unregistered Sale of Securities and Use of Proceeds 17
Item 3. Defaults Upon Senior Securities 17
Item 4. Mine Safety Disclosures 17
Item 5. Other Information 17
Item 6. Exhibits 17
  (a) Exhibits 17
  Signatures 21

 

i -

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

iSign Solutions Inc.

Condensed Consolidated Balance Sheets

(In thousands, except par value amounts)

 

   June 30,   December 31, 
   2020   2019 
Assets  Unaudited     
Current assets:        
Cash and cash equivalents  $320   $25 
Accounts receivable, net of allowance of $10 at June 30, 2020 and $0 at December 31, 2019, respectively   73    61 
Prepaid expenses and other current assets   13    22 
Total current assets   406    108 
Property and equipment, net   6    8 
Other assets   5    5 
Total assets  $417   $121 
           
Liabilities and Stockholders’ Deficit          
Current liabilities:          
Accounts payable  $1,056   $1,196 
Short-term debt- related party   941    841 
Short-term debt – other   

1,706

    

1,405

 
Short-term debt – Paycheck Protection Program   62    

-

 
Accrued compensation   90    71 
Other accrued liabilities   961    814 
Deferred revenue   529    346 
Total current liabilities   

5,345

    4,673 
Long-term debt – Paycheck Protection Program   61    

-

 
Deferred revenue long-term   -    70 
Other long-term liabilities   770    669 
Total liabilities   6,176    5,412 
Commitments and contingencies          
Stockholders’ deficit:          
Common stock, $0.01 par value; 2,000,000 shares authorized; 5,762 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively   58    58 
Treasury shares, 5 at June 30, 2020 and December 31, 2019, respectively   (325)   (325)
Additional paid-in capital   129,703    129,651 
Accumulated deficit   (135,195)   (134,675)
Total stockholders’ deficit   (5,759)   (5,291)
Total liabilities and stockholders’ deficit  $417   $121 

 

See accompanying notes to these Condensed Consolidated Financial Statements

 

1 -

 

 

iSign Solutions Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)

 

   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2020   2019   2020   2019 
Revenue:                
Product  $59   $41   $90   $81 
Maintenance   168    186    327    344 
Total revenue   227    227    417    425 
                     
Operating costs and expenses:                    
Cost of sales:                    
Product   19    1    21    2 
Maintenance   27    17    36    33 
Research and development   144    181    320    352 
Sales and marketing   25    27    52    53 
General and administrative   173    190    419    395 
Total operating costs and expenses   388    416    

848

    835 
                     
Loss from operations   (161)   (189)   (431)   (410)
                     
Other income (expense), net   51    15    52    14 
Interest expense:                    
Related party   (23)   (14)   (47)   (27)
Other   (47)   (49)   (92)   (96)
Amortization of debt discount:                    
Related party   -    (3)   -    (6)
Other   (1)   (7)   (1)   (14)
Loss before income tax expense   (181)   (247)   (519)   (539)
                     
Income tax expense   -   (1)   (1)   (1)
Net loss  $(181)  $(248)  $(520)  $(540)
Basic and diluted net loss per common share  $(0.03)  $(0.04)  $(0.09)  $(0.09)
Weighted average common shares outstanding, basic and diluted   5,762    5,762    5,762    5,762 

 

See accompanying notes to these Condensed Consolidated Financial Statements

 

2 -

 

 

iSign Solutions Inc.

Condensed Consolidated Statements of Stockholders’ Deficit

(Unaudited)

(In thousands)

 

   Common Stock   Treasury Stock   Additional
Paid-in
   Accumulated   Total
Stockholders’
 
   Shares   Amount   Shares   Amount   Capital   Deficit   Deficit 
Balance January 1, 2020   5,762   $58    5   $(325)  $129,651   $(134,675)  $(5,291)
Stock-based compensation   -    -    -    -    22    -    22 
Net loss   -    -    -    -    -    (339)   (339)
Balance, March 31, 2020   5,762   $58    5   $(325)  $129,673   $(135,014)  $(5,608)
Stock-based compensation   -    -    -    -    17    -    17 
Warrant issued for services   -    -    -    -    13    -    - 
Net loss   -    -    -    -    -    (181)   (184)
Balance, June 30, 2020   5,762   $58    5   $(325)   129,703    (135,195)   (5,759)

  

   Common Stock   Treasury Stock   Additional
Paid-in
   Accumulated   Total
Stockholders’
 
   Shares   Amount   Shares   Amount   Capital   Deficit   Deficit 
Balance January 1, 2019   5,762   $58    5   $(325)  $129,251   $(133,589)  $(4,605)
Stock-based compensation   -    -    -    -    59    -    59 
Net loss   -    -    -    -    -    (291)   (291)
Balance, March 31, 2019   5,762   $58    5    (325)  $129,310   $(133,880)  $(4,837)
                                    
Stock-based compensation   -    -    -    -    48    -    48 
Net loss   -    -    -    -    -    (249)   (249)
Balance, June 30, 2019   5,762    58    5    (325)   129,358    (134,129)   (5,038)

 

See accompanying notes to these Condensed Consolidated Financial Statements

 

3 -

 

 

iSign Solutions Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

 

  

Six Months Ended

June 30,

 
   2020   2019 
Cash flows from operating activities:        
Net loss  $(520)  $(540)
Adjustments to reconcile net loss to net cash used in operating activities:          
Depreciation and amortization   2    2 
Debt discount amortization   1    20 
Amortization of Warrants   36    - 
Warrants issued for services   13    - 
Stock-based compensation   39    107 
Forgiveness of debt related to accounts payable   (52)   - 
Changes in operating assets and liabilities:          
Accounts receivable, net   (12)   37 
Prepaid expenses and other assets   9    13 
Accounts payable   (88)   (13)
Accrued compensation   19    (6)
Other accrued and long-term liabilities   212    217 
Deferred revenue   113    109 
Net cash used in operating  activities   (228)   (54)
           
Cash flows from investing activities:          
Acquisition of property and equipment   -    (3)
Net cash used in investing  activities   -    (3)
           
Cash flows from financing activities:          
Proceeds from the issuance of short-term debt – related party   100    - 
Proceeds from the issuance of short-term debt – other   300    - 
Proceeds from Short-term debt - Paycheck Protection Program   123    - 
Net cash provided by financing activities   523    - 
           
Net increase (decrease) in cash and cash equivalents   295    (57)
Cash and cash equivalents at beginning of period   25    335 
Cash and cash equivalents at end of period  $320   $278 

 

See accompanying notes to these Condensed Consolidated Financial Statements

 

4 -

 

 

iSign Solutions Inc.

Condensed Consolidated Statements of Cash Flows (Continued)

(Unaudited)

(In thousands)

 

  

Six Months Ended

June 30,

 
   2020   2019 
Supplementary disclosure of cash flow information        
Interest paid  $5   $- 
Income taxes paid  $1   $1 

 

See accompanying notes to these Condensed Consolidated Financial Statements

 

5 -

 

 

iSign Solutions Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(In thousands, except per share amounts)

 

1.Nature of Business and Summary of Significant Accounting Policies

 

Nature of Business

 

iSign Solutions Inc. and its subsidiary is a leading supplier of digital transaction management (DTM) software enabling the paperless, secure and cost-effective management and authentication of document-based transactions. iSign’s solutions encompass a wide array of functionality and services, including electronic signatures, simple-to-complex workflow management and various options for biometric authentication. These solutions are available across virtually all enterprise, desktop and mobile environments as a seamlessly integrated platform for both ad-hoc and fully automated transactions. iSign’s platform can be deployed both on premise and as a cloud-based (“SaaS”) service, with the ability to easily transition between deployment models. The Company is headquartered in San Jose, California. The Company’s products include SignatureOne™ Ceremony™ Server, the iSign™ suite of products and services, including iSign™ Enterprise and iSign™ Console™, and Sign-it™ programs.

 

In December 2019, an outbreak of a novel strain of coronavirus (COVID-19) originated in Wuhan, China and has since spread to a number of other countries, including the U.S. On March 11, 2020, the World Health Organization characterized COVID-19 as a pandemic. In addition, several states in the U.S., including California, where the Company is headquartered, have experienced an increase in new cases of COVID-19. The COVID-19 outbreak is disrupting supply chains and affecting production and sales across a wide range of industries. The extent of the impact of COVID-19 on our operational and financial performance will depend on certain developments, including the duration and spread of the outbreak, impact on our customers, employees and vendors all of which are uncertain and cannot be predicted. At this point, the extent to which COVID-19 may impact our financial condition or results of operations is uncertain.

 

Basis of Presentation

 

The financial information contained herein should be read in conjunction with the Company’s consolidated audited financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2019.

 

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete consolidated financial statements. In the opinion of management, the unaudited condensed consolidated financial statements included in this quarterly report reflect all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for a fair presentation of its financial position at the dates presented and the Company’s results of operations and cash flows for the periods presented. The Company’s interim results are not necessarily indicative of the results to be expected for the entire year.

 

Going Concern

 

The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has incurred significant cumulative losses since its inception and, at June 30, 2020 the Company’s accumulated deficit was $135,195. The Company has primarily met its working capital needs through the sale of debt and equity securities. As of June 30, 2020, the Company’s cash balance was $320. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

6 -

 

 

iSign Solutions Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(In thousands, except per share amounts)

 

1.Nature of Business and Summary of Significant Accounting Policies (continued)

 

There can be no assurance that the Company will be successful in securing adequate capital resources to fund planned operations or that any additional funds will be available to the Company when needed, or if available, will be available on favorable terms or in amounts required by the Company. If the Company is unable to obtain adequate capital resources to fund operations, it may be required to delay, scale back or eliminate some or all of its operations, which may have a material adverse effect on the Company’s business, results of operations and ability to operate as a going concern. The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Accounting Changes and Recent Accounting Pronouncements

 

Accounting Standards Update No. 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815), Clarifying the Interaction between Topic 321, Topic 323 and Topic 815. The amended guidance in this update was issued to clarify the interaction of the accounting for equity securities under Topic 321, Investments—Equity Securities; investments accounted for under the equity method of accounting in Topic 323, Investments—Equity Method and Joint Ventures; and the accounting for certain forward contracts and purchased options accounted for under Topic 815, Derivatives and Hedging. The amendments are effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

 

The Company will evaluate ASU 2020-01. The Company believes the adoption of ASU 2020-01 will have no impact on the Company’s financial statements.

 

Accounting Standards Update No. 2020-03, Codification Improvements to Financial Instruments. The Board decided to issue a separate update to improve various financial instruments Topics in the Codification to increase stakeholder awareness of the amendments and to clarify and improve the understandability of the guidance of Topics. The amendments are effective immediately.

 

The Company believes the adoption of ASU 2020-03 will have no impact on the Company’s financial statements.

 

2.Concentrations

 

The following table summarizes accounts receivable and revenue concentrations:

 

   Accounts Receivable
as of June 30,
   Total Revenue
for the three months
ended June 30,
   Total Revenue
for the six months
ended June 30,
 
   2020   2019   2020   2019   2020   2019 
Customer #1   88%   70%   28%   17%   23%   16%
Customer #2   -    -    10%   10%   11%   11%
Customer #3   -    -    24%   33%   25%   29%
Customer #4   -    -    21%   15%   20%   16%
Customer #5   12%   21%   -    -    -    - 
Total concentration   100%   91%   83%   75%   79%   72%

 

3.Net Loss per Share

 

The Company calculates basic net loss per share based on the weighted average number of shares outstanding, and when applicable, diluted net income per share, which is based on the weighted average number of shares and potential dilutive shares outstanding.

 

7 -

 

 

iSign Solutions Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(In thousands, except per share amounts)

 

3.Net Loss per Share (continued)

 

The following table lists shares and warrants that were excluded from the calculation of diluted earnings per share as the inclusion of shares from the assumed exercise of such options and warrants would be anti-dilutive.

 

   For the Three Months Ended   For the Six Months Ended 
   June 30,
2020
   June 30,
2019
   June 30,
2020
   June 30,
2019
 
                 
Stock options   1,067    1,077    1,067    1,077 
Warrants   2,566    2,813    2,566    2,813 

 

4.Debt

 

Advances:

 

In January and March 2020, the Company received, from affiliates, advances aggregating $75 in cash against certain accounts receivable of the Company. Upon collection of an invoice, the Company agreed to repay the advance to the lenders on a pro rata basis together with a 5% advance fee. On March 25, 2020, the affiliates converted their advances into unsecured notes. The Company paid the advance fees of $4 in cash, and recorded them as interest expense in the quarter ended March 31, 2020.

 

Notes payable:

 

On March 25, 2020, the Company issued an aggregate of $150 in unsecured notes to affiliates and other investors. The Company received $75 in cash and $75 in exchange for the advances discussed above. The unsecured notes are convertible by the holder into common stock at any time at a price per share of $0.50. Upon closing a new financing of at least $1,000 in aggregate proceeds, holders of such notes can elect to convert at a price equal to the lesser of $0.50 per share or the price per share of the new financing. The notes bear interest at the rate of 10% per annum and are due December 31, 2020.

 

On May 6, 2020, the Company received loan proceeds in the amount of approximately $123 under the Paycheck Protection Program (“PPP”). The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The Company may apply for the loans and accrued interest to be forgiven after a period of either eight or twenty-four weeks, as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the period in question. Under the terms of the related promissory note, the unforgiven portion of the PPP loan is payable over two years at an interest rate of 1%, with a deferral of payments for the first six months. The Company intends to use the proceeds for purposes consistent with the PPP. While the Company currently believes that its use of the loan proceeds, for the most part, will meet the conditions for forgiveness of the loan, we cannot assure you that we will not take actions that could cause the Company to be ineligible for forgiveness of the loan, in whole or in part.

 

On June 19, 2020, iSign Solutions Inc. (the “Company”) entered into a Note Purchase Agreement (the “Purchase Agreement”) with an investor. Under the terms of the Purchase Agreement, the Company received a cash loan in the aggregate amount of $250,000 (the “Loan”) from the Investor in exchange for the Company’s issuance of an unsecured convertible promissory note equal to the amount of such Investor’s loan contribution to the Company. The Note bears interest at the rate of 10% per annum, and has a maturity date the earlier of December 31, 2021, or the date on which the Company’s other outstanding unsecured convertible promissory notes are due. Principal and interest due under the Note may be converted by the investor into shares of the Company’s common stock at a price of $0.50 per share, or, in the event the Company consummates a financing of at least $1,000, at the price per share of such financing, if lower than $0.50 per share.

  

8 -

 

 

iSign Solutions Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(In thousands, except per share amounts)

 

4.Debt (continued)

 

The Company accrued $69 and $139 of interest expense during the three and six months ended June 30, 2020, $60 and $120, respectively, associated with the outstanding secured and unsecured convertible promissory notes, of which $23 and $47, respectively, was to related parties and $38 and $74, respectively, was to other investors. For the three and six months ended June 30, 2019, the Company accrued $63 and $123 of interest expense, $54 and $107, respectively, associated with its outstanding notes, of which $13 and $27, respectively, was to related parties and $40 and $40, respectively, was to other investors.

 

The Company recorded $0 and $1 in debt discount amortization for the three and six months ended June 30, 2020. For the three and six months ended June 30, 2019 the Company recorded $10 and $20 of debt discount

 

5.Stockholders’ Equity (Deficit)

 

Stock-based compensation expense is based on the estimated grant date fair value of the portion of stock-based payment awards that are ultimately expected to vest during the period. The grant date fair value of stock -based awards to employees and directors is calculated using the Black-Scholes-Merton valuation model.

 

Forfeitures of stock-based payment awards are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The estimated average forfeiture rate for the six months ended June 30, 2020 and 2019, was approximately 13.59% and 13.4%, respectively, based on historical data.

 

Valuation and Expense Information:

 

The weighted-average fair value of stock-based compensation is based on the Black-Scholes-Merton valuation model. Forfeitures are estimated and it is assumed no dividends will be declared. The estimated fair value of stock-based compensation awards to employees is amortized using the accrual method over the vesting period of the options.

 

No options were granted during the three and six months ended June 30, 2020. The Company granted stock options to purchase 40,000 shares of common stock during the six months ended June30, 2019. There were no stock options exercised during the three and six months ended June 30, 2020 and 2019, respectively.

 

The fair value calculations for the stock options granted are based on the following assumptions:

 

   Six Months Ended
June 30,
2019
 
Risk free interest rate   2.30%
Expected life (years)   6.1 
Expected volatility   191.65%
Expected dividend yield   None 

 

The following table summarizes the allocation of stock-based compensation expense related to stock option grants for the three and six months ended June 30:

 

   Three Months Ended
June 30,
   Six Months Ended
June 30,
 
   2020   2019   2020   2019 
Research and development  $2   $8   $5   $17 
General and administrative  $12   $32   $28   $73 
Director and consultant options  $3   $8   $6   $17 
Total stock-based compensation expense  $17   $48   $39   $107 

 

9 -

 

 

iSign Solutions Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(In thousands, except per share amounts)

 

5.Stockholders’ Equity (Deficit) (continued)

 

A summary of option activity under the Company’s plans for the six months ended June 30, 2020 and 2019 is as follows:

 

   2020   2019 

Options

 

Shares

  

Weighted Average Exercise Price Per Share

   Weighted Average Remaining Contractual Life (Years)  

Aggregate Intrinsic Value

  

Shares

  

Weighted Average Exercise Price Per Share

   Weighted Average Remaining Contractual Life (Years)  

Aggregate Intrinsic Value

 
Outstanding at January 1,   1,077   $1.59    -   $

 

         

    1,037   $1.65        $- 
Granted   -   $-    -   $    40   $0.50        $- 
Forfeited or expired   10   $56.10    -   $    -   $-        $- 
Outstanding at June 30   1,067   $1.07    5.50   $    1,070   $1.61    5.50   $- 
Vested and expected to vest at June 30   1,067   $1.07    4.52   $-    1,070   $1.61    5.50   $- 
Exercisable at June 30   822   $1.18    4.38   $-    489   $2.77    5.16   $- 

 

The following table summarizes significant ranges of outstanding and exercisable options as of June 30, 2020:

 

   Options Outstanding   Options Exercisable 
Range of Exercise Prices  Number Outstanding   Weighted Average Remaining Contractual Term (in years)   Weighted Average Exercise Price per share   Number Outstanding   Weighted Average Exercise Price per Share 
$0.01 – $0.50   655    4.24   $0.50    574   $0.50 
$0.51 – $625.00   412    4.92   $1.97    229   $9.20 
Total   1,067    4.52   $1.07    822   $2.77 

 

A summary of the status of the Company’s non-vested shares as of June 30, 2020 is as follows:

 

Non-vested Shares  Shares   Weighted Average
Grant-Date
Fair Value per share
 
Non-vested at January 1, 2020   417   $0.65 
Vested   (172)  $0.69 
Non-vested at June 30, 2020   245   $0.69 

 

As of June 30, 2020, there was a total of $30 of unrecognized compensation expense related to non-vested stock-based compensation arrangements granted under the plans. The unrecognized compensation expense is expected to be realized over a weighted average period of 0.86 years.

 

10 -

 

 

iSign Solutions Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(In thousands, except per share amounts)

 

5.Stockholders’ Equity (Deficit) (continued)

 

Warrants

 

The Company issued 30,000 warrants during the three and six months ended June 30, 2020 to a consultant for services. The warrants are exercisable for three years with an exercise price of $0.50 per share. The Company ascribed a value of $13 to the warrants which is based on the Black-Scholes-Merton valuation model.

 

In February 2019, the Company issued warrants to purchase 985,000 shares of common stock to 4 consultants and an employee in connection with the accrued compensation owed by the Company to the employee and consultants. The warrants are exercisable for three years with an exercise price of $0.50 per share. The warrants may not be exercised for cash or on a cashless basis, and may solely be exercised using the holder’s outstanding accrued compensation on the date of exercise.

 

A summary of the warrant activity for the six months ended June 30 is as follows:

 

   2020   2019 
   Shares   Weighted Average Exercise Price Per Share   Shares   Weighted Average Exercise Price Per Share 
Outstanding at beginning of period   2,536   $1.52    1,828   $2.08 
Issued   30   $-    985   $0.50 
Expired   -   $-    -   $- 
Outstanding at end of period   2,566   $1.52    2,813   $1.58 
Exercisable at end of period   2,566   $1.52    2,813   $1.58 

 

A summary of the status of the warrants outstanding and exercisable as of June 30, 2020 is as follows:

 

Number of Warrants   Weighted Average Remaining Life (years)   Weighted Average Exercise Price per share 
          
 1,551    0.89   $2.18 
 985    1.63   $0.50 
 30    2.61   $0.50 
 2,566    1.20   $1.51 

 

6.Subsequent Event

 

In July 2020, the Company booked $307 in forgiven accounts payable. In exchange for the forgiveness the Company made cash payments of $150, issued a 3-year note for $130 bearing 4% interest per annum, and issued of a 5-year warrant to purchase 10,000 shares of the Company’s common stock at a price of $0.50 per share.

 

11 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

Forward Looking Statements

 

Certain statements contained in this quarterly report on Form 10-Q, including, without limitation, statements containing the words “believes”, “anticipates”, “hopes”, “intends”, “expects”, and other words of similar import, constitute “forward looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors which may cause actual events to differ materially from expectations. Such factors include those set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, including the following:

 

Technological, engineering, manufacturing, quality control or other circumstances that could delay the sale or shipment of products;

 

Economic, business, market and competitive conditions in the software industry and technological innovations that could affect the Company’s business;

 

The Company’s inability to protect its trade secrets or other proprietary rights, operate without infringing upon the proprietary rights of others and prevent others from infringing on the proprietary rights of the Company; and

 

General economic and business conditions and the availability of sufficient financing.

 

Except as otherwise required by applicable laws, the Company undertakes no obligation to publicly update or revise any forward-looking statements, as a result of new information, future events or otherwise.

 

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

The following discussion and analysis should be read in conjunction with the Company’s unaudited condensed consolidated financial statements and notes thereto included in Part 1, Item 1 of this quarterly report on Form 10-Q and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in the Company’s Annual report on Form 10-K for the fiscal year ended December 31, 2019.

 

Overview

 

The Company is a leading supplier of digital transaction management (DTM) software enabling the paperless, secure and cost-effective management of document-based transactions. iSign’s solutions encompass a wide array of functionality and services, including electronic signatures, biometric authentication and simple-to-complex workflow management. These solutions are available across virtually all enterprise, desktop and mobile environments as a seamlessly integrated platform for both ad-hoc and fully automated transactions. iSign’s software platform can be deployed both on-premise and as a cloud-based service, with the ability to easily transition between deployment models.

 

The Company was incorporated in Delaware in October 1986. Except for the year ended December 31, 2004, in each year since its inception the Company has incurred losses. For the two-year period ended December 31, 2019, net losses aggregated approximately $2,113, and, at June 30, 2020, the Company’s accumulated deficit was approximately $135,195.

 

In December 2019, an outbreak of a novel strain of coronavirus (COVID-19) originated in Wuhan, China and has since spread to a number of other countries, including the U.S. On March 11, 2020, the World Health Organization characterized COVID-19 as a pandemic. In addition, several states in the U.S., including California, where the Company is headquartered, have experienced an increase in new cases of COVID-19. The COVID-19 outbreak is disrupting supply chains and affecting production and sales across a wide range of industries. The extent of the impact of COVID-19 on our operational and financial performance will depend on certain developments, including the duration and spread of the outbreak, impact on our customers, employees and vendors all of which are uncertain and cannot be predicted. At this point, the extent to which COVID-19 may impact our financial condition or results of operations is uncertain.

 

12 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

In May 2020, the Company received loan proceeds in the amount of approximately $123 under the Paycheck Protection Program (“PPP”). The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”).

 

In June 2020, the Company entered into a Note Purchase Agreement (the “Purchase Agreement”) with an investor. Under the terms of the Purchase Agreement, the Company received a cash loan in the aggregate amount of $250,000 (the “Loan”) from the Investor in exchange for the Company’s issuance of an unsecured convertible promissory note equal to the amount of such Investor’s loan contribution to the Company.

 

For the three months ended June 30, 2020, total revenue was $227, compared to total revenue of $227 in the prior year period. For the six months ended June 30, 2020, total revenue was $417, a decrease of $8, or 2%, compared to total revenue of $425 in the prior year period. The change in revenue for the six months ended June 30, 2020 is due primarily to a decrease in maintenance revenue of $17 or 5%, compared to the prior year period offset by an increase in product revenue of $9, or 11%, compared to the prior year. The increase in product revenue is the result of timing issues related to new orders while the decrease in maintenance is due to the loss of two customers.

 

The net loss for the three months ended June 30, 2020 was $181, a decrease of $67, or 27%, compared to a net loss of $248 in the prior year period. The three month loss from operations decreased $27, or 14%, to $162 compared to $189 in the prior year period. The decrease was due to a net decrease in overhead expenses. For the six months ended June 30, 2020 the net loss was $520, a decrease of $20, or 4%, compared to a net loss of $540 in the prior year period. The six month loss from operations increased $21, or 5%, to $431 compared to $410 in the prior year period. This increase was due to an increase in warrant expense issued for services and other overhead costs compared to the prior year.

 

Critical Accounting Policies and Estimates

 

Refer to Item 7, “Management Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s 2019 Form 10-K.

 

Effect of Recent Accounting Pronouncements

 

Accounting Standards Updates issued in 2020 are being evaluated by the Company, however, implementation is not expected to have a material impact on the Company’s financial position, results of operations and cash flows.

 

Results of Operations

 

Revenue

 

For the three months ended June 30, 2020, product revenue was $59, an increase of $18, or 44%, compared to product revenue of $41 in the prior year period. The increase in revenue is primarily attributable to increases in one time revenue transactions compared to the prior year period. For the three months ended June 30, 2020, maintenance revenue was $168, a decrease of $18, or 10%, compared to maintenance revenue of $186 in the prior year period. The decrease is primarily due to a decrease in net maintenance fee renewals in the first calendar quarter of 2020.

 

For the six months ended June 30, 2020, product revenue was $90, an increase of $9, or 11%, compared to product revenue of $81 in the prior year period. The increase in product revenue is primarily due to the same factors for the three-month period discussed above. For the six months ended June 30, 2020, maintenance revenue was $327, a decrease of $17, or 5%, compared to maintenance revenue of $344 in the prior year period. The decrease in maintenance revenue is primarily due to the factors discussed for the three-month period above.

 

Cost of Sales

 

For the three months ended June 30, 2020, cost of sales was $46, an increase of $28, or 156%, compared to cost of sales of $18 in the prior year period. The increase in cost of sales was due to an increase in direct labor related to revenue from non-recurring engineering (“SOW”) and maintenance contracts during the three months ended June 30, 2020, compared to the prior year period.

 

13 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

  

For the six months ended June 30, 2020, cost of sales was $57, an increase of $22, or 63%, compared to cost of sales of $35 in the prior year period. The increase in cost of sales was due to an increase in direct labor related to revenue from SOW and maintenance contracts, compared to the prior year period.

 

Operating expenses

 

Research and Development Expenses

 

For the three months ended June 30, 2020, research and development expense was $144, a decrease of $37, or 20%, compared to research and development expense of $181 in the prior year period. Research and development expenses consist primarily of salaries and related costs, outside engineering, maintenance items, and allocated facilities expenses. Other general expenses decreased $16, or 8%, due to reductions in professional services and facilities costs compared to the prior year. The reductions in overhead expenses were supplemented by an increase of $20 in allocated labor costs to cost of sales. Total expenses, before allocations for the three months ended June 30, 2020, were $186, a decrease of $16, or 8%, compared to $202 in the prior year period. The decrease in gross expenses is primarily due to the factors discussed above and certain cost saving measures put in place in the current year to safeguard against possible negative repercussions of the COVID-19 pandemic.

 

For the six months ended June 30, 2020, research and development expense was $320, a decrease of $32, or 9%, compared to research and development expense of $352 in the prior year period. Total expenses, before allocations to cost of sales, for the six months ended June 30, 2020, were $373, a decrease of $20, or 5%, compared to $394 in the prior year period. The reasons for these decreases during the six-month period ended June 30, 2020 are the same as for the three-month period discussed above.

 

Sales and Marketing Expense

 

For the three months ended June 30, 2020, sales and marketing expense was $25, a decrease of $2, or 7%, compared to sales and marketing expense of $27 in the prior year period. For the six months ended June 30, 2020, sales and marketing expense was $52, a decrease of $1, or 2%, compared to sales and marketing expense of $53 in the prior year period. These decreases were primarily attributable to reductions in allocated expenses.

 

General and Administrative Expense

 

For the three months ended June 30, 2020, general and administrative expense was $173, a decrease of $17, or 9%, compared to general and administrative expense of $190 in the prior year period. The decrease was primarily due to a decrease in stock option compensation of $20 or 62%. Other general administrative expenses decreased $28, or 22%, compared to the prior year period. The decreases were offset by the issuance of 30,000 warrants to a consultant for services. The company ascribed a value of $13 to the warrants based on the Black-Scholes-Merton valuation model and warrant expense related to deferred compensation issued in the prior year.

 

For the six months ended June 30, 2020, general and administrative expense was $370, a decrease of $25, or 6%, compared to general and administrative expense of $395 in the prior year period. The decrease was primarily due to the same factors discussed for the three-month period ended June 30, 2020, partially offset by an increase in the allowance for doubtful accounts.

 

Other Income and Expense

 

For the three and six months ended June 30, 2020, other income was $51 and $52, respectively, an increase of $36 and $38, respectively, compared to other income of $15 and $14 for the three and six months ended June 30, 2019. The change in other income and expense is due primarily to the forgiveness of $52 of accounts payable during the three months ended June 30, 2020. Such forgiveness was generated from related cash payments of approximately $88. Other income for the three and six months ended June 30 2019 included the collection of $12 of accounts receivable written off in the prior year.

 

14 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

  

For the three months ended June 30, 2020, interest expense was $70, an increase of $7, or 11% compared to interest expense of $63 in the prior year period. For the six months ended June 30, 2020, interest expense was $139, an increase of $16, or 13%, compared to interest expense of $123 in the prior year period. The increase in interest expense is primarily due to the increase in the amount of debt outstanding for the three and six months ended June 30, 2020 compared to the prior year period.

 

Amortization of debt discount was $1 and $1 for the three and six month periods ended June 30, 2020 compared to $10 and $20 in the same periods of the prior year, respectively. The decrease was due to the extension of the maturity date of the Company’s debt to December 31, 2020.

 

Liquidity and Capital Resources

 

At June 30, 2020, cash and cash equivalents totaled $320, compared to cash and cash equivalents of $25 at December 31, 2019. The increase in cash was due primarily to $523 provided by financing activities offset by net cash used in operating activities of $228 for the six month period ended June 30, 2020. At June 30, 2020, total current assets were $406, compared to total current assets of $108 at December 31, 2019. At June 30, 2020, the Company’s principal sources of funds included its aggregated cash and cash equivalents of $320.

 

At June 30, 2020, accounts receivable net, was $73, an increase of $12, or 20%, compared to accounts receivable net of $61 at December 31, 2019. The increase is due primarily to the timing of billings during the six months ended June 30, 2020.

 

At June 30, 2020, and December 31, 2019, prepaid expenses and other current assets were $13. The Company has been working on minimizing the dollar amount of new prepaid expenses incurred during the six-month period in light of the financial uncertainty surrounding the current COVID-19 pandemic.

 

At June 30, 2020, total current liabilities were $5,406, an increase of $733, or 16%, compared to total current liabilities of $4,673 at December 31, 2019. At June 30, 2020, accounts payable was $1,056, a decrease of $140, or 12%, compared to accounts payable of $1,196 at December 31, 2019. The decrease is due to the forgiveness of $51 of accounts payable during the three months ended June 30, 2020, in connection with cash payments of approximately $89.

 

At June 30, 2020, accrued compensation was $90, an increase of $19, or 27%, compared to accrued compensation of $71 at December 31, 2019. The increase is due primarily to accrued commissions on certain maintenance renewals during the six month period. Other accrued liabilities were $961, an increase of $147, or 18%, from $814 at December 31, 2019 primarily due to the accrual of additional interest expense on the Company’s debt and certain franchise taxes.

  

On March 25, 2020, the Company issued an aggregate of $150 in unsecured notes to affiliates and other investors. The Company received $75 in cash and $75 in exchange for the advances discussed above. The unsecured notes are convertible by the holder into common stock at any time at a price per share of $0.50. Upon closing a new financing of at least $1,000 in aggregate proceeds, holders of such notes can elect to convert at a price equal to the lesser of $0.50 per share or the price per share of the new financing. The notes bear interest at the rate of 10% per annum and are due December 31, 2020.

 

On May 6, 2020, the Company received loan proceeds in the amount of approximately $123 under the Paycheck Protection Program (“PPP”). The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The Company may apply for the loans and accrued interest to be forgiven after a period of either eight or twenty-four weeks, as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the period in question. Under the terms of the related promissory note, the unforgiven portion of the PPP loan is payable over two years at an interest rate of 1%, with a deferral of payments for the first six months. The Company intends to use the proceeds for purposes consistent with the PPP. While the Company currently believes that its use of the loan proceeds, for the most part, will meet the conditions for forgiveness of the loan, we cannot assure you that we will not take actions that could cause the Company to be ineligible for forgiveness of the loan, in whole or in part.

 

On June 19, 2020, iSign Solutions Inc. (the “Company”) entered into a Note Purchase Agreement (the “Purchase Agreement”) with an investor. Under the terms of the Purchase Agreement, the Company received a cash loan in the aggregate amount of $250,000 (the “Loan”) from the Investor in exchange for the Company’s issuance of an unsecured convertible promissory note equal to the amount of such Investor’s loan contribution to the Company. The Note bears interest at the rate of 10% per annum, and has a maturity date the earlier of December 31, 2021, or the date on which the Company’s other outstanding unsecured convertible promissory notes are due. Principal and interest due under the Note may be converted by the investor into shares of the Company’s common stock at a price of $0.50 per share, or, in the event the Company consummates a financing of at least $1,000, at the price per share of such financing, if lower than $0.50 per share.

  

At June 30, 2020, current deferred revenue was $529, an increase of $113, or 27%, compared to current deferred revenue of $416 at December 31, 2019. Deferred revenue primarily reflects advance payments for maintenance fees from the Company’s licensees that are generally recognized as revenue by the Company when all obligations are met or over the term of the maintenance agreement, whichever is longer. Deferred revenue is recorded when the Company receives advance payment from its customers.

 

The Company recorded $1 and $1 in debt discount amortization for the three and six months ended June 30, 2020, respectively, related to the 2016 debt financings.

  

15 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

The Company incurred $69 and $139, respectively, of interest expense for the three and six months ended June 30, 2020, of which was $5 was paid in cash.

 

The Company had no material commitments as of June 30, 2020.

 

The Company has experienced recurring losses from operations that raise a substantial doubt about its ability to continue as a going concern. There can be no assurance that the Company will have adequate capital resources to fund planned operations or that any additional funds will be available to it when needed, or if available, will be available on favorable terms or in amounts required by it. If the Company is unable to obtain adequate capital resources to fund operations, it may be required to delay, scale back or eliminate some or all of its operations, which may have a material adverse effect on the Company’s business, results of operations and ability to operate as a going concern.

 

Item 3.Quantitative and Qualitative Disclosures About Market Risk.

 

Interest Rate Risk

 

The Company did not enter into any short-term security investments during the three and six months ended June 30, 2020.

 

Foreign Currency Risk

 

From time to time, the Company makes certain capital equipment or other purchases denominated in foreign currencies. As a result, the Company’s cash flows and earnings are exposed to fluctuations in interest rates and foreign currency exchange rates. The Company attempts to limit these exposures through operational strategies and generally has not hedged currency exposures. During the three and six months ended June 30, 2020 and 2019, foreign currency translation gains and losses were insignificant.

 

Item 4.Controls and Procedures.

 

Disclosure Controls and Procedures

 

The Company carried out an evaluation as of the end of the period covered by this report, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of our disclosure controls and procedures pursuant to paragraph (b) of Rule 13a-15 and 15d-15 under the Exchange Act of 1934 (the “Exchange Act”). Based on that evaluation and because of the material weaknesses in our internal control over financial reporting described below, the Chief Executive Officer and the Chief Financial Officer have concluded that our disclosure controls and procedures were not effective to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act (1) is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and (2) is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.

 

Management identified the following control deficiencies that constitute material weaknesses that are not fully remediated as of the filing date of this report:

 

As a small company with limited resources that are mainly focused on the development and sales of software products and services, iSign does not employ a sufficient number of staff in its finance department to possess an optimal segregation of duties or to provide optimal levels of oversight. This has resulted in certain audit adjustments and management believes that there may be a possibility for a material misstatement to occur in future periods while it employs the current number of personnel in its finance department.

 

The Company does not expect that its disclosure controls and procedures will prevent all error and all fraud. A control procedure, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control procedures are met. Because of the inherent limitations in all control procedures, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The Company considered these limitations during the development of its disclosure controls and procedures, and will continually reevaluate them to ensure they provide reasonable assurance that such controls and procedures are effective.

 

Changes in Internal Control over Financial Reporting

 

There has been no change in our internal control over financial reporting during the quarter ended June 30, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

16 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

PART II – OTHER INFORMATION

 

Item 1.Legal Proceedings.

 

None.

 

Item 1A.Risk Factors

 

Not applicable.

 

Item 2.Unregistered Sale of Securities and Use of Proceeds.

 

None.

 

Item 3.Defaults Upon Senior Securities.

 

None.

 

Item 4.Mine Safety Disclosures

 

Not applicable

 

Item 5.Other Information.

 

None.

 

Item 6.Exhibits.

 

(a)Exhibits.

 

Exhibit Number  

 

Document

3.1

 

Certificate of Incorporation of the Company, as amended, incorporated herein by reference to Exhibits 3.1, 3.2, 3.3 and 3.4 to the Company’s Registration Statement on Form 10 (File No. 0-19301).

3.2   Certificate of Amendment to the Company’s Certificate of Incorporation (authorizing the reclassification of the Class A Common Stock and Class B Common Stock into one class of Common Stock) as filed with the Delaware Secretary of State’s office on November 1, 1991, incorporated herein by reference to Exhibit 3 to Amendment 1 on Form 8 to the Company’s Form 8-A (File No. 0-19301).
3.3   By-laws of the Company adopted on October 6, 1986, incorporated herein by reference to Exhibit 3.5 to the Company’s Registration Statement on Form 10 (File No. 0-19301).
3.5   Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation dated January 24, 2001, incorporated herein by reference to Exhibit 3.5 to the Company’s Registration Statement on Form S/1, filed December 28, 2007.
3.6   Certificate of Elimination of the Company’s Certificate of Designation of the Series A Preferred Stock dated August 17, 2001, incorporated herein by reference to Exhibit 3.6 to the Company’s Registration Statement on Form S/1, filed December 20, 2007.
3.7   Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State August 17, 2007, incorporated herein by reference to Exhibit 3.7 to the Company’s Registration Statement on Form S/1 filed on December 28, 2007.
3.8   Amended and Restated Certificate of Incorporation of the Company filed with the Delaware Secretary of State on May 18, 1995, incorporated herein by reference to Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q filed on August 14, 2008.

 

17 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

Exhibit Number  

 

Document

3.9   Certificate of Designations, Powers, Preferences and Rights of the Series A Cumulative Convertible Preferred Stock filed with the Delaware Secretary of State on June 4, 2008, incorporated herein by reference to Exhibit 4.23 to the Company’s Quarterly Report on Form 10-Q filed on August 14, 2008.
3.10   Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State on June 30, 2008, incorporated herein by reference to Exhibit 3.7 to the Company’s Quarterly Report on Form 10-Q filed on August 14, 2008.
3.11   Certificate of Designations, Powers, Preferences and Rights of the Series A-1 Cumulative Convertible Preferred Stock filed with the Delaware Secretary of State on October 30, 2008, incorporated herein by reference to Exhibit 3.11 to the Company’s Annual Report on Form 10-K filed on March 12, 2009.
3.13   Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State on June 30, 2009, incorporated herein by reference to Exhibit 3.13 to the Company’s Quarterly Report on Form 10-Q filed on August 14, 2009.
3.14   Amendment No. 1 to By-laws dated June 17, 2010, incorporated herein by reference to Exhibit 3.14 to the Company’s Quarterly Report on Form 10-Q filed on August 16, 2010.
3.15   Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State on August 4, 2010, incorporated herein by reference to Exhibit 3.15 to the Company’s Quarterly Report on Form 10-Q filed on November 12, 2010.
3.16   Amended and Restated Certificate of Designation of Series A-1 Cumulative Convertible Preferred Stock filed with the Delaware Secretary of State on August 4, 2010, incorporated herein by reference to Exhibit 3.16 to the Company’s Quarterly Report on Form 10-Q filed on November 12, 2010.
3.17   Certificate of Designation of Series B Participating Convertible Preferred Stock filed with the Delaware Secretary of State on August 4, 2010, incorporated herein by reference to Exhibit 3.17 to the Company’s Quarterly Report on Form 10-Q filed on November 12, 2010.
3.18   Certificate of Amendment to Amended And Restated Certificate of Incorporation filed with the Delaware Secretary of State on December 31, 2010, incorporated herein by reference to Exhibit 3.18 to the Company’s Annual Report on Form 10-K filed on March 30, 2011.
3.19   Second Amended and Restated Certificate of Designation of Series A-1 Cumulative Convertible Preferred Stock filed with the Delaware Secretary of State on December 31, 2010, incorporated herein by reference to Exhibit 3.19 to the Company’s Annual Report on Form 10-K filed on March 30, 2011.
3.20   Second Amended and Restated Certificate of Designation of Series B Participating Convertible Preferred Stock filed with the Delaware Secretary of State on December 31, 2010, incorporated herein by reference to Exhibit 3.20 to the Company’s Annual Report on Form 10-K filed on March 30, 2011.
3.21   Certificate of Designation of Series C Participating Convertible Preferred Stock filed with the Delaware Secretary of State on December 31, 2010, incorporated herein by reference to Exhibit 3.21 to the Company’s Annual Report on Form 10-K filed on March 30, 2011.
3.22   Amendment to the Amended And Restated Certificate of Designation of the Series B Participating Convertible Preferred Stock, incorporated herein by reference to Exhibit 10.59 to the Company’s Current Report on Form 8-K filed March 31, 2011.
3.23   Amendment to the Amended And Restated Certificate of Designation of the Series C Participating Convertible Preferred Stock, incorporated herein by reference to Exhibit 10.60 to the Company’s Current Report on Form 8-K filed March 31, 2011.
3.24   Certificate of Amendment to Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State on November 13, 2012, incorporated herein by reference to Appendix A to the Company’s Definitive Proxy Statement filed on Schedule 14A on October 22, 2012.
3.25   Third Amended and Restated Certificate of Designation of Series A-1 Cumulative Convertible Preferred Stock filed with the Delaware Secretary of State on November 13, 2012, incorporated herein by reference to Exhibit 3.25 to the Company’s Form 10-K filed March 31, 2014.

 

18 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

Exhibit Number  

 

Document

3.26   Second Amended and Restated Certificate of Designation of Series B Participating Convertible Preferred Stock filed with the Delaware Secretary of State on November 13, 2012, incorporated herein by reference to Exhibit 3.26 to the Company’s Form 10-K filed March 31, 2014.
3.27   Amended and Restated Certificate of Designation of Series C Participating Convertible Preferred Stock filed with the Delaware Secretary of State on November 13, incorporated herein by reference to Exhibit 3.27 to the Company’s Form 10-K filed March 31, 2014.
3.28   Certificate of Designation of Series D Convertible Preferred Stock filed with the Delaware Secretary of State on November 13, 2012, incorporated herein by reference to Exhibit 3.28 to the Company’s Form 10-K filed March 31, 2014.
3.29   Certificate of Amendment to Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State on December 10, 2013, incorporated herein by reference to Appendix A to the Company’s Definitive Proxy Statement filed on Schedule 14A on November 1, 2013.
3.30   Certificate of Amendment to Certificate of Designation of Series D Convertible Preferred Stock filed with the Delaware Secretary of State on December 31, 2013, incorporated herein by reference to Exhibit 3.30 to the Company’s Form 10-K filed March 31, 2014.
3.31   Certificate of Amendment to Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State on December 16, 2014, incorporate herein by reference to Appendix A to the Company’s Definitive Proxy Statement filed on Schedule 14A on October 17, 2014.
3.32   Certificate of Amendment to Certificate of Designation of Series D Convertible Preferred Stock filed with the Delaware Secretary of State on March 24, 2015, incorporated herein by reference to Exhibit 3.32 to the Company’s Quarterly Report on Form 10-Q filed May 15, 2015.
3.33   Certificate of Amendment to the Company’s Third Amended and Restated Certificate of Designation of Series A-1 Cumulative Convertible Preferred Stock filed with Secretary of State of the State of Delaware on May 18, 2016, incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed May 19, 2016.
3.34   Certificate of Amendment to the Company’s Second Amended and Restated Certificate of Designation of Series B Participating Convertible Preferred Stock filed with Secretary of State of the State of Delaware on May 18, 2016, incorporated herein by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed May 19, 2016.
3.35   Certificate of Amendment to the Company’s Amended and Restated Certificate of Designation of Series C Participating Convertible Preferred Stock filed with Secretary of State of the State of Delaware on May 18, 2016, incorporated herein by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K filed May 19, 2016.
3.36   Certificate of Amendment to the Company’s Certificate of Designation of Series D Convertible Preferred Stock filed with Secretary of State of the State of Delaware on May 18, 2016, incorporated herein by reference to Exhibit 3.4 to the Company’s Current Report on Form 8-K filed May 19, 2016.
3.37   Certificate of Amendment to the Company’s Certificate of Designation of Series D Convertible Preferred Stock filed with Secretary of State of the State of Delaware on May 18, 2016, incorporated herein by reference to Exhibit 3.5 to the Company’s Current Report on Form 8-K filed May 19, 2016.
10.59   Amendment to the Amended And Restated Certificate of Designation of the Series B Participating Convertible Preferred Stock, incorporated herein by reference to Exhibit 10.59 to the Company’s Current Report on Form 8-K filed March 31, 2011.
10.60   Amendment to the Amended And Restated Certificate of Designation of the Series C Participating Convertible Preferred Stock, incorporated herein by reference to Exhibit 10.60 to the Company’s Current Report on Form 8-K filed March 31, 2011.
10.61   Form Of Subscription Agreement, incorporated herein by reference to Exhibit 10.61 to the Company’s Current Report on Form 8-K filed on April 4, 2011.
10.62   Amendment No. 1 to the Registration Rights Agreement dated March 31, 2011, incorporated herein by reference to Exhibit 10.62 to the Company’s Current Report on Form 8-K filed on April 4, 2011
10.63   Note and Warrant Purchase Agreement dated April 23, 2012, incorporated herein by reference to Exhibit 10.63 to the Company’s Quarterly Report on Form 10-Q filed on August 14, 2012.

 

19 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

Exhibit Number  

 

Document

10.64   Form of Subscription Agreement dated September 14, 2012, incorporated herein by reference to Exhibit 10.64 to the Company’s Quarterly Report on Form 10-Q filed on November 14, 2012.
10.65   Form of Unsecured Convertible Promissory Note dated September 14, 2012, incorporated herein by reference to Exhibit 10.65 to the Company’s Quarterly Report on Form 10-Q filed on November 14, 2012.
10.66   Form of Subscription Agreement dated May 17, 2013, incorporated herein by reference to Exhibit 10.66 to the Company’s Quarterly Report on Form 10-Q filed on August 14, 2013.
10.67   Form of Subscription Agreement dated December 31, 2013, incorporated herein by reference to Exhibit 10.67 to the Company’s Form 10-K filed March 31, 2014.
10.68   Credit Agreement with Venture Champion Asia Limited dated May 6, 2014, incorporated herein by reference to Exhibit 10.68 to the Company’s Form 10-Q filed August 15, 2014.
10.69   Form of Subscription Agreement dated August 5, 2014, incorporated herein by reference to Exhibit 10.69 to the Company’s Form 10-K filed March 31, 2015.
10.70   Form of Subscription Agreement dated March 24, 2015, incorporated herein by reference to Exhibit 10.70 to the Company’s Quarterly Report on Form 10-Q filed May 15, 2015.
10.71   Form of Subscription Agreement dated July 23, 2015, incorporated herein by reference to Exhibit 10.71 to the Company’s Quarterly Report on Form 10-Q filed November 16, 2015.
10.72   Note and Warrant Purchase Agreement dated November 3, 2016, incorporated herein by reference to Exhibit 10.72 to the Company’s Quarterly Report on Form 10-Q filed August 14, 2017.
10.73   Form of Unsecured Convertible Promissory Note dated November 3, 2016, incorporated herein by reference to Exhibit 10.73 to the Company’s Quarterly Report on Form 10-Q filed August 14, 2017.
10.75   Form of Secured Convertible Promissory Note dated May 23, 2017, incorporated herein by reference to Exhibit 10.75 to the Company’s Quarterly Report on Form 10-Q filed August 14, 2017.
*31.1   Certification of Company’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*31.2   Certificate of Company’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*32.1   Certification of Chief Executive Officer pursuant to 18 USC Section 1750, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
*32.2   Certification of Chief Financial Officer pursuant to 18 USC Section 1750, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS   XBRL Instance Document
101.SCH   XBRL Taxonomy Extension Schema Document
101.CAL   XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF   XBRL Taxonomy Extension Definition Linkbase Document
101.LAB   XBRL Taxonomy Extension Label Linkbase Document
101.PRE   XBRL Taxonomy Extension Presentation Linkbase Document

 

*Filed herewith.

 

20 -

 

 

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

  iSign Solutions Inc.
  Registrant

 

August 14, 2020   /s/ Andrea Goren
Date   Andrea Goren
    (Principal Financial Officer and Officer Duly Authorized to Sign on Behalf of the Registrant)

 

 

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