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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended September 30, 2014
 
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 001-35164

ONVIA, INC.
(Exact name of registrant as specified in its charter)
 
Delaware
91-1859172
(State or other jurisdiction of incorporation
or organization)
(I.R.S. Employer Identification No.)
 
509 Olive Way, Suite 400, Seattle, Washington 98101
(Address of principal executive offices, including zip code)

Registrant's telephone number, including area code: (206) 282-5170

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.  [X] 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).  [X] Yes    [  ] No 

Indicate by checkmark 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 [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  [  ] Yes    [X] No

Common stock, par value $.0001 per share: 7,396,459 shares outstanding as of October 31, 2014.
 
 

 
ONVIA, INC.

INDEX


 
Page
 

 
 
 

 
PART I.  FINANCIAL INFORMATION
 
Item 1.  Unaudited Condensed Consolidated Financial Statements
Onvia, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income

   
Three Months Ended September 30,
   
Nine Months Ended September 30,
 
   
2014
   
2013
   
2014
   
2013
 
   
(Unaudited)
   
(Unaudited)
 
   
(In thousands, except per share data)
   
(In thousands, except per share data)
 
                         
Revenue
                       
Subscription
  $ 5,131     $ 4,831     $ 15,159     $ 14,409  
Content license
    480       462       1,417       1,461  
Management information reports
    34       76       129       348  
Other
    55       73       178       226  
                                 
Total revenue
    5,700       5,442       16,883       16,444  
                                 
Cost of revenue (exclusive of depreciation and amortization included below)
    906       961       2,793       2,850  
                                 
Gross margin
    4,794       4,481       14,090       13,594  
                                 
Operating expenses:
                               
Sales and marketing
    2,943       2,822       8,647       8,369  
Technology and development
    989       975       3,038       3,039  
General and administrative
    906       785       2,660       2,510  
                                 
 Total operating expenses
    4,838       4,582       14,345       13,918  
                                 
Loss from operations
    (44 )     (101 )     (255 )     (324 )
                                 
Interest and other income, net
    2       3       7       18  
                                 
Net loss
  $ (42 )   $ (98 )   $ (248 )   $ (306 )
                                 
Unrealized (loss) / gain on available-for-sale securities
    (1 )     1       (1 )     (1 )
                                 
Comprehensive loss
  $ (43 )   $ (97 )   $ (249 )   $ (307 )
                                 
Basic and diluted net loss per common share
  $ (0.01 )   $ (0.01 )   $ (0.03 )   $ (0.04 )
                                 
Basic and diluted weighted average shares outstanding
    7,396       7,329       7,381       7,746  

See accompanying notes to the unaudited condensed consolidated financial statements.
 
1

 
Onvia, Inc.
Condensed Consolidated Balance Sheets

   
September 30,
2014
   
December 31,
2013
 
   
(Unaudited)
 
   
(In thousands, except share data)
 
ASSETS
           
             
CURRENT ASSETS:
           
Cash and cash equivalents
  $ 1,635     $ 2,073  
Short-term investments, available-for-sale
    6,347       5,463  
Accounts receivable, net of allowance for doubtful accounts of $27 and $25
    1,256       1,333  
Prepaid expenses and other current assets
    561       570  
                 
Total current assets
    9,799       9,439  
                 
LONG TERM ASSETS:
               
Property and equipment, net of accumulated depreciation
    1,463       1,773  
Internal use software, net of accumulated amortization
    5,214       5,433  
Long-term investments, available-for-sale
    91       90  
Other long-term assets
    182       174  
                 
Total long term assets
    6,950       7,470  
                 
TOTAL ASSETS
  $ 16,749     $ 16,909  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
                 
CURRENT LIABILITIES:
               
Accounts payable
  $ 742     $ 834  
Accrued expenses
    799       960  
Unearned revenue, current portion
    8,079       7,770  
Other current liabilities
    76       244  
                 
Total current liabilities
    9,696       9,808  
                 
LONG TERM LIABILITIES:
               
Unearned revenue, net of current portion
    496       650  
Deferred rent, net of current portion
    606       586  
Other long-term liabilities
    75       98  
                 
Total long term liabilities
    1,177       1,334  
                 
TOTAL LIABILITIES
    10,873       11,142  
                 
COMMITMENTS AND CONTINGENCIES (Note 9)
               
                 
STOCKHOLDERS’ EQUITY:
               
Preferred stock; $.0001 par value: 2,000,000 shares authorized; no shares issued or outstanding
    -       -  
Common stock; $.0001 par value: 11,000,000 shares authorized; 8,639,266 and 8,577,732 shares issued; and 7,396,459 and 7,345,189 shares outstanding
    1       1  
Treasury stock, at cost: 1,242,807 and 1,242,807 shares
    (4,398 )     (4,398 )
Additional paid in capital
    353,816       353,458  
Accumulated other comprehensive loss
    (1 )     -  
Accumulated deficit
    (343,542 )     (343,294 )
                 
Total stockholders’ equity
    5,876       5,767  
                 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
  $ 16,749     $ 16,909  

See accompanying notes to the unaudited condensed consolidated financial statements.
 
2

 
Onvia, Inc.
Condensed Consolidated Statements of Cash Flows

   
Nine Months Ended September 30,
 
   
2014
   
2013
 
   
(Unaudited)
 
   
(In thousands)
 
             
CASH FLOWS FROM OPERATING ACTIVITIES:
           
Net loss
  $ (248 )   $ (306 )
Adjustments to reconcile net loss to net cash provided by operating activities:
               
Depreciation and amortization
    2,404       2,272  
Idle lease accrual
    -       (74 )
Stock-based compensation
    130       204  
Change in operating assets and liabilities:
               
Accounts receivable
    77       122  
Prepaid expenses and other assets
    -       95  
Accounts payable
    (26 )     (92 )
Accrued expenses
    (161 )     13  
Unearned revenue
    155       157  
Deferred rent
    35       61  
                 
Net cash provided by operating activities
    2,366       2,452  
                 
CASH FLOWS FROM INVESTING ACTIVITIES:
               
Additions to property and equipment
    (270 )     (650 )
Additions to internal use software
    (1,688 )     (1,605 )
Purchases of investments
    (9,606 )     (8,390 )
Sales of investments
    1,570       3,256  
Maturities of investments
    7,152       7,425  
Security deposits
    -       (150 )
                 
Net cash used in investing activities
    (2,842 )     (114 )
                 
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Principal payments on capital lease obligations
    (189 )     (288 )
Repurchase of stock
    -       (4,398 )
Proceeds from exercise of stock options
    227       100  
                 
Net cash provided by / (used in) financing activities
    38       (4,586 )
                 
Net decrease in cash and cash equivalents
    (438 )     (2,248 )
                 
Cash and cash equivalents, beginning of period
    2,073       3,888  
                 
Cash and cash equivalents, end of period
  $ 1,635     $ 1,640  
                 
                 
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
               
Purchases under capital lease obligations
  $ (6 )   $ (122 )
Property and equipment additions in accounts payable
    (4 )     (34 )
Internal use software additions in accounts payable
    (185 )     (240 )

See accompanying notes to the unaudited condensed consolidated financial statements.
 
3

 
Onvia, Inc.
Notes To Condensed Consolidated Financial Statements (Unaudited)

1.
Accounting Policies

Basis of Presentation
The accompanying unaudited condensed consolidated financial statements include the accounts of Onvia, Inc. and its wholly owned subsidiary, collectively referred to as "Onvia" or the ”Company.”  There was no business activity in the subsidiary during the three and nine month periods ended September 30, 2014 or 2013.  The unaudited interim condensed consolidated financial statements and related notes thereto have been prepared pursuant to generally accepted accounting principles in the United States of America, or GAAP, and the rules and regulations of the Securities and Exchange Commission.  Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations.  The accompanying unaudited interim condensed consolidated financial statements and related notes thereto should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013 (“2013 Annual Report”).

The information furnished is unaudited, but reflects, in the opinion of management, all adjustments, consisting of only normal recurring items, necessary for a fair presentation of the results for the interim periods presented. Interim results are not necessarily indicative of results for a full year.

Use of Estimates
The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.  Significant estimates include the fair value of stock-based compensation, allowance for doubtful accounts, capitalization of costs for internally developed software, recoverability of long-lived assets, including internally developed software, and the valuation allowance for Onvia’s net deferred tax assets.  The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances.  Actual results may differ significantly from the Company’s estimates.  In addition, any significant unanticipated changes in any of the Company’s assumptions could have a material adverse effect on its business, financial condition, and results of operations.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance for revenue from contracts with customers, which provides a single comprehensive revenue recognition model to apply in determining how and when to recognize revenue. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. When applying the new revenue model to contracts with customers the guidance requires five steps to be applied, which include: 1) identify the contract(s) with a customer, 2) identify the performance obligations in the contract, 3) determine the transaction price, 4) allocate the transaction price to the performance obligations in the contract and 5) recognize revenue when (or as) the entity satisfies a performance obligation. The guidance also requires both quantitative and qualitative disclosures, which are more comprehensive than existing revenue standards. The disclosures are intended to enable financial statement users to understand the nature, timing and uncertainty of revenue and the related cash flow. This guidance will be effective for Onvia in the first quarter of 2017; early adoption is not permitted. The Company is currently assessing the impact the guidance will have upon adoption.

 
4

 
2.
Stock-Based Compensation and Stock Option Activity

The impact on Onvia’s results of operations of recording stock-based compensation was as follows for the periods presented (in thousands):
 
   
Three Months Ended
September 30,
   
Nine Months Ended
September 30,
 
   
2014
   
2013
   
2014
   
2013
 
Cost of sales
  $ 1     $ 2     $ 4     $ 6  
Sales and marketing
    5       16       -       34  
Technology and development
    5       5       16       30  
General and administrative
    35       43       110       134  
Total stock-based compensation
  $ 46     $ 66     $ 130     $ 204  
 
3.
Loss per Share

Basic loss per share is calculated by dividing the net loss for the period by the weighted average shares of common stock outstanding for the period.  Diluted loss per share is calculated by dividing the net loss per share by the weighted average common stock outstanding for the period, plus dilutive potential common shares using the treasury stock method.  In periods with a net loss, basic and diluted earnings per share are identical because inclusion of potentially dilutive common shares would be anti-dilutive.

The following table sets forth the computation of basic and diluted net income or loss per share for the three and nine months ended September 30, 2014 and 2013 (in thousands, except per share data):
 
   
Three Months Ended September 30,
   
Nine Months Ended September 30,
 
   
2014
   
2013
   
2014
   
2013
 
Net loss
  $ (42 )   $ (98 )   $ (248 )   $ (306 )
                                 
Shares used to compute basic net loss per share
    7,396       7,329       7,381       7,746  
Dilutive potential common shares:
                               
Stock options
    -       -       -       -  
Shares used to compute diluted net loss per share
    7,396       7,329       7,381       7,746  
Basic and diluted net loss per share
  $ (0.01 )   $ (0.01 )   $ (0.03 )   $ (0.04 )

For the three and nine months ended September 30, 2014, the weighted average effect of stock options to purchase approximately 1,076,049 and 1,094,999 shares of common stock, respectively, were excluded from the computation of diluted net loss per share because their effect would be anti-dilutive.

For the three and nine months ended September 30, 2013, the weighted average effect of stock options to purchase approximately 404,000 and 470,000 shares of common stock, respectively, were excluded from the computation of diluted net loss per share because their effect would be anti-dilutive.
 
 
5

 
4.
Investments

Onvia classifies short-term and long-term investments in debt securities as available-for-sale, stated at fair value as summarized in the following table (in thousands):

   
September 30, 2014
 
   
Amortized
Cost
   
Gross
Unrealized
Gains
   
Gross
Unrealized
Losses
   
Fair Value
 
                         
Short-Term Investments
                       
Certificates of Deposit  (1)
  $ 6,348     $ -     $ (1 )   $ 6,347  
Total Short-Term Investments
    6,348       -       (1 )     6,347  
Long-Term Investments
                               
Certificates of Deposit  (1)
    91       -       -       91  
Total Long-Term Investments
    91       -       -       91  
Total Investments
  $ 6,439     $ -     $ (1 )   $ 6,438  

(1) We evaluated certificates of deposits held as of September 30, 2014 and concluded that they meet the definition of securities as available for sale.

   
December 31, 2013
 
   
Amortized
Cost
   
Gross
Unrealized
Gains
   
Gross
Unrealized
Losses
   
Fair Value
 
                         
Short-Term Investments
                       
U.S. Government backed securities
  $ 2,252     $ -     $ -     $ 2,252  
Certificates of Deposit  (1)
    3,212       -       (1 )     3,211  
Total Short-Term Investments
    5,464       -       (1 )     5,463  
Long-Term Investments
                               
Certificates of Deposit  (1)
    90       -       -       90  
Total Long-Term Investments
    90       -       -       90  
Total Investments
  $ 5,554     $ -     $ (1 )   $ 5,553  

(1) We evaluated certificates of deposits held as of December 31, 2013 and concluded that they meet the definition of securities as available for sale.

Onvia accounts investments available for sale according to their fair values, which is defined as the exchange price that would be received for an asset, or paid to transfer a liability (an exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  The Company utilizes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The following are the three levels of inputs that may be used to measure fair value:

Level 1 — Quoted prices in active markets for identical assets or liabilities.
 
Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 
6

 
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Onvia uses the market approach to measure fair value for its financial assets and liabilities.  The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

The following table summarizes, by major security type, investments classified as available-for-sale at September 30, 2014 and at December 31, 2013 , stated at fair value (in thousands):

   
Fair Value Measurements as of September 30, 2014
 
   
Level 1
   
Level 2
   
Level 3
   
Balance as of
September 30, 2014
 
                         
Certificates of Deposit
  $ -     $ 6,438     $ -     $ 6,438  
    $ -     $ 6,438     $ -     $ 6,438  

   
Fair Value Measurements as of December 31, 2013
 
   
Level 1
   
Level 2
   
Level 3
   
Balance as of
December 31, 2013
 
                         
U.S. Government backed securities
  $ -     $ 2,252     $ -     $ 2,252  
Certificates of Deposit
    -       3,301       -       3,301  
    $ -     $ 5,553     $ -     $ 5,553  

There were no transfers in or out of Level 2 investments during the first nine months of 2014 and fourth quarter of 2013, and there was no activity in Level 1 or Level 3 fair value measurements during those periods.
 
5.
Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):
 
   
September 30,
2014
   
December 31,
2013
   
Prepaid insurance
  $ 138     $ 29    
Prepaid software licences and maintenance
    212       338    
Prepaid expenses - other
    198       159    
Interest receivable
    3       14    
Other receivables
    10       30    
    $ 561     $ 570    
 
 
7

 
6.
Property and Equipment

Property and equipment, net of accumulated depreciation, consist of the following (in thousands):

   
September 30,
2014
   
December 31,
2013
   
               
 Computer equipment
  $ 3,605     $ 3,576    
 Software
    1,856       1,837    
 Furniture and fixtures
    109       107    
 Leasehold improvements
    883       883    
 
                 
 Total cost basis
    6,453       6,403    
                   
 Less accumulated depreciation
    (4,990 )     (4,630 )  
                   
 Net book value
  $ 1,463     $ 1,773    

Depreciation expense was $176,000 and $538,000 for the three and nine months ended September 30, 2014, respectively, compared to $190,000 and $556,000, respectively, for the same periods of 2013.  Depreciation expense is included in operating expenses in the Consolidated Statements of Operations and Comprehensive Income.

7.
Internal Use Software

Onvia capitalizes qualifying computer software costs incurred during the “application development stage” and other costs.  Amortization of these costs begins once the product is ready for its intended use.  These costs are amortized on a straight-line basis over the estimated useful life of the product, typically 3 to 5 years.  The amount of costs capitalized within any period is dependent on the nature of software development activities and projects in each period.

Onvia periodically evaluates the remaining useful lives and carrying values of internal use software.  If management determines that all or a portion of the asset will no longer be used, or the estimated remaining useful life differs from existing estimates, an abandonment will be recorded to reduce the carrying value or adjust the remaining useful life to reflect revised estimates.  In addition, if the carrying value of the software exceeds the estimated future cash flows, an impairment will be recorded to reduce the carrying value to the expected realizable value. No impairment has been recorded during the nine months ended September 30, 2014 and 2013.

The following table presents a roll-forward of capitalized internal use software for the nine months ended September 30, 2014 (in thousands):

   
Balance at
December 31,
2013
   
Additions
   
Balance at
September 30,
2014
   
Capitalized Internal Use Software
  $ 15,104     $ 1,647     $ 16,751    
Accumulated amortization
    (9,671 )     (1,866 )     (11,537 )  
    $ 5,433     $ (219 )   $ 5,214    

Amortization expense was $609,000 and $1.9 million for the three and nine months ended September 30, 2014, respectively, compared to $567,000 and $1.7 million, respectively, for the same periods of 2013. Amortization expense is included in operating expenses in the Consolidated Statements of Operations and Comprehensive Income.
 
 
8

 
8.
Accrued Expenses

Accrued expenses consist of the following (in thousands):

   
September 30,
2014
   
December 31,
2013
   
Payroll and related liabilities
  $ 705     $ 715    
Taxes payable and other
    94       245    
    $ 799     $ 960    

Other current liabilities consist of the following (in thousands):

   
September 30,
2014
   
December 31,
2013
   
Obligations under capital leases, current portion
  $ 24     $ 18    
Deferred rent, current portion
    52       37    
Other current liabilities
    -       189    
    $ 76     $ 244    
 
9.
Commitments and Contingencies

Operating Leases

During the first quarter of 2013, Onvia entered into the first amendment to lease agreement for its corporate offices located in Seattle, Washington.  The amendment, among other things, extends the lease term for an additional sixty-five (65) months with a new expiration date of April 30, 2021.  In addition, the amendment reduces the rental area of the premises to approximately 29,606 square feet, after surrender of 5,394 square feet after the execution of the amendment.  Onvia has an additional right to surrender up to 8,898 square feet on or after November 30, 2015 in exchange for reimbursement of unamortized landlord incentives.  In addition to base rent, Onvia will be responsible for its proportionate share of annual incremental increases in the building’s operating expenses, insurance, and real estate taxes over the 2013 base year.  Onvia has a one-time right to terminate the amended lease in its entirety on or after December 1, 2017 in exchange for payment of a significant termination fee.

Rent expense is being recognized on a straight-line basis over the term of the lease.  Onvia also has a non-cancellable operating lease for office equipment, which expires in July 2019.

As of September 30, 2014, remaining future minimum lease payments required on non-cancellable operating leases are as follows for the years ending December 31 (in thousands):

   
Real Estate
Operating Leases
   
Office Equipment
Operating Lease
   
Total
Operating Leases
   
                     
2014
  $ 202     $ 5     $ 207    
2015
    760       20       780    
2016
    780       20       800    
2017
    873       20       893    
2018
    896       20       916    
2019 and thereafter
    2,178       9       2,187    
    $ 5,689     $ 94     $ 5,783    
 
 
9

 
Purchase Obligations

Onvia has non-cancellable purchase obligations for software development and license agreements, co-location hosting arrangements, telecom agreements, marketing agreements and third-party content agreements.  The agreements expire in dates ranging from 2014 to 2017.  Future required payments under these non-cancellable agreements are as follows for the years ending December 31 (in thousands):
 
   
Purchase
Obligations
   
         
2014
  $ 304    
2015
    363    
2016
    277    
2017
    15    
    $ 959    
 
Legal Proceedings

From time to time, legal proceedings may arise in the ordinary course of business.  Although the outcomes of legal proceedings are inherently difficult to predict, we are not currently involved in any legal proceeding in which the outcome, in our judgment based on information currently available, is likely to have a material adverse effect on our business or financial position.

10.
Provision for Income Taxes

As of December 31, 2013 and September 30, 2014, Onvia has recorded a valuation allowance against its net deferred tax assets because the Company has determined it is not more likely than not that the asset will be realized. Onvia will continue to evaluate the likelihood that these tax benefits may be realized, and may reverse all or a portion of its valuation allowance in the future if it is determined that realization of these benefits is more likely than not.

Pursuant to Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), utilization of NOL carryforwards to offset future taxable income are subject to substantial annual limitations if we experience a cumulative change in ownership as defined by the Code. In general, an ownership change, as defined by the Code, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period.

As of September 30, 2014 and December 31, 2013, Onvia’s Federal NOL carryforwards for income tax purposes were approximately $73 million.  The Federal NOL carryforwards are subject to limitations under Section 382 of the Internal Revenue Code. If not utilized, the Federal NOL carryforwards will begin to expire in 2022.  The latest date available for a portion of the Federal NOL carryforwards to be utilized to offset future income is 2033.

11.
Security Deposits

Pursuant to Onvia’s lease for its current corporate office space, Onvia has established a stand by letter of credit as security to the lease increasing from $100,000 in April 2013, to $125,000 in January 2014 and to $150,000 on January 2015.  The letter of credit will be returned at lease termination in April 2021 or earlier as discussed above, subject to standard office lease conditions. As of September 30, 2014 and December 31, 2013, the stand by letter of credit is secured by a security deposit of $150,000 and reported as other long-term assets on the unaudited condensed consolidated balance sheets.
 
 
10

 
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
 
CAUTIONARY STATEMENT

In addition to historical information, the discussion and analysis in this report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Words such as “believes,” “anticipates,” “should,” “expects,” “plans,” “intends,” “indicates” and similar expressions identify forward-looking statements.  Forward-looking statements include, but are not limited to, statements about our future results of operations, the progress to be made on the 2014 initiatives, Onvia’s future financial flexibility and future cash flows and Onvia’s future product and content offerings.  Such statements are based on current expectations that involve a number of known and unknown risks, uncertainties and other factors, which may cause actual events to be materially different from those expressed or implied by such forward-looking statements.  Our actual results could differ materially from those anticipated in these forward-looking statements.

The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements:  Onvia’s new “target market” strategy fails to increase contract value of new customers; Onvia’s Client Success reorganization fails to improve sales penetration and client retention rates, especially first year client retention rates; adoption of Onvia’s new product releases is slower than expected and fails to improve sales penetration and client retention rates; and Onvia’s technology fails to handle the increased demands on its infrastructure caused by increasing network traffic and the volume of aggregated data.
 
Additional information on factors that may impact these forward-looking statements can be found under “Risk Factors,” “Business,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” as applicable, in this report, in our 2013 Annual Report on Form 10-K for the year ended December 31, 2013.  Onvia assumes no obligation to update forward-looking statements as a result of new information or future events or developments, except as may be required by law.  The following discussion should also be read in conjunction with the unaudited Condensed Consolidated Financial Statements and accompanying Notes thereto.

In this Report, the words “we,” “our,” “us,” “Onvia,” or the “Company” refer to Onvia, Inc. and its wholly- owned subsidiary.

Company Overview

Onvia is a leading provider of business information and research solutions that help companies plan, market and sell to government agencies throughout the United States (or U.S.).  Onvia’s business solutions provide clients online access to proprietary information about government procurement activity across local, state, and federal government agencies.  The business intelligence derived from our solutions allows clients to identify and research new market opportunities, analyze market trends, and obtain valuable insights about their competitors and channel partners.  We believe our business solutions provide clients with a distinct competitive advantage, increased revenue opportunities, and strategic insight into the public sector market.

Our procurement solutions include proprietary content and analytical tools that deliver essential insight and intelligence necessary to win more business with state, local and federal governments.  Onvia’s target client prospects operate regionally or nationally, have a long-term strategic interest in the public sector and focus primarily on the decentralized State, Local and Education (SLED) market.  We believe this model will produce higher margins, providing the flexibility to price products based upon the value that we create for clients, not based upon the cost of fulfillment.

The Onvia solution includes access to the Onvia Database, Spending Forecast Center, Term Contract Center, Vendor Center and the Onvia Guide.  These services are sometimes bundled with management information reports in multiple elements arrangements. We allocate revenue from these bundled sales ratably between the subscription services and the management reports based on established list prices for those offerings. Subscriptions to the Onvia Database are typically prepaid, have a minimum term of one year and revenues are recognized ratably over the term of the subscription.  Subscriptions are generally priced based upon the geographic range, nature of content purchased, and the number of users accessing the database.

 
11

 
Most of Onvia’s revenues are generated from sales to companies that leverage our information for their own internal use, and to businesses that license our content for redistribution.  Revenue from businesses who license our content for resale to their own clients is classified as Content License revenue.  Content license contracts are generally multi-year arrangements and typically have higher annual contract values than our subscription-based services.  Revenue from content license agreements is recognized over the term of the agreement.

Over the last three years we have repositioned Onvia’s value proposition from an aggregator of public procurement documents to a provider of comprehensive public sector business intelligence and rebuilt the foundation of the business which we believe is now positioned to generate accelerating subscription revenue and Adjusted EBITDA (see below for more information regarding Adjusted EBITDA).

Onvia was incorporated in January 2000 in the state of Delaware.  Our principal corporate office is located in Seattle, Washington.  Our securities trade on The NASDAQ Capital Market under the symbol ONVI.

Strategic Initiatives

We implemented adjustments to our go-to-market strategy beginning in the fourth quarter of 2013:

·
We tightened our target market and now focus on companies that do business regionally or nationally.

·
The Enterprise and Small/Medium Business (SMB) sales forces were merged into one sales organization, separated by function, not by client segment.  The Business Development organization focuses on new client acquisition, and the Client Success organization is responsible for the renewal and expansion of existing subscription contracts.

·
Within the Client Success organization, we separated responsibility for client service from contract cross-sell/upsell intended to provide more focus on the client and their business objectives.

·
We created a first year client team exclusively responsible for the consistent onboarding of new clients, intended to improve first year retention rates.

In 2014, Onvia management is focused on four new initiatives intended to accelerate subscription revenue and Adjusted EBITDA by leveraging the solid foundation built over the last three years.

·
Our first 2014 initiative is to accelerate the acquisition of the new clients within the defined verticals of the new target market.  We will measure the success of this initiative by the overall growth in new client bookings and Annual Contract Value per Client (ACVC) year over year.

The third quarter of 2014 was our third full quarter selling into our new target market of companies with a national or regional geographic focus.  Total acquisition bookings declined in the third quarter of 2014 compared to the same period of 2013, however, national and regional acquisition bookings increased by 35% compared to the same period last year.  In addition, the ACVC for new clients grew 24% to $14,908 in the third quarter of 2014 from $12,053 in the third quarter of 2013.

The growth in national and regional acquisition bookings and corresponding improvement in ACVC continues to validate our adoption of a new target market strategy developed in October 2013.  In addition, we have begun to invest in content marketing which we expect will benefit new client acquisition through an increase in awareness and engagement from our target audience.  In particular, we experienced an increase in lead generation following the publishing of our quarterly SLED reports in the first and second quarter of 2014.

 
12

 
·
Our second initiative is to improve first year client retention and renew tenured, long term clients within the target market.  In the first quarter of 2014, the Client Success team was reorganized to focus on three specific objectives: client retention, first year client on-boarding and contract upgrades.  Dollar retention is a measurement of how effectively the Client Success team achieves these three short- and long-term objectives.  For the twelve months ended September 30, 2014, dollar retention increased to 88%, up from 84% in the same period last year.  Dollar retention can fluctuate from period to period due to the mix of first year and tenured clients expiring in each period.  The fourth quarter of 2014 has a higher mix of first year clients that the previous quarters of 2014.

·
Our third initiative is to maximize growth within the existing client base.  In the first quarter of 2014, we created a team that specializes in increasing clients’ investment in our solution.  Contract upgrades are the primary measure of the results of this initiative. In the third quarter of 2014 contract upgrades increased 52% compared to the same period in 2013.  This growth in contract expansions provides further evidence that there is significant opportunity to expand the adoption of our solutions deeper into our client organizations.  We continue to believe that by meeting more business objectives, the partnership with clients is strengthened which should drive improvements in ACVC and increase the lifetime value of each client.

·
Our fourth and final initiative is to continue to drive enhancements to our existing platform and to provide innovative new solutions that make Onvia a strategic business partner with our clients.  The most significant achievement for this 2014 initiative occurred in October with the release of Onvia 7, a major upgrade to the Onvia platform.  We have adopted the latest technology to organize and structure the massive Onvia database of procurement intelligence.  This investment offers two key client benefits: it should be easier for clients to setup their own searches with aids resident on the platform and clients should receive only the most relevant search results eliminating the noise found in most search engines on the market today.

We have initiated a strategic partnership with SmartProcure, a provider of purchase order intelligence for the public sector.  Purchase order analytics should help clients identify new agency buyers, inform pricing strategies and understand the competitive landscape for its goods and services.  Purchase orders often include transactional information that is below the threshold for public disclosure which can provide clients with a competitive advantage.  Before the end of the year our clients will have the opportunity to access the SmartProcure database as an additional module on the Onvia platform for an additional fee.  This gives our clients access to actual purchase orders of their customers and prospects so they have greater visibility into actual spending by the agencies.

Executive Summary of Operations and Financial Position

Our target clients are businesses that are strategically focused on selling their goods and services into the public sector.  As discussed above, we sell into this market through two sales channels: businesses that leverage our information for their own internal use and businesses that license our content for redistribution or resale (i.e. content license).

Prior to 2011, our target market was extremely broad, and we acquired a large number of non-strategic clients that were not adequately profitable.  We no longer invest in acquiring non-strategic clients, and our client base has declined as a result of this decision to transition to our more profitable target market. We believe that ACV is a better measure of sales effectiveness than the number of clients.
 
 
13

 
We manage the business using the following key client metrics:

Annual Contract Value, or ACV
Annual contract value represents the annualized aggregate revenue value of all subscription contracts as of the end of the quarter.  ACV is driven by ACVC and the number of clients. Most of our revenues are generated from subscription contracts, which are typically prepaid and have a minimum term of one year, with revenues recognized ratably over the term of the subscription.  We also receive revenue from multi-year content distribution partnerships, stand-alone management reports, document download services, and list rental services, which are not included in the calculation of ACV.  Content license contracts are excluded from ACV.

ACV increased by 7% to $21.1 million in the third quarter of 2014 from $19.8 million for the same period one year ago.  Growth in ACV indicates that new client acquisitions, contract expansions and improving client retention rates have more than offset the impact of client attrition.  The growth rate in ACV can fluctuate from quarter to quarter based on timing of the amount of ACV available for renewal.

Dollar Retention
Since the first quarter of 2014 we have reported dollar retention which measures the dollars renewed on the available base of expiring contracts over the preceding twelve months. Dollar retention is calculated on a percentage basis by dividing the contract value of subscription contracts renewed, including the value of contract upgrades, during the most recent twelve-month period by the total value of subscription contracts expiring over the same period.  Dollar retention measures the percentage of dollars retained from the population of expiring contracts over a twelve month period.

In the twelve months ended September 30, 2014, dollar retention was 88% compared to 84% in the twelve months ended September 30, 2013.  Dollar retention can fluctuate from period to period due to the mix of first year and tenured clients expiring in each period.  Dollar retention, in conjunction with ACV, provides insight in to our subscription retention rate and ability to generate future subscription revenue.

Number of Clients
Number of clients represents the number of individual businesses subscribing to our products.

At the end of the third quarter, our total client base decreased 9% to 3,350 clients compared to 3,700 clients in the same year-ago period and were flat compared to the second quarter of 2014.  Our strategy is to continue to improve profitability by acquiring and managing fewer strategic clients at higher ACVC.  We believe that ACV is a better measure of sales effectiveness than the number of clients.

Annual Contract Value per Client, or ACVC
Annual contract value per client is the ACV divided by the number of clients and indicates the average value of each of our subscriptions.

ACVC increased 18% to $6,286 in the third quarter of 2014 compared to $5,333 in the third quarter of 2013.  ACVC for new clients increased 24% to $14,908 from $12,053 in the third quarter of 2013.  The continued growth in ACVC demonstrates our success in acquiring clients with strategic interest in the public sector at a regional or national level.  Companies within this target market typically have higher ACVC and renew at higher rates, which are key attributes of a profitable long-term client.

Adjusted EBITDA
Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”) and should not be considered as an alternative to net income, operating income or any other financial measures so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of the company’s liquidity.  Onvia defines Adjusted EBITDA as net income/(loss) before interest expense and other non-cash financing costs; taxes; depreciation; amortization; and non-cash stock-based compensation.  Other companies (including Onvia’s competitors) may define Adjusted EBITDA differently.  Onvia presents Adjusted EBITDA because it believes Adjusted EBITDA to be an important supplemental measure of performance that is commonly used by securities analysts, investors and other interested parties in the evaluation of companies in similar industries and size. Management also uses this information internally for forecasting and budgeting.  It may not be indicative of the historical operating results of Onvia nor is it intended to be predictive of potential future results.  Investors should not consider Adjusted EBITDA in isolation or as a substitute for analysis of results as reported under GAAP.

 
14

 
The following table provides a reconciliation of GAAP Net Loss to Adjusted EBITDA for the periods indicated (in thousands of dollars):
 
   
Three Months Ended
   
Nine Months Ended
 
   
September 30,
   
September 30,
   
September 30,
   
September 30,
 
   
2014
 
2013
   
2014
   
2013
 
GAAP net loss
  $ (42 )   $ (98 )   $ (248 )   $ (306 )
                                 
Reconciling items from GAAP to adjusted EBITDA
                               
Interest and other income, net
    (2 )     (3 )     (7 )     (18 )
Depreciation and amortization
    785       757       2,404       2,272  
Stock-based compensation
    46     66       130       204  
                                 
Adjusted EBITDA
  $ 787   $ 722     $ 2,279     $ 2,152  

Seasonality

Our client acquisition business is subject to some seasonal fluctuations.  The second and third quarters are generally slower than the first and fourth quarters for client acquisition.  Infrastructure is our single largest market and these prospects are typically engaged on projects during the spring and summer months, not prospecting for new work, which causes new client acquisition to decline compared to the first and fourth quarters in the year.  For this reason, comparisons of the performance of our business quarter to consecutive quarter may not provide the most relevant information, and so in addition to sequential quarter comparisons, our quarterly results and metrics should be considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter of the previous year.

Results of Operations for the Three and Nine months ended September 30, 2014 Compared to the Three and Nine months ended September 30, 2013

Revenue and Cost of Revenue

The following table provides a breakdown of revenue for the periods presented as a percentage of total revenue:
 
   
Three Months Ended September 30,
   
Nine Months Ended September 30,
   
   
2014
   
2013
   
2014
   
2013
   
                           
Revenue
  $ 5,700     $ 5,442     $ 16,883     $ 16,444    
                                   
Revenue:
                                 
 Subscription
    90 %     89 %     90 %     88 %  
 Content license
    8 %     9 %     8 %     9 %  
 Management information reports
    1 %     1 %     1 %     2 %  
 Other
    1 %     1 %     1 %     1 %  
Total revenue
    100 %     100 %     100 %     100 %  

In the third quarter of 2014, subscription revenue grew by 6% to $5.1 million over the third quarter of 2013.  The growth in subscription revenue is primarily a result of improved client retention and contract expansions over the last three quarters.  Our operating initiatives are intended to drive subscription revenue growth.
 
 
15

 
Total revenue for the quarter ended September 30, 2014 was $5.7 million, up by 5% compared to the same period last year.  In addition to subscription revenue, total revenue includes content license and report revenue.

Cost of revenue for the three and nine months ended September 30, 2014 and 2013 was as follows (in thousands of dollars):

               
Increase / (Decrease)
   
   
2014
   
2013
   
Amount
   
Percent
   
 Three months ended September 30,
  $ 906     $ 961     $ (55 )     (6 %)  
 Percentage of Revenue
    16 %     18 %                  
 Nine months ended September 30,
    2,793       2,850     $ (57 )     (2 %)  
 Percentage of Revenue
    17 %     17 %                  

Our cost of revenue primarily represents payroll-related expenses associated with the research and aggregation of the data in our proprietary database and third-party content fees, and also includes credit card processing fees.  The decrease for the comparable three and nine month periods was due to individually immaterial changes.

Sales and Marketing

Sales and marketing expenses for the three and nine months ended September 30, 2014 and 2013 were as follows (in thousands of dollars):
 
               
Increase / (Decrease)
   
   
2014
   
2013
   
Amount
   
Percent
   
 Three months ended September 30,
  $ 2,943     $ 2,822     $ 121       4 %  
 Percentage of Revenue
    52 %     52 %                  
 Nine months ended September 30,
    8,647       8,369     $ 278       3 %  
 Percentage of Revenue
    51 %     51 %                  

The increase in expenses for the comparable three month periods is primarily related to a $195,000 increase in commission expenses as a result of increase in bookings offset by a $60,000 decrease in payroll related costs due to lower headcount and other individually immaterial changes.

The increase in expenses for the comparable nine month periods is primarily related to a $319,000 increase in commission expenses as a result of higher bookings, a $56,000 increase in amortization costs of software licenses, a $50,000 increase in amortization costs as a result of launch of vendor center, offset by a $83,000 decrease in travel costs and $75,000 decrease in payroll related costs due to lower headcount and other individually immaterial changes.

Technology and Development

Technology and development expenses for the three and nine months ended September 30, 2014 and 2013 were as follows (in thousands of dollars):
 
               
Increase / (Decrease)
   
   
2014
   
2013
   
Amount
   
Percent
   
 Three months ended September 30,
  $ 989     $ 975     $ 14       1 %  
 Percentage of Revenue
    17 %     18 %                  
 Nine months ended September 30,
    3,038       3,039     $ (1 )     (0 %)  
 Percentage of Revenue
    18 %     18 %                  

The expenses for the comparable three and nine month periods were flat.
 
 
16

 
General and Administrative

General and administrative expenses for the three and nine months ended September 30, 2014 and 2013 were as follows (in thousands of dollars):
 
               
Increase / (Decrease)
   
   
2014
   
2013
   
Amount
   
Percent
   
 Three months ended September 30,
  $ 906     $ 785     $ 121       15 %  
 Percentage of Revenue
    16 %     14 %                  
 Nine months ended September 30,
    2,660       2,510     $ 150       6 %  
 Percentage of Revenue
    16 %     15 %                  

The increase in expenses for the comparable three month periods is primarily related to a $72,000 increase in payroll related costs primarily because of the human resource function being fully staffed in the third quarter of 2014 compared to the same period one year ago and other individually immaterial changes.

The increase in expenses for the comparable nine month periods is related to a $74,000 increase in professional services costs primarily due to legal costs incurred related to our enforcement of a non-compete agreement with a former employee, a $73,000 increase in payroll related costs primarily because of the human resource function being fully staffed in 2014 compared to the same period one year ago and other individually immaterial changes.

Interest and Other Income, Net
Net interest and other income was $2,000 and $3,000 for the three and nine months ended September 30, 2014, respectively, compared to $7,000 and $18,000, respectively, for the same periods in 2013. Interest expense is immaterial for the three and nine months ended September 30, 2014 and 2013.

Net Loss and Net Loss per Share
Net loss for the three months and nine months ended September 30, 2014 was $42,000 and $248,000, respectively compared to net loss of $98,000 and $306,000, respectively, for the same periods in 2013.   On a diluted per share basis, net loss was $0.01 and $0.03 for the three and nine months ended September 30, 2014, respectively compared to net loss of $0.01and $0.04 for the three and nine months ended September 30, 2013.

Critical Accounting Policies and Management Estimates

Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities.  On an on-going basis, we evaluate our estimates including, but not limited to, those affecting the fair value of stock-based compensation, allowance for doubtful accounts, capitalization of costs for internally developed software, recoverability of long-lived assets, including internally developed software, and the valuation allowance for net deferred tax assets..  The brief discussion below is intended to highlight some of the judgments and uncertainties that can impact the application of these policies and the specific dollar amounts reported on our financial statements.

We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form our basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results may differ from these estimates under different assumptions or conditions, or if management made different judgments or utilized different estimates.  Many of our estimates or judgments are based on anticipated future events or performance, and as such are forward-looking in nature, and are subject to many risks and uncertainties, including those discussed in our Annual Report on Form 10-K for the year ended December 31, 2013 and elsewhere in this Quarterly Report on Form 10-Q.  Except as otherwise required by law, we do not undertake any obligation to update or revise this discussion to reflect any future events or circumstances.

 
17

 
For a detailed discussion of our critical accounting policies and estimates, please refer to our Annual Report on Form 10-K for the year ended December 31, 2013.

There have been no material changes in the application of our critical accounting policies and estimates subsequent to that report.

See Note 1 to the unaudited Consolidated Financial Statements for the issuance of new accounting pronouncements during fiscal 2014.

Liquidity and Capital Resources
 
Our principal sources of liquidity are cash, cash equivalents and available for sale investments.  Our combined cash and cash equivalents and available for sale investments were $8.0 million at September 30, 2014.  At September 30, 2014, we held $6.4 million in available for sale investments, primarily in FDIC insured or U.S. government backed securities.  From December 31, 2013 to September 30, 2014, our cash, cash equivalents and available for sale investments increased by $447,000 as a result of cash provided by operating activities for the nine months ended September 30, 2014.

If we engage in merger or acquisition transactions or our overall operating plans change, we may require additional equity or debt financing to meet future working capital needs, which may have a dilutive effect on existing stockholders or may include securities that have rights, preferences or privileges senior to those of the rights of our common stock.  We cannot make assurances that if additional financing is required, it will be available, or that such financing can be obtained on satisfactory terms.

Operating Activities
Net cash provided by operating activities consists of net loss adjusted for certain non-cash items and changes in assets and liabilities. Net cash provided by operating activities was $2.4 million for the nine months ended September 30, 2014, a decrease of $100,000 compared to $2.5 million in the same period in the prior year. The decrease in net cash provided by operating activities is due primarily to a decrease in net loss of $58,000 adjusted by a $132,000 increase in depreciation and amortization, offset by a $276,000 decrease in other operating assets and liabilities.

Investing Activities
Net cash used in investing activities was $2.8 million in the nine months ended September 30, 2014, compared to $114,000 in the same period in 2013.  The decrease of $2.7 million in cash used in investing activities is attributable to a $2.0 million decrease in sales and maturities of investments and a $1.2 million increase in purchases of investments, partially offset by a decrease of $297,000 in additions to property and equipment and internal use software.  In addition, there was a $150,000 decrease of our security deposit for the lease of our corporate headquarters.

Financing Activities
Net cash provided by financing activities was $38,000 in the nine months ended September 30, 2014, compared to $4.6 million of net cash used in financing activities in the same period of 2013.  The increase in cash provided by financing activities is due to $4.4 million of stock repurchase included in the nine months ended September 30, 2013, a $127,000 increase in proceeds from stock options exercises, and a $99,000 decrease in principal payments on capital leases.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

The disclosures under this Item are not required for smaller reporting companies.
 
 
18

 
Item 4. Controls and Procedures

The Company conducted an evaluation (pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934 (the "Exchange Act")), under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company's disclosure controls and procedures (as defined in Rule 13a-15(e)) as of September 30, 2014.  Based on the evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that these disclosure controls and procedures were effective as of September 30, 2014.

We made no change in our internal control over financial reporting during the fiscal quarter ended September 30, 2014 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. We intend to continue to refine our internal control over financial reporting on an ongoing basis, as we deem appropriate with a view towards continuous improvement.

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

From time to time, legal proceedings may arise in the ordinary course of business.  Although the outcomes of legal proceedings are inherently difficult to predict, we are not currently involved in any legal proceeding in which the outcome, in our judgment based on information currently available, is likely to have a material adverse effect on our business or financial position.

Item 1A.  Risk Factors

There have been no material changes in our risk factors from those disclosed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2013.

Item 2.  Unregistered Sales of Equity 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.
 
 
19

 
Item 6.  Exhibits

Number
 
Description
     
31.1++
 
Certification of Henry G. Riner, Chief Executive Officer and President of Onvia, Inc., Pursuant to Rule 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
     
31.2++
 
Certification of Cameron S. Way, Chief Financial Officer and Principal Accounting Officer of Onvia, Inc., Pursuant to Rule 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
     
32.1++
 
Certification of Henry G. Riner, Chief Executive Officer and President of Onvia, Inc., Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
     
32.2++
 
Certification of Cameron S. Way, Senior Vice President and Chief Financial Officer of Onvia, Inc., Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
     
101++
 
101.INS        XBRL Instance Document
   
101.SCH      XBRL Taxonomy Extension Schema
   
101.CAL      XBRL Taxonomy Extension Calculation Linkbase
   
101.LAB      XBRL Taxonomy Extension Label Linkbase
   
101.PRE      XBRL Taxonomy Extension Presentation Linkbase
   
101.DEF      XBRL Taxonomy Extension Definition Linkbase


++  Furnished herewith
 
 
 
 
 
 
 
20

 

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.
 
 
ONVIA, INC.
     
     
  By:
/s/ Henry G. Riner
   
Henry G. Riner
President and Chief Executive Officer
     
     
  By:
/s/ Cameron S. Way
   
Cameron S. Way
Chief Financial Officer and Principal Accounting Officer
 
 
Date:  November 12, 2014
 
 
 
 
 
 
 
 21