0001280058-22-000010 | 10-K | XBRL Viewer

Organization

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]


1. Organization

We are the world’s leading cloud software company powering social good. Serving the entire social good community—nonprofits, higher education institutions, K–12 schools, healthcare organizations, faith communities, arts and cultural organizations, foundations, companies and individual change agents—we connect and empower organizations to increase their impact through cloud software, services, expertise and data intelligence. Our portfolio is tailored to the unique needs of vertical markets, with solutions for fundraising and CRM, marketing, advocacy, peer-to-peer fundraising, corporate social responsibility (CSR) and environmental, social and governance (ESG), school management, ticketing, grantmaking, financial management, payment processing and analytics. Serving the industry for more than four decades, we are a remote-first company headquartered in Charleston, South Carolina, with operations in the United States, Australia, Canada, Costa Rica and the United Kingdom.

Debt (Annual Maturities Related to Credit Facility, Real Estate Loans and Other Debt) (Details) $ in Thousands	Dec. 31, 2021 USD ($)
Debt Disclosure [Abstract]
2022	$ 18,697
2023	18,232
2024	17,859
2025	853,034
2026	1,969
Thereafter	51,383
Total required maturities	$ 961,174

- Definition

Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.

+ References + Details

Income Taxes (Schedule of Components of Income Tax Expense) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Current taxes:
U.S. Federal	$ (2,499)	$ (407)	$ 1,534
U.S. State and local	(257)	1,563	613
International	6,570	3,904	130
Total current taxes	3,814	5,060	2,277
Deferred taxes:
U.S. Federal	(4,615)	(1,064)	(1,724)
U.S. State and local	222	7,725	(2,235)
International	1,964	2,176	359
Total deferred taxes	(2,429)	8,837	(3,600)
Total income tax provision (benefit)	$ 1,385	$ 13,897	$ (1,323)

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Common stock [Member]	Additional paid-in capital [Member]	Treasury stock [Member]	Accumulated other comprehensive loss [Member]	Retained earnings [Member]
Balance (in shares) at Dec. 31, 2018		59,327,633
Balance at Dec. 31, 2018	$ 373,783	$ 59	$ 399,241	$ (266,884)	$ (5,110)	$ 246,477
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	11,908					11,908
Payment of dividends	$ (23,607)					(23,607)
Dividends per share (in dollars per share)	$ 0.48
Exercise of stock options and stock appreciation rights and vesting of restricted stock units (in shares)		267,455
Exercise of stock options and stock appreciation rights and vesting of restricted stock units	$ 7		7
Employee taxes paid for withheld shares upon equity award settlement	$ (23,781)			(23,781)
Employee taxes paid for withheld shares upon equity award settlement (in shares)	305,780
Stock-based compensation	$ 58,633		58,556			77
Restricted stock grants (in shares)		723,868
Restricted stock grants	1	$ 1
Restricted stock cancellations (in shares)		(112,865)
Other comprehensive income	(180)				(180)
Balance (in shares) at Dec. 31, 2019		60,206,091
Balance at Dec. 31, 2019	396,764	$ 60	457,804	(290,665)	(5,290)	234,855
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	7,717					7,717
Payment of dividends	$ (5,960)					(5,960)
Dividends per share (in dollars per share)	$ 0.12
Purchase of treasury shares under stock repurchase program, cost method	$ (41,001)			(41,001)
Purchase of treasury shares under stock repurchase program (in shares)	714,000
Exercise of stock options and stock appreciation rights and vesting of restricted stock units (in shares)		218,141
Exercise of stock options and stock appreciation rights and vesting of restricted stock units	$ 4		4
Employee taxes paid for withheld shares upon equity award settlement	$ (21,425)			(21,425)
Employee taxes paid for withheld shares upon equity award settlement (in shares)	273,914
Stock-based compensation	$ 87,257		87,155			102
Restricted stock grants (in shares)		657,483
Restricted stock grants	1	$ 1
Restricted stock cancellations (in shares)		(177,077)
Other comprehensive income	2,793				2,793
Balance (in shares) at Dec. 31, 2020		60,904,638
Balance at Dec. 31, 2020	426,150	$ 61	544,963	(353,091)	(2,497)	236,714
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	5,698					5,698
Stock Issued During Period, Shares, Acquisitions		3,844,423
Stock Issued During Period, Value, Acquisitions	303,633	$ 4	303,629
Purchase of treasury shares under stock repurchase program, cost method	$ (108,416)			(108,416)
Purchase of treasury shares under stock repurchase program (in shares)	1,592,933
Exercise of stock options and stock appreciation rights and vesting of restricted stock units (in shares)		1,014,562
Exercise of stock options and stock appreciation rights and vesting of restricted stock units	$ 1	$ 1	0
Employee taxes paid for withheld shares upon equity award settlement	$ (39,404)			(39,404)
Employee taxes paid for withheld shares upon equity award settlement (in shares)	535,604
Stock-based compensation	$ 120,379		120,335			44
Restricted stock grants (in shares)		596,763
Restricted stock grants	0	$ 0
Restricted stock cancellations (in shares)		(194,720)
Other comprehensive income	9,019				9,019
Balance (in shares) at Dec. 31, 2021		66,165,666
Balance at Dec. 31, 2021	$ 717,060	$ 66	$ 968,927	$ (500,911)	$ 6,522	$ 242,456

Income Taxes (Schedule of Effective Income Tax Rate Reconciliation) (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Federal statutory rate	21.00%	21.00%	21.00%
Effect of:
State income taxes, net of federal benefit	4.40%	5.90%	(1.70%)
Change in valuation reserve (primarily state credit reserves)	26.10%	38.20%	3.70%
Acquisition costs	8.70%	0.00%	0.00%
Section 162(m) limitation	75.00%	17.50%	30.80%
Nondeductible meals, entertainment and transportation	1.10%	3.30%	11.30%
Unrecognized tax benefit	(32.70%)	1.30%	4.40%
GILTI inclusion	0.00%	1.30%	5.90%
FDII benefit	0.00%	0.00%	(1.50%)
Stock-based compensation	(36.20%)	(1.20%)	(20.20%)
Foreign tax rate	(6.00%)	(1.70%)	0.30%
State credits, net of federal benefit	(32.60%)	(2.30%)	(15.40%)
DTA Adjustment – NOLs	0.00%	(3.30%)	0.00%
Return to accrual adjustment	(4.20%)	(4.10%)	(10.60%)
Federal credits generated	(54.50%)	(17.40%)	(37.60%)
Other	4.60%	1.70%	(1.80%)
Income tax provision (benefit) effective rate	19.60%	64.30%	(12.50%)
Foreign Tax Authority [Member]
Effect of:
Change in income tax rate applied to deferred tax balances	42.60%	4.00%	2.00%
State and Local Jurisdiction [Member]
Effect of:
Change in income tax rate applied to deferred tax balances	2.30%	0.10%	(3.10%)

Basis of Presentation (Policy)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Basis of presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

Basis of consolidation

The consolidated financial statements include the accounts of Blackbaud, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. On an ongoing basis, we reconsider and evaluate our estimates and assumptions, including those that impact revenue recognition, long-lived and intangible assets, income taxes, business combinations, stock-based compensation, capitalization of software development costs, our allowances for credit losses and sales returns, costs of obtaining contracts, valuation of derivative instruments, loss contingencies and insurance recoveries, among others. Changes in the facts or circumstances underlying these estimates, including due to COVID-19, could result in material changes and actual results could materially differ from these estimates.

Recently adopted accounting pronouncements

In October 2021, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2021-08, Business Combinations (Topic 805) – Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("ASU 2021-08"). ASU 2021-08 requires that an entity recognize and measure contract assets and deferred revenue (a contract liability) acquired in a business combination in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts from Customers (“ASC 606”). At the acquisition date, an acquirer should account for the related revenue contracts in accordance with ASC 606 as if it had originated the contracts. To achieve this, an acquirer may assess how the acquiree applied ASC 606 to determine what to record for the acquired revenue contracts. Generally, this should result in an acquirer recognizing and measuring the acquired contract assets and deferred revenue consistent with how they were recognized and measured in the acquiree’s financial statements (if the acquiree financial statements were prepared in accordance with GAAP). We early adopted ASU 2021-08 as of October 1, 2021 and applied the guidance to the deferred revenue recorded for EVERFI as of December 31, 2021. See Note 3 to these consolidated financial statements for further information on our acquisition of EVERFI.

Revenue recognition

Our revenue is primarily generated from the following sources: (i) charging for the use of our software solutions in cloud and hosted environments; (ii) providing payment and transaction services; (iii) providing software maintenance and support services; and (iv) providing professional services, including implementation, consulting, training, analytic and other services. Revenues are recognized when control of these services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services.

We determine revenue recognition through the following steps:

•Identification of the contract, or contracts, with a customer;

•Identification of the performance obligations in the contract;

•Determination of the transaction price;

•Allocation of the transaction price to the performance obligations in the contract; and

•Recognition of revenue when, or as, we satisfy a performance obligation.

Recurring

Recurring revenue represents stand-ready performance obligations in which we are making our solutions or services available to our customers continuously over time or the value of the contract renews. Therefore, recurring revenue is generally recognized over time on a ratable basis over the contract term, beginning on the date that the solution or service is made available to the customer. Our recurring revenue contracts are generally for a term of 3 years at contract inception with 1 to 3-year renewals thereafter, billed annually in advance and non-cancelable.

Recurring revenue is comprised of fees for the use of our subscription-based software solutions, which includes providing access to cloud solutions, hosting services, payment services, online training programs, subscription-based analytic services, such as donor acquisitions and data enrichment services. Recurring revenue also includes fees from maintenance services for our on-premises solutions, services included in our renewable subscription contracts, retained and managed services contracts that we expect to have a term consistent with our cloud solution contracts, and variable transaction revenue associated with the use of our solutions.

Our payment services are offered with the assistance of third-party vendors. In general, when we are the principal in a transaction based on the factors identified in ASC 606-10-55-36 through 55-40, we record the revenue and related costs on a gross basis. Otherwise, we net the cost of revenue associated with the service against the gross revenue (amount billed to the customer) and record the net amount as revenue. For payment and transaction services, we have the right to invoice the customer in an amount that directly corresponds with the value to the customer of our performance to date. Therefore, we recognize revenue for these services over time based on the amount billable to the customer in accordance with the 'as invoiced' practical expedient in ASC 606-10-55-18.

One-time services and other

One-time services and other revenue is primarily comprised of fees for one-time consulting, analytic and onsite training services, fees for retained and managed services contracts that we do not expect to have a term consistent with our cloud solution contracts, and fees from user conferences.

We generally bill consulting services based on hourly rates plus reimbursable travel-related expenses. Fixed price consulting engagements are generally billed as milestones towards completion are reached. Revenue for one-time consulting services is generally recognized over time as the services are performed.

We generally recognize analytic services revenue from donor prospect research engagements, the sale of lists of potential donors, data enrichment engagements and benchmarking studies at a point in time (upon delivery).

In certain cases, we sell training at a fixed rate for each specific class at a per attendee price or at a packaged price for several attendees, and recognize the related revenue upon the customer attending and completing training.

Fees for retained and managed services contracts are generally billed in advance and recognized over time on a ratable basis over the contract term, beginning on the date the service is made available to the customer.

Contracts with multiple performance obligations

Some of our contracts with customers contain multiple performance obligations. For these contracts, we account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices of our solutions and services are typically estimated based on observable transactions when the solutions or services are sold on a standalone basis.

Costs of obtaining contracts, contract assets and deferred revenue

We pay sales commissions at the time contracts with customers are signed or shortly thereafter, depending on the size and duration of the sales contract. Sales commissions and related fringe benefits earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. These costs are deferred and then amortized in a manner that aligns with the expected period of benefit, which we have determined to be 5 years. We determined the period of benefit by taking into consideration our customer contracts, including renewals, retention, our technology and other factors. We do not generally pay commissions for contract renewals. The related amortization expense is included in sales, marketing and customer success expense in our consolidated statements of comprehensive income.

A contract asset is recorded when revenue is recognized in advance of our right to receive consideration (i.e., we must satisfy additional performance obligations in order to receive consideration). Amounts are recorded as receivables when our right to consideration is unconditional (i.e., only the passage of time is required before payment of the consideration is due). Our contract assets are recorded within prepaid expenses and other current assets on our consolidated balance sheets. To the extent that our customers are billed for our solutions and services in advance of us satisfying the related performance obligations, we record such amounts in deferred revenue.

Sales taxes

We present sales taxes and other taxes collected from customers and remitted to governmental authorities on a net basis and, as such, exclude them from revenues.

Fair value measurements

We measure certain financial assets and liabilities at fair value on a recurring basis, including derivative instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. An active market is defined as a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. We use a three-tier fair value hierarchy to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

•Level 1 - Quoted prices for identical assets or liabilities in active markets;

•Level 2 - Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and

•Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Our financial assets and liabilities are classified in their entirety within the hierarchy based on the lowest level of input that is significant to fair value measurement. Changes to a financial asset's or liability's level within the fair value hierarchy are determined as of the end of a reporting period. All methods of assessing fair value result in a general approximation of value, and such value may never actually be realized.

Derivative instruments

We generally use derivative instruments to manage interest rate risk. We view derivative instruments as risk management tools and do not use them for trading or speculative purposes. Our policy requires that derivatives used for hedging purposes be designated and effective as a hedge of the identified risk exposure at the inception of the contract. Accordingly, changes in fair value of the derivative contract must be highly correlated with changes in the fair value of the underlying hedged item at inception of the hedge and over the life of the hedge contract.

We record all derivative instruments on our consolidated balance sheets at fair value as either an asset or liability. If the derivative is designated as a cash flow hedge, the effective portions of the changes in fair value of the derivative are recorded in other comprehensive income and reclassified to earnings in a manner that matches the timing of the earnings impact of the hedged transactions. Ineffective portions of the changes in the fair value of cash flow hedges are recognized currently in earnings.

Cash and cash equivalents

We consider all highly liquid investments purchased with an original maturity of three months or less and cash items in transit to be cash equivalents.

Restricted cash due to customers; customer funds receivable; due to customers

Restricted cash due to customers; Customer funds receivable; Due to customers

Restricted cash due to customers consists of monies collected by us and payable to our customers, net of the associated transaction fees earned. Monies associated with amounts due to customers are segregated in separate bank accounts and used exclusively for the payment of amounts due to customers. This usage restriction is either legally or internally imposed and reflects our intention with regard to such deposits. Customer funds receivable consists of monies we expect to collect and remit to our customers.

Concentration of credit risk

Concentration of credit riskFinancial instruments that potentially subject us to concentrations of credit risk consist of cash and cash equivalents, restricted cash due to customers and accounts receivable. Our cash and cash equivalents and restricted cash due to customers are placed with high credit-quality financial institutions. Our accounts receivable is derived from sales to customers who primarily operate in the nonprofit sector. With respect to accounts receivable, we perform ongoing evaluations of our customers and maintain an allowance for credit losses based on historical experience and our expectations of future credit losses.

Property and equipment

We record property and equipment assets at cost and depreciate them over their estimated useful lives using the straight-line method. Leasehold improvements are depreciated over the lesser of the term of the lease or the estimated useful life of the asset. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is credited or charged to earnings. Repair and maintenance costs are expensed as incurred.

Business combinations

We include the operating results of acquired companies as well as the net assets acquired and liabilities assumed in our consolidated financial statements from the date of acquisition. We are required to allocate the purchase price of acquired companies to the tangible and intangible assets acquired and liabilities assumed at the acquisition date based upon their estimated fair values. Goodwill as of the acquisition date represents the excess of the purchase consideration of an acquired business over the fair value of the underlying net tangible and intangible assets acquired and liabilities assumed.

We apply significant judgement in estimating the fair value of intangible assets acquired, which involves the use of significant assumptions. Significant assumptions used in the valuation of customer relationships include future revenue and operating expenses, customer attrition rates, contributory asset charges, tax amortization benefit, and discount rates. Significant assumptions used in the valuation of certain developed technology assets include future revenue, proprietary technology obsolescence curve, royalty rate, and discount rate. Significant assumptions used in the valuation of marketing assets include assumptions about the period of time the brand will continue to be valuable, royalty rate, and discount rate. Significant assumptions used in the valuation of content intangible assets include cost-based assumptions. Our estimates of fair value are based upon assumptions we believe to be reasonable, but which are inherently uncertain and unpredictable, and unanticipated events and changes in circumstances may occur.

Goodwill

Goodwill represents the purchase price in excess of the net amount assigned to assets acquired and liabilities assumed by us in a business combination. Goodwill is not amortized, but tested annually for impairment on the first day of our fourth quarter, or more frequently if indicators of potential impairment arise.

Accounting guidance permits entities to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis to determine whether it is necessary to perform the quantitative impairment test. Significant judgment is required in the assessment of qualitative factors, including but not limited to an evaluation of macroeconomic conditions as they relate to our business, industry and market trends, as well as the overall future financial performance of identified reporting units and future opportunities in the markets in which we operate.

Intangible assets

Intangible assets other than goodwill

We amortize finite-lived intangible assets over their estimated useful lives as follows.


	Basis of amortization	Amortization period (in years)
Customer relationships	Straight-line and accelerated(1)	8-17
Marketing assets	Straight-line and accelerated(1)	2-15
Developed technology	Straight-line and accelerated(1)	5-14
Content	Straight-line	9

(1)Certain of the customer relationships, marketing assets and developed technology assets are amortized on an accelerated basis.

Impairment of long-lived assets

Impairment of long-lived assetsWe review long-lived assets for impairment when events change or circumstances indicate the carrying amount may not be recoverable. Events or changes in circumstances that indicate the carrying amount may not be recoverable include, but are not limited to, a significant decrease in the market value of the business or asset acquired, a significant adverse change in the extent or manner in which the business or asset acquired is used or significant adverse change in the business climate. If such events or changes in circumstances are present, the undiscounted cash flow method is used to determine whether the asset is impaired.

Deferred financing costs

Deferred financing costs and debt discount

Deferred financing costs included in other assets represent the direct third-party costs of entering into the revolving (line-of-credit) portion of our credit facility in October 2020 and portions of the unamortized deferred financing costs from prior facilities. These costs are amortized ratably over the term of the credit facility as interest expense.

Other debt issuance costs, as well as the debt discount associated with our 2020 Credit facility (as defined below) and portions of the unamortized balances from prior facilities, are recorded as a direct deduction from debt. These costs are amortized over the term of the credit facility as interest expense.

Stock-based compensation

We measure stock-based compensation cost at the grant date based on the fair value of the award and recognize it as expense over the requisite service period, which is the vesting period. We determine the fair value of stock options and stock appreciation rights using a Black-Scholes option pricing model, which requires us to use significant judgment to make estimates regarding the life of the award, volatility of our stock price, the risk-free interest rate and the dividend yield of our stock over the life of the award. We determine the fair value of awards that contain market conditions using a Monte Carlo simulation model. Changes to these estimates would result in different fair values of awards.

We recognize the effect of awards for which the requisite service period is not rendered when the award is forfeited (that is, we recognize the effect of forfeitures in compensation cost when they occur). Previously recognized compensation cost for an award is reversed in the period that the award is forfeited. Income tax benefits resulting from the vesting and exercise of stock-based compensation awards are recognized in the period the unit or award is vested or option or right is exercised.

Income taxes

We make estimates and judgments in accounting for income taxes. The calculation of the income tax provision requires estimates due to transactions, credits and calculations where the ultimate tax determination is uncertain. Uncertainties arise as a consequence of the actual source of taxable income between domestic and foreign locations, the outcome of tax audits and the ultimate utilization of tax credits. To the extent actual results differ from estimated amounts recorded, such differences will impact the income tax provision in the period in which the determination is made.

We make estimates in determining tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes. We record valuation allowances to reduce our deferred tax assets to the amount expected to be realized. In assessing the adequacy of a recorded valuation allowance significant judgment is required. We consider all positive and negative evidence and a variety of factors including the scheduled reversal of deferred tax liabilities, historical and projected future taxable income, and prudent and feasible tax planning strategies. If we determine there is less than a 50% likelihood that we will be able to use a deferred tax asset in the future in excess of its net carrying value, then an adjustment to the deferred tax asset valuation allowance is made to increase income tax expense, thereby reducing net income in the period such determination was made.

We measure and recognize uncertain tax positions. To recognize such positions, we must first determine if it is more likely than not that the position will be sustained upon audit. We must then measure the benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. Significant judgment is required in the identification and measurement of uncertain tax positions.

Foreign currency

Net assets recorded in a foreign currency are translated at the exchange rate on the balance sheet date. Revenue and expense items are translated using an average of monthly exchange rates. The resulting translation adjustments are recorded in accumulated other comprehensive income.

Research and development

Research and development costs are expensed as incurred except as noted below under Software development costs. These costs include compensation costs for engineering and product management personnel, third-party contractor expenses, software development tools and other expenses related to researching and developing new solutions or upgrading and enhancing existing solutions that do not qualify for capitalization, and allocated depreciation, facilities and IT support costs.

Software development costs, software for internal use

Software development costs

We incur certain costs associated with the development of internal-use software, which are primarily related to activities performed to develop our cloud solutions. Internal and external costs incurred in the preliminary project stage of internal-use software development are expensed as incurred. Once the software being developed has reached the application development stage, qualifying internal costs including payroll and payroll-related costs of employees who are directly associated with and devote time to the software project as well as external direct costs of materials and services are capitalized. Capitalization ceases at the point at which the developed software is substantially complete and ready for its intended use, which is typically upon completion of all substantial testing. Qualifying costs capitalized during the application development stage include those related to specific upgrades and enhancements when it is probable that those costs incurred will result in additional functionality. Overhead costs, including general and administrative costs, as well as maintenance, training and all other costs associated with post-implementation stage activities are expensed as incurred. In addition, internal costs that cannot be reasonably separated between maintenance and relatively minor upgrades and enhancements are expensed as incurred.

Software development costs, software to be sold

Credit losses and sales returns

Allowance for credit losses

Our accounts receivable consist of a single portfolio segment. Accounts receivable are recorded at original invoice amounts less an allowance for credit losses, an amount we estimate to be sufficient to provide adequate protection against lifetime expected losses resulting from extending credit to our customers. In judging the adequacy of the allowance for credit losses, we consider multiple factors including historical bad debt experience, the current aging of our receivables and current economic conditions that may affect our customers' ability to pay. A considerable amount of judgment is required in assessing these factors and if any receivables were to deteriorate, an additional provision for credit losses could be required. Accounts are written off after all means of collection are exhausted and recovery is considered remote. Provisions for credit losses are recorded in general and administrative expense.

Below is a summary of the changes in our allowance for credit losses.


Years ended December 31, (in thousands)	Balance at beginning of year		Provision/ adjustment		Write-off		Recovery		Balance at end of year
2021	$	9,016	$	4,483	$	(4,565)	$	441	$	9,375
2020(1)	4,011		6,787		(2,363)		581		9,016
2019	1,345		2,476		(2,617)		679		1,883

(1)Upon adoption of ASU 2016-13 at January 1, 2020, we reclassified certain balances previously disclosed within the allowance for sales returns to the allowance for credit losses, as these amounts reflect the credit risk associated with our accounts receivable. The amount reclassified was $2.1 million.

Our allowance for credit losses remained relatively unchanged during the year ended December 31, 2021. The amount of write-offs during the year ended December 31, 2021 was higher than during 2020 as we temporarily suspended sending past due customer accounts to collections during the second and third quarters of 2020 due to payment delays related to COVID-19.

Allowance for sales returns

We maintain a reserve for returns and credits which is estimated based on several factors including historical experience, known credits yet to be issued, the aging of customer accounts and the nature of service level commitments. A considerable amount of judgment is required in assessing these factors. Provisions for sales returns and credits are charged against the related revenue items.

Advertising costs

Advertising costsWe expense advertising costs as incurred

Restructuring costs

Restructuring costsRestructuring costs include charges for the costs of exit or disposal activities. The liability for costs associated with exit or disposal activities is measured initially at fair value and only recognized when the liability is incurred.

Leases

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease ROU assets, accrued expense and other current liabilities, and operating lease liabilities, net of current portion in our consolidated balance sheet as of December 31, 2021 and 2020.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate in determining the present value of lease payments. Our incremental borrowing rate is based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at the commencement date. We use the implicit rate when readily determinable. The operating lease ROU asset also includes any initial direct costs and lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments related to our operating leases is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are generally accounted for separately. We do not recognize short-term leases (those that, at the commencement date, have a lease term of 12 months or less) on our consolidated balance sheets. Variable lease payments, which are primarily comprised of common-area maintenance, utilities and real estate taxes that are passed on from the lessor in proportion to the space leased by us, are recognized in operating expenses in the period in which the obligation for those payments is incurred.

Contingencies

We are subject to the possibility of various loss contingencies in the normal course of business. We record an accrual for a contingency when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Often these issues are subject to substantial uncertainties and, therefore, the probability of loss and the estimation of damages are difficult to ascertain. These assessments can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions that have been deemed reasonable by us. Although we believe we have substantial defenses in these matters, we could incur judgments or enter into settlements of claims that could have a material adverse effect on our consolidated financial position, results of operations or cash flows in any particular period.

Earnings per share

We compute basic earnings per share by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares and dilutive potential common shares outstanding during the period. Diluted earnings per share reflect the assumed exercise, settlement and vesting of all dilutive securities using the “treasury stock method” except when the effect is anti-dilutive. Potentially dilutive securities consist of shares issuable upon the exercise of stock options and stock appreciation rights and vesting of restricted stock awards and units.

Legal contingencies

Legal proceedings

We are subject to legal proceedings and claims that arise in the ordinary course of business, as well as certain other non-ordinary course proceedings, claims and inquiries, as described below. We make a provision for a loss contingency when it is both probable that a material liability has been incurred and the amount of the loss can be reasonably estimated. If only a range of estimated losses can be determined, we accrue an amount within the range that, in our judgment, reflects the most likely outcome; if none of the estimates within that range is a better estimate than any other amount, we accrue the low end of the range. For proceedings in which an unfavorable outcome is reasonably possible but not probable and an estimate of the loss or range of losses arising from the proceeding can be made, we disclose such an estimate, if material. If such a loss or range of losses is not reasonably estimable, we disclose that fact. We review any such loss contingency provisions at least quarterly and adjust them to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. We recognize insurance recoveries, if any, when they are probable of receipt. All associated costs due to third-party service providers and consultants, including legal fees, are expensed as incurred.

Goodwill And Other Intangible Assets (Fair Values Of Intangible Assets Acquired In Various Business Combinations By Class) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Schedule of Acquired Intangible Assets by Major Class [Line Items]
Finite-lived intangible assets, gross carrying amount	$ 910,592	$ 554,097
Finite-lived intangible assets, accumulated amortization	(212,540)	(276,591)
Intangible assets, net (excluding goodwill)	698,052	277,506
Customer relationships [Member]
Schedule of Acquired Intangible Assets by Major Class [Line Items]
Finite-lived intangible assets, gross carrying amount	606,409	287,116
Finite-lived intangible assets, accumulated amortization	(151,258)	(138,635)
Marketing assets [Member]
Schedule of Acquired Intangible Assets by Major Class [Line Items]
Finite-lived intangible assets, gross carrying amount	74,731	34,642
Finite-lived intangible assets, accumulated amortization	(7,269)	(5,918)
Developed technology [Member]
Schedule of Acquired Intangible Assets by Major Class [Line Items]
Finite-lived intangible assets, gross carrying amount	211,552	232,339
Finite-lived intangible assets, accumulated amortization	(54,013)	(132,038)
Content [Member]
Schedule of Acquired Intangible Assets by Major Class [Line Items]
Finite-lived intangible assets, gross carrying amount	17,900	0
Finite-lived intangible assets, accumulated amortization	$ 0	$ 0

Derivative Instruments (Schedule of Interest Rate Swaps) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Jul. 31, 2021	Nov. 30, 2020
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount	$ 435,000
November 2020 Swap 1 [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount			$ 60,000
November 2020 Swap 2 [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount			60,000
November 2020 Swap 3 [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount			120,000
November 2020 Swap 4 [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount			$ 120,000
July 2021 Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount		$ 75,000

Revenue Recognition (Revenue by Geography) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Revenue	$ 927,740	$ 913,219	$ 900,423
United States [Member]
Disaggregation of Revenue [Line Items]
Revenue	777,333	772,188	775,308
United Kingdom [Member]
Disaggregation of Revenue [Line Items]
Revenue	89,688	84,121	65,176
Other countries [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 60,719	$ 56,910	$ 59,939

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 280
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130545-203045

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-Name Accounting Standards Codification
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+ Details

Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Deferred tax assets relating to:
Federal and state and foreign net operating loss carryforwards	$ 21,456	$ 5,592
Federal, state and foreign tax credits	52,283	42,598
Stock-based compensation	21,432	17,434
Operating leases	23,795	13,375
Allowance for credit losses	2,524	2,399
Intangible assets	1,070	1,663
Deferred revenue	1,057	524
Accrued bonuses	218	0
Other	13,515	9,111
Total deferred tax assets	137,350	92,696
Deferred tax liabilities relating to:
Intangible assets	(168,392)	(45,757)
Capitalized software development costs	(31,326)	(28,804)
Costs of obtaining contracts	(18,046)	(20,256)
Operating leases	(23,582)	(12,333)
Fixed assets	(8,483)	(8,458)
Other	(2,515)	(398)
Total deferred tax liabilities	(252,344)	(116,006)
Valuation allowance	(31,974)	(29,184)	$ (6,453)	$ (6,855)
Net deferred tax liability	$ (146,968)	$ (52,494)

Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Change in Goodwill

The change in our goodwill during 2021 consisted of the following:


(dollars in thousands)	Total
Balance at December 31, 2020	$	635,854
Additions related to current year business combinations	422,846

Effect of foreign currency translation	(60)
Balance at December 31, 2021	$	1,058,640

Fair Values Of Intangible Assets Acquired In Various Business Combinations By Class

The table below sets forth the balances of each class of intangible asset and related amortization as of:


	December 31,
(dollars in thousands)	2021		2020
Finite-lived gross carrying amount
Customer relationships	$	606,409	$	287,116
Marketing assets	74,731		34,642
Developed technology	211,552		232,339
Content	17,900		—


Total finite-lived gross carrying amount	910,592		554,097
Accumulated amortization
Customer relationships	(151,258)		(138,635)
Marketing assets	(7,269)		(5,918)
Developed technology	(54,013)		(132,038)
Content	—		—


Total accumulated amortization	(212,540)		(276,591)


Intangible assets, net	$	698,052	$	277,506

Summary of Amortization Expense

The following table summarizes amortization expense of our finite-lived intangible assets:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Included in cost of revenue:
Cost of recurring	$	33,132	$	36,835	$	42,565
Cost of one-time services and other	1,680		2,133		2,204
Total included in cost of revenue	34,812		38,968		44,769
Included in operating expenses	2,227		2,915		5,316
Total amortization of intangibles from business combinations	$	37,039	$	41,883	$	50,085

Future Amortization Expense for Finite-Lived Intangible Assets

The following table outlines the estimated future amortization expense for each of the next five years for our finite-lived intangible assets as of December 31, 2021:


Years ending December 31, (dollars in thousands)	Amortization expense
2022	52,677
2023	57,371
2024	63,110
2025	66,832
2026	65,545
Total	$	305,535

Segment Information (Tables)

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Long-Lived Assets By Geographic Region

The following table presents long-lived assets by geographic region based on the location of the assets.


	Years ended December 31,
(dollars in thousands)	2021		2020
United States	$	110,613	$	103,123
Other countries	815		2,054
Total property and equipment	$	111,428	$	105,177

Debt (Summary of Debt) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Oct. 30, 2020
Line of Credit Facility [Line Items]
Debt, gross	$ 961,174	$ 534,177
Other debt	1,694	3,926
Less: Unamortized discount and debt issuance costs	4,994	3,144	$ 2,000
Less: Debt, current portion	18,697	12,840
Debt, net of current portion	$ 937,483	$ 518,193
Weighted average effective interest rate	3.23%	3.21%
Revolving credit loans [Member]
Line of Credit Facility [Line Items]
Debt, gross	$ 260,000	$ 69,625
Weighted average effective interest rate	3.27%	1.83%
Term loans [Member]
Line of Credit Facility [Line Items]
Debt, gross	$ 640,000	$ 400,000
Weighted average effective interest rate	3.02%	3.12%
Real estate loans [Member]
Line of Credit Facility [Line Items]
Debt, gross	$ 59,480	$ 60,626
Weighted average effective interest rate	5.22%	5.22%
Other debt [Member]
Line of Credit Facility [Line Items]
Weighted average effective interest rate	5.00%	5.00%
Short-term debt [Member]
Line of Credit Facility [Line Items]
Weighted average effective interest rate	3.11%	2.61%
Long-term debt [Member]
Line of Credit Facility [Line Items]
Weighted average effective interest rate	3.23%	3.22%

Commitments and Contingencies (Schedule of Supplemental Cash Flow Information Related To Leases) (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Operating cash flows from operating leases

$ 11,338

$ 26,713

^[1]

$ 24,569

Right-of-use assets obtained in exchange for lease obligations (non-cash), operating leases

$ 5,358

$ 11,002

$ 102,245

[1]	The 2020 amount was revised to correct an immaterial disclosure error in the previously filed consolidated financial statements.

Defined Contribution Plan (Details) - USD ($) $ in Millions	12 Months Ended
Defined Contribution Plan (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Defined Contribution Plan Disclosure [Line Items]
Employer matching contribution, percent of qualified employees' contribution	50.00%	50.00%	50.00%
Employer matching contributions, total	$ 6.5	$ 1.9	$ 8.7
Employer discretionary contributions, total	$ 0.0		$ 0.0
COVID-19 [Member]
Defined Contribution Plan Disclosure [Line Items]
Employer discretionary contributions, total		$ 1.2
Minimum [Member]
Defined Contribution Plan Disclosure [Line Items]
Employee contribution, percent of salary	1.00%	1.00%	1.00%
Maximum [Member]
Defined Contribution Plan Disclosure [Line Items]
Employee contribution, percent of salary	75.00%	75.00%	75.00%
Employer matching contribution, percent of employees' salary	6.00%	6.00%	6.00%

Restructuring

12 Months Ended

Dec. 31, 2021

Restructuring and Related Activities [Abstract]

Restructuring


18. Restructuring

During 2017, in an effort to further our organizational objectives, including improved operating efficiency, customer outcomes and employee satisfaction, we initiated a multi-year plan to consolidate and relocate some of our existing offices to highly modern and more collaborative workspaces with short-term financial commitments. We substantially completed our facilities optimization restructuring plan as of December 2019. During the year ended December 31, 2019, we incurred $5.8 million in before-tax restructuring charges related to these activities. Such charges during the years ended December 31, 2021 and 2020 were insignificant.

Restructuring costs incurred prior to our adoption of ASU 2016-02 Leases (Topic 842) ("ASU 2016-02") on January 1, 2019 consisted primarily of costs to terminate lease agreements, contractual lease payments, net of estimated sublease income, upon vacating space as part of the plan, as well as insignificant costs to relocate affected employees and write-off facilities-related fixed assets that we would no longer use.

Upon adoption of ASU 2016-02 at January 1, 2019, we reduced our operating lease ROU assets recognized at transition by the carrying amounts of the restructuring liabilities for certain leased office spaces that we ceased using prior to December 31, 2018. Restructuring costs incurred during the year ended December 31, 2019 consisted primarily of operating lease ROU asset impairment costs and, to a lesser extent, lease payments for offices we had ceased using and write-offs of facilities-related fixed assets that we would no longer use.

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Summary of Awards Outstanding by Each Award Type

The following table sets forth the number of awards outstanding for each award type as of:


	Outstanding at December 31,
Award type	2021	2020
Restricted stock awards	1,192,810	1,277,109
Restricted stock units	1,279,270	1,170,885

Summary of Stock-Based Compensation Expense

The following table summarizes stock-based compensation expense:


	Years ended December 31,
(in thousands)	2021		2020		2019
Included in cost of revenue:
Cost of recurring	$	12,405	$	5,793	$	1,879
Cost of one-time services and other	7,547		7,581		1,487
Total included in cost of revenue	19,952		13,374		3,366
Included in operating expenses:
Sales, marketing and customer success	20,283		15,514		11,203
Research and development	27,080		18,527		11,115
General and administrative	53,064		39,842		32,949
Total included in operating expenses	100,427		73,883		55,267
Total stock-based compensation expense	$	120,379	$	87,257	$	58,633

Summary of Unvested Restricted Stock Awards, Activity

The following table summarizes our unvested restricted stock awards as of December 31, 2021, and changes during the year then ended:


Restricted stock awards	Restricted stock awards	Weighted average grant-date fair value		Aggregate intrinsic value(1) (in thousands)
Unvested at January 1, 2021	1,277,109	$	79.54
Granted	596,763	77.39
Vested	(486,342)	79.21
Forfeited	(194,720)	78.67
Unvested at December 31, 2021	1,192,810	78.73		$	94,208

(1)The intrinsic value is calculated as the market value as of the end of the fiscal period.

Summary of Unvested Restricted Stock Units, Activity

The following table summarizes our unvested restricted stock units as of December 31, 2021, and changes during the year then ended:


Restricted stock units	Restricted stock units	Weighted average grant-date fair value		Aggregate intrinsic value(1) (in thousands)
Unvested at January 1, 2021	1,170,885	$	63.62
Granted	1,126,266	73.47
Forfeited	(110,722)	66.11

Vested	(907,159)	59.83
Unvested at December 31, 2021	1,279,270	74.77		$	101,037

(1)The intrinsic value is calculated as the market value as of the end of the fiscal period.

Derivative Instruments (Tables)

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives

The terms and notional values of our derivative instruments were as follows as of December 31, 2021:


(dollars in thousands)	Term of derivative instrument	Notional value
Derivative instruments designated as hedging instruments:
Interest rate swap	November 2020 - October 2024	$	60,000
Interest rate swap	November 2020 - October 2024	60,000
Interest rate swap	June 2021 - October 2024	120,000
Interest rate swap	July 2021 - October 2024	120,000
Interest rate swap	July 2021 - October 2024	75,000
		$	435,000

Fair Values of Derivative Instruments

The fair values of our derivative instruments were as follows as of:


		Asset Derivatives					Liability Derivatives
(dollars in thousands)	Balance sheet location	December 31, 2021		December 31, 2020		Balance sheet location	December 31, 2021		December 31, 2020
Derivative instruments designated as hedging instruments:
Interest rate swaps, current portion	Prepaid expenses and other current assets	$	—	$	—	Accrued expenses and other current liabilities	$	—	$	2,698
Interest rate swaps, long-term portion	Other assets	7,160		—		Other liabilities	—		1,461
Total derivative instruments designated as hedging instruments		$	7,160	$	—		$	—	$	4,159

Effects of Derivative Instruments in Cash Flow Hedging Relationships

The effects of derivative instruments in cash flow hedging relationships were as follows:


	Gain (loss) recognized in accumulated other comprehensive loss as of		Location of gain (loss) reclassified from accumulated other comprehensive loss into income	Gain (loss) reclassified from accumulated other comprehensive loss into income
(dollars in thousands)	December 31, 2021			Year ended December 31, 2021
Interest rate swaps	$	7,160	Interest expense	$	(3,714)

	December 31, 2020			Year ended December 31, 2020
Interest rate swaps	$	(4,159)	Interest expense	$	(3,827)

	December 31, 2019			Year ended December 31, 2019
Interest rate swaps	$	(1,757)	Interest expense	$	573

Revenue Recognition (Disaggregation of Recurring Revenue by Type) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Revenue	$ 927,740	$ 913,219	$ 900,423
Contractual recurring [Member]
Disaggregation of Revenue [Line Items]
Revenue	601,397	591,272	590,464
Transactional recurring [Member]
Disaggregation of Revenue [Line Items]
Revenue	279,453	259,473	241,145
Recurring [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 880,850	$ 850,745	$ 831,609

- Definition

+ References

+ Details

Income Taxes (Schedule of Income Before Provision for Income Taxes) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
U.S.	$ (23,180)	$ (4,112)	$ 5,149
International	30,263	25,726	5,436
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	$ 7,083	$ 21,614	$ 10,585

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets


4. Goodwill and Other Intangible Assets

The change in our goodwill during 2021 consisted of the following:


(dollars in thousands)	Total
Balance at December 31, 2020	$	635,854
Additions related to current year business combinations	422,846

Effect of foreign currency translation	(60)
Balance at December 31, 2021	$	1,058,640

We have recorded intangible assets acquired in various business combinations based on their fair values at the date of acquisition. The table below sets forth the balances of each class of intangible asset and related amortization as of:


	December 31,
(dollars in thousands)	2021		2020
Finite-lived gross carrying amount
Customer relationships	$	606,409	$	287,116
Marketing assets	74,731		34,642
Developed technology	211,552		232,339
Content	17,900		—


Total finite-lived gross carrying amount	910,592		554,097
Accumulated amortization
Customer relationships	(151,258)		(138,635)
Marketing assets	(7,269)		(5,918)
Developed technology	(54,013)		(132,038)
Content	—		—


Total accumulated amortization	(212,540)		(276,591)


Intangible assets, net	$	698,052	$	277,506

During the year ended December 31, 2021, changes to the gross carrying amounts of intangible asset classes were primarily related to our acquisition of EVERFI as described in Note 3 to these consolidated financial statements, write-offs of fully amortized intangible assets and the effect of foreign currency translation.

During the year ended December 31, 2019, we recorded an impairment charge of $0.9 million against an acquired marketing asset that reduced the carrying value of the asset to zero. The impairment charge resulted from our decision during the year to rebrand the solution to which the asset related. This impairment charge was recorded as amortization on our consolidated statements of comprehensive income.

Amortization expense

Amortization expense related to finite-lived intangible assets acquired in business combinations is allocated to cost of revenue on the consolidated statements of comprehensive income based on the revenue stream to which the asset contributes, except for marketing assets and non-compete agreements, for which the associated amortization expense is included in operating expenses.

The following table summarizes amortization expense of our finite-lived intangible assets:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Included in cost of revenue:
Cost of recurring	$	33,132	$	36,835	$	42,565
Cost of one-time services and other	1,680		2,133		2,204
Total included in cost of revenue	34,812		38,968		44,769
Included in operating expenses	2,227		2,915		5,316
Total amortization of intangibles from business combinations	$	37,039	$	41,883	$	50,085

The following table outlines the estimated future amortization expense for each of the next five years for our finite-lived intangible assets as of December 31, 2021:


Years ending December 31, (dollars in thousands)	Amortization expense
2022	52,677
2023	57,371
2024	63,110
2025	66,832
2026	65,545
Total	$	305,535

Stock-Based Compensation (Summary of Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	$ 120,379	$ 87,257	$ 58,633
Cost of recurring [Member]
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	12,405	5,793	1,879
Cost of one-time services and other [Member]
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	7,547	7,581	1,487
Total included in cost of revenue [Member]
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	19,952	13,374	3,366
Sales, marketing and customer success [Member]
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	20,283	15,514	11,203
Research and development [Member]
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	27,080	18,527	11,115
General and administrative [Member]
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	53,064	39,842	32,949
Total included in operating expenses [Member]
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated stock-based compensation expense	$ 100,427	$ 73,883	$ 55,267

Revenue Recognition (Contract Balances) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Revenue from Contract with Customer [Abstract]
Total deferred revenue	$ 378,746	$ 316,914

Business Combinations (Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination) (Details) - EVERFI [Member] $ in Thousands	Dec. 31, 2021 USD ($)
Business Acquisition [Line Items]
Finite-lived intangible assets acquired	$ 457,449
Weighted average amortization period (in years)	14 years
Developed technology [Member]
Business Acquisition [Line Items]
Finite-lived intangible assets acquired	$ 72,000
Weighted average amortization period (in years)	7 years
Customer relationships [Member]
Business Acquisition [Line Items]
Finite-lived intangible assets acquired	$ 326,649
Weighted average amortization period (in years)	16 years
Marketing assets [Member]
Business Acquisition [Line Items]
Finite-lived intangible assets acquired	$ 40,900
Weighted average amortization period (in years)	14 years
Content [Member]
Business Acquisition [Line Items]
Finite-lived intangible assets acquired	$ 17,900
Weighted average amortization period (in years)	9 years

Stock-Based Compensation (Summary of Awards Outstanding by Each Award Type) (Details) - shares	Dec. 31, 2021	Dec. 31, 2020
Restricted stock awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding, number	1,192,810	1,277,109
Restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding, number	1,279,270	1,170,885

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities
Net income	$ 5,698	$ 7,717	$ 11,908
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	82,410	92,735	85,693
Provision for credit losses and sales returns	11,450	13,230	8,725
Stock-based compensation expense	120,379	87,257	58,633
Deferred taxes	(2,429)	8,837	(3,600)
Amortization of deferred financing costs and discount	1,570	781	752
Other non-cash adjustments	10,490	2,958	4,906
Changes in operating assets and liabilities, net of acquisition and disposal of businesses:
Accounts receivable	(6,525)	(18,414)	(6,569)
Prepaid expenses and other assets	(2,048)	22,568	6,383
Trade accounts payable	(9,670)	(19,997)	12,900
Accrued expenses and other liabilities	(8,190)	(49,232)	(9,718)
Deferred revenue	10,526	(485)	12,464
Net cash provided by operating activities	213,661	147,955	182,477
Cash flows from investing activities
Purchase of property and equipment	(11,664)	(29,690)	(11,492)
Capitalized software development costs	(40,489)	(42,157)	(46,874)
Purchase of net assets of acquired companies, net of cash and restricted cash acquired	(419,120)	0	(109,353)
Other investing activities	0	0	500
Net cash used in investing activities	(471,273)	(71,847)	(167,219)
Cash flows from financing activities
Proceeds from issuance of debt	582,200	748,500	424,000
Payments on debt	(152,971)	(747,563)	(344,500)
Debt issuance costs	(3,106)	(4,586)	0
Employee taxes paid for withheld shares upon equity award settlement	(39,404)	(21,425)	(23,781)
Proceeds from exercise of stock options	0	4	7
Change in due to customers	(13,464)	61,214	77,793
Change in customer funds receivable	(731)	138	1,301
Purchase of treasury stock	(108,416)	(41,001)	0
Dividend payments to stockholders	0	(5,960)	(23,607)
Net cash provided by (used in) financing activities	264,108	(10,679)	111,213
Effect of exchange rate on cash, cash equivalents and restricted cash	297	2,245	978
Net increase in cash, cash equivalents and restricted cash	6,793	67,674	127,449
Cash, cash equivalents and restricted cash, beginning of year	644,969	577,295	449,846
Cash, cash equivalents and restricted cash, end of year	651,762	644,969	577,295
Cash (paid) received during the year for:
Interest	(16,386)	(15,716)	(19,926)
Taxes, net of refunds	(10,073)	(3,563)	(383)
Non-cash investing and financing activities:
Purchase of property and equipment by assuming directly related liabilities	0	(61,064)	0
Purchase of equipment and other assets included in accounts payable	(1,747)	(840)	(794)
Acquired restricted cash liabilities due to customers	0	0	46,838
Stock Issued	(303,633)	0	$ 0
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract]
Cash and cash equivalents	55,146	35,750
Total restricted cash	596,616	609,219
Total cash, cash equivalents and restricted cash in the statement of cash flows	$ 651,762	$ 644,969

Debt (Tables)

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Summary of Debt

The following table summarizes our debt balances and the related weighted average effective interest rates, which includes the effect of interest rate swap agreements.


	Debt balance at				Weighted average effective interest rate at
(dollars in thousands)	December 31, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Credit facility:
Revolving credit loans	$	260,000	$	69,625	3.27	%	1.83	%
Term loans	640,000		400,000		3.02	%	3.12	%
Real estate loans	59,480		60,626		5.22	%	5.22	%
Other debt	1,694		3,926		5.00	%	5.00	%
Total debt	961,174		534,177		3.23	%	3.21	%
Less: Unamortized discount and debt issuance costs	4,994		3,144
Less: Debt, current portion	18,697		12,840		3.11	%	2.61	%
Debt, net of current portion	$	937,483	$	518,193	3.23	%	3.22	%

Annual Maturities Related to Credit Facility, Real Estate Loans and Other Debt

As of December 31, 2021, the required annual maturities related to the 2020 Credit Facility, the Real Estate Loans and our other debt were as follows:


Years ending December 31, (dollars in thousands)	Annual maturities
2022	$	18,697
2023	18,232
2024	17,859
2025	853,034
2026	1,969
Thereafter	51,383
Total required maturities	$	961,174

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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+ Details

Fair Value Measurements (Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - Fair value measurements, recurring [Member] - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	$ 7,160
Total financial assets	7,160
Derivative liabilities		$ 4,159
Total financial liabilities		4,159
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0
Total financial assets	0
Derivative liabilities		0
Total financial liabilities		0
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	7,160
Total financial assets	7,160
Derivative liabilities		4,159
Total financial liabilities		4,159
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0
Total financial assets	$ 0
Derivative liabilities		0
Total financial liabilities		$ 0

Basis of Presentation (Tables)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Schedule of Finite-Lived Intangible Assets

We amortize finite-lived intangible assets over their estimated useful lives as follows.


	Basis of amortization	Amortization period (in years)
Customer relationships	Straight-line and accelerated(1)	8-17
Marketing assets	Straight-line and accelerated(1)	2-15
Developed technology	Straight-line and accelerated(1)	5-14
Content	Straight-line	9

(1)Certain of the customer relationships, marketing assets and developed technology assets are amortized on an accelerated basis.

Accounts Receivable, Allowance for Credit Loss

Below is a summary of the changes in our allowance for credit losses.


Years ended December 31, (in thousands)	Balance at beginning of year		Provision/ adjustment		Write-off		Recovery		Balance at end of year
2021	$	9,016	$	4,483	$	(4,565)	$	441	$	9,375
2020(1)	4,011		6,787		(2,363)		581		9,016
2019	1,345		2,476		(2,617)		679		1,883

Allowance for sales returns

Below is a summary of the changes in our allowance for sales returns.


Years ended December 31, (in thousands)	Balance at beginning of year		Provision/ adjustment		Deduction		Balance at end of year
2021	$	1,276	$	6,967	$	(6,463)	$	1,780
2020(1)	1,518		6,443		(6,685)		1,276
2019	3,377		6,232		(5,963)		3,646

(1)As discussed above, we reclassified certain balances previously disclosed within the allowance for sales returns to the allowance for credit losses upon adoption of ASU 2016-13 at January 1, 2020. The amount reclassified was $2.1 million.

Revenue Recognition

12 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer


17. Revenue Recognition

Transaction price allocated to the remaining performance obligations

As of December 31, 2021, approximately $1.0 billion of revenue is expected to be recognized from remaining performance obligations. We expect to recognize revenue on approximately 60% of these remaining performance obligations over the next 12 months, with the remainder recognized thereafter.

We applied the practical expedient in ASC 606-10-50-14 and have excluded the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less (one-time services); and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed (payment services and usage).

We also applied the practical expedient in ASC 606-10-65-1-(f)(3), whereby the transaction price allocated to the remaining performance obligations, or an explanation of when we expect to recognize that amount as revenue for all reporting periods presented before the date of the initial application, is not disclosed.

Contract balances

Our contract assets as of December 31, 2021 and December 31, 2020 were insignificant. Our opening and closing balances of deferred revenue were as follows:


(in thousands)	December 31, 2021		December 31, 2020

Total deferred revenue	$	378,746	$	316,914

Deferred revenue increased during 2021, primarily due to the inclusion of EVERFI deferred revenue balances and, to a much lesser extent, early progress in initiatives to bring our pricing in line with the market. The amount of revenue recognized during the 2021 that was included in the deferred revenue balance at the beginning of the period was approximately $288 million. The amount of revenue recognized during the 2021 from performance obligations satisfied in prior periods was insignificant.

Disaggregation of revenue

We sell our cloud solutions and related services in three primary geographical markets: to customers in the United States, to customers in the United Kingdom and to customers located in other countries. The following table presents our revenue by geographic area based on the address of our customers:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
United States	$	777,333	$	772,188	$	775,308
United Kingdom	89,688		84,121		65,176
Other countries	60,719		56,910		59,939
Total revenue	$	927,740	$	913,219	$	900,423

Beginning in the second quarter of 2021, we combined our General Markets Group and Enterprise Markets Group into a single U.S. Markets Group ("UMG") and moved our Corporations vertical under our International Markets Group ("IMG"). This change was made to better align our resources toward customer retention and growth, which are key objectives as we progress toward our long-term aspirational goals.

The UMG and the IMG comprised our go-to-market organizations as of December 31, 2021. The following is a description of each market group as of that date:

•The UMG focuses on sales primarily to all prospects and customers inside of the U.S.; and

•The IMG focuses on sales primarily to all prospects and customers outside of the U.S, as well as corporations.

The following table presents our revenue by market group:


	Years ended December 31,
(dollars in thousands)	2021		2020(1)		2019(1)
UMG	$	733,663	$	730,482	$	750,007
IMG	193,632		181,948		147,147
Other	445		789		3,269
Total revenue	$	927,740	$	913,219	$	900,423

(1)Due to the market group changes discussed above, we have recast our revenue by market group for the years ended December 31, 2020 and 2019 to present them on a consistent basis with the current year.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total number of authorized stock-based awards available (in shares)	3,500,423
Unvested awards, compensation cost not yet recognized	$ 97.8
Unvested awards, compensation cost not yet recognized, period of recognition (in years)	1 year 3 months 18 days
Restricted stock awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Contractual term (in years)	10 years
Vesting period (in years)	3 years
Restricted stock vested, total fair value	$ 38.5	$ 39.9	$ 37.5
Restricted stock granted, weighted average grant date fair value	$ 77.39	$ 77.16	$ 78.39
Restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Contractual term (in years)	10 years
Vesting period (in years)	3 years
Restricted stock vested, total fair value	$ 54.3	$ 18.9	$ 19.2
Restricted stock granted, weighted average grant date fair value	$ 73.47	$ 59.59	$ 77.90
Stock appreciation rights (SARs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options exercised, total intrinsic value			$ 3.6
Stock options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Contractual term (in years)	10 years

Basis of Presentation (Changes in Allowance for Sales Returns and Doubtful Accounts) (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Allowance for credit losses [Member]

SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]

Balance at beginning of year

$ 9,016

$ 4,011

^[1]

Provision/adjustment

4,483

6,787

Write-off

4,565

2,363

Recovery

441

581

Balance at end of year

9,375

9,016

$ 4,011

^[1]

SEC Schedule, 12-09, Balance at beginning of year

1,883

1,345

SEC Schedule, 12-09, Provision/adjustment

2,476

SEC Schedule, 12-09, Deduction

(2,617)

SEC Schedule, 12-09, Recovery

679

SEC Schedule, 12-09, Balance at end of year

1,883

Allowance for sales returns [Member]

SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]

Balance at beginning of year

1,276

1,518

^[2]

Provision/adjustment

6,967

6,443

Write-off

6,463

6,685

Balance at end of year

$ 1,780

1,276

1,518

^[2]

SEC Schedule, 12-09, Balance at beginning of year

$ 3,646

3,377

SEC Schedule, 12-09, Provision/adjustment

6,232

SEC Schedule, 12-09, Deduction

(5,963)

SEC Schedule, 12-09, Balance at end of year

$ 3,646

[1]	Upon adoption of ASU 2016-13 at January 1, 2020, we reclassified certain balances previously disclosed within the allowance for sales returns to the allowance for credit losses, as these amounts reflect the credit risk associated with our accounts receivable. The amount reclassified was $2.1 million.
[2]	As discussed above, we reclassified certain balances previously disclosed within the allowance for sales returns to the allowance for credit losses upon adoption of ASU 2016-13 at January 1, 2020. The amount reclassified was $2.1 million.

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense

The following summarizes the components of income tax expense (benefit):


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Current taxes:
U.S. Federal	$	(2,499)	$	(407)	$	1,534
U.S. State and local	(257)		1,563		613
International	6,570		3,904		130
Total current taxes	3,814		5,060		2,277
Deferred taxes:
U.S. Federal	(4,615)		(1,064)		(1,724)
U.S. State and local	222		7,725		(2,235)
International	1,964		2,176		359
Total deferred taxes	(2,429)		8,837		(3,600)
Total income tax provision (benefit)	$	1,385	$	13,897	$	(1,323)

Schedule of Income Before Provision for Income Taxes

The following summarizes the components of income before provision for income taxes:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
U.S.	$	(23,180)	$	(4,112)	$	5,149
International	30,263		25,726		5,436
Income before provision for income taxes	$	7,083	$	21,614	$	10,585

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation between the effect of applying the federal statutory rate and the effective income tax rate used to calculate our income tax provision (benefit) is as follows:


	Years ended December 31,
	2021		2020		2019
Federal statutory rate	21.0	%	21.0	%	21.0	%
Effect of:
State income taxes, net of federal benefit	4.4		5.9		(1.7)
Change in foreign income tax rate applied to deferred tax balances	42.6		4.0		2.0

Change in state income tax rate applied to deferred tax balances	2.3		0.1		(3.1)
Section 162(m) limitation	75.0		17.5		30.8
Change in valuation reserve (primarily state credit reserves)	26.1		38.2		3.7
Acquisition costs	8.7		—		—
Nondeductible meals, entertainment and transportation	1.1		3.3		11.3
GILTI inclusion	—		1.3		5.9

FDII benefit	—		—		(1.5)



DTA Adjustment – NOLs	—		(3.3)		—
Return to accrual adjustment	(4.2)		(4.1)		(10.6)
Foreign tax rate	(6.0)		(1.7)		0.3
State credits, net of federal benefit	(32.6)		(2.3)		(15.4)
Unrecognized tax benefit	(32.7)		1.3		4.4
Stock-based compensation	(36.2)		(1.2)		(20.2)
Federal credits generated	(54.5)		(17.4)		(37.6)
Other	4.6		1.7		(1.8)
Income tax provision (benefit) effective rate	19.6	%	64.3	%	(12.5)	%

Schedule of Deferred Tax Assets and Liabilities

The significant components of our deferred tax assets and liabilities were as follows:


	December 31,
(dollars in thousands)	2021		2020
Deferred tax assets relating to:
Federal and state and foreign net operating loss carryforwards	$	21,456	$	5,592
Federal, state and foreign tax credits	52,283		42,598
Stock-based compensation	21,432		17,434
Operating leases	23,795		13,375
Allowance for credit losses	2,524		2,399
Intangible assets	1,070		1,663
Deferred revenue	1,057		524
Accrued bonuses	218		—
Other	13,515		9,111
Total deferred tax assets	137,350		92,696
Deferred tax liabilities relating to:
Intangible assets	(168,392)		(45,757)
Capitalized software development costs	(31,326)		(28,804)
Costs of obtaining contracts	(18,046)		(20,256)
Operating leases	(23,582)		(12,333)
Fixed assets	(8,483)		(8,458)
Other	(2,515)		(398)
Total deferred tax liabilities	(252,344)		(116,006)
Valuation allowance	(31,974)		(29,184)
Net deferred tax liability	$	(146,968)	$	(52,494)

Summary of Changes in Deferred Tax Asset Valuation Allowance

The following table illustrates the change in our deferred tax asset valuation allowance:


Years ended December 31, (dollars in thousands)	Balance at beginning of year		Acquisition- related change		Charges to expense		Balance at end of year

2021	$	29,184	$	893	$	1,897	$	31,974
2020	6,453		—		22,731		29,184
2019	6,855		—		(402)		6,453

Summary of Changes in Unrecognized Tax Benefits

The following table sets forth the change to our unrecognized tax benefit for the years ended December 31, 2021, 2020 and 2019:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Balance at beginning of year	$	4,625	$	4,346	$	3,704
Increases from prior period positions	6		414		1,183
Decreases in prior year positions	(57)		(614)		(385)
Increases from current period positions	1,751		491		456
Settlements (payments)	(1,192)		—		—
Lapse of statute of limitations	(1,482)		(12)		(612)
Balance at end of year	$	3,651	$	4,625	$	4,346

Stock-Based Compensation (Summary of Unvested Restricted Stock Awards, Activity) (Details) - Restricted stock awards [Member] - USD ($)
$ / shares in Units, $ in Thousands

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Unvested, number, beginning of period

1,277,109

Unvested, weighted average grant date fair value, beginning of period

$ 79.54

Granted, number

596,763

Granted, weighted average grant date fair value

$ 77.39

$ 77.16

$ 78.39

Vested, number

(486,342)

Vested, weighted average grant date fair value

$ 79.21

Forfeited, number

(194,720)

Forfeited, weighted average grant date fair value

$ 78.67

Unvested, number, end of period

1,192,810

1,277,109

Unvested, weighted average grant date fair value, end of period

$ 78.73

$ 79.54

Unvested, aggregate intrinsic value

^[1]

$ 94,208

[1]	The intrinsic value is calculated as the market value as of the end of the fiscal period.

Stock-Based Compensation

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation


13. Stock-based Compensation

Employee stock-based compensation plans

Under the 2016 Equity and Incentive Compensation Plan Amended and Restated as of June 10, 2021 (the "2016 Equity Plan"), we may grant incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units, other stock awards and cash incentive awards to employees, directors and consultants. Our Compensation Committee of the Board of Directors administers this plan and the stock-based awards are granted under terms determined by it.

The total number of authorized stock-based awards available under our plan was 3,500,423 as of December 31, 2021. We issue common stock from our pool of authorized stock upon exercise of stock options and stock appreciation rights, vesting of restricted stock units or upon granting of restricted stock.

Historically, we have issued four types of awards under our plans: restricted stock awards, restricted stock units, stock options and stock appreciation rights ("SARs"). There have been no new stock options or SARs granted since 2005 and 2013, respectively. The following table sets forth the number of awards outstanding for each award type as of:


	Outstanding at December 31,
Award type	2021	2020
Restricted stock awards	1,192,810	1,277,109
Restricted stock units	1,279,270	1,170,885

Options and SARs granted under the 2016 Equity Plan have a 10-year contractual term. Awards granted to our executive officers and certain members of management are subject to accelerated vesting upon a change in control as defined in the employees’ retention agreement.

Expense recognition

We recognize compensation expense associated with stock options and awards with performance or market based vesting conditions on an accelerated basis over the requisite service period of the individual grantees, which generally equals the vesting period. We recognize compensation expense associated with restricted stock awards and SARs on a straight-line basis over the requisite service period of the individual grantees, which generally equals the vesting period. We recognize the effect of awards for which the requisite service period is not rendered when the award is forfeited (that is, we recognize the effect of forfeitures in compensation cost when they occur). Previously recognized compensation cost for an award is reversed in the period that the award is forfeited.

Stock-based compensation expense is allocated to cost of revenue and operating expenses on the consolidated statements of comprehensive income based on where the associated employee’s compensation is recorded. The following table summarizes stock-based compensation expense:


	Years ended December 31,
(in thousands)	2021		2020		2019
Included in cost of revenue:
Cost of recurring	$	12,405	$	5,793	$	1,879
Cost of one-time services and other	7,547		7,581		1,487
Total included in cost of revenue	19,952		13,374		3,366
Included in operating expenses:
Sales, marketing and customer success	20,283		15,514		11,203
Research and development	27,080		18,527		11,115
General and administrative	53,064		39,842		32,949
Total included in operating expenses	100,427		73,883		55,267
Total stock-based compensation expense	$	120,379	$	87,257	$	58,633

The total amount of compensation cost related to unvested awards not recognized was $97.8 million at December 31, 2021. It is expected that this amount will be recognized over a weighted average period of 1.3 years.

Restricted stock awards

We have granted shares of common stock subject to certain restrictions under the 2016 Equity Plan. Restricted stock awards granted to employees vest in equal annual installments generally over 3 years from the grant date subject to the recipient’s continued employment with us. Restricted stock awards granted to non-employee directors vest after one year from the date of grant or, if earlier, immediately prior to the next annual election of directors, provided the non-employee director is serving as a director at that time. The fair market value of the stock at the time of the grant is amortized on a straight-line basis to expense over the period of vesting. Recipients of restricted stock awards have the right to vote such shares and receive dividends, if declared.

The following table summarizes our unvested restricted stock awards as of December 31, 2021, and changes during the year then ended:


Restricted stock awards	Restricted stock awards	Weighted average grant-date fair value		Aggregate intrinsic value(1) (in thousands)
Unvested at January 1, 2021	1,277,109	$	79.54
Granted	596,763	77.39
Vested	(486,342)	79.21
Forfeited	(194,720)	78.67
Unvested at December 31, 2021	1,192,810	78.73		$	94,208

(1)The intrinsic value is calculated as the market value as of the end of the fiscal period.

The total fair value of restricted stock awards that vested during the years ended December 31, 2021, 2020 and 2019 was $38.5 million, $39.9 million and $37.5 million, respectively. The weighted average grant-date fair value of restricted stock awards granted during the years ended December 31, 2020 and 2019 was $77.16 and $78.39, respectively.

Restricted stock units

We have also granted restricted stock units subject to certain restrictions under the 2016 Equity Plan. Restricted stock units granted to employees vest in equal annual installments generally over 3 years from the grant date subject to the recipient’s continued employment with us. We have also granted restricted stock units for which vesting is subject to meeting certain performance and/or market conditions. Restricted stock units granted with a market condition had a fair market value assigned at the grant date based on the use of a Monte Carlo simulation model. The fair market value of the stock at the time of the grant is amortized to expense on a straight-line basis over the period of vesting except for awards with market or performance conditions, which are amortized on an accelerated basis over the period of vesting.

The following table summarizes our unvested restricted stock units as of December 31, 2021, and changes during the year then ended:


Restricted stock units	Restricted stock units	Weighted average grant-date fair value		Aggregate intrinsic value(1) (in thousands)
Unvested at January 1, 2021	1,170,885	$	63.62
Granted	1,126,266	73.47
Forfeited	(110,722)	66.11

Vested	(907,159)	59.83
Unvested at December 31, 2021	1,279,270	74.77		$	101,037

(1)The intrinsic value is calculated as the market value as of the end of the fiscal period.

The total fair value of restricted stock units that vested during the years ended December 31, 2021, 2020 and 2019 was $54.3 million, $18.9 million, and $19.2 million, respectively. The weighted average grant date fair value of restricted stock units granted for the years ended December 31, 2020 and 2019 was $59.59 and $77.90, respectively.

Stock appreciation rights

All SARs previously granted were fully vested as of December 31, 2017. There were no SARs exercised during 2021 and 2020. The total intrinsic value of SARs exercised during the year ended December 31, 2019 was $3.6 million. SARs granted with a market condition had a fair market value assigned at the grant date based on the use of a Monte Carlo simulation model. All other SARs granted had a fair market value assigned at the grant date based on the use of the Black-Scholes option pricing model.

Consolidated Financial Statement Details (Components of Restricted Cash) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Restricted cash due to customers	$ 593,296	$ 607,943
Letters of credit for operating leases	2,256	0
Real estate escrow balances	1,064	1,276
Total restricted cash	$ 596,616	$ 609,219

Business Combinations

12 Months Ended

Dec. 31, 2021

Business Combinations [Abstract]

Business Combinations


3. Business Combinations

2021 Acquisition

EVERFI

On December 31, 2021, we acquired all of the outstanding equity securities, including all voting equity interests, of EVERFI, Inc., a Delaware corporation ("EVERFI"), pursuant to an agreement and plan of merger. The acquisition advances our position as a leader in the rapidly evolving ESG and CSR spaces. We acquired the equity securities for approximately $440.1 million in cash consideration and 3,844,423 shares of the company's common stock, valued at approximately $303.6 million, for an aggregate purchase price of approximately $743.8 million, subject to closing adjustments. The cash consideration and related expenses were funded primarily through cash on hand and new borrowings under the 2020 Credit Facility (as defined below). As a result of the acquisition, EVERFI has become a wholly owned subsidiary of ours. The operating results of EVERFI have been included in our consolidated financial statements from the date of acquisition. During the year ended December 31, 2021, we incurred $2.9 million of acquisition-related expenses associated with the acquisition, which were recorded in general and administrative expense. In accordance with applicable accounting rules, we determined that the impact of this acquisition was not material to our consolidated financial statements; therefore, revenue and earnings since the acquisition date and pro forma information are not required or presented.

The fair values assigned to the assets acquired and liabilities assumed in the table below are based on our best estimates and assumptions as of the reporting date and are considered preliminary pending finalization. The estimates and assumptions are subject to change as we obtain additional information during the measurement period, which may be up to one year from the acquisition date. The assets and liabilities, pending finalization, include the valuation of intangible assets as well as the assumed deferred income tax balances.


(in thousands)	Purchase price allocation
Net working capital, excluding deferred revenue	$	(3,279)
Operating lease ROU assets	44,845
Other long-term assets	10,322
Identifiable intangible assets	457,449
Deferred tax liability	(93,925)
Deferred revenue	(51,770)
Operating lease liabilities, net of current portion	(42,068)
Other long-term liabilities	(645)
Goodwill	422,846
Total purchase price	$	743,775

The estimated fair value of accounts receivable acquired approximates the contractual value of $12.9 million and $14.7 million of EVERFI's historic carryover goodwill is deductible for income tax purposes. The estimated goodwill recognized is attributable primarily to the opportunities for expected synergies from combining the operations and assembled workforce of EVERFI.

The EVERFI acquisition resulted in the identification of the following identifiable intangible assets:


	Intangible assets acquired		Weighted average amortization period
EVERFI	(in thousands)		(in years)
Developed technology	$	72,000	7
Customer relationships	326,649		16
Marketing assets	40,900		14
Content	17,900		9
Total intangible assets	$	457,449	14

The estimated fair values of the customer relationships, marketing assets, and a substantial portion of the developed technology were based on variations of the income approach, which estimates fair value based upon the present value of cash flows that the assets are expected to generate, and which included the relief-from-royalty method and multi-period excess earnings method, depending on the intangible asset being valued. The estimated fair value of the content intangible asset and a small portion of the developed technology was based on the cost approach and included the replacement cost method. The method of amortization of identifiable finite-lived intangible assets is based on the expected pattern in which the estimated economic benefits of the respective assets are consumed or otherwise used up. Customer relationships, marketing assets and a substantial portion of the developed technology assets are being amortized on an accelerated basis. A small portion of the developed technology and content assets are being amortized on a straight-line basis.

2019 Acquisition

YourCause

On January 2, 2019, we acquired all of the outstanding equity securities, including all voting equity interests, of YourCause Holdings, LLC, a Delaware limited liability company ("YourCause"), pursuant to a purchase agreement and plan of merger. The acquisition expanded our footprint in corporate social responsibility and employee engagement and enhanced our position as a leader in providing solutions to both nonprofit organizations and for-profit companies committed to addressing social issues. We acquired the equity securities for an aggregate purchase price of $157.7 million in cash, net of closing adjustments. The purchase price and related expenses were funded primarily through borrowings under the 2017 Credit Facility (as defined below). As a result of the acquisition, YourCause became a wholly owned subsidiary of ours. We finalized the purchase price allocation of YourCause, including the valuation of assets acquired and liabilities assumed, during the fourth quarter of 2019. All measurement period adjustments were insignificant. In accordance with applicable accounting rules, we determined that the impact of this acquisition was not material to our consolidated financial statements; therefore, revenue and earnings since the acquisition date and pro forma information are not required or presented.

Subsequent Events

12 Months Ended

Dec. 31, 2021

Subsequent Events [Abstract]

Subsequent Events


19. Subsequent Events

Shelf registration statement

As a well-known seasoned issuer, we filed an automatic shelf registration statement for an undetermined amount of debt and equity securities with the SEC on January 14, 2022. Under this universal shelf registration statement we may offer, from time to time, debt securities, common stock, preferred stock, depositary shares, warrants, stock purchase contracts and stock purchase units. Subject to certain conditions, this registration statement will be effective through January 13, 2024.

First amendment to 2020 Credit Facility

On January 31, 2022, we entered into the First Amendment to Credit Agreement (the “Amendment”). The Amendment amends the 2020 Credit Facility to, among other things, (i) modify the definition of “Applicable Margin”, (ii) modify the net leverage ratio financial covenant to require a net leverage ratio of (A) 4.00:1.00 or less for the fiscal quarter ended December 31, 2021 and for fiscal quarters ending thereafter through December 31, 2023 and (B) 3.75:1.00 or less for the fiscal quarters ending March 31, 2024 and thereafter, (iii) reset the $250.0 fixed dollar basket with respect to the accordion feature and (iv) modify certain negative covenants to provide additional operational flexibility.

Under the Amended Credit Agreement, revolving loans and term loans (other than the $250.0 million 2021 Incremental Term Loan incurred in December 2021 (as defined above)) bear interest at a rate per annum equal to, at the option of the Company: (a) a base rate equal to the highest of (i) the Federal Funds Rate plus 0.50%, (ii) the prime rate announced by Bank of America, N.A., and (iii) Eurocurrency Rate plus 1.00% (the “Base Rate”), plus an applicable margin as specified in the Amendment (the “Applicable Margin”); or (b) Eurocurrency Rate plus the Applicable Margin. The Incremental Term Loan bear interest at a rate per annum equal to, at the option of the Company, the Base Rate, the Daily SOFR rate plus a SOFR adjustment rate as specified in the Amendment (the “SOFR Adjustment”) plus the Applicable Margin or the Term SOFR rate plus the SOFR Adjustment plus the Applicable Margin. The Applicable Margin shall be adjusted quarterly, varies based on our net leverage ratio and varies based on whether the loan is a Base Rate loan (0.375% to 1.50%), a Eurocurrency Rate loan (1.375% to 2.50%) or, solely in the case of the Incremental Term Loan, a SOFR Rate loan (1.375% to 2.50%). With respect to the Incremental Term Loan, the SOFR Adjustment varies based on the applicable interest period and equals 0.10% for Daily SOFR loans and for Term SOFR loans with a one-month interest period, 0.15% for Term SOFR loans with a three-month interest period and 0.25% for Term SOFR loans with a six-month interest period.

Earnings Per Share (Computation of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Earnings Per Share [Abstract]
Net income	$ 5,698	$ 7,717	$ 11,908
Weighted average common shares	47,412,306	48,184,714	47,695,383
Stock-based awards	818,132	511,627	616,888
Weighted average common shares assuming dilution	48,230,438	48,696,341	48,312,271
Earnings (Loss) Per Share, Basic and Diluted [Abstract]
Basic earnings per share	$ 0.12	$ 0.16	$ 0.25
Diluted earnings per share	$ 0.12	$ 0.16	$ 0.25
Shares excluded from calculations of diluted earnings per share	974,110	956,303	241,336

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities that are measured at fair value on a recurring basis consisted of the following, as of the dates indicated below:


	Fair value measurement using
(dollars in thousands)	Level 1		Level 2		Level 3		Total
Fair value as of December 31, 2021
Financial assets:
Derivative instruments	$	—	$	7,160	$	—	$	7,160
Total financial assets	$	—	$	7,160	$	—	$	7,160











Fair value as of December 31, 2020
Financial liabilities:
Derivative instruments	$	—	$	4,159	$	—	$	4,159
Total financial liabilities	$	—	$	4,159	$	—	$	4,159

Subsequent Events (Details)			1 Months Ended
Subsequent Events (Details)	Jan. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Oct. 30, 2020 USD ($)
Subsequent Event [Line Items]
Line of credit facility, available increase capacity, amount			$ 250,000,000
Subsequent Event [Member]
Subsequent Event [Line Items]
Line of credit facility, available increase capacity, amount	$ 250,000,000.0
Maximum Through December 31, 2023 \| Subsequent Event [Member]
Subsequent Event [Line Items]
Net leverage ratio	4.00
Maximum After December 31, 2023 \| Subsequent Event [Member]
Subsequent Event [Line Items]
Net leverage ratio	3.75
Term loans [Member]
Subsequent Event [Line Items]
Proceeds from lines of credit		$ 250,000,000	$ 400,000,000
Maximum [Member]
Subsequent Event [Line Items]
Net leverage ratio			3.25
Federal funds rate option [Member]
Subsequent Event [Line Items]
Credit facility, variable interest rate		0.50%	0.50%
Federal funds rate option [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Credit facility, variable interest rate	0.50%
Eurocurrency base rate option [Member]
Subsequent Event [Line Items]
Credit facility, variable interest rate			1.00%
Eurocurrency base rate option [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Credit facility, variable interest rate	1.00%
Base rate margin [Member] \| Minimum [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate		0.375%	0.375%
Base rate margin [Member] \| Minimum [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate	0.375%
Base rate margin [Member] \| Maximum [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate		1.50%	1.125%
Base rate margin [Member] \| Maximum [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate	1.50%
Eurocurrency rate margin [Member] \| Minimum [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate			1.375%
Eurocurrency rate margin [Member] \| Minimum [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate	1.375%
Eurocurrency rate margin [Member] \| Maximum [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate			2.125%
Eurocurrency rate margin [Member] \| Maximum [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate	2.50%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Subsequent Event [Line Items]
Credit facility, variable interest rate		1.00%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Daily
Subsequent Event [Line Items]
SOFR Adjustment		0.10%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| One-month
Subsequent Event [Line Items]
SOFR Adjustment		0.10%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Three-month
Subsequent Event [Line Items]
SOFR Adjustment		0.15%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Six-month
Subsequent Event [Line Items]
SOFR Adjustment		0.25%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Minimum [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate		1.375%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Maximum [Member]
Subsequent Event [Line Items]
Credit facility, basis spread on variable rate		2.50%

Goodwill and Other Intangible Assets (Change in Goodwill) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($)
Goodwill [Line Items]
Balance at December 31, 2020	$ 635,854
Effect of foreign currency translation	(60)
Balance at December 31, 2021	1,058,640
EVERFI [Member]
Goodwill [Line Items]
Additions related to current year business combinations	422,846
Balance at December 31, 2021	$ 422,846

Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Equity [Abstract]
Dividends paid per share (in dollars per share)		$ 0.12	$ 0.48
Stock repurchase program, authorized amount	$ 250,000
Treasury stock, shares, acquired	1,592,933	714,000
Treasury stock, value, acquired, cost method	$ 108,416	$ 41,001
Stock repurchase program, remaining authorized repurchase amount	$ 250,000
Subsequent Event [Line Items]
Treasury stock, shares, acquired	1,592,933	714,000
Treasury stock, value, acquired, cost method	$ 108,416	$ 41,001
Stock repurchase program, remaining authorized repurchase amount	$ 250,000

Consolidated Financial Statement Details

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidated Financial Statement Details


8. Consolidated Financial Statement Details

Restricted cash


(dollars in thousands)	December 31, 2021		December 31, 2020
Restricted cash due to customers	$	593,296	$	607,943
Letters of credit for operating leases	2,256		—
Real estate escrow balances	1,064		1,276
Total restricted cash	$	596,616	$	609,219

Prepaid expenses and other assets


(dollars in thousands)	December 31, 2021		December 31, 2020
Costs of obtaining contracts(1)(2)	$	78,465	$	84,914
Prepaid software maintenance and subscriptions(3)	28,880		24,471
Receivables for probable insurance recoveries(4)	18,202		6,288
Implementation costs for cloud computing arrangements, net(5)(6)	11,892		11,298
Derivative instruments	7,160		—
Unbilled accounts receivable	5,443		10,385
Prepaid insurance	5,363		1,426
Taxes, prepaid and receivable	3,986		1,891
Deferred tax assets	1,546		1,592
Other assets	11,835		8,740
Total prepaid expenses and other assets	172,772		151,005
Less: Long-term portion	77,266		72,639
Prepaid expenses and other current assets	$	95,506	$	78,366

(1)Amortization expense from costs of obtaining contracts was $35.5 million, $37.4 million and $38.1 million for the years ended December 31, 2021, 2020 and 2019, respectively, and is included in sales, marketing and customer success expense in our consolidated statements of comprehensive income.

(2)The current portion of costs of obtaining contracts as of December 31, 2021 and 2020 was $30.2 million and $31.9 million, respectively.

(3)The current portion of prepaid software maintenance and subscriptions as of December 31, 2021 and December 31, 2020 was $24.7 million and $19.8 million, respectively.

(4)See discussion of the Security Incident at Note 11 to these consolidated financial statements.

(5)These costs primarily relate to the multi-year implementations of our new global enterprise resource planning and customer relationship management systems.

(6)Amortization expense from capitalized cloud computing implementation costs was $1.9 million, $0.8 million and insignificant for the years ended December 31, 2021, 2020 and 2019, respectively. Accumulated amortization for these costs was $3.0 million and $1.1 million as of December 31, 2021 and 2020, respectively.

Accrued expenses and other liabilities


(dollars in thousands)	December 31, 2021		December 31, 2020
Taxes payable(1)	$	19,777	$	19,577
Amounts payable to former EVERFI option holders(2)	17,404		—
Accrued legal costs(3)	11,724		4,808
Operating lease liabilities, current portion	9,170		9,359
Customer credit balances	8,403		5,874
Accrued commissions and salaries	7,872		5,010
Accrued bonuses	5,829		—
Accrued transaction-based costs related to payments services	5,427		—
Accrued health care costs	3,042		2,341
Accrued vacation costs	2,234		2,311
Unrecognized tax benefit	1,248		3,351
Derivative instruments	—		4,159
Other liabilities	9,310		6,304
Total accrued expenses and other liabilities	101,440		63,094
Less: Long-term portion	1,344		10,866
Accrued expenses and other current liabilities	$	100,096	$	52,228

(1)We deferred payments of the employer's portion of Social Security taxes during 2020 under the Coronavirus, Aid, Relief and Economic Security Act ("CARES Act"), half of which was due by the end of calendar year 2021 with the remainder due by the end of calendar year 2022.

(2)Represents amounts not yet paid by EVERFI to its former option holders as of December 31, 2021, solely due to the timing of the acquisition on the last day of 2021. See Note 3 to these consolidated financial statements for additional information regarding our acquisition of EVERFI.

(3)All accrued legal costs are classified as current. The increase in accrued legal costs from December 31, 2020 was primarily due to the Security Incident. See Note 11 to these consolidated financial statements.

Deferred revenue


(dollars in thousands)	December 31, 2021		December 31, 2020
Recurring	$	360,890	$	303,840
One-time services and other	17,856		13,074
Total deferred revenue	378,746		316,914
Less: Long-term portion	4,247		4,678
Deferred revenue, current portion	$	374,499	$	312,236

Other income, net


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Interest income	$	392	$	1,660	$	2,802
Other (expense) income, net	(212)		(2)		1,256
Other income, net	$	180	$	1,658	$	4,058

Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies


11. Commitments and Contingencies

Leases

We have operating leases for corporate offices, subleased offices and certain equipment and furniture. In August 2020, we completed the purchase of our global headquarters facility that we previously leased. As of December 31, 2021, we did not have any operating leases that had not yet commenced.

With the acquisition of EVERFI, we assumed a lease for office space in Washington, D.C. At December 31, 2021, we had a standby letter of credit of $2.1 million for a security deposit for this lease.

The following table summarizes the components of our lease expense:


	Year ended December 31,
(dollars in thousands)	2021		2020		2019
Operating lease cost(1)	$	9,636	$	41,210	$	27,519
Variable lease cost	2,478		4,266		4,035
Sublease income	(1,516)		(3,120)		(3,189)
Net lease cost	$	10,598	$	42,356	$	28,365

(1)Includes short-term lease costs, which were immaterial.

In October 2021, we made the decision to permanently close our fixed office locations (with the exception of our global headquarters facility in Charleston, South Carolina), effective in December 2021. This change was intended to align our real estate footprint with our transition to a remote-first workforce. We enter into arrangements for smaller more flexible workspaces where necessary. As a result, during the twelve months ended December 31, 2021, we reduced the estimated useful lives of our operating lease ROU assets for certain of our office locations we expected to exit. We recorded $5.3 million in incremental operating lease costs during 2021 related to this change in accounting estimate. For these same office locations, we also reduced the estimated useful lives of certain facilities-related fixed assets, which resulted in incremental depreciation expense of $1.7 million during 2021 (see Note 7 to these consolidated financial statements). During the twelve months ended December 31, 2021, we also recorded $3.6 million in impairments of operating lease ROU assets associated with certain leased office spaces we have ceased using as a result of our adjusted workforce strategy. These impairment charges are reflected in general and administrative expense.

During the twelve months ended December 31, 2020, we reduced the estimated useful lives of our operating lease ROU assets for certain of our office locations we expected to exit. We recorded $16.2 million in incremental operating lease costs during 2020 related to this change in accounting estimate, which accounts for a substantial portion of the increase in operating lease costs during 2020. For these same office locations, we also reduced the estimated useful lives of certain facilities-related fixed assets, which resulted in incremental depreciation expense of $4.6 million during 2020 (see Note 7 to these consolidated financial statements). During the twelve months ended December 31, 2020, we also recorded $4.0 million in impairments of operating lease ROU assets associated with certain leased office spaces we ceased using. These impairment charges are reflected in general and administrative expense.

During the twelve months ended December 31, 2019, we recorded $3.8 million in impairments of operating lease ROU assets associated with certain leased office spaces we ceased using as part of our facilities optimization restructuring. These impairments, which were based on our estimates about our inability to sublease the office spaces, were recorded as restructuring expense on our consolidated statements of comprehensive income. See Note 18 to these consolidated financial statements for additional details regarding our facilities optimization restructuring.

Maturities of our operating lease liabilities as of December 31, 2021 were as follows:


Years ending December 31, (dollars in thousands)	Operating leases
2022	11,706
2023	10,328
2024	7,886
2025	6,805
2026	6,109
Thereafter	32,997
Total lease payments	75,831
Less: Amount representing interest	13,275
Present value of future payments	$	62,556

Our ROU assets and lease liabilities are included in the following line items in our consolidated balance sheet:


(dollars in thousands)	December 31, 2021		December 31, 2020
Operating leases
Operating lease ROU assets	$	53,883	$	22,671

Accrued expenses and other current liabilities	$	9,170	$	9,359
Operating lease liabilities, net of current portion	53,386		17,357
Total operating lease liabilities	$	62,556	$	26,716

The increase in operating lease ROU assets and operating lease liabilities during 2021 was primarily due to leases for office space we assumed with our acquisition of EVERFI. See Note 3 to these consolidated financial statements for details.

The weighted average remaining lease terms and discount rates were as follows:


(dollars in thousands)	December 31, 2021		December 31, 2020		December 31, 2019
Operating leases
Weighted average remaining lease term (years)	8.9		4.6		12.5
Weighted average discount rate	4.68	%	5.70	%	5.96	%

Supplemental cash flow information related to leases was as follows:


	Year ended December 31,
(dollars in thousands)	2021		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases(1)	$	11,338	$	26,713	$	24,569
Right-of-use assets obtained in exchange for lease obligations (non-cash):
Operating leases	5,358		11,002		102,245

(1)The 2020 amount was revised to correct an immaterial disclosure error in the previously filed consolidated financial statements.

Other commitments

The term loans under the 2020 Credit Facility require periodic principal payments. The balance of the term loans and any amounts drawn on the revolving credit loans are due upon maturity of the 2020 Credit Facility in October 2025. The Real Estate Loans also require periodic principal payments and the balance of the Real Estate Loans are due upon maturity in April 2038.

We have contractual obligations for third-party technology used in our solutions and for other services we purchase as part of our normal operations. In certain cases, these arrangements require a minimum annual purchase commitment by us. As of December 31, 2021, the remaining aggregate minimum purchase commitment under these arrangements was approximately $33.6 million through 2025.

Solution and service indemnifications

In the ordinary course of business, we provide certain indemnifications of varying scope to customers against claims of intellectual property infringement made by third parties arising from the use of our solutions or services. If we determine that it is probable that a loss has been incurred related to solution or service indemnifications, any such loss that could be reasonably estimated would be recognized. We have not identified any losses and, accordingly, we have not recorded a liability related to these indemnifications.

Legal proceedings

Legal proceedings are inherently unpredictable. However, we believe that we have valid defenses with respect to the legal matters pending or threatened against us and intend to defend ourselves vigorously against all claims asserted. It is possible that our consolidated financial position, results of operations or cash flows could be materially negatively affected in any particular period by an unfavorable resolution of one or more of such legal proceedings.

Security incident

As previously disclosed, we are subject to risks and uncertainties as a result of a ransomware attack against us in May 2020 in which a cybercriminal removed a copy of a subset of data from our self-hosted environment (the "Security Incident"). Based on the nature of the Security Incident, our research and third party (including law enforcement) investigation, we have no reason to believe that any data went beyond the cybercriminal, was or will be misused, or will be disseminated or otherwise made available publicly. Our investigation into the Security Incident by our cybersecurity team and third-party forensic advisors remains ongoing.

As a result of the Security Incident, we are currently subject to certain legal proceedings, claims, inquiries and investigations, as discussed below, and could be the subject of additional legal proceedings, claims, inquires and investigations in the future that might result in adverse judgments, settlements, fines, penalties, or other resolution. To limit our exposure to losses related to claims against us, including data breaches such as the Security Incident, we maintain $50 million of insurance above a $250 thousand deductible payable by us. As noted below, this coverage has reduced our financial exposure related to the Security Incident, and we will continue to seek recoveries under these insurance policies.

We recorded expenses and offsetting probable insurance recoveries related to the Security Incident as follows:


	Years ended December 31,
(dollars in thousands)	2021		2020
Gross expense(1)	$	40,560	$	9,831
Offsetting probable insurance recoveries	(38,746)		(9,363)
Net expense	$	1,814	$	468

(1)The 2020 amount has been revised to exclude costs associated with enhancements to our cybersecurity program.

The following summarizes our cumulative expenses, probable insurance recoveries and insurance recoveries paid as of:


(dollars in thousands)	December 31, 2021		December 31, 2020
Cumulative gross expense(1)	$	50,391	$	9,831
Cumulative offsetting insurance recoveries	(48,109)		(9,363)
Cumulative net expense	$	2,282	$	468

Cumulative offsetting insurance recoveries paid	$	(29,968)	$	(3,075)

(1)The 2020 amount has been revised to exclude costs associated with enhancements to our cybersecurity program.

Due to the time required to submit and process such insurance claims, we have not yet received all of the accrued insurance recoveries. Recorded expenses consisted primarily of payments for legal fees related to governmental inquiries and investigations and customer constituent class actions. We present expenses and insurance recoveries related to the Security Incident in general and administrative expense on our consolidated statements of comprehensive income and as operating activities on our consolidated statements of cash flows. Based on our review of expenses incurred to date, total costs related to the Security Incident have exceeded the limit of our insurance coverage during the first quarter of 2022. We expect to continue to experience significant expenses related to our response to the Security Incident, resolution of legal proceedings, claims, inquiries and investigations discussed below, and our efforts to further enhance our security measures. For full year 2022, we currently expect net cash outlays of approximately $25.0 million to $35.0 million for ongoing legal fees related to the Security Incident. In line with our policy as discussed above, legal fees, are expensed as incurred.

Based on our analysis of the factors described above, we have not recorded a liability for a loss contingency related to the Security Incident as of December 31, 2021 because we are unable at this time to reasonably estimate the possible loss or range of loss.

Customer claims. To date, we have received approximately 260 specific requests for reimbursement of expenses ("Customer Reimbursement Requests") and approximately 400 reservations of the right to seek expense recovery in the future from customers or their attorneys in the U.S., U.K. and Canada related to the Security Incident (none of which have as yet been filed in court). Of the Customer Reimbursement Requests received to date, approximately 180 have been fully resolved and closed. In addition, insurance companies representing various customers’ interests through subrogation claims have contacted us. One insurance company has filed a subrogation claim in court. Customer and insurer subrogation claims generally seek reimbursement of their costs and expenses associated with notifying their own customers of the Security Incident and taking steps to assure that personal information has not been compromised as a result of the Security Incident. Our review of customer and subrogation claims includes analyzing individual customer contracts into which we have entered, the specific claims made and applicable law.

Customer constituent class actions. Presently, we are a defendant in 19 putative consumer class action cases [17 in U.S. federal courts (which have been consolidated under multi district litigation to a single federal court) and 2 in Canadian courts] alleging harm from the Security Incident. The plaintiffs in these cases, who purport to represent various classes of individual constituents of our customers, generally claim to have been harmed by alleged actions and/or omissions by us in connection with the Security Incident and assert a variety of common law and statutory claims seeking monetary damages, injunctive relief, costs and attorneys’ fees, and other related relief.

Lawsuits that are putative class actions require a plaintiff to satisfy a number of procedural requirements before proceeding to trial. These requirements include, among others, demonstration to a court that the law proscribes in some manner our activities, the making of factual allegations sufficient to suggest that our activities exceeded the limits of the law and a determination by the court—known as class certification—that the law permits a group of individuals to pursue the case together as a class. If these procedural requirements are not met, the lawsuit cannot proceed as a class action and the plaintiff may lose the financial incentive to proceed with the case. Frequently, a court’s determination as to these procedural requirements is subject to appeal to a higher court. As a result of these uncertainties, we may be unable to determine the probability of loss until, or after, a court has finally determined that a plaintiff has satisfied the applicable class action procedural requirements.

Furthermore, for putative class actions, it is often not possible to estimate the possible loss or a range of loss amounts, even where we have determined that a loss is reasonably possible. Generally, class actions involve a large number of people and raise complex legal and factual issues that result in uncertainty as to their outcome and, ultimately, making it difficult for us to estimate the amount of damages that a plaintiff might successfully prove. This analysis is further complicated by the fact that the plaintiffs lack contractual privity with us.

Governmental inquiries and investigations. To date, we have received a consolidated, multi-state Civil Investigative Demand issued on behalf of 48 state Attorneys General and the District of Columbia and separate Civil Investigative Demands from the offices of the Illinois Attorney General and the California Attorney General relating to the Security Incident. We also are subject to the following pending governmental actions:

•an investigation by the U.S. Federal Trade Commission;

•a formal investigation by the SEC;

•an investigation by the U.S. Department of Health and Human Services;

•an investigation by the Office of the Australian Information Commissioner; and

•an investigation by the Office of the Privacy Commissioner of Canada.

On September 28, 2021, the Information Commissioner’s Office in the United Kingdom under the U.K. Data Protection Act 2018 (the "ICO") notified us that it has closed its investigation of the Security Incident. Based on its investigation and having considered our actions before, during and after the Security Incident, the ICO issued our European subsidiary a reprimand in accordance with Article 58(2)(b) of the U.K. General Data Protection Regulation ("U.K. GDPR") due to our non-compliance, in the ICO's view, with the requirements set out in Article 32 of the U.K. GDPR regarding the processing of personal data. The ICO did not impose a penalty related to the Security Incident, nor did it impose any requirements for further action by us.

On September 24, 2021, we received notice from the Spanish Data Protection Authority that it has concluded its investigation of the Security Incident, pursuant to which our European subsidiary paid a penalty of €60,000 in relation to the alleged late notification of two Spanish data controllers regarding the Security Incident.

On January 15, 2021, we were notified by the Data Protection Commission of Ireland that it has concluded its investigation of the Security Incident without taking any action against us.

We continue to cooperate with all ongoing inquiries and investigations, which include various requests for documents, policies, narratives and communications, as well as requests to interview or depose various Company-related personnel. As noted above, each of these separate governmental inquiries and investigations could result in adverse judgements, settlements, fines, penalties, or other resolution, the amount, scope and timing of which we are currently unable to predict, but could have a material adverse impact on our results of operations, cash flows, or financial condition.

Business Combinations (Tables)

12 Months Ended

Dec. 31, 2021

Business Combinations [Abstract]

Purchase Price Allocation


(in thousands)	Purchase price allocation
Net working capital, excluding deferred revenue	$	(3,279)
Operating lease ROU assets	44,845
Other long-term assets	10,322
Identifiable intangible assets	457,449
Deferred tax liability	(93,925)
Deferred revenue	(51,770)
Operating lease liabilities, net of current portion	(42,068)
Other long-term liabilities	(645)
Goodwill	422,846
Total purchase price	$	743,775

Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination

The EVERFI acquisition resulted in the identification of the following identifiable intangible assets:


	Intangible assets acquired		Weighted average amortization period
EVERFI	(in thousands)		(in years)
Developed technology	$	72,000	7
Customer relationships	326,649		16
Marketing assets	40,900		14
Content	17,900		9
Total intangible assets	$	457,449	14

Fair Value Measurements

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements


6. Fair Value Measurements

Recurring fair value measurements

Assets and liabilities that are measured at fair value on a recurring basis consisted of the following, as of the dates indicated below:


	Fair value measurement using
(dollars in thousands)	Level 1		Level 2		Level 3		Total
Fair value as of December 31, 2021
Financial assets:
Derivative instruments	$	—	$	7,160	$	—	$	7,160
Total financial assets	$	—	$	7,160	$	—	$	7,160











Fair value as of December 31, 2020
Financial liabilities:
Derivative instruments	$	—	$	4,159	$	—	$	4,159
Total financial liabilities	$	—	$	4,159	$	—	$	4,159

Our derivative instruments within the scope of Accounting Standards Codification ("ASC") 815, Derivatives and Hedging, are required to be recorded at fair value. Our derivative instruments that are recorded at fair value include interest rate swaps.

The fair value of our interest rate swaps was based on model-driven valuations using LIBOR rates, which are observable at commonly quoted intervals. Accordingly, our interest rate swaps are classified within Level 2 of the fair value hierarchy. The Financial Conduct Authority in the U.K. has stated that it plans to phase out all tenors of LIBOR by June 2023. We do not currently anticipate a significant impact to our financial position or results of operations as a result of this action as we expect that our financial contracts currently indexed to LIBOR will either expire or be modified without significant financial impact before the phase out occurs.

We believe the carrying amounts of our cash and cash equivalents, restricted cash, accounts receivable, trade accounts payable, accrued expenses and other current liabilities and due to customers approximate their fair values at December 31, 2021 and December 31, 2020, due to the immediate or short-term maturity of these instruments.

We believe the carrying amount of our debt approximates its fair value at December 31, 2021 and December 31, 2020, as the debt bears interest rates that approximate market value. As LIBOR rates are observable at commonly quoted intervals, our debt under the 2020 Credit Facility (as defined below) is classified within Level 2 of the fair value hierarchy. Our fixed rate debt is classified within Level 2 of the fair value hierarchy.

We did not transfer any assets or liabilities among the levels within the fair value hierarchy during the years ended December 31, 2021, 2020 and 2019. Additionally, we did not hold any Level 3 assets or liabilities during the years ended December 31, 2021, 2020 and 2019.

Non-recurring fair value measurements

Assets and liabilities that are measured at fair value on a non-recurring basis include long-lived assets, intangible assets, goodwill and operating lease ROU assets. These assets are recognized at fair value during the period in which an acquisition is completed or at lease commencement, from updated estimates and assumptions during the measurement period, or when they are considered to be impaired. These non-recurring fair value measurements, primarily for long-lived assets, intangible assets acquired and operating lease ROU assets, are based on Level 3 unobservable inputs. In the event of an impairment, we determine the fair value of these assets other than goodwill using a discounted cash flow approach, which contains significant unobservable inputs and, therefore, is considered a Level 3 fair value measurement. The unobservable inputs in the analysis generally include future cash flow projections and a discount rate. For goodwill impairment testing, we estimate fair value using market-based methods including the use of market capitalization and consideration of a control premium.

As more fully described in Note 7 and Note 11 to these consolidated financial statements, during the year ended December 31, 2021, we recorded impairment charges of $1.7 million against certain property and equipment assets and $3.6 million against our operating lease ROU assets.

During the year ended December 31, 2020, we recorded impairment charges of $4.3 million against certain previously capitalized software development costs and $4.0 million against our operating lease ROU assets. See Notes 7 and 11, respectively, to these consolidated financial statements for additional details.

During the year ended December 31, 2019, we recorded impairment charges of $3.8 million against our operating lease ROU assets, $1.4 million against certain property and equipment assets and $0.9 million against certain finite-lived intangible assets. See Notes 11, 7 and 4, respectively, to these consolidated financial statements for additional details.

There were no other non-recurring fair value adjustments during 2021, 2020 and 2019 except for certain business combination accounting adjustments to the initial fair value estimates of the assets acquired and liabilities assumed at the acquisition date from updated estimates and assumptions during the measurement period. See Note 3 to these consolidated financial statements for additional details.

Property and Equipment and Software Development Costs

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Property and Equipment and Software Development Costs


7. Property and Equipment and Software Development Costs

Property and equipment

Property and equipment consisted of the following as of:


	Estimated useful life (years)	December 31,
(dollars in thousands)		2021		2020
Land	—	$	9,548	$	9,548
Building	39	61,284		61,284
Building improvements(1)	7 - 20	10,874		9,942
Equipment	1 - 5	2,320		2,865
Computer hardware	1 - 5	47,768		56,202
Computer software	1 - 5	21,347		23,116
Construction in progress	—	2,135		3,435
Furniture and fixtures	1 - 7	2,658		2,796
Leasehold improvements	Lesser of lease term or estimated useful life	12,086		6,044
Total property and equipment		170,020		175,232
Less: accumulated depreciation		(58,592)		(70,055)
Property and equipment, net		$	111,428	$	105,177

(1)Upon acquisition of our global headquarters facility in August 2020, we reclassified related leasehold improvement costs of $5.5 million to building improvements given the acquisition of the underlying assets.

Depreciation expense was $14.4 million, $19.2 million and $15.0 million for the years ended December 31, 2021, 2020 and 2019, respectively.

During the year ended December 31, 2021, we recorded impairment charges of $1.7 million against certain property and equipment assets. These impairment charges resulted primarily from our decision to close our Austin office. This impairment charge is reflected in general and administrative expense on the statements of comprehensive income.

During the year ended December 31, 2019, we recorded impairment charges of $1.4 million against certain property and equipment assets that reduced the carrying value of the assets to zero. These impairment charges are reflected in restructuring on the statements of comprehensive income and resulted primarily from our facilities optimization restructuring as we wrote-off facilities-related fixed assets that we would no longer use. See Note 18 to these consolidated financial statements for additional details regarding our facilities optimization restructuring.

Software development costs

Software development costs consisted of the following as of:


	Estimated useful life (years)	December 31,
(dollars in thousands)		2021		2020
Software development costs	3 - 7	$	196,337	$	164,665
Less: accumulated amortization		(74,960)		(52,838)
Software development costs, net		$	121,377	$	111,827

During the year ended December 31, 2020, we recorded an impairment charge of $4.3 million against certain previously capitalized software development costs that reduced the carrying value of those assets to zero. The impairment charge was reflected in cost of recurring revenue and resulted primarily from our decision to accelerate the end of customer support for certain solutions. Other changes to the gross carrying amount of software development costs were primarily related to qualifying costs associated with development activities that are required to be capitalized under the internal-use software accounting guidance such as those for our cloud solutions, write-offs of fully amortized assets, and the effect of foreign currency translation.

Amortization expense related to software development costs was $31.0 million, $31.7 million and $20.7 million for the years ended December 31, 2021, 2020 and 2019, respectively, and is included primarily in cost of recurring.

Commitments and Contingencies (Schedule of Maturities of Operating Lease Liabilities) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
2022	$ 11,706
2023	10,328
2024	7,886
2025	6,805
2026	6,109
Thereafter	32,997
Total lease payments	75,831
Less: Amount representing interest	13,275
Present value of future payments	$ 62,556	$ 26,716

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 55,146	$ 35,750
Total restricted cash	596,616	609,219
Accounts receivable, net of allowance of $11,155 and $10,292 at December 31, 2021 and December 31, 2020, respectively	102,726	95,404
Customer funds receivable	977	321
Prepaid expenses and other current assets	95,506	78,366
Total current assets	850,971	819,060
Property and equipment, net	111,428	105,177
Operating lease right-of-use assets	53,883	22,671
Software development costs, net	121,377	111,827
Goodwill	1,058,640	635,854
Intangible assets, net	698,052	277,506
Other assets	77,266	72,639
Total assets	2,971,617	2,044,734
Current liabilities:
Trade accounts payable	22,067	27,836
Accrued expenses and other current liabilities	100,096	52,228
Due to customers	594,273	608,264
Debt, current portion	18,697	12,840
Deferred revenue, current portion	374,499	312,236
Total current liabilities	1,109,632	1,013,404
Debt, net of current portion	937,483	518,193
Deferred tax liability	148,465	54,086
Deferred revenue, net of current portion	4,247	4,678
Operating lease liabilities, net of current portion	53,386	17,357
Other liabilities	1,344	10,866
Total liabilities	2,254,557	1,618,584
Commitments and contingencies (see Note 11)
Stockholders' equity:
Preferred stock; 20,000,000 shares authorized, none outstanding	$ 0	$ 0
Preferred stock, shares authorized	20,000,000	20,000,000
Preferred stock, shares outstanding	0	0
Common stock, $0.001 par value; 180,000,000 shares authorized, 66,165,666 and 60,904,638 shares issued at December 31, 2021 and December 31, 2020, respectively	$ 66	$ 61
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	180,000,000	180,000,000
Common stock, shares issued	66,165,666	60,904,638
Additional paid-in capital	$ 968,927	$ 544,963
Treasury stock, at cost; 14,182,805 and 12,054,268 shares at December 31, 2021 and December 31, 2020, respectively	$ (500,911)	$ (353,091)
Treasury stock, shares	14,182,805	12,054,268
Accumulated other comprehensive income (loss)	$ 6,522	$ (2,497)
Retained earnings	242,456	236,714
Total stockholders' equity	717,060	426,150
Total liabilities and stockholders' equity	$ 2,971,617	$ 2,044,734

Commitments and Contingencies (Schedule of Supplemental Balance Sheet Information Related To Leases) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Lessee, Lease, Description [Line Items]
Operating lease right-of-use assets	$ 53,883	$ 22,671
Operating lease liabilities	$ 62,556	$ 26,716
Weighted average remaining lease term (years)	8 years 10 months 24 days	4 years 7 months 6 days	12 years 6 months
Weighted average discount rate	4.68%	5.70%	5.96%
Accrued expenses and other current liabilities [Member]
Lessee, Lease, Description [Line Items]
Operating lease liabilities	$ 9,170	$ 9,359
Operating lease liabilities, net of current portion
Lessee, Lease, Description [Line Items]
Operating lease liabilities	$ 53,386	$ 17,357

Goodwill and Other Intangible Assets (Future Amortization Expense for Finite-Lived Intangible Assets) (Details) $ in Thousands	Dec. 31, 2021 USD ($)
Future amortization expense for finite-lived intangible assets:
2022	$ 52,677
2023	57,371
2024	63,110
2025	66,832
2026	65,545
Total	$ 305,535

Fair Value Measurements (Details) - USD ($) $ in Millions	12 Months Ended
Fair Value Measurements (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Fair Value Disclosures [Abstract]
Impairment charges against certain property and equipment assets	$ 1.7		$ 1.4
Operating lease right-of-use assets, impairments	3.6	$ 4.0	3.8
Capitalized software development costs, impairments		$ 4.3
Impairment charges against certain finite-lived intangible assets	$ 0.0		$ 0.9

Consolidated Financial Statement Details (Components of Prepaid Expenses and Other Assets) (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Costs of obtaining contracts

^[1],[2]

$ 78,465

$ 84,914

Prepaid software maintenance and subscriptions

^[3]

28,880

24,471

Implementation costs for cloud computing arrangements

^[4],[5]

11,892

11,298

Derivative instruments

7,160

Unbilled accounts receivable

5,443

10,385

Receivables for probable insurance recoveries

18,202

^[6]

6,288

Prepaid insurance

5,363

1,426

Taxes, prepaid and receivable

3,986

1,891

Deferred tax assets

1,546

1,592

Other assets

11,835

8,740

Total prepaid expenses and other assets

172,772

151,005

Less: Long-term portion

77,266

72,639

Prepaid expenses and other current assets

95,506

78,366

Amortization expense from costs of obtaining contracts

35,500

37,400

$ 38,100

Cost of obtaining contracts, current portion

30,200

31,900

Prepaid software maintenance and subscriptions, current portion

24,700

19,800

Implementation costs for cloud computing arrangements, amortization

1,900

800

Implementation costs for cloud computing arrangements, accumulated amortization

$ 3,000

$ 1,100

[1]	Amortization expense from costs of obtaining contracts was $35.5 million, $37.4 million and $38.1 million for the years ended December 31, 2021, 2020 and 2019, respectively, and is included in sales, marketing and customer success expense in our consolidated statements of comprehensive income.
[2]	The current portion of costs of obtaining contracts as of December 31, 2021 and 2020 was $30.2 million and $31.9 million, respectively.
[3]	The current portion of prepaid software maintenance and subscriptions as of December 31, 2021 and December 31, 2020 was $24.7 million and $19.8 million, respectively.
[4]	Amortization expense from capitalized cloud computing implementation costs was $1.9 million, $0.8 million and insignificant for the years ended December 31, 2021, 2020 and 2019, respectively. Accumulated amortization for these costs was $3.0 million and $1.1 million as of December 31, 2021 and 2020, respectively.
[5]	These costs primarily relate to the multi-year implementations of our new global enterprise resource planning and customer relationship management systems.
[6]	See discussion of the Security Incident at Note 11 to these consolidated financial statements.

Debt (Details)			1 Months Ended	12 Months Ended
Debt (Details)	Dec. 31, 2021 USD ($) shares	Jun. 02, 2017 USD ($)	Oct. 30, 2020 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Aug. 31, 2020 USD ($)	Jan. 31, 2020 USD ($)
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity		$ 700,000,000	$ 900,000,000
Debt instrument, term		5 years	5 years
Payment of financing costs			$ 4,000,000	$ 3,106,000	$ 4,586,000	$ 0
Capitalized financing costs to be amortized over term of facility			1,200,000
Total deferred financing costs included in other assets	$ 1,200,000			1,200,000
Aggregate financing costs related to debt discount and debt issuance costs	(4,994,000)		(2,000,000)	$ (4,994,000)	(3,144,000)
Commitment fee on unused portion of revolving credit facility				0.25%
Line of credit facility, available increase capacity, amount			$ 250,000,000
Line of credit facility, current borrowing capacity	239,500,000			$ 239,500,000
Long-term debt, gross	961,174,000			961,174,000	534,177,000
EVERFI [Member]
Line of Credit Facility [Line Items]
Total cash consideration paid for the acquisition	$ 440,100,000
Shares of company's common stock, shares \| shares	3,844,423
Shares of company's common stock, value assigned	$ 303,600,000			$ 303,600,000
Aggregate purchase price	$ 743,800,000
Global HQ [Member]
Line of Credit Facility [Line Items]
Long-term debt, gross							$ 61,100,000
Minimum [Member]
Line of Credit Facility [Line Items]
Commitment fee on unused portion of revolving credit facility			0.25%
Maximum [Member]
Line of Credit Facility [Line Items]
Commitment fee on unused portion of revolving credit facility			0.375%
Net leverage ratio			3.25
Federal funds rate option [Member]
Line of Credit Facility [Line Items]
Credit facility, variable interest rate	0.50%		0.50%
Eurocurrency base rate option [Member]
Line of Credit Facility [Line Items]
Credit facility, variable interest rate			1.00%
Base rate margin [Member] \| Minimum [Member]
Line of Credit Facility [Line Items]
Credit facility, basis spread on variable rate	0.375%		0.375%
Base rate margin [Member] \| Maximum [Member]
Line of Credit Facility [Line Items]
Credit facility, basis spread on variable rate	1.50%		1.125%
Eurocurrency rate margin [Member] \| Minimum [Member]
Line of Credit Facility [Line Items]
Credit facility, basis spread on variable rate			1.375%
Eurocurrency rate margin [Member] \| Maximum [Member]
Line of Credit Facility [Line Items]
Credit facility, basis spread on variable rate			2.125%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Line of Credit Facility [Line Items]
Credit facility, variable interest rate	1.00%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Daily
Line of Credit Facility [Line Items]
SOFR Adjustment	0.10%			0.10%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| One-month
Line of Credit Facility [Line Items]
SOFR Adjustment	0.10%			0.10%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Three-month
Line of Credit Facility [Line Items]
SOFR Adjustment	0.15%			0.15%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Six-month
Line of Credit Facility [Line Items]
SOFR Adjustment	0.25%			0.25%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Minimum [Member]
Line of Credit Facility [Line Items]
Credit facility, basis spread on variable rate	1.375%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Maximum [Member]
Line of Credit Facility [Line Items]
Credit facility, basis spread on variable rate	2.50%
Revolving credit loans [Member]
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			$ 500,000,000
Repayments of lines of credit			124,400,000
Long-term debt, gross	$ 260,000,000			$ 260,000,000	69,625,000
Term loans [Member]
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			400,000,000
Proceeds from lines of credit	250,000,000		400,000,000
Payment of financing costs	3,100,000
Long-term debt, gross	$ 640,000,000			$ 640,000,000	$ 400,000,000
Standby letters of credit [Member]
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			50,000,000
Swingline loans [Member]
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			50,000,000
Multicurrency borrowings [Member]
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			$ 100,000,000
Senior Secured Note, Series A1 [Member] \| Global HQ [Member]
Line of Credit Facility [Line Items]
Long-term debt, percentage bearing fixed interest, percentage rate							5.12%
Long-term debt, gross							$ 49,100,000
Senior Secured Note, Series A2 [Member] \| Global HQ [Member]
Line of Credit Facility [Line Items]
Long-term debt, percentage bearing fixed interest, percentage rate							5.61%
Long-term debt, gross							$ 12,000,000
Other debt [Member]
Line of Credit Facility [Line Items]
Other debt, face amount						$ 2,150,000		$ 3,470,000

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Accounts receivable, allowance	$ 11,155	$ 10,292

Commitments and Contingencies (Details) € in Thousands, $ in Thousands	1 Months Ended	12 Months Ended
	Sep. 30, 2021 EUR (€)	Dec. 31, 2021 USD ($) cases	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Lessee, Lease, Description [Line Items]
Incremental operating lease costs		$ 9,636	$ 41,210	$ 27,519
Incremental depreciation expense		14,400	19,200	15,000
Operating lease right-of-use assets, impairments		3,600	4,000	$ 3,800
Letters of credit for operating leases		2,256	0
Liability insurance, amount, total		50,000
Liability insurance, amount, deductible		250
Security incident, gross expense		40,560	9,831
Security incident, offsetting probable insurance recoveries		(38,746)	(9,363)
Security incident, net expense		1,814	468
Security incident, cumulative gross expense		50,391	9,831
Security incident, cumulative offsetting insurance recoveries		(48,109)	(9,363)
Security incident, cumulative net expense		2,282	468
Insurance Recoveries		$ (29,968)	(3,075)
Security incident, number of customer reimbursement requests received \| cases		260
Security incident, number of reservations of the right to seek future expense recovery \| cases		400
Security incident, number of customer reimbursement requests settled \| cases		180
Security incident, number of consumer class action cases \| cases		19
Security incident, number of state Attorneys General \| cases		48
EVERFI [Member]
Lessee, Lease, Description [Line Items]
Letters of credit for operating leases		$ 2,100
Change in Accounting Estimate, Workforce Strategy
Lessee, Lease, Description [Line Items]
Incremental operating lease costs		5,300	16,200
Incremental depreciation expense		$ 1,700	$ 4,600
United States [Member]
Security incident, number of consumer class action cases \| cases		17
Canada [Member]
Security incident, number of consumer class action cases \| cases		2
Spain [Member]
Security incident, penalty paid \| €	€ 60
Minimum [Member]
Security incident, expected net cash outlays for ongoing legal fees		$ 25,000
Maximum [Member]
Security incident, expected net cash outlays for ongoing legal fees		35,000
Third-party technology [Member]
Long-term Purchase Commitment [Line Items]
Remaining aggregate minimum purchase commitment		$ 33,600

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue
Revenue	$ 927,740	$ 913,219	$ 900,423
Cost of revenue
Cost of revenue	443,195	428,065	418,424
Gross profit	484,545	485,154	481,999
Operating expenses
Sales, marketing and customer success	186,314	209,762	224,152
Research and development	124,573	100,146	106,164
General and administrative	146,262	134,852	113,414
Amortization	2,227	2,915	5,316
Restructuring	263	236	5,808
Total operating expenses	459,639	447,911	454,854
Income from operations	24,906	37,243	27,145
Interest expense	(18,003)	(17,287)	(20,618)
Other income, net	180	1,658	4,058
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	7,083	21,614	10,585
Income tax provision (benefit)	1,385	13,897	(1,323)
Net income	$ 5,698	$ 7,717	$ 11,908
Earnings per share
Basic earnings per share	$ 0.12	$ 0.16	$ 0.25
Diluted earnings per share	$ 0.12	$ 0.16	$ 0.25
Common shares and equivalents outstanding
Basic weighted average shares	47,412,306	48,184,714	47,695,383
Diluted weighted average shares	48,230,438	48,696,341	48,312,271
Other comprehensive income (loss)
Foreign currency translation adjustment	$ 661	$ 4,571	$ 2,641
Total other comprehensive income (loss)	9,019	2,793	(180)
Comprehensive income	14,717	10,510	11,728
Unrealized gain (loss) on derivative instruments, net of tax	8,358	(1,778)	(2,821)
Recurring [Member]
Revenue
Revenue	880,850	850,745	831,609
Cost of revenue
Cost of revenue	390,803	369,681	357,988
Cost of one-time services and other [Member]
Revenue
Revenue	46,890	62,474	68,814
Cost of revenue
Cost of revenue	$ 52,392	$ 58,384	$ 60,436

Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes


12. Income Taxes

We file income tax returns in the U.S. for federal and various state jurisdictions as well as in foreign jurisdictions including Canada, the U.K., Australia, Ireland and Costa Rica. We are generally subject to U.S. federal income tax examination for calendar tax years 2018 through 2021 as well as state and foreign income tax examinations for various years depending on statutes of limitations of those jurisdictions. We entered into settlement with the IRS Appeals Office in relation to one of our uncertain tax positions which resulted in release of the corresponding liability for uncertain tax position.

The following summarizes the components of income tax expense (benefit):


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Current taxes:
U.S. Federal	$	(2,499)	$	(407)	$	1,534
U.S. State and local	(257)		1,563		613
International	6,570		3,904		130
Total current taxes	3,814		5,060		2,277
Deferred taxes:
U.S. Federal	(4,615)		(1,064)		(1,724)
U.S. State and local	222		7,725		(2,235)
International	1,964		2,176		359
Total deferred taxes	(2,429)		8,837		(3,600)
Total income tax provision (benefit)	$	1,385	$	13,897	$	(1,323)

The following summarizes the components of income before provision for income taxes:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
U.S.	$	(23,180)	$	(4,112)	$	5,149
International	30,263		25,726		5,436
Income before provision for income taxes	$	7,083	$	21,614	$	10,585

A reconciliation between the effect of applying the federal statutory rate and the effective income tax rate used to calculate our income tax provision (benefit) is as follows:


	Years ended December 31,
	2021		2020		2019
Federal statutory rate	21.0	%	21.0	%	21.0	%
Effect of:
State income taxes, net of federal benefit	4.4		5.9		(1.7)
Change in foreign income tax rate applied to deferred tax balances	42.6		4.0		2.0

Change in state income tax rate applied to deferred tax balances	2.3		0.1		(3.1)
Section 162(m) limitation	75.0		17.5		30.8
Change in valuation reserve (primarily state credit reserves)	26.1		38.2		3.7
Acquisition costs	8.7		—		—
Nondeductible meals, entertainment and transportation	1.1		3.3		11.3
GILTI inclusion	—		1.3		5.9

FDII benefit	—		—		(1.5)



DTA Adjustment – NOLs	—		(3.3)		—
Return to accrual adjustment	(4.2)		(4.1)		(10.6)
Foreign tax rate	(6.0)		(1.7)		0.3
State credits, net of federal benefit	(32.6)		(2.3)		(15.4)
Unrecognized tax benefit	(32.7)		1.3		4.4
Stock-based compensation	(36.2)		(1.2)		(20.2)
Federal credits generated	(54.5)		(17.4)		(37.6)
Other	4.6		1.7		(1.8)
Income tax provision (benefit) effective rate	19.6	%	64.3	%	(12.5)	%

The decrease in our effective income tax rate in 2021 when compared to 2020, was primarily due to prior year increase in valuation allowance attributable to state tax credit carryforwards for which we do not expect to realize benefit. Furthermore, our 2021 effective income tax rate was positively impacted by increased benefit attributable to stock based compensation deduction and a reduction to the unrecognized tax benefit as a result of IRS audit settlement and statute of limitation lapses offset against negative impacts of the U.K.-enacted tax rate increase and an increase in non-deductible compensation.

The significant components of our deferred tax assets and liabilities were as follows:


	December 31,
(dollars in thousands)	2021		2020
Deferred tax assets relating to:
Federal and state and foreign net operating loss carryforwards	$	21,456	$	5,592
Federal, state and foreign tax credits	52,283		42,598
Stock-based compensation	21,432		17,434
Operating leases	23,795		13,375
Allowance for credit losses	2,524		2,399
Intangible assets	1,070		1,663
Deferred revenue	1,057		524
Accrued bonuses	218		—
Other	13,515		9,111
Total deferred tax assets	137,350		92,696
Deferred tax liabilities relating to:
Intangible assets	(168,392)		(45,757)
Capitalized software development costs	(31,326)		(28,804)
Costs of obtaining contracts	(18,046)		(20,256)
Operating leases	(23,582)		(12,333)
Fixed assets	(8,483)		(8,458)
Other	(2,515)		(398)
Total deferred tax liabilities	(252,344)		(116,006)
Valuation allowance	(31,974)		(29,184)
Net deferred tax liability	$	(146,968)	$	(52,494)

As of December 31, 2021, our federal, foreign and state net operating loss carryforwards for income tax purposes were approximately $76.8 million, $8.5 million and $137.6 million, respectively. The federal and state net operating loss carryforwards are subject to various Internal Revenue Code limitations and applicable state tax laws. If not utilized, the federal net operating loss carryforwards will begin to expire in 2028 and the state net operating loss carryforwards will expire over various periods beginning in 2022. Of our foreign net operating loss carryforwards, $425 thousand expires in 2024 with the remainder having an unlimited carryforward period. Our federal tax credit carryforwards for income tax purposes were approximately $22.1 million. Our state tax credit carryforwards for income tax purposes were approximately $32.8 million, net of federal benefit. If not utilized, the federal tax credit carryforwards will begin to expire in 2036 and the state tax credit carryforwards will begin to expire in 2022. A portion of the foreign and state net operating loss carryforwards and state credit carryforwards have a valuation reserve due to management's uncertainty regarding the future ability to use such carryforwards.

The following table illustrates the change in our deferred tax asset valuation allowance:


Years ended December 31, (dollars in thousands)	Balance at beginning of year		Acquisition- related change		Charges to expense		Balance at end of year

2021	$	29,184	$	893	$	1,897	$	31,974
2020	6,453		—		22,731		29,184
2019	6,855		—		(402)		6,453

The following table sets forth the change to our unrecognized tax benefit for the years ended December 31, 2021, 2020 and 2019:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Balance at beginning of year	$	4,625	$	4,346	$	3,704
Increases from prior period positions	6		414		1,183
Decreases in prior year positions	(57)		(614)		(385)
Increases from current period positions	1,751		491		456
Settlements (payments)	(1,192)		—		—
Lapse of statute of limitations	(1,482)		(12)		(612)
Balance at end of year	$	3,651	$	4,625	$	4,346

The total amount of unrecognized tax benefit that, if recognized, would favorably affect the effective tax rate was $3.2 million at December 31, 2021. Certain prior period amounts relating to our 2014 acquisitions are covered under indemnification agreements and, therefore, we have recorded a corresponding indemnification asset. We recognize accrued interest and penalties, if any, related to unrecognized tax benefits as a component of income tax expense. The total amount of accrued interest and penalties included in the consolidated balance sheet as of December 31, 2021 and December 31, 2020 was insignificant and $1.1 million, respectively. The total amount of interest and penalties included in the consolidated statements of comprehensive income as an increase or decrease in income tax expense for 2021, 2020 and 2019 was insignificant.

We have taken federal and state tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits might decrease within the next twelve months. This possible decrease could result from the expiration of statutes of limitations. The reasonably possible decrease at December 31, 2021 was insignificant.

For our undistributed earnings of foreign subsidiaries, which we do not consider to be significant, we concluded that these earnings would be permanently reinvested in the local jurisdictions and not repatriated to the United States. Accordingly, we have not provided for U.S. state income taxes and foreign withholding taxes on those undistributed earnings of our foreign subsidiaries. If some or all of such earnings were to be remitted, the amount of taxes payable would be insignificant.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

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+ Details

Basis of Presentation (Details) - USD ($) $ in Thousands	12 Months Ended
Basis of Presentation (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2020
Basis of Presentation [Line Items]
Operating lease liabilities	$ 62,556	$ 26,716
Operating lease right-of-use assets	$ 53,883	22,671
Contract term of recurring revenue contracts at contract inception (years)	3 years
Expected period of benefit	5 years
Capitalized interest applicable to construction-in-progress	$ 0	0	$ 0
Impairment of goodwill	0	0	0
Impairment charges against certain finite-lived intangible assets	0		900
Impairment of long-lived assets		0
Net foreign currency loss	1,600	1,100
Impairment of capitalized software dev costs	0	0	0
Amount reclassified upon adoption of ASU 2016-13				$ (2,100)
Advertising costs	$ 7,100	$ 3,000	$ 3,100
Minimum [Member]
Basis of Presentation [Line Items]
Contract term of recurring revenue contracts at renewal (years)	1 year
Maximum [Member]
Basis of Presentation [Line Items]
Contract term of recurring revenue contracts at renewal (years)	3 years
Software development [Member] \| Minimum [Member]
Basis of Presentation [Line Items]
Software development costs, estimated useful life (years)	3 years
Software development [Member] \| Maximum [Member]
Basis of Presentation [Line Items]
Software development costs, estimated useful life (years)	7 years

Stockholders' Equity

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Stockholders' Equity


14. Stockholders' Equity

Preferred stock

Our Board of Directors may fix the relative rights and preferences of each series of preferred stock in a resolution of the Board of Directors.

Stock repurchase program

Under our stock repurchase program, we are authorized to repurchase shares from time to time in accordance with applicable laws both on the open market, including under trading plans established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, and in privately negotiated transactions. The timing and amount of repurchases depends on several factors, including market and business conditions, the trading price of our common stock and the nature of other investment opportunities. The repurchase program does not have an expiration date and may be limited, suspended or discontinued at any time without prior notice. Under the 2020 Credit Facility, we have restrictions on our ability to repurchase shares of our common stock, which are summarized on page 56 in this report.

We account for purchases of treasury stock under the cost method. During the year ended December 31, 2021, we purchased 1,592,933 shares for $108.4 million. In December 2021, our Board of Directors reauthorized and replenished our stock repurchase program that authorizes us to purchase up to $250.0 million of our outstanding shares of common stock. The remaining amount available to purchase stock under the stock repurchase program was $250.0 million as of December 31, 2021.

Changes in accumulated other comprehensive loss by component

The changes in accumulated other comprehensive loss by component, consisted of the following:


	Years ended December 31,
(in thousands)	2021		2020		2019
Accumulated other comprehensive loss, beginning of period	$	(2,497)	$	(5,290)	$	(5,110)
By component:
Gains and losses on cash flow hedges:
Accumulated other comprehensive (loss) income balance, beginning of period	$	(3,101)	$	(1,323)	$	1,498
Other comprehensive (loss) income before reclassifications, net of tax effects of $(1,982), $1,625 and $860	5,617		(4,602)		(2,399)
Amounts reclassified from accumulated other comprehensive income (loss) to interest expense	3,714		3,827		(573)

Tax (benefit) expense included in provision for income taxes	(973)		(1,003)		151
Total amounts reclassified from accumulated other comprehensive income (loss)	2,741		2,824		(422)
Net current-period other comprehensive income (loss)	8,358		(1,778)		(2,821)
Accumulated other comprehensive income (loss) balance, end of period	$	5,257	$	(3,101)	$	(1,323)
Foreign currency translation adjustment:
Accumulated other comprehensive income (loss) balance, beginning of period	$	604	$	(3,967)	$	(6,608)
Translation adjustments	661		4,571		2,641
Accumulated other comprehensive income (loss) balance, end of period	1,265		604		(3,967)
Accumulated other comprehensive income (loss), end of period	$	6,522	$	(2,497)	$	(5,290)

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

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-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section 50
-Paragraph 13
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-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-URI http://asc.fasb.org/topic&trid=2208762

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Consolidated Financial Statement Details (Tables)

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Components of Restricted Cash

Restricted cash


(dollars in thousands)	December 31, 2021		December 31, 2020
Restricted cash due to customers	$	593,296	$	607,943
Letters of credit for operating leases	2,256		—
Real estate escrow balances	1,064		1,276
Total restricted cash	$	596,616	$	609,219

Components of Prepaid Expenses and Other Assets

Prepaid expenses and other assets


(dollars in thousands)	December 31, 2021		December 31, 2020
Costs of obtaining contracts(1)(2)	$	78,465	$	84,914
Prepaid software maintenance and subscriptions(3)	28,880		24,471
Receivables for probable insurance recoveries(4)	18,202		6,288
Implementation costs for cloud computing arrangements, net(5)(6)	11,892		11,298
Derivative instruments	7,160		—
Unbilled accounts receivable	5,443		10,385
Prepaid insurance	5,363		1,426
Taxes, prepaid and receivable	3,986		1,891
Deferred tax assets	1,546		1,592
Other assets	11,835		8,740
Total prepaid expenses and other assets	172,772		151,005
Less: Long-term portion	77,266		72,639
Prepaid expenses and other current assets	$	95,506	$	78,366

(2)The current portion of costs of obtaining contracts as of December 31, 2021 and 2020 was $30.2 million and $31.9 million, respectively.

(3)The current portion of prepaid software maintenance and subscriptions as of December 31, 2021 and December 31, 2020 was $24.7 million and $19.8 million, respectively.

(4)See discussion of the Security Incident at Note 11 to these consolidated financial statements.

(5)These costs primarily relate to the multi-year implementations of our new global enterprise resource planning and customer relationship management systems.

Components of Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities


(dollars in thousands)	December 31, 2021		December 31, 2020
Taxes payable(1)	$	19,777	$	19,577
Amounts payable to former EVERFI option holders(2)	17,404		—
Accrued legal costs(3)	11,724		4,808
Operating lease liabilities, current portion	9,170		9,359
Customer credit balances	8,403		5,874
Accrued commissions and salaries	7,872		5,010
Accrued bonuses	5,829		—
Accrued transaction-based costs related to payments services	5,427		—
Accrued health care costs	3,042		2,341
Accrued vacation costs	2,234		2,311
Unrecognized tax benefit	1,248		3,351
Derivative instruments	—		4,159
Other liabilities	9,310		6,304
Total accrued expenses and other liabilities	101,440		63,094
Less: Long-term portion	1,344		10,866
Accrued expenses and other current liabilities	$	100,096	$	52,228

Components of Deferred Revenue

Deferred revenue


(dollars in thousands)	December 31, 2021		December 31, 2020
Recurring	$	360,890	$	303,840
One-time services and other	17,856		13,074
Total deferred revenue	378,746		316,914
Less: Long-term portion	4,247		4,678
Deferred revenue, current portion	$	374,499	$	312,236

Our opening and closing balances of deferred revenue were as follows:


(in thousands)	December 31, 2021		December 31, 2020

Total deferred revenue	$	378,746	$	316,914

Components of Other Income (Expense)

Other income, net


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Interest income	$	392	$	1,660	$	2,802
Other (expense) income, net	(212)		(2)		1,256
Other income, net	$	180	$	1,658	$	4,058

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Changes in Accumulated Other Comprehensive Loss by Component

The changes in accumulated other comprehensive loss by component, consisted of the following:


	Years ended December 31,
(in thousands)	2021		2020		2019
Accumulated other comprehensive loss, beginning of period	$	(2,497)	$	(5,290)	$	(5,110)
By component:
Gains and losses on cash flow hedges:
Accumulated other comprehensive (loss) income balance, beginning of period	$	(3,101)	$	(1,323)	$	1,498
Other comprehensive (loss) income before reclassifications, net of tax effects of $(1,982), $1,625 and $860	5,617		(4,602)		(2,399)
Amounts reclassified from accumulated other comprehensive income (loss) to interest expense	3,714		3,827		(573)

Tax (benefit) expense included in provision for income taxes	(973)		(1,003)		151
Total amounts reclassified from accumulated other comprehensive income (loss)	2,741		2,824		(422)
Net current-period other comprehensive income (loss)	8,358		(1,778)		(2,821)
Accumulated other comprehensive income (loss) balance, end of period	$	5,257	$	(3,101)	$	(1,323)
Foreign currency translation adjustment:
Accumulated other comprehensive income (loss) balance, beginning of period	$	604	$	(3,967)	$	(6,608)
Translation adjustments	661		4,571		2,641
Accumulated other comprehensive income (loss) balance, end of period	1,265		604		(3,967)
Accumulated other comprehensive income (loss), end of period	$	6,522	$	(2,497)	$	(5,290)

Derivative Instruments (Effects of Derivative Instruments in Cash Flow Hedging Relationships) (Details) - Interest rate swap [Member] - Cash flow hedging [Member] - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in accumulated other comprehensive loss	$ 7,160	$ (4,159)	$ (1,757)
Interest expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) reclassified from accumulated other comprehensive loss into income	$ (3,714)	$ (3,827)	$ 573

Income Taxes (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Income Taxes [Line Items]
Unrecognized tax benefit that, if recognized, would favorably affect the effective tax rate	$ 3,200
Accrued interest and penalties		$ 1,100
Domestic Tax Authority [Member]
Income Taxes [Line Items]
Operating loss carryforwards	76,800
Tax credit carryforwards	22,100
Foreign Tax Authority [Member]
Income Taxes [Line Items]
Operating loss carryforwards	8,500
Tax credit carryforwards	425
State and Local Jurisdiction [Member]
Income Taxes [Line Items]
Operating loss carryforwards	137,600
Tax credit carryforwards	$ 32,800

Basis of Presentation (Finite-Lived Intangible Assets by Major Class) (Details)

12 Months Ended

Dec. 31, 2021

Customer relationships [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, amortization method

Straight-line and accelerated(1)

^[1]

Customer relationships [Member] | Minimum [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, useful life

8 years

Customer relationships [Member] | Maximum [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, useful life

17 years

Marketing assets [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, amortization method

Straight-line and accelerated(1)

^[1]

Marketing assets [Member] | Minimum [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, useful life

2 years

Marketing assets [Member] | Maximum [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, useful life

15 years

Acquired software and technology [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, amortization method

Straight-line and accelerated(1)

^[1]

Acquired software and technology [Member] | Minimum [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, useful life

5 years

Acquired software and technology [Member] | Maximum [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, useful life

14 years

Content [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, amortization method

Straight-line

Content [Member] | Maximum [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, useful life

9 years

[1]	Certain of the customer relationships, marketing assets and developed technology assets are amortized on an accelerated basis.

Commitments and Contingencies (Components of Lease Expense) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Operating lease cost	$ 9,636	$ 41,210	$ 27,519
Variable lease cost	2,478	4,266	4,035
Sublease income	(1,516)	(3,120)	(3,189)
Net lease cost	$ 10,598	$ 42,356	$ 28,365

Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Impairment charges against certain finite-lived intangible assets	$ 0.0	$ 0.9

Defined Contribution Plan

12 Months Ended

Dec. 31, 2021

Retirement Benefits [Abstract]

Defined Contribution Plan


15. Defined Contribution Plan

We have a defined contribution 401(k) plan (the "401K Plan") covering substantially all employees. Employees were able to contribute between 1% and 75% of their salaries in 2021, 2020 and 2019. We match 50% of qualified employees’ contributions up to 6% of their salary. The 401K Plan also provides for additional employer contributions to be made at our discretion. We suspended our 401(k) match program between April 1, 2020 and December 31, 2020 in response to COVID-19. Total matching contributions to the 401K Plan for the years ended December 31, 2021, 2020 and 2019 were $6.5 million, $1.9 million and $8.7 million, respectively.

In December 2020, we made a discretionary matching contribution to eligible employees 401(k) plans totaling $1.2 million, given our financial performance during the fourth quarter. There were no discretionary contributions by us to the 401K Plan in 2021 and 2019.

Property and Equipment and Software Development Costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Aug. 31, 2020
Long-term debt, gross	$ 961,174	$ 534,177
Depreciation	14,400	19,200	$ 15,000
Impairment charges against certain property and equipment assets	1,700		1,400
Software development costs, amortization	$ 31,000	31,700	$ 20,700
Capitalized software development costs, impairments		$ 4,300
Global HQ [Member]
Long-term debt, gross				$ 61,100

Segment Information

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Segment Information


16. Segment Information

Our chief operating decision maker is our chief executive officer ("CEO"). Our chief operating decision maker uses consolidated financial information to make operating decisions, assess financial performance and allocate resources. We have one operating segment and one reportable segment.

The following table presents long-lived assets by geographic region based on the location of the assets.


	Years ended December 31,
(dollars in thousands)	2021		2020
United States	$	110,613	$	103,123
Other countries	815		2,054
Total property and equipment	$	111,428	$	105,177

See Note 17 to these consolidated financial statements for information about our revenues by geographic region.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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+ Details

Business Combinations (Details) - USD ($) $ in Millions			12 Months Ended
Business Combinations (Details) - USD ($) $ in Millions	Dec. 31, 2021	Jan. 02, 2019	Dec. 31, 2021
Business Acquisition [Line Items]
Estimated fair value of accounts receivable acquired	$ 12.9		$ 12.9
Goodwill, tax deductible amount	14.7		14.7
EVERFI [Member]
Business Acquisition [Line Items]
Total cash consideration paid for the acquisition	$ 440.1
Shares of company's common stock, shares	3,844,423
Shares of company's common stock, value assigned	$ 303.6		303.6
Aggregate purchase price	$ 743.8
Acquisition-related expenses			$ 2.9
YourCause [Member]
Business Acquisition [Line Items]
Total cash consideration paid for the acquisition		$ 157.7

Debt

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Debt


9. Debt

The following table summarizes our debt balances and the related weighted average effective interest rates, which includes the effect of interest rate swap agreements.


	Debt balance at				Weighted average effective interest rate at
(dollars in thousands)	December 31, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Credit facility:
Revolving credit loans	$	260,000	$	69,625	3.27	%	1.83	%
Term loans	640,000		400,000		3.02	%	3.12	%
Real estate loans	59,480		60,626		5.22	%	5.22	%
Other debt	1,694		3,926		5.00	%	5.00	%
Total debt	961,174		534,177		3.23	%	3.21	%
Less: Unamortized discount and debt issuance costs	4,994		3,144
Less: Debt, current portion	18,697		12,840		3.11	%	2.61	%
Debt, net of current portion	$	937,483	$	518,193	3.23	%	3.22	%

2020 refinancing

We were previously party to a 5-year $700.0 million credit facility entered into during June 2017. The credit facility included: a dollar and a designated currency revolving credit facility with sublimits for letters of credit, swingline loans and multicurrency borrowings (the “2017 Revolving Facility”) and a term loan (the “2017 Term Loan”) together, (the “2017 Credit Facility”).

In October 2020, we entered into a 5-year $900.0 million Amended and Restated Credit Agreement (the “2020 Credit Facility”). The 2020 Credit Facility matures in October 2025 and replaced the 2017 Credit Facility by amending and restating it to include a $500.0 million revolving credit facility (the “2020 Revolving Facility”) and a $400.0 million term loan facility (the “2020 Term Loan”). Upon closing, we borrowed $400.0 million pursuant to the 2020 Term Loan and used the proceeds to repay the outstanding principal balance of the term loan under the 2017 Credit Facility, and repay $124.4 million of outstanding revolving credit loans under the 2017 Revolving Facility.

In connection with the amendment and restatement of the 2017 Credit Facility, the existing Pledge Agreement dated June 2, 2017, by us in favor of Bank of America, N.A., as administrative agent, was likewise amended and restated.

Certain lenders of the 2020 Term Loan participated in the 2017 Term Loan and the change in present value of our future cash flows to these lenders under the 2017 Term Loan and under the 2020 Term Loan was less than 10%. Accordingly, we accounted for the refinancing event as a debt modification. Certain lenders of the 2017 Term Loan did not participate in the 2020 Term Loan. Accordingly, we accounted for the refinancing event for these lenders as a debt extinguishment. Certain lenders of the 2017 Revolving Facility participated in the 2020 Revolving Facility and provided increased borrowing capacities. Accordingly, we accounted for the refinancing event for these lenders as a debt modification. Certain lenders of the 2017 Revolving Facility did not participate in the 2020 Revolving Facility. Accordingly, we accounted for the refinancing event for these lenders as a debt extinguishment.

We recorded an insignificant loss on debt extinguishment related to the write-off of debt discount and deferred financing costs for the portions of the 2017 Credit Facility considered to be extinguished. This loss was recognized in the consolidated statements of comprehensive income within other income, net.

Summary of the 2020 Credit Facility

The 2020 Revolving Facility includes (i) a $50.0 million sublimit available for the issuance of standby letters of credit, (ii) a $50.0 million sublimit available for swingline loans, and (iii) a $100.0 million sublimit available for multicurrency borrowings.

Our obligations under the 2020 Credit Facility are secured by the stock and limited liability company interests of certain of our direct subsidiaries and any of our material domestic subsidiaries, if any, and the proceeds therefrom pledged pursuant to an Amended and Restated Pledge Agreement dated as of October 30, 2020, by us in favor of Bank of America, N.A., as administrative agent, for the ratable benefit of itself and the secured parties referred to therein.

Dollar tranche loans under the 2020 Revolving Facility and 2020 Term Loan bear interest at a rate per annum equal to (a) a base rate equal to the highest of (i) the Federal Funds Rate plus 0.50%, (ii) the prime rate announced by Bank of America, N.A., and (iii) the Eurocurrency Rate (which varies depending on the currency in which the loan is denominated) plus 1.00% (the “Base Rate”), plus (b) an applicable margin as specified in the 2020 Credit Facility (the “Applicable Margin”). Each Eurocurrency Rate Loan under the 2020 Credit Facility shall bear interest at a rate per annum equal to the Eurocurrency Rate, plus the Applicable Margin. The Applicable Margin shall be adjusted quarterly, varies based on our net leverage ratio and varies based on whether the loan is a Base Rate Loan (0.375% to 1.125%) or a Eurocurrency Rate Loan (1.375% to 2.125%).

We also pay a quarterly commitment fee on the unused portion of the 2020 Revolving Facility from 0.250% to 0.375% per annum, depending on our net leverage ratio. At December 31, 2021, the commitment fee was 0.25%.

The term loan under the 2020 Credit Facility requires periodic principal payments. The balance of the term loan and any amounts drawn on the revolving credit loans are due upon maturity of the 2020 Credit Facility in October 2025. We evaluate the classification of our debt as current or non-current based on the required annual maturities of the 2020 Credit Facility. We may prepay the 2020 Credit Facility in whole or in part at any time without premium or penalty, other than customary breakage costs with respect to certain types of loans.

The 2020 Credit Facility contains various representations, warranties and affirmative, negative and financial covenants customary for financings of this type. Financial covenants include a net leverage ratio and an interest coverage ratio. At December 31, 2021, we were in compliance with our debt covenants under the 2020 Credit Facility.

Under the terms of the 2020 Credit Facility, we are entitled on one or more occasions, subject to the satisfaction of certain conditions, to request an increase in the commitments under the Revolving Credit Facility and/or request additional incremental term loans in the aggregate principal amount of up to $250.0 million plus an amount, if any, such that the net leverage ratio shall be no greater than 3.25 to 1.00. At December 31, 2021, our available borrowing capacity under the 2020 Credit Facility was $239.5 million.

First incremental term loan

In December 2021, we entered into the First Incremental Term Loan Agreement (the "Incremental Amendment"). The Incremental Amendment amends the 2020 Credit Facility and, among other things, provides for a $250.0 million incremental term loan (the “2021 Incremental Term Loan”).

The 2021 Incremental Term Loan bears interest at a rate per annum equal to, at the option of the Company: (a) a base rate equal to the highest of (i) the Federal Funds Rate plus 0.50%, (ii) the prime rate announced by Bank of America, N.A., and (iii) the Daily SOFR rate plus 1.00% (the “Base Rate”), plus an applicable margin as specified in the Incremental Amendment (the “Applicable Margin”); (b) the Daily SOFR rate plus a SOFR adjustment rate as specified in the Incremental Amendment (the “SOFR Adjustment”) plus the Applicable Margin; or (c) the Term SOFR rate plus the SOFR Adjustment plus the Applicable Margin. The Applicable Margin shall be adjusted quarterly, varies based on our net leverage ratio and varies based on whether the loan is a Base Rate loan (0.375% to 1.50%) or a SOFR Rate loan (1.375% to 2.50%). The SOFR Adjustment varies based on the applicable interest period and equals 0.10% for Daily SOFR loans and for Term SOFR loans with a one-month interest period, 0.15% for Term SOFR loans with a three-month interest period and 0.25% for Term SOFR loans with a six-month interest period. The 2021 Incremental Term Loan matures in October 2025, which is the maturity date of the existing term loan under the 2020 Credit Facility, and is otherwise subject to substantially the same terms and conditions as the existing term loan under the 2020 Credit Facility.

Financing costs

In connection with our entry into the 2020 Credit Facility, we paid $4.0 million in financing costs, of which $1.2 million were capitalized in other assets and, together with a portion of the unamortized deferred financing costs from the 2017 Credit Facility and prior facilities, are being amortized into interest expense over the term of the new facility. We recorded aggregate financing costs of $2.0 million as a direct deduction from the carrying amount of our debt liability, which related to debt discount (fees paid to lenders) and debt issuance costs for the 2020 Term Loan.

In connection with our entry into the 2021 Incremental Term Loan, we paid $3.1 million in financing costs which were recorded as a direct deduction from the carrying amount of our debt liability.

As of December 31, 2021, deferred financing costs totaling $1.2 million were included in other assets on our consolidated balance sheets.

Financing for EVERFI acquisition

On December 31, 2021, we acquired EVERFI for approximately $440.1 million in cash consideration and 3,844,423 shares of the company's common stock, valued at approximately $303.6 million, for an aggregate purchase price of approximately $743.8 million, subject to closing adjustments. We financed the cash consideration and related expenses through cash on hand and new borrowings under the 2020 Credit Facility, including $250.0 million under the First Incremental Term Loan (as defined above).

Real estate loans

In August 2020, we completed the purchase of our global headquarters facility. As part of the purchase price, we assumed the Seller’s obligations under (i) a 5.12% Senior Secured Note, Series A1, in the outstanding principal amount of $49.1 million, dated May 2, 2018, and (ii) a 5.61% Senior Secured Note, Series A2, in the outstanding principal amount of $12.0 million, dated May 2, 2018, or an aggregate outstanding principal amount of $61.1 million (collectively, the “Real Estate Loans”). The Series A1 Note provides that we will pay the remaining principal amount due thereunder together with interest thereon at the rate indicated above, in monthly installments until it matures in April 2038. The Series A2 Note provides that we pay interest only in monthly installments at the rate indicated above with the principal amount due at maturity in April 2038. The Real Estate Loans are secured by a first priority lien on the real property constituting the global headquarters facility. Our assumption of the Real Estate Loans was a noncash investing and financing transaction and is reflected in our supplemental disclosure of cash flow information. At December 31, 2021, we were in compliance with our debt covenants under the Real Estate Loans.

Other debt

From time to time, we enter into third-party financing agreements for purchases of software and related services for our internal use. Generally, the agreements are non-interest-bearing notes requiring annual payments. Interest associated with the notes is imputed at the rate we would incur for amounts borrowed under our then-existing credit facility at the inception of the notes.

The following table summarizes our currently effective financing agreements as of December 31, 2021:


(dollars in thousands)	Term in Months	Number of Annual Payments	First Annual Payment Due	Original Loan Value
Effective dates of agreements:
December 2019	51	4	January 2020	$	2,150
January 2020	39	3	March 2020	3,470

As of December 31, 2021, the required annual maturities related to the 2020 Credit Facility, the Real Estate Loans and our other debt were as follows:


Years ending December 31, (dollars in thousands)	Annual maturities
2022	$	18,697
2023	18,232
2024	17,859
2025	853,034
2026	1,969
Thereafter	51,383
Total required maturities	$	961,174

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Revenue Recognition (Tables)

12 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Contract Balances

Deferred revenue


(dollars in thousands)	December 31, 2021		December 31, 2020
Recurring	$	360,890	$	303,840
One-time services and other	17,856		13,074
Total deferred revenue	378,746		316,914
Less: Long-term portion	4,247		4,678
Deferred revenue, current portion	$	374,499	$	312,236

Our opening and closing balances of deferred revenue were as follows:


(in thousands)	December 31, 2021		December 31, 2020

Total deferred revenue	$	378,746	$	316,914

Disaggregation of Revenue

The following table presents our revenue by geographic area based on the address of our customers:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
United States	$	777,333	$	772,188	$	775,308
United Kingdom	89,688		84,121		65,176
Other countries	60,719		56,910		59,939
Total revenue	$	927,740	$	913,219	$	900,423

The following table presents our revenue by market group:


	Years ended December 31,
(dollars in thousands)	2021		2020(1)		2019(1)
UMG	$	733,663	$	730,482	$	750,007
IMG	193,632		181,948		147,147
Other	445		789		3,269
Total revenue	$	927,740	$	913,219	$	900,423

Disaggregation Of Revenue, Recurring

The following table presents our recurring revenue by type:


	Years ended December 31,
(dollars in thousands)	2021		2020		2019
Contractual recurring	$	601,397	$	591,272	$	590,464
Transactional recurring	279,453		259,473		241,145
Total recurring revenue	$	880,850	$	850,745	$	831,609

Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share:


	Years ended December 31,
(dollars in thousands, except per share amounts)	2021		2020		2019
Numerator:
Net income	$	5,698	$	7,717	$	11,908
Denominator:
Weighted average common shares	47,412,306		48,184,714		47,695,383
Add effect of dilutive securities:
Stock-based awards	818,132		511,627		616,888
Weighted average common shares assuming dilution	48,230,438		48,696,341		48,312,271
Earnings per share:
Basic	$	0.12	$	0.16	$	0.25
Diluted	$	0.12	$	0.16	$	0.25

Anti-dilutive shares excluded from calculations of diluted earnings per share	974,110		956,303		241,336

Consolidated Financial Statement Details (Components of Accrued Expenses and Other Liabilities) (Details) - USD ($)
$ in Thousands

Dec. 31, 2021

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Taxes payable

$ 19,777

$ 19,577

^[1]

Amounts payable to former EVERFI option holders

17,404

^[2]

Accrued legal costs

^[3]

11,724

4,808

Operating lease liabilities, current portion

9,170

9,359

Customer credit balances

8,403

5,874

Accrued commissions and salaries

7,872

5,010

Accrued bonuses

5,829

Accrued transaction-based costs related to payments services

5,427

Accrued health care costs

3,042

2,341

Accrued vacation costs

2,234

2,311

Unrecognized tax benefit

1,248

3,351

Derivative instruments

4,159

Other liabilities

9,310

6,304

Total accrued expenses and other liabilities

101,440

63,094

Less: Long-term portion

1,344

10,866

Accrued expenses and other current liabilities

$ 100,096

$ 52,228

Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]

[1]	We deferred payments of the employer's portion of Social Security taxes during 2020 under the Coronavirus, Aid, Relief and Economic Security Act ("CARES Act"), half of which was due by the end of calendar year 2021 with the remainder due by the end of calendar year 2022.
[2]	Represents amounts not yet paid by EVERFI to its former option holders as of December 31, 2021, solely due to the timing of the acquisition on the last day of 2021. See Note 3 to these consolidated financial statements for additional information regarding our acquisition of EVERFI.
[3]	All accrued legal costs are classified as current. The increase in accrued legal costs from December 31, 2020 was primarily due to the Security Incident. See Note 11 to these consolidated financial statements.

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

Components of Lease Expense

The following table summarizes the components of our lease expense:


	Year ended December 31,
(dollars in thousands)	2021		2020		2019
Operating lease cost(1)	$	9,636	$	41,210	$	27,519
Variable lease cost	2,478		4,266		4,035
Sublease income	(1,516)		(3,120)		(3,189)
Net lease cost	$	10,598	$	42,356	$	28,365

(1)Includes short-term lease costs, which were immaterial.

Schedule of Maturities of Operating Lease Liabilities

Maturities of our operating lease liabilities as of December 31, 2021 were as follows:


Years ending December 31, (dollars in thousands)	Operating leases
2022	11,706
2023	10,328
2024	7,886
2025	6,805
2026	6,109
Thereafter	32,997
Total lease payments	75,831
Less: Amount representing interest	13,275
Present value of future payments	$	62,556

Schedule Of Supplemental Balance Sheet Information Related To Leases

Our ROU assets and lease liabilities are included in the following line items in our consolidated balance sheet:


(dollars in thousands)	December 31, 2021		December 31, 2020
Operating leases
Operating lease ROU assets	$	53,883	$	22,671

Accrued expenses and other current liabilities	$	9,170	$	9,359
Operating lease liabilities, net of current portion	53,386		17,357
Total operating lease liabilities	$	62,556	$	26,716

The weighted average remaining lease terms and discount rates were as follows:


(dollars in thousands)	December 31, 2021		December 31, 2020		December 31, 2019
Operating leases
Weighted average remaining lease term (years)	8.9		4.6		12.5
Weighted average discount rate	4.68	%	5.70	%	5.96	%

Schedule Of Supplemental Cash Flow Information Related To Leases

Supplemental cash flow information related to leases was as follows:


	Year ended December 31,
(dollars in thousands)	2021		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases(1)	$	11,338	$	26,713	$	24,569
Right-of-use assets obtained in exchange for lease obligations (non-cash):
Operating leases	5,358		11,002		102,245

(1)The 2020 amount was revised to correct an immaterial disclosure error in the previously filed consolidated financial statements.

Consolidated Financial Statement Details (Components of Other Income (Expense)) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Interest income	$ 392	$ 1,660	$ 2,802
Other (expense) income, net	(212)	(2)	1,256
Other income, net	$ 180	$ 1,658	$ 4,058

Earnings Per Share

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Earnings Per Share


5. Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share:


	Years ended December 31,
(dollars in thousands, except per share amounts)	2021		2020		2019
Numerator:
Net income	$	5,698	$	7,717	$	11,908
Denominator:
Weighted average common shares	47,412,306		48,184,714		47,695,383
Add effect of dilutive securities:
Stock-based awards	818,132		511,627		616,888
Weighted average common shares assuming dilution	48,230,438		48,696,341		48,312,271
Earnings per share:
Basic	$	0.12	$	0.16	$	0.25
Diluted	$	0.12	$	0.16	$	0.25

Anti-dilutive shares excluded from calculations of diluted earnings per share	974,110		956,303		241,336

Derivative Instruments (Fair Value of Derivative Instruments) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Derivatives, Fair Value [Line Items]
Derivative instruments	$ 0	$ 4,159
Designated as hedging instrument [Member] \| Interest rate swap [Member]
Derivatives, Fair Value [Line Items]
Derivative assets, fair value	7,160	0
Derivative liabilities, fair value	0	4,159
Designated as hedging instrument [Member] \| Interest rate swap [Member] \| Prepaid expenses and other current assets [Member]
Derivatives, Fair Value [Line Items]
Derivative assets, current portion	0	0
Designated as hedging instrument [Member] \| Interest rate swap [Member] \| Accrued expenses and other current liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liabilities, current portion	0	2,698
Designated as hedging instrument [Member] \| Interest rate swap [Member] \| Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative assets, long-term portion	7,160	0
Designated as hedging instrument [Member] \| Interest rate swap [Member] \| Other liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative instruments	$ 0	$ 1,461

Property and Equipment and Software Development Costs (Tables)

12 Months Ended

Dec. 31, 2021

Global HQ [Member]

Property, Plant and Equipment [Line Items]

Schedule of Property and Equipment

Property and equipment [Member]

Property, Plant and Equipment [Line Items]

Schedule of Property and Equipment

Property and equipment consisted of the following as of:


	Estimated useful life (years)	December 31,
(dollars in thousands)		2021		2020
Land	—	$	9,548	$	9,548
Building	39	61,284		61,284
Building improvements(1)	7 - 20	10,874		9,942
Equipment	1 - 5	2,320		2,865
Computer hardware	1 - 5	47,768		56,202
Computer software	1 - 5	21,347		23,116
Construction in progress	—	2,135		3,435
Furniture and fixtures	1 - 7	2,658		2,796
Leasehold improvements	Lesser of lease term or estimated useful life	12,086		6,044
Total property and equipment		170,020		175,232
Less: accumulated depreciation		(58,592)		(70,055)
Property and equipment, net		$	111,428	$	105,177

Software development [Member]

Property, Plant and Equipment [Line Items]

Schedule of Property and Equipment

Software development costs consisted of the following as of:


	Estimated useful life (years)	December 31,
(dollars in thousands)		2021		2020
Software development costs	3 - 7	$	196,337	$	164,665
Less: accumulated amortization		(74,960)		(52,838)
Software development costs, net		$	121,377	$	111,827

Business Combinations (Purchase Price Allocation) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Business Acquisition [Line Items]
Goodwill	$ 1,058,640	$ 635,854
EVERFI [Member]
Business Acquisition [Line Items]
Net working capital, excluding deferred revenue	(3,279)
Operating lease ROU assets	44,845
Other long-term assets	10,322
Identifiable intangible assets	457,449
Deferred tax liability	(93,925)
Deferred revenue	(51,770)
Operating lease liabilities, net of current portion	(42,068)
Other long-term liabilities	(645)
Goodwill	422,846
Total purchase price	$ 743,775

Restructuring (Details) $ in Millions	12 Months Ended
Restructuring (Details) $ in Millions	Dec. 31, 2019 USD ($)
Restructuring and Related Activities [Abstract]
Restructuring Costs	$ 5.8

Stock-Based Compensation (Summary of Unvested Restricted Stock Units, Activity) (Details) - Restricted stock units [Member] - USD ($)
$ / shares in Units, $ in Thousands

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Unvested, number, beginning of period

1,170,885

Unvested, weighted average grant date fair value, beginning of period

$ 63.62

Granted, number

1,126,266

Granted, weighted average grant date fair value

$ 73.47

$ 59.59

$ 77.90

Forfeited, number

(110,722)

Forfeited, weighted average grant date fair value

$ 66.11

Vested, number

(907,159)

Vested, weighted average grant date fair value

$ 59.83

Unvested, number, end of period

1,279,270

1,170,885

Unvested, weighted average grant date fair value, end of period

$ 74.77

$ 63.62

Unvested, aggregate intrinsic value

^[1]

$ 101,037

[1]	The intrinsic value is calculated as the market value as of the end of the fiscal period.

Goodwill and Other Intangible Assets (Summary of Amortization Expense) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Amortization of Intangible Assets Acquired by Income Statement Location [Line Items]
Amortization	$ 37,039	$ 41,883	$ 50,085
Cost of recurring [Member]
Amortization of Intangible Assets Acquired by Income Statement Location [Line Items]
Amortization	33,132	36,835	42,565
Cost of one-time services and other [Member]
Amortization of Intangible Assets Acquired by Income Statement Location [Line Items]
Amortization	1,680	2,133	2,204
Total included in cost of revenue [Member]
Amortization of Intangible Assets Acquired by Income Statement Location [Line Items]
Amortization	34,812	38,968	44,769
Included in operating expenses [Member]
Amortization of Intangible Assets Acquired by Income Statement Location [Line Items]
Amortization	$ 2,227	$ 2,915	$ 5,316

Segment Information (Long-Lived Assets By Geographic Region) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment	$ 111,428	$ 105,177
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment	110,613	103,123
Other countries [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment	$ 815	$ 2,054

Property and Equipment and Software Development Costs (Schedule of Property and Equipment) (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 170,020

$ 175,232

Less: accumulated depreciation

(58,592)

(70,055)

Property and equipment, net

111,428

105,177

Amount reclassified from leasehold improvements to building improvements

5,500

Land [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

9,548

Building [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 61,284

61,284

Property and equipment, estimated useful life (years)

39 years

Building improvements [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 10,874

^[1]

9,942

Building improvements [Member] | Minimum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

7 years

Building improvements [Member] | Maximum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

20 years

Equipment [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 2,320

2,865

Equipment [Member] | Minimum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

1 year

Equipment [Member] | Maximum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

5 years

Computer hardware [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 47,768

56,202

Computer hardware [Member] | Minimum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

1 year

Computer hardware [Member] | Maximum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

5 years

Computer software [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 21,347

23,116

Computer software [Member] | Minimum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

1 year

Computer software [Member] | Maximum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

5 years

Construction in progress [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 2,135

3,435

Furniture and fixtures [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 2,658

2,796

Furniture and fixtures [Member] | Minimum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

1 year

Furniture and fixtures [Member] | Maximum [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, estimated useful life (years)

7 years

Leasehold improvements [Member]

Property, Plant and Equipment [Line Items]

Property and equipment, gross

$ 12,086

$ 6,044

[1]	Upon acquisition of our global headquarters facility in August 2020, we reclassified related leasehold improvement costs of $5.5 million to building improvements given the acquisition of the underlying assets.

Revenue Recognition (Details) $ in Millions	12 Months Ended
Revenue Recognition (Details) $ in Millions	Dec. 31, 2021 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue recognized that was included in deferred revenue at beginning of period	$ 288.0
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation	$ 1,000.0
Revenue, remaining performance obligation, percentage to be recognized	60.00%
Revenue, remaining performance obligation, expected timing of satisfaction	12 months

Income Taxes (Summary of Changes in Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Balance at December 31, 2020	$ 4,625	$ 4,346	$ 3,704
Increases from prior period positions	6	414	1,183
Decreases in prior year positions	(57)	(614)	(385)
Increases from current period positions	1,751	491	456
Settlements (payments)	(1,192)	0	0
Lapse of statute of limitations	(1,482)	(12)	(612)
Balance at December 31, 2021	$ 3,651	$ 4,625	$ 4,346

Consolidated Financial Statement Details (Components of Deferred Revenue) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Disaggregation of Revenue [Line Items]
Deferred revenue	$ 378,746	$ 316,914
Less: Long-term portion	4,247	4,678
Deferred revenue, current portion	374,499	312,236
Recurring [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	360,890	303,840
Cost of one-time services and other [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	$ 17,856	$ 13,074

Property and Equipment and Software Development Costs (Schedule of Software Development Costs) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Software development costs, gross	$ 196,337	$ 164,665
Less: accumulated amortization	(74,960)	(52,838)
Software development costs, net	$ 121,377	$ 111,827
Software development [Member] \| Minimum [Member]
Property, Plant and Equipment [Line Items]
Software development costs, estimated useful life (years)	3 years
Software development [Member] \| Maximum [Member]
Property, Plant and Equipment [Line Items]
Software development costs, estimated useful life (years)	7 years

Revenue Recognition (Revenue by Market Group) (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Disaggregation of Revenue [Line Items]

Revenue

$ 927,740

$ 913,219

$ 900,423

UMG [Member]

Disaggregation of Revenue [Line Items]

Revenue

733,663

730,482

^[1]

750,007

^[1]

IMG [Member]

Disaggregation of Revenue [Line Items]

Revenue

193,632

181,948

^[1]

147,147

^[1]

Other [Member]

Disaggregation of Revenue [Line Items]

Revenue

$ 445

$ 789

^[1]

$ 3,269

^[1]

[1]	Due to the market group changes discussed above, we have recast our revenue by market group for the years ended December 31, 2020 and 2019 to present them on a consistent basis with the current year.

- Definition

+ References

+ Details

Basis of Presentation

9 Months Ended

Sep. 30, 2021

Accounting Policies [Abstract]

Basis of Presentation


2. Basis of Presentation

Basis of presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

Basis of consolidation

The consolidated financial statements include the accounts of Blackbaud, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Risks and uncertainties related to COVID-19

We are subject to risks and uncertainties as a result of the global COVID-19 pandemic. We believe that COVID-19 may continue to impact our vertical markets and geographies, but the magnitude of the impact on our business cannot be determined at this time due to numerous uncertainties, including the duration of the outbreak, the severity of variants which may develop, travel restrictions and business closures, the effectiveness of vaccination programs and other actions taken to contain the disease and other unforeseeable consequences.

Use of estimates

Recently adopted accounting pronouncements

Recently issued accounting pronouncements

There are no recently issued accounting pronouncements that are expected to have a material impact on our financial position or results of operations when adopted in the future.

Summary of significant accounting policies

Revenue recognition

We determine revenue recognition through the following steps:

•Identification of the contract, or contracts, with a customer;

•Identification of the performance obligations in the contract;

•Determination of the transaction price;

•Allocation of the transaction price to the performance obligations in the contract; and

•Recognition of revenue when, or as, we satisfy a performance obligation.

Recurring

One-time services and other

Contracts with multiple performance obligations

Costs of obtaining contracts, contract assets and deferred revenue

Sales taxes

We present sales taxes and other taxes collected from customers and remitted to governmental authorities on a net basis and, as such, exclude them from revenues.

Fair value measurements

•Level 1 - Quoted prices for identical assets or liabilities in active markets;

•Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Derivative instruments

Cash and cash equivalents

We consider all highly liquid investments purchased with an original maturity of three months or less and cash items in transit to be cash equivalents.

Restricted cash due to customers; Customer funds receivable; Due to customers

Concentration of credit risk

Financial instruments that potentially subject us to concentrations of credit risk consist of cash and cash equivalents, restricted cash due to customers and accounts receivable. Our cash and cash equivalents and restricted cash due to customers are placed with high credit-quality financial institutions. Our accounts receivable is derived from sales to customers who primarily operate in the nonprofit sector. With respect to accounts receivable, we perform ongoing evaluations of our customers and maintain an allowance for credit losses based on historical experience and our expectations of future credit losses. As of and for the years ended December 31, 2021, 2020 and 2019, there were no significant concentrations with respect to our consolidated revenues or accounts receivable.

Property and equipment

Construction-in-progress primarily related to purchases of facilities and information technology assets which had not been placed in service at the respective balance sheet dates. We transfer these assets to the applicable property and equipment category on the date they are placed in service. There was no capitalized interest applicable to construction-in-progress for the years ended December 31, 2021, 2020 and 2019.

Business combinations

Goodwill

The quantitative impairment test compares the fair values of identified reporting units with their respective carrying amounts. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. Based on our current internal reporting structure, we currently have one operating segment, one reportable segment, and one reporting unit. In each of 2021, 2020 and 2019, we performed the quantitative impairment test, which indicated that the estimated fair values of the identified reporting units significantly exceeded their respective carrying values. There was no impairment of goodwill during 2021, 2020 and 2019.

Intangible assets other than goodwill

We amortize finite-lived intangible assets over their estimated useful lives as follows.


	Basis of amortization	Amortization period (in years)
Customer relationships	Straight-line and accelerated(1)	8-17
Marketing assets	Straight-line and accelerated(1)	2-15
Developed technology	Straight-line and accelerated(1)	5-14
Content	Straight-line	9

(1)Certain of the customer relationships, marketing assets and developed technology assets are amortized on an accelerated basis.

We write off the gross carrying amount and accumulated amortization balances for all fully amortized intangible assets. We evaluate the estimated useful lives and the potential for impairment of finite and indefinite-lived intangible assets on an annual basis or more frequently if events or circumstances indicate revised estimates of useful lives may be appropriate or that the carrying amount may be impaired. If the carrying amount of a finite-lived intangible asset is no longer recoverable based upon the undiscounted cash flows of the asset, the amount of impairment is the difference between the carrying amount and the fair value of the asset. Substantially all of our intangible assets were acquired in business combinations. There were no impairments of acquired intangible assets during 2021 and 2020. See Note 6 to these consolidated financial statements for a discussion of our impairment of certain acquired intangible assets during 2019.

Impairment of long-lived assets

We review long-lived assets for impairment when events change or circumstances indicate the carrying amount may not be recoverable. Events or changes in circumstances that indicate the carrying amount may not be recoverable include, but are not limited to, a significant decrease in the market value of the business or asset acquired, a significant adverse change in the extent or manner in which the business or asset acquired is used or significant adverse change in the business climate. If such events or changes in circumstances are present, the undiscounted cash flow method is used to determine whether the asset is impaired. See Note 6 to these consolidated financial statements for a discussion of our impairment of certain long-lived assets during 2021 and 2019. There were no impairments of long-lived assets during 2020.

Deferred financing costs and debt discount

Stock-based compensation

Income taxes

Foreign currency

Gains and losses resulting from foreign currency transactions denominated in currency other than the functional currency are recorded at the approximate rate of exchange at the transaction date in other income, net. For the years ended December 31, 2021, 2020 and 2019, we recorded net foreign currency losses that were $1.6 million, $1.1 million and insignificant, respectively.

Research and development

Software development costs

Qualifying capitalized software development costs are amortized on a straight-line basis over the software asset's estimated useful life, which is generally 3 to 7 years. We evaluate the useful lives of these assets on an annual basis and test for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. See Note 6 to these consolidated financial statements for a discussion of our impairment of certain capitalized software development costs during 2020. There were no impairment charges related to capitalized software development costs during 2021 and 2019. We write off the gross carrying amount and accumulated amortization balances for all fully amortized software development cost assets.

Allowance for credit losses

Below is a summary of the changes in our allowance for credit losses.


Years ended December 31, (in thousands)	Balance at beginning of year		Provision/ adjustment		Write-off		Recovery		Balance at end of year
2021	$	9,016	$	4,483	$	(4,565)	$	441	$	9,375
2020(1)	4,011		6,787		(2,363)		581		9,016
2019	1,345		2,476		(2,617)		679		1,883

Allowance for sales returns

Below is a summary of the changes in our allowance for sales returns.


Years ended December 31, (in thousands)	Balance at beginning of year		Provision/ adjustment		Deduction		Balance at end of year
2021	$	1,276	$	6,967	$	(6,463)	$	1,780
2020(1)	1,518		6,443		(6,685)		1,276
2019	3,377		6,232		(5,963)		3,646

Advertising costs

We expense advertising costs as incurred, which were $7.1 million, $3.0 million and $3.1 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Restructuring costs

Restructuring costs include charges for the costs of exit or disposal activities. The liability for costs associated with exit or disposal activities is measured initially at fair value and only recognized when the liability is incurred. For details of our restructuring activities, see Note 18 to these consolidated financial statements.

Leases

Contingencies

Earnings per share

Derivative Instruments (Details) - USD ($) $ in Millions	12 Months Ended
Derivative Instruments (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Ineffective portion of interest rate swap(s)	$ 0.0	$ 0.0	$ 0.0
Undesignated derivative instruments	$ 0.0	$ 0.0	$ 0.0

Stockholders' Equity (Changes in Accumulated Other Comprehensive Loss by Component) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accumulated Other Comprehensive Income [Roll Forward]
Accumulated other comprehensive (loss) income, beginning of period	$ (2,497)	$ (5,290)	$ (5,110)
Amounts reclassified from accumulated other comprehensive income (loss) to interest expense	(18,003)	(17,287)	(20,618)
Income tax provision (benefit)	1,385	13,897	(1,323)
Net current-period other comprehensive income (loss)	(9,019)	(2,793)	180
Translation adjustments	661	4,571	2,641
Accumulated other comprehensive (loss) income, end of period	6,522	(2,497)	(5,290)
Other comprehensive (loss) income before reclassifications, net of tax effects of $(1,982), $1,625 and $860	(1,982)	1,625	860
Gains and losses on cash flow hedges [Member]
Accumulated Other Comprehensive Income [Roll Forward]
Accumulated other comprehensive (loss) income, beginning of period	(3,101)	(1,323)	1,498
Other comprehensive income (loss) before reclassifications	5,617	(4,602)	(2,399)
Amounts reclassified from accumulated other comprehensive income (loss) to interest expense	(3,714)	(3,827)	(573)
Income tax provision (benefit)	(973)	(1,003)	151
Total amounts reclassified from accumulated other comprehensive loss	2,741	2,824	(422)
Net current-period other comprehensive income (loss)	8,358	(1,778)	(2,821)
Accumulated other comprehensive (loss) income, end of period	5,257	(3,101)	(1,323)
Foreign currency translation adjustment [Member]
Accumulated Other Comprehensive Income [Roll Forward]
Accumulated other comprehensive (loss) income, beginning of period	604	(3,967)	(6,608)
Translation adjustments	661	4,571	2,641
Accumulated other comprehensive (loss) income, end of period	$ 1,265	$ 604	$ (3,967)

Income Taxes (Summary of Changes in Deferred Tax Asset Valuation Allowance) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Valuation Allowance [Line Items]
Balance at beginning of year	$ 29,184	$ 6,453	$ 6,855
Balance at end of year	31,974	29,184	6,453
Acquisition- related change
Valuation Allowance [Line Items]
Acquisition-related change	893	0	0
Charges to expense
Valuation Allowance [Line Items]
Acquisition-related change	$ 1,897	$ 22,731	$ (402)

Derivative Instruments

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives Instruments


10. Derivative Instruments

Cash flow hedges

We generally use derivative instruments to manage our variable interest rate risk. We have entered into interest rate swap agreements, which effectively convert portions of our variable rate debt under the 2020 Credit Facility to a fixed rate for the term of the swap agreements. We designated each of the interest rate swap agreements as a cash flow hedge at the inception of the contracts.

The terms and notional values of our derivative instruments were as follows as of December 31, 2021:


(dollars in thousands)	Term of derivative instrument	Notional value
Derivative instruments designated as hedging instruments:
Interest rate swap	November 2020 - October 2024	$	60,000
Interest rate swap	November 2020 - October 2024	60,000
Interest rate swap	June 2021 - October 2024	120,000
Interest rate swap	July 2021 - October 2024	120,000
Interest rate swap	July 2021 - October 2024	75,000
		$	435,000

The fair values of our derivative instruments were as follows as of:


		Asset Derivatives					Liability Derivatives
(dollars in thousands)	Balance sheet location	December 31, 2021		December 31, 2020		Balance sheet location	December 31, 2021		December 31, 2020
Derivative instruments designated as hedging instruments:
Interest rate swaps, current portion	Prepaid expenses and other current assets	$	—	$	—	Accrued expenses and other current liabilities	$	—	$	2,698
Interest rate swaps, long-term portion	Other assets	7,160		—		Other liabilities	—		1,461
Total derivative instruments designated as hedging instruments		$	7,160	$	—		$	—	$	4,159

The effects of derivative instruments in cash flow hedging relationships were as follows:


	Gain (loss) recognized in accumulated other comprehensive loss as of		Location of gain (loss) reclassified from accumulated other comprehensive loss into income	Gain (loss) reclassified from accumulated other comprehensive loss into income
(dollars in thousands)	December 31, 2021			Year ended December 31, 2021
Interest rate swaps	$	7,160	Interest expense	$	(3,714)

	December 31, 2020			Year ended December 31, 2020
Interest rate swaps	$	(4,159)	Interest expense	$	(3,827)

	December 31, 2019			Year ended December 31, 2019
Interest rate swaps	$	(1,757)	Interest expense	$	573

Our policy requires that derivatives used for hedging purposes be designated and effective as a hedge of the identified risk exposure at the inception of the contract. Accumulated other comprehensive income (loss) includes unrealized gains or losses from the change in fair value measurement of our derivative instruments each reporting period and the related income tax expense or benefit. Changes in the fair value measurements of the derivative instruments and the related income tax expense or benefit are reflected as adjustments to accumulated other comprehensive income (loss) until the actual hedged expense is incurred or until the hedge is terminated at which point the unrealized gain (loss) is reclassified from accumulated other comprehensive income (loss) to current earnings. The estimated accumulated other comprehensive income as of December 31, 2021 that is expected to be reclassified into earnings within the next twelve months is insignificant. There were no ineffective portions of our interest rate swap derivatives during the years ended December 31, 2021, 2020 and 2019. See Note 14 to these consolidated financial statements for a summary of the changes in accumulated other comprehensive income (loss) by component.

We did not have any undesignated derivative instruments during 2021, 2020 and 2019.