I-many Reports Record First Quarter 2009 Financial Results

EDISON, NJ, Apr 29 (MARKET WIRE) --
I-many, Inc. (NASDAQ: IMNY), a leading provider of contract management
software and services for the enterprise, reported financial results for
the first quarter ended March 31, 2009.

Q1 2009 Highlights

-- Net revenues: $9.9 million, up 15% from the previous quarter and up
35% year-over-year
-- First quarter of positive net income since the company's IPO in 2000:
$799,000 or $0.02 per diluted share
-- Signed three major license transactions, with two of those in the low
seven figures
-- Achieved EBITDA of $2.0 million, or $0.04 per basic and diluted share
(see important discussion about EBITDA, a non-GAAP term, in "Use of Non-
GAAP Financial Information," below)

Financial Results for Q1 2009

Net revenues in the first quarter of 2009 totaled $9.9 million, an
increase of 15% from $8.6 million reported in the previous quarter and an
increase of 35% from $7.4 million reported in the same period a year ago.

Total operating expenses in the quarter were $8.7 million, a decrease of
23% from $11.3 million in the previous quarter and a decrease of 31% from
$12.6 million in the same quarter a year ago.

Research and development expense totaled $2.0 million in the quarter, a
decrease of 29% from $2.9 million in the previous quarter and a decrease
of 44% from the $3.7 million expensed in the first quarter of 2008.

Net Income totaled $799,000, or $0.02 per basic and diluted share, as
compared to a net loss of $3.0 million or ($0.06) in the previous quarter
and a net loss of $5.4 million or ($0.10) in the first quarter of 2008.

EBITDA totaled a record $2.0 million, or $0.04 per basic and diluted
share, as compared to a negative EBITDA of $1.7 million or ($0.03) in the
previous quarter and negative EBITDA of $4.2 million or ($0.08) in the
same period a year ago.

Quarter-end cash, restricted cash and short-term investments totaled $9.3
million, as compared to $9.6 million at the end of the previous quarter
and $20.6 million at the end of the first quarter of 2008. Approximately
$620,000 in net cash was used during the first quarter to pay
restructuring and employee severance costs accrued at the end of 2008.
Excluding these non-recurring expenditures, the company would have
increased its cash balance during the quarter.

Results by Revenue Category

Recurring revenue, which constitutes revenue generated from software
subscriptions, maintenance, support and hosting, totaled $5.1 million in
the quarter, a decrease of 1% from $5.2 million in the prior quarter and
an increase of 4% from $4.9 million reported in the same quarter a year
ago.

Services revenue, which is principally revenue from professional services,
totaled $2.9 million, a decrease of 6% from $3.1 million in the prior
quarter and an increase of 30% from $ 2.2 million reported in the same
period a year ago. Excluding revenue of $299,000 from the company's annual
user conference held in October 2008, service revenue increased 5% from
the prior quarter.

License revenue, representing one-time perpetual license fees from
software license sales, totaled $1.9 million, an increase of 380% from
$398,000 in the prior quarter and an increase of 831% from $205,000
reported in the same period a year ago.

Non-GAAP Financial Results

Management believes certain non-GAAP financial measures may present a
useful picture of the company's results since implementing the change in
its licensing model to include software subscriptions (see "About the Use
of Non-GAAP Financial Information," below). This includes the gross value
of license contracts signed during a period, which the company calls
"bookings." Bookings totaled $3.1 million in the first quarter of 2009.
This represented an increase of 108% from $1.5 million signed in the prior
quarter and an increase of 506% from $518,000 signed in the first quarter
of 2008.

Unamortized software subscriptions (the remaining portion of
non-cancelable subscription contracts that have been signed and expected
to be recognized over the next five years) totaled $11.9 million at the
end of the first quarter of 2009. This was an increase of 1% from $11.8
million at the end of the prior quarter and a decrease of 21% from $15.1
million at the end of the first quarter of 2008. The year-over-year
decrease was due to the recognition of subscription revenue exceeding the
amount of new subscriptions signed and not yet recognized.

The combined amount of deferred revenue and unamortized software
subscriptions, which includes unrecognized multi-year maintenance and
support commitments, totaled $30.1 million at the end of the quarter, an
increase of 9% from $27.7 million at the end of the prior quarter and an
increase of 2% from $29.6 million at the end of the first quarter of 2008.
The increase over both periods is principally due to the execution of two
significant multi-year maintenance and support agreements in the first
quarter, which also helped secure I-many's long-term recurring revenue
stream.

Q1 2009 Operational Highlights

-- Three contracts booked during the first quarter of 2009 were major
transactions (i.e., exceeding $50,000 in gross value), which compares to
four signed in both the previous quarter and the same period a year ago.
The major transactions averaged $832,000 in net software license value, as
compared to an average of $310,000 in the previous quarter and an average
of $89,000 in the same period a year ago. "Net software license value"
represents the perpetual license fee or the net present value of non-
cancelable subscription payments, exclusive of the value of maintenance and
support.
-- Two of these major transactions signed in the first quarter of 2009
were in the company's Life Science market segment. One of these was
subscription-based with a customer who uses the company's software both
within and outside of Life Science. Both contracts were with Fortune 50
companies, with the gross value of each ranging in the low seven figures.
-- One of these transactions was with one of the largest branded consumer
goods companies in the world and a long-term I-many customer, which
extended its relationship with I-many by signing a multi-year subscription
agreement for I-many's enterprise contract management suite. For nearly 10
years, I-many has helped this customer adjudicate contracts within the
bounds of compliance.
-- A Fortune 50 provider of healthcare products and services with more
than 100,000 employees worldwide and annual sales of more than $60 billion
converted its annually renewable term license to a perpetual license and
entered into a three-year maintenance and support agreement for I-many
CARSCopyright and I-many Medicaid(TM).
-- One of the world's top 20 pharmaceutical companies, with nearly $40
billion in annual revenue and considered the world leader in generic
pharmaceuticals, signed a six figure contract that added additional users
to its installation of I-many Medicaid and CARS.
-- I-many partnered with CSC (NYSE: CSC), a global leader in IT services
with more than 92,000 employees and annual revenue exceeding $17 billion.
Together, I-many and CSC are working to help pharmaceutical and
biotechnology companies prepare for Medicare Part D compliance audits.
-- I-many successfully completed its plan to streamline operations,
improve financial performance and leverage the multi-million dollar
investment in its new technology platform. This resulted in achieving the
company's stated goal of positive EBITDA in the first quarter of 2009.

Management Commentary

"We not only exceeded our Q1 expectations with a very strong showing in
EBITDA, but also generated positive net income for the first time since we
went public in 2000," said John A. Rade, president and CEO of I-many.
"This demonstrates our ability to adapt and perform well in the current
economic climate and is perhaps the best indicator of our success in
implementing the transformational strategy we announced in December.

"Within a fairly short period of time, we streamlined operations, cut
costs, and refocused our sales force and customer service personnel. We
have emerged as a stronger organization, better able to leverage our
multi-million dollar investment in upgrading and expanding our
ContractSphere(R) suite. The completion of this major development cycle is
evident in a nearly 50% year-over-year reduction in our R&D expense. These
results put us well on our way towards realizing our goals for the year,
including generating cash in 2009 through achieving positive EBITDA in
every quarter.

"Through this process, I-many has remained the leader in delivering
enterprise contract management solutions to the Life Science industry,
with 80% of the top 25 and all of the top 10 pharmaceutical companies
using one or more of our products. Our well-established customer
relationships continued to maintain our recurring revenue stream and they
form the backbone of our business plan for 2009. In this first quarter,
key members of this esteemed group of customers made the financial
commitment to renew their relationship with I-many despite these
challenging economic times. They recognize the strong ROI our products
provide, which has become more critical to their bottom line than ever
before.

"Despite this successful quarter, we continue to face a difficult set of
challenges regarding our outstanding debt obligations and possible NASDAQ
de-listing. We issued a separate press release today announcing a merger
agreement with LLR Partners, Inc. Please refer to that press release for
additional details on the transaction."

Conference Call

Today at 4:30 p.m. Eastern time, I-many will hold a conference call to
discuss the merger agreement with LLR Partners and the financial
performance for the first quarter of 2009. I-many President and CEO John
A. Rade and CFO Kevin M. Harris will host the presentation, followed by a
question and answer period.

Date: Wednesday, April 29, 2009
Time: 4:30 pm Eastern time (1:30 pm Pacific time)
Dial-In Number: 1-800-894-5910
International: 1-785-424-1052
Conference ID#: 7IMANY

Please call the conference telephone number 5-10 minutes prior to the
start time. An operator will register your name and organization and ask
you to wait until the call begins. If you have any difficulty connecting
with the conference call, please contact the Liolios Group at
949-574-3860.

A simultaneous webcast and replay of the call will be accessible via the
investor section of I-many's website at www.imany.com.

A telephone replay of the call will be available within approximately 48
hours of the call until May 29, 2009: Dial 1-800-374-1375 or
1-402-220-0682 (No passcode required).

Use of Non-GAAP Financial Information

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. I-many defines EBITDA as net income/(loss) before
interest expense and other non-cash financing costs; taxes; depreciation;
and amortization of non-cash stock-based compensation and acquired
intangibles. Other companies (including the company's competitors) may
define EBITDA differently. The company presents EBITDA because it
believes it 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 a similar industry. Management
also uses this information internally for forecasting and budgeting. It
may not be indicative of the historical operating results of I-many nor
is it intended to be predictive of potential future results. Investors
should not consider EBITDA in isolation or as a substitute for analysis
of results as reported under GAAP. See "Reconciliation of GAAP Income
(Loss) to EBITDA (Loss)" below for further information on this non-GAAP
measure and reconciliation of EBITDA to GAAP net income (loss) for the
periods indicated.

I-MANY, INC. AND SUBSIDIARIES
Reconciliation of GAAP Income (Loss) to EBITDA (Loss)
(in thousands, except per share amounts)
(unaudited)

Three months ended,
----------------------------
March 31, Dec. 31, March 31,
2009 2008 2008
--------- -------- --------

GAAP net income (loss) $ 799 ($ 3,001) ($ 5,442)

Reconciling items from GAAP to EBITDA (loss)
Interest expense 387 387 394
Taxes - - -
Depreciation 279 312 229
Amortization of stock-based compensation 394 462 521
Amortization of acquired intangible assets 163 162 56
--------- -------- --------

EBITDA (loss) $ 2,022 ($ 1,678) ($ 4,242)
========= ======== ========

EBITDA (loss) per common share:
Basic $ 0.04 ($ 0.03) ($ 0.08)
========= ======== ========
Diluted $ 0.04 ($ 0.03) ($ 0.08)
========= ======== ========

Weighted average common shares outstanding:
Basic 52,951 52,660 52,327
Diluted 53,054 52,660 52,327

The company also supplements its GAAP financial statements in this
release and in its annual report on Form 10-K and quarterly reports on
Form 10-Q with a reconciliation of the non-GAAP gross value of license
transactions to its reported GAAP license revenues (see "Reconciliation
of Gross Value of License Bookings to Reportable License Revenue,"
below). This non-GAAP financial information is provided as additional
information for investors and is not in accordance with or an alternative
to GAAP. Management has included a table that shows the results for the
period being reported as compared to previous comparable periods for new
license transactions including subscription contracts, the recognition
into reportable revenue of deferred non-subscription license
transactions, and the reconciliation of those numbers to total license
revenue according to GAAP. Management believes its inclusion can enhance
an overall understanding of the company's past operational performance
and also its prospects for the future. This reconciliation of license
revenues is made with the intent of providing both management and
investors a more complete understanding of the revenue performance of the
company, as opposed to GAAP revenue results, which do not include the
full impact of newly-executed subscription agreements and other deferred
revenue arrangements that are material to the ongoing performance of the
company's business. This information quantifies the various components
comprising current license revenue, which in each quarter consists of
revenues from licenses sold in current periods plus revenues deferred
from prior periods, less revenue deferred from licenses sold in current
periods. Management uses this information as a basis for planning and
forecasting core business activity in future periods and believes it is
useful in understanding our results of operations. The presentation of
this additional revenue information is not meant to be considered in
isolation or as a substitute for revenues reported in accordance with
generally accepted accounting principles in the United
States.

Reconciliation of Gross Value of License Bookings to Reportable License
Revenue
(Unaudited)

Three Months (Quarter) ended
---------------------------------------
3/31/ 6/30/ 9/30/ 12/31/ 3/31/
2008 2008 2008 2008 2009
------- ------- ------- ------- -------
(AMOUNTS IN THOUSANDS)

Gross value of license contracts
sold:
Health and Life Sciences $ 298 $ 1,833 $ 520 $ 1,390 $ 2,640
Industry Solutions 220 20 0 122 499
------- ------- ------- ------- -------
518 1,853 520 1,512 3,139
Add license revenue recorded in
current quarter from contracts
sold in prior periods:
Health and Life Sciences 0 1,797 475 175 50
Industry Solutions 0 0 0 61 146
------- ------- ------- ------- -------
0 1,797 475 236 196
Less value of license contracts
sold in current quarter and
deferred to future periods:
Health and Life Sciences 190 1,438 520 1,255 946
Industry Solutions 123 0 0 95 480
------- ------- ------- ------- -------
313 1,438 520 1,350 1,426
------- ------- ------- ------- -------
License revenue recorded:
Health and Life Sciences 108 2,192 475 310 1,744
Industry Solutions 97 20 0 88 165
------- ------- ------- ------- -------
$ 205 $ 2,212 $ 475 $ 398 $ 1,909
======= ======= ======= ======= =======

About I-many

I-many (NASDAQ: IMNY) is a leading provider of contract management
software and services for the enterprise. With hundreds of companies
across 21 industries worldwide, I-many is enabling businesses to manage
the entire contract life cycle, from pre-contract processes and contract
management to active compliance, contract optimization, demand channel
visibility and control. The result is an end-to-end solution that
provides greater levels of insight into contract performance, allowing
companies to improve profitability and achieve a measurable return on
investment. For more information, please visit www.imany.com.

Additional Information and Where to Find It

I-many plans to file with the SEC and mail to its stockholders a proxy
statement (the "Proxy Statement") in connection with the merger agreement
with LLR Partners (the "Merger Agreement") and related transactions. The
Proxy Statement will contain important information about I-many, LLR
Partners, the Merger Agreement and related matters. INVESTORS AND SECURITY
HOLDERS ARE URGED TO READ THE PROXY STATEMENT CAREFULLY WHEN IT IS
AVAILABLE.

Investors and security holders will be able to obtain free copies of the
Proxy Statement (when it is available) and other documents filed with the
SEC by the Company through the website maintained by the SEC at
www.sec.gov.

In addition, investors and security holders will be able to obtain free
copies of the Proxy Statement (when it is available) from the Company by
contacting I-many, Inc., Attn: Secretary, 399 Thornall Street, 12th Floor,
Edison, NJ.

I-many and LLR Partners, and their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies
from the stockholders of I-many in respect of the transactions
contemplated by the Merger Agreement. Information regarding I-many's
directors and executive officers will be included in the Proxy Statement.
Additional information regarding these directors and executive officers
is contained in I-many's Annual Report on Form 10-K for the fiscal year
ended December 31, 2008, as amended by Amendment No. 1 dated April 29,
2009, which is filed with the SEC and available free of charge at the
SEC's web site at www.sec.gov. As of March 31, 2009, I-many's directors
and executive officers beneficially owned approximately 5,885,994 shares,
or 10.9%, of I-many's common stock. This excludes 7,383,264 shares owned
by Ramius LLC, of which Mark R. Mitchell, a director of I-many, is an
executive officer and for which Mr. Mitchell disclaims beneficial
ownership. Information regarding LLR Partners' directors and officers and
a more complete description of the interests of I-many's directors and
officers will be available in the Proxy Statement.

Forward-looking Statements

This news release contains forward-looking statements, and actual results
may vary from those expressed or implied herein. Factors that could affect
these results include the risk that our appeal of the delisting of our
common stock from the NASDAQ Capital Market will not be successful; the
risk that current economic conditions and consolidation in the
pharmaceutical industry could weaken demand for our products; the risk of
unforeseen technical or practical impediments to planned software
development, which could affect the company's product release timetable;
the risk that the ratio of subscription license sales to perpetual license
sales could be higher than anticipated, possibly leading to lower revenue
in current periods and less cash than predicted in the near term; the risk
of lower demand for the company's new products than management
anticipates; the inherent risks of large software implementation
projects, which can cause customer disagreements that could affect
I-many's ability to collect both services and license revenue, whether
recognized or deferred; the possibility that customers could cancel
maintenance and support services at the time of annual renewal, which
could decrease I-many's base of recurring revenue; the possibility that
extraordinary events outside the company's control could extend the
length of the sales cycle for the company's products or make the market
for the company's products more unpredictable; and other risk factors set
forth from time to time in the company's filings with the Securities and
Exchange Commission.

I-MANY, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
(Unaudited)

Three months
ended March 31,
2009 2008
----------- -----------
Net Revenues:
Recurring $ 5,098 $ 4,916
Services 2,911 2,242
License 1,909 205
----------- -----------
Total net revenues 9,918 7,363

Operating expenses:
Cost of recurring revenue (1) 1,400 1,566
Cost of services revenue (1) 2,162 2,381
Cost of third-party technology 31 9
Amortization of acquired intangible assets 163 56
Sales and marketing (1) 1,275 2,398
Research and development (1) 2,040 3,656
General and administrative (1) 1,350 1,532
Depreciation 279 229
In-process research and development - 760
Restructuring and other charges 37 13
Total operating expenses 8,737 12,600
----------- -----------

Income (loss) from operations 1,181 (5,237)

Interest expense (387) (394)
Other income, net 5 189
----------- -----------

Net income (loss) $ 799 ($ 5,442)
=========== ===========

Earnings (loss) per common share:
Basic $ 0.02 $ (0.10)
=========== ===========
Diluted $ 0.02 $ (0.10)
=========== ===========

Weighted average shares outstanding:
Basic 52,951 52,327
Diluted 53,054 52,327

(1) Stock-based compensation amounts included
above:
Cost of recurring revenue $ 30 $ 22
Cost of services revenue 55 127
Sales and marketing 74 100
Research and development 65 92
General and administrative 170 180
----------- -----------
$ 394 $ 521
=========== ===========

I-MANY, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)

March 31, December 31,
2009 2008
----------- -----------
(Unaudited)

Assets
Current Assets:
Cash and cash equivalents $ 9,094 $ 9,342
Restricted cash - 80
Accounts receivable 6,253 6,092
Other current assets 499 500
----------- -----------
Total current assets 15,846 16,014

Property and equipment, net 1,732 1,964
Restricted cash 195 199
Deferred charges and other assets 978 1,053
Acquired intangible assets, net 2,012 2,175
Goodwill 9,953 9,822
----------- -----------
Total assets $ 30,716 $ 31,227
=========== ===========

Liabilities and Stockholders' Deficit
Current liabilities:
Accounts payable and accrued expenses $ 5,115 $ 6,590
Current portion of deferred revenue 14,163 14,421
Current portion of capital lease obligations 354 418
----------- -----------
Total current liabilities 19,632 21,429

Convertible notes payable 17,000 17,000
Deferred revenue, net of current portion 998 757
Other long-term liabilities 628 746

Stockholders' deficit (7,542) (8,705)
----------- -----------

Total liabilities and stockholders' deficit $ 30,716 $ 31,227
=========== ===========

Company Contacts
I-many, Inc.
Kevin Harris
CFO
732-452-1515
Email Contact

or

Investor Relations:
Liolios Group, Inc.
Ron Both or Geoffrey Plank
949-574-3860
Email Contact

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