Covisint Corporation
Covisint Corp (Form: 8-K, Received: 06/05/2017 17:05:33)


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of earliest event reported): June 5, 2017


Covisint Corporation
(Exact Name of Registrant as Specified in its Charter)


Commission File Number: 001-36088

Michigan
(State or other jurisdiction of incorporation or organization)
26-2318591
(I.R.S. Employer Identification No.)

26533 Evergreen Road, Suite 500, Southfield, Michigan

(Address of Principal Executive Offices)

48076
(Zip Code)


(Registrant’s telephone number, including area code): (248) 483-2000



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o
Written Communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))







Item 2.02. Results of Operations and Financial Condition.

On June 5, 2017, Covisint Corporation (“Covisint”) issued a press release announcing financial results for its fourth quarter and fiscal year ended March 31, 2017 and certain other information.  A copy of the press release is furnished with the Report as Exhibit 99.1. The Registrant intends to hold an investor call and webcast to discuss these results on June 5, 2017, at 5:00 p.m. Eastern Time. Additional presentation materials relating to such call are furnished hereto as Exhibit 99.2 and are incorporated herein by reference.

Forward-Looking Statements

Certain statements in this Current Report on Form 8-K, including but not limited to statements set forth in the attached press release and additional presentation materials, may constitute forward-looking statements. These forward looking statements involve a number of known and unknown risks, uncertainties and other factors that may cause such forward-looking statements not to be realized and that could cause actual results to differ materially from Covisint’s expectations in these statements. For more information about other risks that could affect the forward-looking statements herein, please see Covisint’s most recent annual report on Form 10-K, quarterly report on Form 10-Q, and other filings made with the Securities and Exchange Commission. Covisint expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements to reflect any changes in expectations, or any change in events or circumstances on which those statements are based, unless otherwise required by law.

Item 9.01. Financial Statements and Exhibits.

(c) Exhibits.

99.1
Press Release, dated June 5, 2017.
99.2
Presentation materials dated June 5, 2017.



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 hereunto duly authorized.

COVISINT CORPORATION


Date: June 5, 2017                        By:     /s/ Enrico Digirolamo    
Enrico Digirolamo
Chief Financial Officer









INDEX OF EXHIBITS


Exhibit No.
Description
99.1
Press Release, dated June 5, 2017
 
99.2
Presentation materials dated June 5, 2017
 




NEWS RELEASE
26533 Evergreen Rd., Suite 500 Southfield, Michigan 48076
(800) 229-4125

For Immediate Release     
June 5, 2017



Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results


DETROIT — June 5, 2017 -- Covisint Corporation (Nasdaq: COVS), the leading Cloud Platform for building Identity and Internet of Things (IoT) applications, today announced financial results for the fourth quarter and full fiscal year ended March 31, 2017.

Fiscal 2017 Financial Results

Revenue
Total revenue was $70.2 million, a decrease of 8% compared to $76.0 million in the prior year.
Subscription revenue was $60.7 million, a decrease of 4% compared to $63.4 million in the prior fiscal year.
Services revenue was $9.5 million, a decrease of 25% compared to $12.7 million in the prior fiscal year.
 
Profitability
GAAP gross margin was 53%, compared to 54% in the prior year.
Non-GAAP gross margin was 59%, in-line with the prior year.
GAAP net loss was $12.7 million or ($0.31) per share, compared to net loss of $14.9 million or ($0.38) per share in the prior year .
Non-GAAP net loss was $9.4 million or ($0.23) per share, compared to net loss of $12.9 million or ($0.33) per share in the prior year .

Fourth Quarter Fiscal 2017 Financial Highlights

Revenue
Total revenue was $19.0 million, a decrease of 5% compared to $20.0 million in the same period last year.
Subscription revenue was $16.8 million, a decrease of 2% compared to $17.2 million in the same period last year.
Services revenue was $2.2 million, a decrease of 21% compared to the same period last year.
 
Profitability
GAAP gross margin was 60%, compared to 49% in the prior fiscal quarter and 61% in the same period last year .



Page 2
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017

Non-GAAP gross margin was 66%, compared to 56% in the prior fiscal quarter and 65% in the same period last year .
GAAP net income was $1.6 million or $0.04 per diluted share, compared to net loss of $0.1 million or ($0.00) per share in the same period last year .
Non-GAAP net income was $2.6 million or $0.06 per diluted share, compared to net loss of $0.5 million or ($0.01) per share in the same period last year .

Balance Sheet
The Company had $33.2 million in cash and cash equivalents at March 31, 2017, compared with $30.4 million at December 31, 2016.

Fourth Quarter Fiscal 2017 Business Highlights
Hosted customers and showcased the Covisint IoT Platform at the 2017 Consumer Electronics Show (CES) in Las Vegas.
Sponsored AutoMobili-D 2017 , in conjunction with the North American International Auto Show (NAIAS), with a “Connecting the Global Automotive Ecosystem” themed exhibit and presented on “Enabling and Monetizing Connected Cars.”
Announced that Covisint was recognized as “Supplier of the Year” for the second consecutive year by SAIC General Motors.
Launched the most complete IoT Platform for enabling digital transformation, unlocking the full business value of enterprise IoT solutions by securely connecting complete ecosystems of people, systems and things.
Exhibited at the 2017 RSA Conference in San Francisco, and showcased an identity-centric approach to the Internet of Things with the Covisint Platform.
Showcased the Covisint Platform at the Gartner Identity & Access Management Summit in London in March 2017. Covisint Chief Security Officer, David Miller, presented on “Orchestrating Identities Across the Internet of Things.”

Use of Non-GAAP Financial Measures

In addition to reporting financial results in accordance with generally accepted accounting principles in the United States (“GAAP”), Covisint monitors non-GAAP measures, including non-GAAP gross profit, non-GAAP gross margin, non-GAAP net income (loss), and non-GAAP net income (loss) per diluted share. Each of these financial measures excludes the impact of certain items (the impact of stock award compensation expense, the amortization and impairment of intangible assets and amounts incurred for capitalized internal software costs) and, therefore, has not been calculated in accordance with GAAP.



Page 3
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017

Covisint monitors these non-GAAP measures to evaluate its ongoing operational performance and enhance an overall understanding of its past financial performance. Covisint believes that these non-GAAP metrics help illustrate underlying trends in its business that could otherwise be masked by the effect of the expenses that are excluded in non-GAAP gross profit, non-GAAP gross margin , non-GAAP net income (loss), and non-GAAP net income (loss) per diluted share. Furthermore, Covisint uses these measures to establish budgets and operational goals for managing its business and evaluating its performance. Covisint also believes that these non-GAAP measures provide additional tools for investors to use in comparing its recurring core business operating results over multiple periods against other companies in its industry.

The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release to the most directly comparable GAAP financial measures is included with the financial statements contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating its business internally and as such has determined that it is important to provide this information to investors.

Conference Call and Webcast Information

Covisint management will hold a conference call at 5:00 p.m. (Eastern time) today to discuss these results. The U.S. toll free dial-in for the conference call is 1-877-407-4018, and the international dial-in number is 1-201-689-8471. No passcode is required. A live webcast of the conference call will also be available on the company's website at investors.covisint.com .

For those unable to participate in the conference call, a replay will be available after the conclusion of the earnings call on June 5, 2017, through June 12, 2017. The U.S. toll-free replay dial-in number is 1-844 - 512 - 2921 and the international replay dial-in number is 1-412 - 317 - 6671. The replay passcode is 13663623 .

About Covisint Corporation

Covisint is the connected company - we securely connect ecosystems of people, systems and things to enable new service offerings, optimize operations, develop new business models and ultimately enable the connected economy. Today, we support more than 2,000 organizations and connect to more than 212,000 business partners and customers worldwide. Learn more at www.covisint.com .



Page 4
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017

Covisint on Twitter
Covisint on LinkedIn
Covisint on Facebook

Forward-looking Statements

This press release contains forward-looking statements, including statements regarding Covisint's future financial performance, market growth, the demand for Covisint's solutions, and general business conditions. Any forward-looking statements contained in this press release are based upon Covisint's historical performance and its current plans, estimates and expectations and are not a representation that such plans, estimates, or expectations will be achieved. These forward-looking statements represent Covisint's expectations as of the date of this press release. Subsequent events may cause these expectations to change, and Covisint disclaims any obligation to update the forward-looking statements in the future. These forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, our ability to attract new customers; the extent to which customers renew their contracts; the extent we are able to maintain pricing with our customers at renewal; the continued growth of the market for our solutions; the success of our channel partner and certified partner strategies; competition from current competitors and new market entrants; unpredictable macro-economic conditions; the loss of any of our key employees; the length of the sales for our solutions; and other risks and uncertainties. Further information on potential factors that could affect actual results is included in Covisint's reports filed with the SEC.

Investor Relations Contact
866-319 - 7659
investors@covisint.com

Media Contact
Brad Schechter, Vice President, Corporate Marketing
248-483-2097
bschecht@covisint.com

For Sales and Marketing Information
Covisint Corporation, 26533 Evergreen Road, Suite 500, Southfield, MI 48076, 800-229-4125
http://www.covisint.com



Page 5
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017

COVISINT CORPORATION
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Data)

 
March 31, 2017
 
March 31, 2016
ASSETS
 
 
 
CURRENT ASSETS:
 
 
 
Cash and cash equivalents

$33,227

 

$39,681

Accounts receivable, net of allowance for doubtful accounts of $36 and $39 as of March 31, 2017 and 2016, respectively
8,066

 
12,836

Prepaid expenses
1,992

 
2,167

Other current assets
878

 
1,603

Total current assets
44,163

 
56,287

PROPERTY AND EQUIPMENT, NET
5,103

 
7,847

CAPITALIZED SOFTWARE AND OTHER INTANGIBLE ASSETS, NET
10,031

 
11,486

OTHER:
 
 
 
Goodwill
25,385

 
25,385

Deferred costs
56

 
580

Deferred tax asset, net
172

 
171

Other assets
156

 
289

Total other assets
25,769

 
26,425

TOTAL ASSETS

$85,066

 

$102,045

LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
CURRENT LIABILITIES:
 
 
 
Accounts payable

$2,427

 

$5,061

Accrued commissions and bonuses
1,423

 
1,071

Deferred revenue
14,595

 
15,952

Accrued expenses
1,432

 
2,377

Total current liabilities
19,877

 
24,461

DEFERRED REVENUE
2,115

 
3,595

ACCRUED LIABILITIES
2,265

 
2,327

DEFERRED TAX LIABILITY, NET
327

 
353

Total liabilities
24,584

 
30,736

COMMITMENTS AND CONTINGENCIES
 
 
 
SHAREHOLDERS' EQUITY:
 
 
 
Preferred stock, no par value - authorized 5,000,000 shares; none issued and outstanding

 

Common stock, no par value - authorized 50,000,000 shares; issued and outstanding 40,865,897 and   40,490,928 as of March 31, 2017 and 2016, respectively

 

Additional paid-in capital
164,120

 
161,997

Accumulated deficit
(103,253
)
 
(90,527
)
Accumulated other comprehensive loss
(385
)
 
(161
)
Total shareholders' equity
60,482

 
71,309

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$85,066

 

$102,045


See notes to consolidated financial statements.



Page 6
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017

COVISINT CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In Thousands, Except Per Share Data)

 
YEAR ENDED MARCH 31,
 
2017
 
2016
 
2015
REVENUE

$70,243

 

$76,024

 

$88,534

COST OF REVENUE
33,279

 
34,953

 
66,404

GROSS PROFIT
36,964

 
41,071

 
22,130

OPERATING EXPENSES:
 
 
 
 
 
Research and development
11,381

 
13,019

 
10,416

Sales and marketing
26,804

 
29,448

 
32,593

General and administrative
11,497

 
13,286

 
17,640

Total operating expenses
49,682

 
55,753

 
60,649

OPERATING LOSS
(12,718
)
 
(14,682
)
 
(38,519
)
Other (expense) income
61

 
(23
)
 
69

LOSS BEFORE INCOME TAX PROVISION
(12,657
)
 
(14,705
)
 
(38,450
)
INCOME TAX PROVISION
69

 
189

 
112

NET LOSS

($12,726
)
 

($14,894
)
 

($38,562
)
Basic and diluted loss per share

($0.31
)
 

($0.38
)
 

($1.01
)
Weighted average shares used to compute net loss per share attributable to common stockholders - basic and diluted
40,719

 
39,658

 
38,217

OTHER COMPREHENSIVE LOSS, NET OF TAX
 
 
 
 
 
Foreign currency translation adjustments
(224
)
 
(137
)
 
(12
)
OTHER COMPREHENSIVE LOSS, NET OF TAX
(224
)
 
(137
)
 
(12
)
COMPREHENSIVE LOSS

($12,950
)
 

($15,031
)
 

($38,574
)



See notes to consolidated financial statements.




Page 7
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017

COVISINT CORPORATION
RECONCILIATION OF U.S. GAAP TO NON-U.S. GAAP
(In Thousands, Except Per Share Data)
(Unaudited)

 
 
Three Months Ended
March 31,
 
Twelve Months Ended 
March 31,
 
 
2017
 
2016
 
2017
 
2016
Gross profit
 

$11,296

 

$12,102

 

$36,964

 

$41,071

Gross margin
 
60
%
 
61
%
 
53
%
 
54
%
Adjustments:
 
 
 
 
 
 
 
 
Stock compensation expense
 
16

 
3

 
53

 
71

Amortization of capitalized software
 
1,128

 
787

 
4,274

 
3,398

Non-U.S. GAAP gross profit
 

$12,440

 

$12,892

 

$41,291

 

$44,540

Non-U.S. GAAP gross margin
 
66
%
 
65
%
 
59
%
 
59
%





 
 
Three Months Ended
March 31,
 
Twelve Months Ended 
March 31,
 
 
2017
 
2016
 
2017
 
2016
Cost of revenue
 

$7,685

 

$7,885

 

$33,279

 

$34,953

Adjustments:
 
 
 
 
 
 
 
 
Stock compensation expense
 
16

 
3

 
53

 
71

Amortization of capitalized software
 
1,128

 
787

 
4,274

 
3,398

Non-U.S. GAAP cost of revenue
 

$6,541

 

$7,095

 

$28,952

 

$31,484






 
 
Three Months Ended
March 31,
 
Twelve Months Ended 
March 31,
 
 
2017
 
2016
 
2017
 
2016
Research and development
 

$2,065

 

$3,129

 

$11,381

 

$13,019

Adjustments:
 
 
 
 
 
 
 
 
Capitalized internal software costs
 
(644
)
 
(1,673
)
 
(2,819
)
 
(4,238
)
Stock compensation expense
 
11

 
2

 
37

 
78

Non-U.S. GAAP research and development
 

$2,698

 

$4,800

 

$14,163

 

$17,179




Page 8
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017



 
 
Three Months Ended
March 31,
 
Twelve Months Ended 
March 31,
 
 
2017
 
2016
 
2017
 
2016
Sales and marketing
 

$5,412

 

$6,225

 

$26,804

 

$29,448

Adjustments:
 
 
 
 
 
 
 
 
Stock compensation expense
 
85

 
91

 
296

 
501

Non-U.S. GAAP sales and marketing
 

$5,327

 

$6,134

 

$26,508

 

$28,947




 
 
Three Months Ended
March 31,
 
Twelve Months Ended 
March 31,
 
 
2017
 
2016
 
2017
 
2016
General and administrative
 

$2,290

 

$2,770

 

$11,497

 

$13,286

Adjustments:
 
 
 
 
 
 
 
 
Stock compensation expense
 
369

 
381

 
1,513

 
2,166

Non-U.S. GAAP general and administrative
 

$1,921

 

$2,389

 

$9,984

 

$11,120




 
 
Three Months Ended
March 31,
 
Twelve Months Ended 
March 31,
 
 
2017
 
2016
 
2017
 
2016
Net income (loss)
 

$1,589

 

($110
)
 

($12,726
)
 

($14,894
)
Adjustments:
 
 
 
 
 
 
 
 
Capitalized internal software costs
 
(644
)
 
(1,673
)
 
(2,819
)
 
(4,238
)
Stock compensation expense
 
480

 
478

 
1,899

 
2,817

Amortization of capitalized software
 
1,128

 
787

 
4,274

 
3,398

Non-U.S. GAAP net income (loss)
 

$2,553

 

($518
)
 

($9,372
)
 

($12,917
)



 
 
Three Months Ended
March 31,
 
Twelve Months Ended 
March 31,
 
 
2017
 
2016
 
2017
 
2016
Diluted EPS
 
$0.04
 
$0.00
 
($0.31)
 
($0.38)
Adjustments:
 
 
 
 
 
 
 
 
Capitalized internal software costs
 
(0.02
)
 
(0.04
)
 
(0.07
)
 
(0.11
)
Stock compensation expense
 
0.01

 
0.01

 
0.05

 
0.07

Amortization of capitalized software
 
0.03

 
0.02

 
0.10

 
0.09

Non-U.S. GAAP Diluted EPS
 

$0.06

 

($0.01
)
 

($0.23
)
 

($0.33
)




Page 9
Covisint Corporation Announces Fourth Quarter and Full-Year Fiscal 2017 Financial Results
June 5, 2017

COVISINT CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)

 
YEAR ENDED MARCH 31,
 
2017
 
2016
 
2015
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:
 
 
 
 
 
Net loss

($12,726
)
 

($14,894
)
 

($38,562
)
Adjustments to reconcile net loss to cash provided by (used in) operations:
 
 
 
 
 
Depreciation and amortization
7,210

 
6,772

 
9,574

Capitalized software and other intangible asset impairment

 

 
8,751

Deferred income taxes
(8
)
 
148

 
11

Stock award compensation
1,899

 
2,817

 
6,232

Other
1

 
18

 
307

Net change in assets and liabilities:
 
 
 
 
 
Accounts receivable
4,705

 
2,474

 
6,377

Other assets
1,532

 
5,397

 
3,306

Accounts payable and accrued expenses (1)
(2,751
)
 
(4,157
)
 
4,919

Deferred revenue
(2,799
)
 
(2,441
)
 
(5,610
)
Net cash used in operating activities
(2,937
)
 
(3,866
)
 
(4,695
)
CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:
 
 
 
 
 
Purchase of:
 
 
 
 
 
Property and equipment (1)
(229
)
 
(3,817
)
 
(3,953
)
Capitalized software
(2,819
)
 
(4,238
)
 
(3,509
)
Proceeds from asset disposals
2

 
33

 

Net cash used in investing activities
(3,046
)
 
(8,022
)
 
(7,462
)
CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:
 
 
 
 
 
Cash payments from former parent company

 

 
23,999

Cash payments to former parent company

 

 
(13,879
)
Vendor financing payments
(614
)
 
(728
)
 

Net proceeds from exercise of stock awards
239

 
2,191

 
2,865

Net cash provided by (used in) financing activities
(375
)
 
1,463

 
12,985

EFFECT OF EXCHANGE RATE CHANGES ON CASH
(96
)
 
29

 
(287
)
NET CHANGE IN CASH
(6,454
)
 
(10,396
)
 
541

CASH AT BEGINNING OF YEAR
39,681

 
50,077

 
49,536

CASH AT END OF YEAR

$33,227

 

$39,681

 

$50,077


(1)
Accounts payable and accrued expenses in the balance sheet as of March 31, 2015 include $3.0 million associated with purchases of property and equipment, which are non-cash acquisitions of fixed assets as of March 31, 2015.

See notes to consolidated financial statements.



6/5/2017 1 Covisint Corporation Fourth Quarter and Full Year Fiscal 2017 Results June 5, 2017


 
This presentation contains “forward-looking” statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, our results may differ materially from those expressed or implied by such forward-looking statements. All statements other than statements of historical fact could be deemed forward-looking, including, but not limited to, any projections of financial information; any statements about historical results that may suggest trends for our business and results of operations; any statements of the plans, strategies and objectives of management for future operations; any statements of expectation or belief regarding future events, potential markets or market size, technology developments, or enforceability of our intellectual property rights; and any statements of assumptions underlying any of the foregoing. These statements are based on estimates and information available to us at the time of this presentation and are not guarantees of future performance. Actual results could differ materially from our current expectations as a result of many factors, including but not limited to: our ability to attract new customers; the extent to which customers renew their contracts for our solutions; the extent we are able to maintain pricing with our customers at renewal; the seasonality of our business; our ability to manage our growth; the continued growth of the market for our solutions; the success of our channel partner and certified partner strategies; competition from current competitors and new market entrants; our ability to penetrate new vertical markets; unpredictable macro-economic conditions; the loss of any of our key employees; the length of the sales and implementation cycles for our solutions; increased demands on our infrastructure and costs associated with operating as a public company; failure to protect our intellectual property; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the failure to obtain the requisite approval of Covisint’s shareholders or the failure to satisfy other closing conditions; risks related to disruption of management’s attention from Covisnt’s on-going business operations due to the pending transaction; and the effect of the announcement of the pending transaction on the ability of Covisint to retain and hire key personnel, maintain relationships with its customers and suppliers, and maintain its operating results and business generally. These and other risks and uncertainties associated with our business are described in Item 1A “Risk Factors” in our Quarterly Report on Form 10-K for the period ended March 31, 2017. We assume no obligation and do not intend to update these forward-looking statements. In addition to U.S. GAAP financials, this presentation includes certain non-GAAP financial measures. These historical and forward-looking non-GAAP measures are in addition to, not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation between GAAP and non-GAAP measures is included in the appendix to this presentation. Covisint is a registered trademark of Covisint Corporation. This presentation also contains additional trademarks and service marks of ours and of other companies. We do not intend our use or display of other companies’ trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies. Forward Looking Statements 2


 
3 Fiscal 2017: Financial Overview Key Metrics ($ in thousands) * Excludes the impact of stock compensation and the expensing of certain R&D costs (rather than capitalizing such costs), refer to the reconciliation of quarterly results on slide 6 Highlights • Cash at $33 million • Non-GAAP Gross Margin at plan levels • Cash Flow better than expectations Q4 FY 17 Y/Y Q/Q FY 17 Y/Y Subscription Revenue $ 16,788 (2%) 14% $ 60,727 (4%) Services Revenue $ 2,194 (21%) 15% $ 9,516 (25%) Total Revenue $ 18,982 (5%) 14% $ 70,243 (8%) Q4 FY 17 Y/Y Q/Q FY 17 Y/Y Gross Profit $ 11,296 (7%) 39% $ 36,964 (10%) Gross Margin 60% 53% Stock Compensation Expense $ 16 $ 53 Amortization of Capitalized Software $ 1,128 $ 4,274 Non-GAAP Gross Profit* $ 12,440 (4%) 34% $ 41,291 (7%) Non-GAAP Gross Margin 66% 59% Net Income/(Loss) $ 1,589 $ (12,726) Stock Compensation Expense $ 480 $ 1,899 Capitalized internal software costs $ (644) $ (2,819) Amortization of Capitalized Software $ 1,128 $ 4,274 Non-GAAP Net Income/( Loss)* $ 2,553 $ (9,372) Net Change in Cash $ 2,786 $ (6,454) Net proceeds from exercise of stock awards $ - $ (239) Vendor Financing Payment $ - $ 614 Effect of Exchange Rate Changes on Cash $ (42) $ 96 Free Cash Flow $ 2,744 $ (5,983)


 
Executive Commentary and Perspective • Covisint Enters Definitive Agreement to be Acquired by OpenText • $2.45 per share, or approximately $103 million • 23% premium to the prior closing price on June 2, 2017 • 27% premium to the 30-day volume-weighted average price • 46% cash-adjusted premium to the 30-day volume-weighted average price* • All-cash transaction with no financial contingencies • Approved by the Board of Directors at both Covisint and OpenText • Expected to close in the third quarter of calendar 2017, subject to a shareholder vote and customary closing conditions • Expected Benefits for Covisint's Employees and Customers • Enhanced financial scale and greater development and support resources to reach our growth potential • Shared values, commitment to customer success, passion for engineering solutions, and disciplined execution * The cash-adjusted calculation deducts the Company’s cash and cash equivalents of $33 million or $0.79 per share as of March 31, 2017 from both its current share price and from the total Merger Consideration implied by the offer in order to better measure the premium being offered 4


 
Appendix


 
Fiscal 2017: Non-GAAP Reconciliation ($ in thousands, except per share) Q4'FY17 FY17 Cost of revenue 7,685 33,279 Adjustments: Stock compensation expense 16 53 Amortization of capitalized software and other intangibles 1,128 4,274 Cost of revenue, non-GAAP 6,541 28,952 Q4'FY17 FY17 Research and development 2,065 11,381 Adjustments: Capitalized internal software costs (644) (2,819) Stock compensation expense 11 37 Research and development, non-GAAP 2,698 14,163 Q4'FY17 FY17 Sales and marketing 5,412 26,804 Adjustments: Stock compensation expense 85 296 Sales and marketing, non-GAAP 5,327 26,508 Net Change in Cash $ 2,786 $ (6,454) Net proceeds from exercise of stock awards $ - $ (239) Vendor Financing Payment $ - $ 614 Effect of Exchange Rate Changes on Cash $ (42) $ 96 Free Cash Flow $ 2,744 $ (5,983) Q4'FY17 FY17 General and administrative 2,290 11,497 Adjustments: Stock compensation expens 369 1,513 General and administrative, non-GAAP 1,921 9,984 Q4'FY17 FY17 Net loss 1,589 (12,726) Adjustments: Capitalized internal software costs (644) (2,819) Stock comp nsation expense 480 1,899 Amortization of capitalized software and other intangibles 1,128 4,274 Net loss, non-GAAP 2,553 (9,372) Q4'FY17 FY17 Diluted EPS 0.04 (0.31) Adjustments: Capitalized internal software costs (0.02) (0.07) Stock compensation expense 0.01 0.05 Amortization of capitalized software and other intangibles 0.03 0.10 Diluted EPS, non-GAAP 0.06 (0.23) 6