Quarterly report pursuant to sections 13 or 15(d)

Consolidated Statements of Cash Flows (Unaudited)

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Consolidated Statements of Cash Flows (Unaudited) (USD $)
 6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
Cash flows from operating activities:    
Net loss $ (3,853,000) $ (2,014,000)
Less: income (loss) on discontinued operations 15,000 (198,000)
Loss from continuing operations, net of taxes (3,868,000) (1,816,000)
Adjustments to reconcile net income to cash provided by operations:    
Depreciation and amortization 2,576,000 2,753,000
Amortization of debt discount 0 12,000
Amortization of fair value of customer contracts (1,043,000) (1,943,000)
Deferred tax benefit (1,636,000) (852,000)
Provision for bad debt and other reserves 43,000 43,000
Impairment loss on goodwill 1,149,000 0
Loss (gain) on disposal of plant, property and equipment 2,000 (3,000)
Foreign exchange (loss) gain (2,000) 2,000
Issuance of common stock for services 99,000 102,000
Stock-based compensation 54,000 98,000
Changes in operating assets and liabilities of continuing operations, net of effect from business acquisitions:    
Accounts receivable 60,000 2,031,000
Unbilled receivables 1,482,000 (3,632,000)
Prepaid expenses, inventories and other assets 1,078,000 1,646,000
Accounts payable, accrued expenses and unearned revenue (3,603,000) (6,887,000)
Cash used in continuing operations (3,609,000) (8,446,000)
Cash used in discontinued operations (167,000) (372,000)
Cash used in operating activities (3,776,000) (8,818,000)
Cash flows from investing activities:    
Purchases of property and equipment (175,000) (387,000)
Change in restricted cash, net 0 1,500,000
Proceeds from sale of plant, property and equipment 0 3,000
Non-controlling distribution/redemption (508,000) 0
Payment to finite risk sinking fund (18,000) (1,899,000)
Cash used in investing activities (701,000) (783,000)
Cash flows from financing activities:    
Net borrowing of revolving credit 1,671,000 643,000
Principal repayments of long term debt (1,449,000) (2,134,000)
Proceeds from finite risk financing 0 565,000
Payment of finite risk financing 0 (251,000)
Cash provided by (used in) financing activities of continuing operations 222,000 (1,177,000)
Principal repayments of long term debt for discontinued operations (18,000) (17,000)
Cash provided by (used in) financing activities 204,000 (1,194,000)
Decrease in cash (4,273,000) (10,795,000)
Cash at beginning of period 4,368,000 12,055,000
Cash at end of period 95,000 1,260,000
Supplemental disclosure:    
Interest paid 353,000 479,000
Income taxes paid $ 104,000 $ 470,000