What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-11-13 compared with 2023-08-14 · 102 added, 96 removed, 323 unchanged (38% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

Current assets:

13 unchanged sentences

Total current liabilities

Long-term portion of deferred revenue

Long-term portion of deferred revenue (see note 4)

Long-term portion of operating lease liabilities (see note 6)

5 unchanged sentences

shares issued and outstanding:

123,685 at June 30, 2023 and December 31, 2022 (see note 7)

123,685 at September 30, 2023 and December 31, 2022 (see note 7)

Stockholders’ deficit:

Common stock, $ 0.001 par value, 150,000,000 shares authorized, shares issued and

90,477,798 at June 30, 2023 and December 31, 2022

90,477,798 at September 30, 2023 and December 31, 2022

Additional paid-in capital

4 unchanged sentences

( 1,228,675 )

Total liabilities, mezzanine equity and stockholders’ deficit

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three-months ended June 30,

Six-months ended June 30,

Three-months ended September 30,

Nine-months ended September 30,

REVENUE (see note 4)

4 unchanged sentences

Software development

OPERATING INCOME (LOSS)

OTHER EXPENSES

Foreign exchange loss

Interest expense

NET INCOME (LOSS) BEFORE INCOME TAXES

OPERATING INCOME

OTHER INCOME (EXPENSES)

Foreign exchange gain (loss)

Interest income (expense), net

NET INCOME BEFORE INCOME TAXES

Income tax expense

NET INCOME (LOSS)

$ ( 163,080 )

EARNINGS PER SHARE (see note 8)

Basic earnings (loss) per share

Diluted earnings (loss) per share

Basic earnings per share

Diluted earnings per share

WEIGHTED AVERAGE SHARES OUTSTANDING (see note 8)

5 unchanged sentences

Preferred Stock

Three-months ended June 30, 2023:

Stockholders’

Balance, March 31, 2023

Three-months ended September 30, 2023:

Number of Shares

Paid-in Capital

Accumulated Deficit

Stockholders’ Deficit

Balance, June 30, 2023

( 20,036,100 )

$ ( 1,042,349 )

Balance, June 30, 2023

Balance, September 30, 2023

$ ( 19,910,064 )

2 unchanged sentences

Preferred Stock

Three-months ended June 30, 2022:

Stockholders’

Balance, March 31, 2022 (restated)

Three-months ended September 30, 2022:

Number of Shares

Paid-in Capital

Accumulated Deficit

Stockholders’ Deficit

Balance, June 30, 2022

$ ( 20,680,935 )

1 unchanged sentence

Stock-based compensation

Balance, June 30, 2022

Balance, September 30, 2022

$ ( 20,371,392 )

2 unchanged sentences

Preferred Stock

Six-months ended June 30, 2023:

Stockholders’

Nine-months ended September 30, 2023:

Number of Shares

Paid-in Capital

Accumulated Deficit

Stockholders’ Deficit

Balance, December 31, 2022

1 unchanged sentence

$ ( 1,228,675 )

Balance, June 30, 2023

Balance, September 30, 2023

$ ( 19,910,064 )

2 unchanged sentences

Preferred Stock

Six-months ended June 30, 2022:

Stockholders’

Balance, December 31, 2021 (restated)

Nine-months ended September 30, 2022:

Number of Shares

Paid-in Capital

Accumulated Deficit

Stockholders’ Deficit

Balance, December 31, 2021

$ ( 20,666,896 )

1 unchanged sentence

Stock-based compensation

Balance, June 30, 2022

Balance, September 30, 2022

$ ( 20,371,392 )

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Six-months ended June 30,

Nine-months ended September 30,

OPERATING ACTIVITIES:

Net income (loss)

Adjustments to reconcile net income to net cash provided by operating activities:

32 unchanged sentences

Operating results for any quarter are not necessarily indicative of the results for any other quarter or for a full year.

In connection with the preparation of the condensed consolidated financial statements, management evaluated subsequent events after the balance sheet date of June 30, 2023 through the filing of this report.

In connection with the preparation of the condensed consolidated financial statements, management evaluated subsequent events after the balance sheet date of September 30, 2023 through the filing of this report.

These consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto for the fiscal year ended December 31, 2022 contained in the Form 10-K filed with the Securities and Exchange Commission dated March 31, 2023.

22 unchanged sentences

If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, additional allowances would be required.

The allowance for doubtful accounts was $ 125,000 and $ 200,000 as of June 30, 2023 and December 31, 2022, respectively.

Bad debt expense was $ 25,852 and $ 30,633 for the three-months ended June 30, 2023 and 2022, respectively.

Bad debt expense (recovery) was ($ 38,241 ) and $ 36,191 for the six-months ended June 30, 2023 and 2022, respectively.

On January 1, 2023, the Company adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments-Credit Losses (Topic 326), which changes the impairment model for most financial assets, including accounts receivable, and replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses.

The adoption of ASU 2016-13 had no impact on the Company’s consolidated financial statements.

The allowance for doubtful accounts was $ 275,000 and $ 200,000 as of September 30, 2023 and December 31, 2022, respectively.

Bad debt expenses were $ 155,980 and $ 19,745 for the three-months ended September 30, 2023 and 2022, respectively.

Bad debt expenses were $ 117,739 and $ 55,936 for the nine-months ended September 30, 2023 and 2022, respectively.

QUOTEMEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company generates substantially all of its revenue from subscriptions for access to its software products and related support.

1 unchanged sentence

The Company’s products and services are divided into two main categories:

QUOTEMEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Interactive Content and Data Applications

22 unchanged sentences

customer creditworthiness, past transaction history with the customer, current economic industry trends, and changes in customer payment terms.

If these factors do not indicate collection is reasonably assured, revenue is deferred until collection becomes reasonably assured, which is generally upon receipt of cash.

Cost of revenue

21 unchanged sentences

Revenue by type of service consists of the following:

Three-months ended June 30,

Six-months ended June 30,

Three-months ended September 30,

Nine-months ended September 30,

Portfolio Management Systems

4 unchanged sentences

Deferred Revenue

Changes in deferred revenue for the six-months ended June 30, 2023 and 2022 were as follows:

June 30, 2023

June 30, 2022

Changes in deferred revenue for the nine-months ended September 30, 2023 and 2022 were as follows:

September 30, 2023

September 30, 2022

Deferred revenue at beginning of period

7 unchanged sentences

Practical Expedients

We apply a practical expedient and do not disclose the value of the remaining performance obligations for contracts that are less than one year in duration, which represent a substantial majority of our revenue.

The Company applies a practical expedient and does not disclose the value of the remaining performance obligations for contracts that are less than one year in duration, which represent a substantial majority of its revenue.

QUOTEMEDIA, INC.

3 unchanged sentences

effective May 1, 2021 for approximately $6,500 per month.

Shworan, CEO of Quotemedia Ltd., is a control person of 410734 B.C.

At June 30, 2023, there were no amounts due to 410734 B.C.

Shworan, President & CEO of QuoteMedia Ltd., is a control person of 410734 B.C.

At September 30, 2023, there were no amounts due to 410734 B.C.

At December 31, 2022, there was $ 13,343 due to 410734 B.C.

2 unchanged sentences

The Company agreed to pay Bravenet an upfront setup fee of $ 7,000 upon signing the agreement and a monthly service fee of $ 2,500 starting February 2020.

At June 30, 2023 and December 31, 2022, there was $ 5,000 and $ 12,500 due to Bravenet related to this agreement, respectively.

At September 30, 2023 and December 31, 2022, there was $ 7,000 and $ 12,500 due to Bravenet related to this agreement, respectively.

Shworan is a control person of Bravenet.

At June 30, 2023 and December 31, 2022, there were $ 220,517 and $ 70,100 in unreimbursed expenses owed to Keith Randall, CEO of Quotemedia, Inc., respectively.

At September 30, 2023 and December 31, 2022, there were $ 48,628 and $ 70,100 in unreimbursed expenses owed to Keith Randall, CEO of QuoteMedia, Inc., respectively.

As a matter of policy all significant related party transactions are subject to review and approval by the Company’s Board of Directors.

11 unchanged sentences

Supplemental balance sheet information related to leases was as follows:

September 30,

Operating Leases

1 unchanged sentence

Current portion of operating lease liability

Long-term portion of operating lease liability

Total operating lease liability

September 30,

Weighted Average Remaining Lease Term

3 unchanged sentences

Maturities of lease liabilities were as follows:

Year ending December 31 ,

2023 (excluding the six-months ended June 30, 2023)

2023 (excluding the nine-months ended September 30, 2023)

2026 and thereafter

3 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The components of lease expense for the three and six-months ended June 30, 2023 and 2022 were as follows:

Three-months ended June 30,

Six-months ended June 30,

The components of lease expense for the three and nine-months ended September 30, 2023 and 2022 were as follows:

Three-months ended September 30,

Nine-months ended September 30,

Operating lease costs:

4 unchanged sentences

Total finance lease costs

Supplemental cash flow information for the six-months ended June 30, 2023 and 2022 related to leases was as follows:

Supplemental cash flow information for the nine-months ended September 30, 2023 and 2022 related to leases was as follows:

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

Operating cash flows from finance leases

Financing cash flows from finance leases

There was no additional right of use assets obtained in exchange for lease obligations for the six-months ended June 30, 2023 and 2022.

Operating cash flows used in operating leases

Operating cash flows used in finance leases

Financing cash flows used in finance leases

Right-of-use assets obtained in exchange for lease obligations:

Operating leases

REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT

2 unchanged sentences

A total of 550,000 shares of the Company’s Preferred Stock are designated as “Series A Redeemable Convertible Preferred Stock.” The Series A Redeemable Convertible Preferred Stock has no dividend or voting rights.

At June 30, 2023, 123,685 shares of Series A Redeemable Convertible Preferred Stock were outstanding.

No shares of Series A Redeemable Convertible Preferred Stock were issued or redeemed during the three and six-months ended June 30, 2023 and 2022.

At September 30, 2023, 123,685 shares of Series A Redeemable Convertible Preferred Stock were outstanding.

No shares of Series A Redeemable Convertible Preferred Stock were issued or redeemed during the three and nine-months ended September 30, 2023 and 2022.

Redemption Rights

7 unchanged sentences

b) Common stock

No shares of common stock were issued during the three and six-months ended June 30, 2023 and 2022.

No shares of common stock were issued during the three and nine-months ended September 30, 2023 and 2022.

c) Stock Options and Warrants

1 unchanged sentence

The impact of forfeitures that may occur prior to vesting is also estimated and considered in the amount recognized.

Total stock-based compensation expense, related to all of the Company’s stock-based awards, recognized for the three and six-months ended June 30, 2023 and 2022 was comprised as follows:

Three-months ended June 30,

Six-months ended June 30,

Total stock-based compensation expense, related to all of the Company’s stock-based awards, recognized for the three and nine-months ended September 30, 2023 and 2022 was comprised as follows:

Three-months ended September 30,

Nine-months ended September 30,

Sales and marketing

1 unchanged sentence

Common Stock Options and Warrants

There were 25,772,803 fully vested common stock warrants and options outstanding at June 30, 2023 and December 31, 2022 at a weighted-average grant date exercise price of $ 0.06 .

No stock options or warrants to purchase common stock were granted or exercised during the three and six-months ended June 30, 2023 and 2022.

The following table summarizes the weighted average remaining contractual life and exercise price of common stock options and warrants outstanding and exercisable at June 30, 2023:

At June 30, 2023, there was no unrecognized compensation cost related to non-vested options and warrants granted to purchase common stock.

There were 25,772,803 fully vested common stock warrants and options outstanding at September 30, 2023 and December 31, 2022 at a weighted-average grant date exercise price of $ 0.06 .

No stock options or warrants to purchase common stock were granted or exercised during the three and nine-months ended September 30, 2023 and 2022.

The following table summarizes the weighted average remaining contractual life and exercise price of common stock options and warrants outstanding and exercisable at September 30, 2023:

At September 30, 2023, there was no unrecognized compensation cost related to non-vested options and warrants granted to purchase common stock.

All stock options and warrants to purchase common stock have been granted with exercise prices equal to or greater than the market value of the underlying common shares on the date of grant.

At June 30, 2023, the aggregate intrinsic value of options and warrants outstanding and exercisable was $ 6,240,574 .

At September 30, 2023, the aggregate intrinsic value of options and warrants outstanding and exercisable was $ 5,725,118 .

The intrinsic value of stock options and warrants are calculated as the amount by which the market price of the Company’s common stock exceeds the exercise price of the option or warrant.

9 unchanged sentences

The probability of the liquidity event performance condition is not currently determinable or probable;

therefore, no compensation expense has been recognized as of June 30, 2023.

therefore, no compensation expense has been recognized as of September 30, 2023.

The probability is re-evaluated each reporting period.

As of June 30, 2023, there was $ 7,185,430 in unrecognized stock-based compensation expense related to these Liquidity Preferred Stock Warrants.

As of September 30, 2023, there was $ 7,185,430 in unrecognized stock-based compensation expense related to these Liquidity Preferred Stock Warrants.

Since the Liquidity Preferred Stock Warrants only vest and become exercisable on the consummation of a Liquidity Event which is currently determined not to be probable, management is also unable to determine the weighted-average period over which the unrecognized compensation cost will be recognized.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As of June 30, 2023, there were a total of 413,493 preferred stock warrants outstanding with a weighted average remaining contractual life of 24.5 years.

As of June 30, 2023, 31,250 preferred stock warrants were exercisable.

No preferred stock warrants were granted or exercised for the three and six-months ended June 30, 2023 and 2022.

As of September 30, 2023, there were a total of 413,493 preferred stock warrants outstanding with a weighted average remaining contractual life of 24.3 years.

As of September 30, 2023, 31,250 preferred stock warrants were exercisable.

No preferred stock warrants were granted or exercised for the three and nine-months ended September 30, 2023 and 2022.

Fair Value Measurement of Compensation Preferred Stock Warrants

12 unchanged sentences

The estimated fair value of the Preferred Stock Warrant liability is determined using Level 3 inputs.

As of June 30, 2023 and December 31, 2022, the fair value of the Preferred Stock Warrant Liability was $ 767,188 and $ 629,375 , respectively.

As of September 30, 2023 and December 31, 2022, the fair value of the Preferred Stock Warrant Liability was $ 710,000 and $ 629,375 , respectively.

The Preferred Stock Warrants were valued using a bond plus option framework reflecting the cash flow of the Preferred Stock Warrants and used a probability weighted sum of the value in each potential year before expiration to estimate the fair value of the Preferred Stock Warrants.

3 unchanged sentences

This model was run based on the Management's expected term and probabilities of a liquidity event.

The key inputs for the framework were as follows as of June 30, 2023 and December 31, 2022:

The key inputs for the framework were as follows as of September 30, 2023 and December 31, 2022:

Valuation Inputs

June 30, 2023

September 30, 2023

December 31, 2022

5 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table sets forth a summary of the changes in the fair value of the Level 3 Preferred Stock Warrant Liability for the three and six-months ended June 30, 2023:

The following table sets forth a summary of the changes in the fair value of the Level 3 Preferred Stock Warrant Liability for the three and nine-months ended September 30, 2023:

Preferred Stock Warrant Liability

1 unchanged sentence

Change in fair value

Fair value as of March 31, 2023

Change in fair value

Fair value as of June 30, 2023

Change in fair value

Fair value as of September 30, 2023

The changes in fair value attributable to the Preferred Stock Warrants are recorded as an adjustment to stock compensation expense and reported in Sales and Marketing expense on the Statements of Operations.

6 unchanged sentences

Therefore, in periods when a loss is reported, the calculation of basic and dilutive loss per share results in the same value.

The calculations for basic and diluted net income per share for the three and six-months ended June 30, 2023 and 2022 are as follows:

Three-months ended June 30,

Six-months ended June 30,

Net income (loss)

$ ( 163,080 )

Weighted average common shares used to

calculate net income per share

Warrants to purchase redeemable

convertible preferred stock

The calculations for basic and diluted net income per share for the three and nine-months ended September 30, 2023 and 2022 are as follows:

Three-months ended September 30,

Nine-months ended September 30,

Weighted average common shares used to calculate net income per share - basic

Warrants to purchase redeemable convertible preferred stock

Redeemable convertible preferred stock

Stock options and warrants to purchase

Weighted average common shares used to

calculate diluted net income per share

Net income (loss) per share – basic

Net income (loss) per share – diluted

Stock options and warrants to purchase common stock

Weighted average common shares used to calculate net income per share - diluted

Net income per share – basic

Net income per share – diluted

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements