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: March 31, 20212022

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)

(650) 802-7888

Registrant’s telephone number, including area code

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.

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).

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

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

Number of shares outstanding of the issuer’s Common Stock as of May 17, 2021: 5,761,980.16, 2022: 6,332,736

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

INDEX

INDEX

PART I–FINANCIAL INFORMATION

Item 1. Financial Statements.

iSign Solutions Inc.

Condensed Consolidated Balance Sheets

(In thousands)

See accompanying notes to these Condensed Consolidated Financial Statements

iSign Solutions Inc.

Condensed Consolidated Statements of Operations

Unaudited

(In thousands, except per share amounts)

See accompanying notes to these Condensed Consolidated Financial Statements

iSign Solutions Inc.

Condensed Consolidated Statements of Stockholders’ Deficit

Unaudited

(In thousands)

See accompanying notes to these Condensed Consolidated Financial Statements

iSign Solutions Inc.
Condensed Consolidated Statements of Cash Flows
Unaudited
(In thousands)

See accompanying notes to these Condensed Consolidated Financial Statements

iSign Solutions Inc.
Condensed Consolidated Statements of Cash Flows (Continued)
Unaudited
(In thousands)

See accompanying notes to these Condensed Consolidated Financial Statements

iSign Solutions Inc.

Condensed Consolidated Statements of Cash Flows

Unaudited

(In thousands)

(In thousands, except per share amounts)

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. Since March 11, 2020 states in the U.S., including California, where the Company is headquartered, have begun to open up as the result of the development of vaccines to thwart the spread of the virus. The COVID-19 outbreak has disrupted supply chains and affected 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 any further spread of the outbreak, continued 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 have a continued impact on 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, 2020.2021.

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 March 31, 20212022 the Company’s accumulated deficit was $135,393.$135,920. The Company has primarily met its working capital needs through the sale of debt and equity securities. As of March 31, 2021,2022, the Company’s cash balance was $250.$56. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

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 Updates issued in 20212022 are not currently applicable to the Company, therefore implementation would not be expected to have a material impact on the Company’s financial position, results of operations and cash flows.

The following table summarizes accounts receivable and revenue concentrations:

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.

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:

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

Advances:

On February 17January 19 and February 22, 2021,9, 2022, the Company repaid $30$15 and $30,$15, respectively, of accounts receivable advances from unrelatedrelated parties along with $4$2 of accrued but unpaid advance fees. In addition, on March 31, 2021,February 2022, the Company repaid $20 in accounts receivable advances$100 of demand notes to a related party. The advance feean unrelated party along with 20% of $1 was repaid on April 1, 2021.accrued fees.

In March 2021, the Company received, from related parties, advances aggregating $25 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. The Company accrued $1 in advance fees recorded as interest expense on the Statement of Operations.

Notes payable:

On May 6, 2020,In January 2022, the Company received, loan proceedsfrom unrelated parties, demand notes aggregating $50 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 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 has applied for full loan and interest forgiveness. While the Company currently believes that its use of the loan proceeds, meets the conditions for forgiveness of the loan, we cannot assure you that we did not take actions that caused the Company to be ineligible for forgiveness of the loan, in whole or in part.

On February 28, 2021, the Company issued an aggregate of $75 in unsecured notes, $30 to related parties and $45 to other investors. The Company received $15 in cash and $15 in exchange for an account receivable advance, received in the prior year, from related parties, and $45 in cash from other investors. 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, the Company can force conversion at a price equal to the lesser of $0.50 per share or the price per share of the new financing. cash. The notes bear interest at the rate of 10%20% per annumannum. Principal and areinterest due December 31, 2021.shall be paid in full on demand, following ten (10) calendar day prior written notices starting on March 15, 2022. These note may be prepaid in whole or in part at any time without penalty, premium or other consideration by giving at least five (5) business day prior written notice to the Holder. The notes were repaid in full plus $1 of accrued interest in February 2022.

During the three months ended March 31, 2022, the Company accrued $91 of interest expense, $67 associated with the outstanding secured and unsecured convertible promissory notes, of which $30 was to related parties and $37 was to other investors. For the three months ended March 31, 2021, the Company accrued $79 of interest expense, $67 associated with theits outstanding secured and unsecured convertible promissory notes, of which $24 was to related parties and $43 was to other investors. For the three months ended March 31, 2020, the Company accrued $69 of interest expense, $60 associated with its outstanding notes, of which $24 was to related parties and $36 was to other investors.

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 three months ended March 31, 20212022 and 20202021 was approximately 4.78%1.73% and 6.43%4.78%, respectively, based on historical data.

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

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 over the vesting period of the options. No options were granted during the three months ended March 31, 20212022 and 2020.2021. There were no stock options exercised during the three months ended March 31, 20212022 and 2020,2021, respectively.

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

The following table summarizes the allocation of stock-based compensation expense for the three months ended March 31:

A summary of option activity under the Company’s plans for the three months ended March 31, 20212022 and 20202021 is as follows:

The following table summarizes significant ranges of outstanding and exercisable options as of March 31, 2021:2022:

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

A summary of the status of the Company’s non-vested shares as of March 31, 20212022 is as follows:

As of March 31, 2021,2022, there was $63$17 of total 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 1.65 years.one year.

Warrants

The Company did not issue any warrants during the three months ended March 31, 20212022 and 2020.2021.

A summary of the warrant activity to purchase shares of Common Stock for the three months ended March 31 is as follows:

A summary of the status of the warrants outstanding and exercisable to purchase shares of Common Stock as of March 31, 20212022 is as follows:

On April 1, 2021 the company repaid $128 in accounts receivable advances to two related parties. In addition the Company paid $10 in accrued but unpaid advance fees to the two related parties.

iSign Solutions Inc.

FORM 10-Q

(In thousands, except per share amounts)

On April 20, 2022, the Company issued an aggregate of $125 in unsecured convertible notes, $70 to related parties and $55 to other investors. The unsecured notes are convertible by the holder into common stock at any time at a price per share of $1.00. Upon closing a new financing of at least $1,000 in aggregate proceeds, the Company can force conversion at a price equal to the lesser of $1.00 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, 2022.

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 DecemberDecember 31, 2020, including the following:

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, 2020.

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, 2020,2021, net losses aggregated approximately $1,614,$1,014, and, at March 31, 2021,2022, the Company’s accumulated deficit was approximately $135,393.$135,920.

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. Since March 11, 2020 states in the U.S., including California, where the Company is headquartered, have begun to open up as the result of the development of vaccines to thwart the spread of the virus. The COVID-19 outbreak has disrupted supply chains and affected 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 any further spread of the outbreak, continued 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 have a continued impact on our financial condition or results of operations is uncertain.

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

For the three months ended March 31, 2021,2022, total revenue was $259, an increase$255, a decrease of $69,$4, or 36%2%, compared to total revenue of $190$259 in the prior year period. The increase in revenue is primarily attributable to an increase of $51, or 165% in the Company’s engineering service and transactional product revenues and an $18, or 11% increase in maintenance revenue compared to the prior year period.

The net loss for the three months ended March 31, 20212022 was $190, a decrease$231, an increase of $149,$42, or 44%22%, compared to a net loss of $339$189 in the prior year period. The decreaseincrease in net loss is due to the increasedecrease in revenue of $69,$4, or 36%2%, the decreaseincrease in overhead expenses of $90$35 or 20%10%, offset by the increasedecrease in cash and non-cash interest expense of $10$16 or 14%66% 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 2020 Form 10-K.

Effect of Recent Accounting Pronouncement,

Accounting Standards Updates issued in 2021 are not currently applicable to the Company, therefore implementation would not be 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 March 31, 2021,2022, product revenue was $82, an increase$80, a decrease of $51,$2, or 165%2%, compared to product revenue of $31$82 in the prior year period. The increase in product revenue is primarily due to an increase in transaction volume and engineering service revenues compared to the prior year period. For the three months ended March 31, 2021,2022, maintenance revenue was $177, an increase$175, a decrease of $18,$2, or 11%1%, compared to maintenance revenue of $159$177 in the prior year period. The increasedecrease is primarily due to the conversion of discounted long-term maintenance contracts to a non-discounteddiscontinued annual maintenance term.maintenance.

Cost of Sales

For the three months ended March 31, 2021,2022, cost of sales was $30, an increase$20, a decrease of $19,$10, or 173%33%, compared to cost of sales of $11$30 in the prior year. The increasedecrease was primarily due to an increasea decrease in direct engineering costs associated with engineering service software product and maintenance contracts and revenue, compared to the prior year.

Operating Expenses

Research and Development Expenses

For the three months ended March 31, 2021,2022, research and development expense was $144, a decrease$161, an increase of $32,$17, or 18%12%, compared to research and development expense of $176$144 in the prior year period. Research and development expenses consist primarily of salaries and related costs, outside engineering, maintenance items, and allocated facilities expenses. The decreaseincrease in research and development expense was due to a decreasean increase in salaries and related expenses of $3,$5, and a decrease of $10 in professional services and other overhead expenses and a $19 increase in direct engineering costs transferredthe expense allocation to cost of sales. Grosssales of $10, or 33%.Gross engineering expenses, before allocations to cost of sales, was $175 a decrease$185 an increase of $13,$10, or 7%6%, compared to $187$175 in the prior year period, due primarily to the decreaseincrease in professional services and other overhead expenses.

Sales and Marketing Expenses

For the three months ended March 31, 2021,2022, sales and marketing expense was $49,$54, an increase of $22,$5, or 81%11%, compared to $27$49 in the prior year period. The increase was primarily attributable to an increase in commissions and professional services.commissions.

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

General and Administrative Expenses

For the three months ended March 31, 2021,2022, general and administrative expense was $147, a decrease$160, an increase of $99,$13, or 40%9%, compared to general and administrative expense of $246$147 in the prior year period. The decreaseincrease was due primarily to decreasesincrease in warrant and professional service expenses of $101,$21, offset by increasesdecreases of $2$8 in other overhead expense,expenses, compared to the prior year period.

Other income and expense

Other income, expense was $1$0 and $1 for the three months ended March 31, 2020.2022 and 2021.

Interest expense for the three months ended March 31, 20202021 was $79,$91, an increase of $10,$12, or 14%15% compared to interest expense of $69$79 in the prior year period. The increase is due to an increase in short-term debt and other unpaid interest-bearing liabilities. Interest expense on short-term debt associated with related parties was $24$39 and non-related party interest expense was $55$52 for the three months ended March 31, 2021,2022, compared to $24 associated with related parties and non-related party interest expense of $45$55 in the prior year period.

Liquidity and Capital Resources

At March 31, 2021,2022, cash and cash equivalents totaled $250,$56, compared to cash and cash equivalents of $26$40 at December 31, 2020.2021. The increase in cash was due to cash flows from operating activities of $222 and $5 from financing activities.$99. The increased amounts were offset by $80 used in financing activities and $3 used in investing activities. At March 31, 2021,2022, total current assets were $331$165 compared to total current assets of $136$186 at December 31, 2020.2021. At March 31, 2021,2022, the Company’s principal sources of funds included its cash and cash equivalents aggregating $250.$56.

At March 31, 2021,2022, accounts receivable net, was $69,$94, a decrease of $31,$30, or 31%24%, compared to accounts receivable, net of $100$124 at December 31, 2020.2021. The decrease is due primarily due to faster collection times fortiming of collections of accounts receivable.

At March 31, 2021,2022, prepaid expenses and other current assets were $12, an increase$15, a decrease of $2,$7, or 20%32%, compared to prepaid expenses and other current assets of $10$22 at December 31, 2020.2021. The increasedecrease is due primarily to prepaymentsnormal amortization of insurance premiums and other prepaid for the current year.

At March 31, 2021,2022, accounts payable were $380,$396, an increase of $27,$18, or 8%5%, from the December 31, 20202021 balance of $353.$378. The increase is due primarily to professional fees for engineering services and accounting fees related to the prior year audit.

At March 31, 2021,2022, accrued compensation was $116,$88, an increase of $34,$19, or 41%28%, compared to accrued compensation of $82$69 at December 31, 2020.2021. The increase is due primarily to the accrual of commissions during the quarter ended March 31, 2021.2022.

Other accrued liabilities were $1,222$1,556 at March 31, 2021,2022, an increase of $81,$68, or 7%5%, compared to other accrued liabilities of $1,141$1,488 at December 31, 2020,2021, primarily due to the accrual of interest on the Company’s debt and certain franchise taxes.

Deferred revenue was $394$339 at March 31, 2021,2022, an increase of $179,$143, or 83%73%, compared to deferred revenue of $215$196 at December 31, 2020.2021. The increase is primarily due to the renewal of maintenance contracts offset by the recognition of maintenance revenues during the quarter ended March 31, 2021.2022.

At March 31, 2021,2022, total current liabilities were $5,331,$5,542, an increase of $326,$168, or 7%3%, compared to total current liabilities of $5,005$5,374 at December 31, 2020.2021. The increase is primarily due to the factors discussed above.

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

On February 28, 2021,In January 2022, the Company issued an aggregate of $75received, from unrelated parties, demand notes aggregating $50 in unsecured notes to affiliates and other investors. The Company received $60 in cash and $15 in exchange for advances received in the prior year. 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, the Company can force conversion at a price equal to the lesser of $0.50 per share or the price per share of the new financing.cash. The notes bear interest at the rate of 10%20% per annumannum. Principal and areinterest due Decembershall be paid in full on demand, following ten (10) calendar day prior written notice starting on March 15, 2022. These note may be prepaid in whole or in part at any time without penalty, premium or other consideration by giving at least five (5) business day prior written notice to the Holder. The notes were repaid in full plus $1 of accrued interest in February 2022.

.

During the three months ended March 31, 2021.

In March 2021,2022, the Company received, fromaccrued $91 of interest expense, $67 associated with the outstanding secured and unsecured convertible promissory notes, of which $30 was to related parties advances aggregating $25 in cash against certain accounts receivable of the Company. Upon collection of an invoice, the Company agreedand $37 was to repay the advance to the lenders on a pro rata basis together with a 5% advance fee. The Company accrued $1 in advance fees recorded as interest expense on the Statement of Operations.

Duringother investors. For the three months ended March 31, 2021, the Company accrued $79 of interest expense, $67 associated with theits outstanding secured and unsecured convertible promissory notes, of which $24 was to related parties and $43 was to other investors. For the three months ended March 31, 2020, the Company accrued $69 of interest expense, $60 associated with its outstanding notes, of which $24 was to related parties and $36 was to other investors.

The Company had no material commitments as of March 31, 2021.2022.

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.

Interest Rate Risk

The Company did not enter into any short-term security investments during the three months ended March 31, 2021.2022.

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 months ended March 31, 20212022 and 2020,2021, foreign currency translation gains and losses were insignificant.

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.

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

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 March 31, 20212022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II-OTHER INFORMATIONPart II-Other Information

None.

Not applicable.

None.

None.

Not applicable

None.

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

iSign Solutions Inc.
FORM 10-Q
(In thousands, except per share amounts)

SIGNATURES

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.

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