UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
(Mark One)
þANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year EndedDecember 31, 20182020
or
oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File No. 001-37394
 _________________________________________________________________________________________________________
Black Knight, Inc.
(Exact name of registrant as specified in its charter)
Delaware81-5265638
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)Number)
601 Riverside Avenue
,Jacksonville,Florida32204
(Address of principal executive offices, including zip code)offices)
(904) 854-5100
(Registrant’s telephone number,
Zip Code)
(904) 854-5100

(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, $0.0001 par valueBKINew York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None
 
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes þ     No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes o     No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes þ     No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes þ    No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  þ
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer     Accelerated filer Non-accelerated filerSmaller reporting company 
Large accelerated filer þ
     Accelerated filer o
Non-accelerated filer o
Smaller reporting company o
Emerging growth companyo
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o     No þ
The aggregate market value of the shares of Black Knight, Inc. common stock held by non-affiliates of the registrant as ofJune 30, 20182020 was $7,534,921,486$10,908,979,941 based on the closing price of $53.55$72.56 as reported by the New York Stock Exchange.
As ofFebruary 21, 2019,25, 2021, there were 150,011,919156,799,773 shares of Black Knight, Inc. common stock outstanding.
The information in Part III hereof is incorporated by reference to certain information from the registrant's definitive proxy statement for the fiscal year ended December 31, 2018.2020 annual meeting of shareholders. The registrant intends to file the proxy statement within 120 days after the close of the fiscal year that is the subject of this Report.

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FORM 10-K
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Statement Regarding Forward-Looking Information
The statements contained in this Annual Report on Form 10-K or in our other documents or in oral presentations or other statements made by our management that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including statements regarding our expectations, hopes, intentions or strategies regarding the future. These statements relate to, among other things, future financial and operating results of Black Knight. In many cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "could," "potential" or "continue," or the negative of these terms and other comparable terminology. Actual results could differ materially from those anticipated in these statements as a result of a number of factors, including, but not limited to the following:
changes in general economic, business, regulatory and political conditions, including those resulting from pandemics such as COVID-19, particularly as they affect foreclosures and the mortgage industry;
the outbreak of COVID-19 and measures to reduce its spread, including the effect of governmental or voluntary actions such as business shutdowns and stay-at-home orders;
security breaches against our information systems;systems or breaches involving our third-party vendors;
changes to our relationships with our top clients, whom we rely on for a significant portion of our revenues and profit;
limitation of our growth due to the time and expense associated with switching from competitors' software and services;
providing credits or refunds for prepaid amounts or contract terminations in connection with our service level commitments;
our ability to meet our contractual commitments and to offer high-quality technical support services;
our ability to comply with or changes in laws, rules and regulations that affect our and our customers'clients' businesses;
consolidation in our end client market;
regulatory developments with respect to use of consumer data and public records;
efforts by the government to reform or address the mortgage market and current economic environment;
our clients' relationships with government-sponsored enterprises;
our ability to adapt our solutions to technological changes or evolving industry standards;standards or to achieve our growth strategies;
our ability to compete effectively;
increase in the availability of free or relatively inexpensive information;
our ability to protect our proprietary software and information rights;
infringement on the proprietary rights of others by our applications or services;
our ability to successfully consummate, integrate and integrate acquisitions;achieve the intended benefits of acquisitions, including the acquisition of Optimal Blue, LLC ("Optimal Blue");
our reliance on third parties;
our dependence on our ability to access data from external sources;
our international operations and third-party service providers;
our investment in The Dun & Bradstreet CorporationHoldings, Inc. ("D&B"DNB");
our ability to develop widespread brand awareness cost-effectively;
system failures damage or interruption with respect to our software solutions;service interruptions;
delays or difficulty in developing or implementing new, enhanced or existing mortgage processing or software solutions;
change in the strength of the economy and housing market generally;
our existing indebtedness and any additional significant debt we incur;
the adequacy of our risk management policies and procedures;
our ability to achieve our growth strategies;
litigation, investigations or other actions against us;
the market price of our common stock may be volatile;
future sales of our common stock in the public market;
industry or securities analysts could publish unfavorable or inaccurate information about us;
our charter and bylaws and provisions of Delaware law may discourage or prevent strategic transactions;
our intention not to pay dividends on our common stock for the foreseeable future; and
if the spin-off from Fidelity National Financial, Inc. and its subsidiaries ("FNF") (the "Distribution") is treated as a taxable transaction due to our acts or failure to act, we may have a significant indemnity obligation to FNF, which is not limited in amount or subject to any cap;
the possibility that we will forgo certain transactions in order to avoid the risk of incurring significant tax-related liabilities; and
restrictions on our ability to pursue potential business opportunities under a non-competition agreement with FNFFidelity National Financial, Inc. and its subsidiaries ("FNF") that we entered in connection with the Distribution.spin-off from FNF (the "Distribution").


See "Risk Factors" for a further description of these and other factors. For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements that are included elsewhere in this Annual Report on Form 10-K. Any forward-looking statement made by us in this Annual Report on Form 10-K speaks only as of the date on which we make it. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We are not under any obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future

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events or otherwise. You should carefully consider the possibility that actual results may differ materially from our forward-looking statements.
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Part I
Item 1.Business
Item 1.    Business
Except as otherwise indicated or unless the context otherwise requires, all references to "Black Knight," the "Company," "we," "us" or "our" (1) prior to the Distribution, are to Black Knight Financial Services, Inc., a Delaware corporation, and its subsidiaries ("BKFS") and (2) after the Distribution, are to Black Knight, Inc., a Delaware corporation, and its subsidiaries ("BKI").
Overview
We are a leading provider of integratedan award-winning software, data and analytics solutions tocompany that drives innovation in the mortgage lending and consumer loan,servicing and real estate industries, as well as the capital and capital markets verticals. Oursecondary markets. Businesses leverage our robust, integrated solutions facilitate and automate many of the mission-critical business processes across the entire homeownership lifecycle. We are committedlife cycle to being a premier business partner thathelp retain existing clients, gain new clients, mitigate risk and operate more effectively. Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering exceptional client support to achieve their strategic goals realize greater success and better serve their customers by delivering best-in-class software, services and insights with a relentless commitment to excellence, innovation, integrity and leadership.customers.
We have market-leading vertical software solutions combined with comprehensive real estate data and extensive analytic capabilities. Our solutions are utilized by U.S. mortgage originators and servicers, as well as other financial institutions, investors and real estate professionals, to support mortgage lending and servicing operations, analyze portfolios and properties, operate more efficiently, meet regulatory compliance requirements and mitigate risk.
We believe the breadth and depth of our comprehensive end-to-end, integrated solutions and the insight we provide to our clients differentiate us from other software providers and position us particularly well for emerging opportunities. We have served the mortgage and real estate industries for over 55 years and utilize this experience to design and develop solutions that fit our clients' ever-evolving needs. The cost of origination and servicing are at historically high levels according to the Mortgage Bankers Association ("MBA"). Our proprietary software solutions and data and analytics capabilities are designed to reduce manual processes, improvesupport compliance and quality, mitigate risk and deliver significant cost savings to our clients. Our scale allows us to continually and cost-effectively invest in our business in order to meet industry requirements and maintain our position as ana provider of industry-standard platformplatforms for mortgage market participants.
The table below summarizes the number of active first and second lien mortgagesmortgage loans on our mortgage loan servicing software solution and the related market data, reflecting our leadership in the mortgage loan servicing software solutions market (in millions):
First lien mortgages Second lien mortgages Total first and second lien mortgagesFirst lien
as of December 31,
Second lien
as of December 31,
Total first and second lien
as of December 31,
2018 2017 2018 2017 2018 2017202020192020201920202019
Active loans32.1
 31.6
 2.5
 2.0
 34.6
 33.6
Active loans32.431.23.52.735.933.9
Market size51.8
(1)51.2
(1) 13.4
(2)15.4
(2)65.2
 66.6
Market size53.4(1)53.0(1)12.4(2)13.4(2)65.866.4
Market share62% 62% 19% 13% 53% 50%Market share61%59%28%20%55%51%

(1)
(1)    According to the December Black Knight Mortgage Monitor Reports as of December 31, 2018 and 2017 for U.S. first lien mortgages.
(2)According to the October 2018 and November 2017 Equifax National Consumer Credit Trends Reports as of September 30, 2018 and 2017, respectively, for U.S. second lien mortgages.
Our business is organized into two segments:
Software Solutions – offers software and hosting solutions that support loan servicing, loan origination and settlement services.
Data and Analytics – offers data and analytics solutions to the Black Knight Mortgage Monitor Reports as of December 31, 2020 and 2019 for U.S. first lien mortgage real estateloans.
(2)    According to the January 2021 and capital markets verticals. These solutions include property ownership data,December 2019 Equifax National Consumer Credit Trends Reports as of January 4, 2021 and September 30, 2019, respectively, for U.S. second lien data, servicing data, automated valuation models, collateral risk scores, prepayment and default models, lead generation, multiple listing service solutions and other data solutions.mortgage loans.
We offer our solutions to a wide range of clients across the mortgage and consumer loan, real estate and capital markets verticals. The quality and breadth of our solutions contribute to the long-standing nature of our relationships with our clients, the majority of whom enter into long-term contracts across multiple products that are embedded in their mission criticalmission-critical workflow and decision processes, particularly in the Software Solutions segment. Given the contractual nature of our revenues and stickiness of our client relationships, our revenues are highly visible and recurring in nature. Due to our integrated suite of solutions and our scale, we are able to drive significant operating leverage, which we believe enables our clients to operate more efficiently while allowing us to generate strong margins and cash flows.

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Our Markets
The U.S. mortgage loan market is large, and the loan lifecycle is complex and consists of several stages. The mortgage loan lifecycle includes origination, servicing and default. MortgagesMortgage loans are originated to finance home purchases or refinance existing mortgages.mortgage loans. Once a mortgage loan is originated, it is serviced on a periodic basis by mortgage loan servicers, which may not be the lenders that originated the mortgage.mortgage loan. Furthermore, if a mortgage loan experiences default, it triggers a set of multifaceted processes with an assortment of potential outcomes depending on a mix of variables.
Underlying the three major components of the mortgage loan lifecycle are the software, data and analytics support behind each process, which hashave become increasingly critical to industry participants due to the complexity of regulatory requirements. As the industry has grown in complexity, participants have responded by outsourcing to large scale specialty providers, automating manual processes and seeking end-to-end solutions that support the processes required to manage the entire mortgage loan lifecycle.
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Overview of the Markets We Serve
The U.S. mortgage loan servicing market is comprised of first and second lien mortgage loans. Even through housing downturns, the mortgage loan servicing market generally remains stable, as the total number of first lien mortgage loans outstanding tends to stay relatively constant. The number of second lien mortgage loans outstanding can vary based on a number of factors including loan-to-value ratios, interest rates and lenders' desire to own such loans.
While delinquent mortgagesmortgage loans typically represent a small portion of the overall mortgage loan servicing market, the mortgage loan default process is long and complex and involves multiple parties, a significant exchange of data and documentation and extensive regulatory requirements. Providers in the default process must be able to meet strict regulatory guidelines, which we believe are best met through the use of proven technology.
The U.S. mortgage loan origination market consists of both purchase and refinance mortgage loan originations. The mortgage loan origination process is complex and involves multiple parties, significant data exchange and significant regulatory oversight, which requires a comprehensive, scalable solution developed by a company with substantial industry experience. According to the MBA,Mortgage Bankers Association ("MBA"), Federal National Mortgage Association ("FNMA") and Federal Home Loan Mortgage Corporation ("FHLMC") the U.S. mortgage loan origination market for purchase and refinance mortgage loan originations iswas estimated as follows (in billions):
202020192018
2018 2017 2016
Mortgage Originations (1):     
Mortgage loan originations:Mortgage loan originations:
Purchase$1,185.0
 $1,143.0
 $1,052.0
Purchase$1,424.0 $1,272.0 $1,185.0 
Refinance458.0
 616.0
 999.0
Refinance2,268.0 796.0 458.0 
Total$1,643.0
 $1,760.0
 $2,051.0
Total - MBA(1)
Total - MBA(1)
$3,692.0 $2,068.0 $1,643.0 
PurchasePurchase$1,605.0 $1,326.0 $1,234.0 
RefinanceRefinance2,806.0 1,136.0 532.0 
Total - FNMA(2)
Total - FNMA(2)
$4,411.0 $2,462.0 $1,766.0 
PurchasePurchase$1,419.0 $1,303.0 $1,163.0 
RefinanceRefinance2,585.0 1,130.0 537.0 
Total - FHLMC(3)
Total - FHLMC(3)
$4,004.0 $2,432.0 $1,700.0 

Note: Amounts may not recalculate due to rounding.
(1) The 2018, 20172020, 2019 and 20162018 U.S. mortgage loan origination market for purchase and refinance originations is estimated by the MBA Mortgage Finance Forecast as of February 19, 2021, February 18, 2020 and February 11, 2019, respectively.
(2) The 2020 and 2019 U.S. mortgage loan origination market for purchase and refinance originations is estimated by the FNMA Housing Forecast as of January 2021. The 2018 U.S. mortgage loan origination market for purchase and refinance originations is estimated by the FNMA Housing Forecast as of January 2020.
(3) The 2020 and 2019 U.S. mortgage loan origination market for purchase and refinance originations is estimated by the FHLMC Economic and Housing Market Outlook as of January 8, 2021. The 2018 U.S. mortgage loan origination market for purchase and refinance originations is estimated by the FHLMC Economic and Housing Market Outlook as of October 16, 2018 and January 20, 2018, respectively.1, 2020.
Market Trends
Market trends that have spurred lenders and servicers to seek software, data and analytics solutions are as follows:
GrowingIntegral role of technology in the U.S. mortgage loan industry. BanksOver the past few years, the homebuyer’s processes have become more digital and banks and other lenders and servicers have become increasingly focused on automation and workflow management to operate more efficiently and meet their regulatory requirements.requirements as well as using technology to enhance the consumer experience during the mortgage loan origination, closing and servicing processes. Since the start of the COVID-19 pandemic, our clients have become increasingly aware that digital solutions are integral to their ability to stay connected with their customer base in times when face-to-face interactions are not possible. We believe technology providers must be able to support the complexity and dynamic nature of the market, display extensive industry knowledge and possess the financial resources to make the necessary investments in technology and software to support lenders. This includes an enhanced digital experience along with the application of artificial intelligence, robotic process automation and adaptive learning.
Lenders increasingly focused on core operations. As a result of regulatory scrutiny and the higher cost of doing business, we believe lenders have become more focused on their core operations and customers. We believe lenders are increasingly shifting from in-house solutions to third-party solutions that provide a more comprehensive and efficient solution. Lenders require these providers to deliver best-in-class solutions and deep domain expertise and to assist them in maintaining regulatory compliance.
IncreasedHeightened demand for enhanced transparency and analytic insight. As U.S. mortgage loan market participants work to minimize the risk in lending, servicing and capital markets, they rely on the integration of data and analytics with solutions that enhance the decision-making process. These industry participants rely on large comprehensive third-party databases coupled with enhanced analytics to achieve these goals. The pandemic is putting pressure on the U.S. economy, affecting millions of American jobs and creating a high-level of uncertainty in the volume of work that our clients are facing with possible
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delinquent mortgage loans. Mortgage loan market participants are eager for timely data and insights to help them plan and react to the changing environment.
Regulatory changes and oversight. Most U.S. mortgage loan market participants are subject to a high level of regulatory oversight and regulatory requirements as federal and state governments have enacted various new laws, rules and regulations. One example of such legislation is the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank Act"), which contained broad changes for many sectors of the financial services and lending industries and established the Consumer Financial Protection Bureau ("CFPB"), the federal regulatory agency responsible for regulating consumer financial protection within the United States. It is our experience that mortgage lenders have become more focused on minimizing the risk of non-compliance with regulatory requirements and are

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looking toward solutions that assist them in complying with their regulatory requirements. We expect this trend to continue as additional governmental programs and regulations have been recently enacted to address the economic concerns resulting from the pandemic, and our clients have had to adapt their systems and processes in record time to the shifting landscape. In addition, recent high-profile data security incidents have resulted in an increased focus on data security by our clients and our clients' regulators.regulators have elevated their focus on privacy and data security while many of our clients’ employees are working from home and in light of an increased level of cybersecurity incidents. We expect the industry focus on privacy and data security to continue to increase.
Our Solutions and Services
Our business is organized into two segments: Software Solutions and Data and Analytics. Our solutions provide clients with a comprehensive, integrated software and workflow management solution set that is supported by data and analytics to enhance capabilities and drive efficiencies while assisting our clients with regulatory compliance.
Software Solutions
Our Software Solutions segment offers leading software and hosting solutions that facilitate and automate many of the mission-critical business processes across the homeownership lifecycle. These solutions primarily consist of mortgage loan origination and servicing, processing and workflow management software applications coupled with related support and services.
Our clients in this segment are primarily mortgage lenders and servicers. We believe they use our software and services to reduce their operating costs, improve their ability to provide superiorexceptional customer service and enhance the quality and consistency of various aspects of their mortgage operations. We work with our clients to enhance and integrate our software and services in order to assist them in gaining the greatest value from the solutions we provide.
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The primary applications and services within our Software Solutions segment are as follows:
Solution:Description:
MSP®
A software as a service application that delivers one central, comprehensive platform for mortgage and home equity loans. MSP® provides servicers the ability to automate all areas of loan servicing, including setup and maintenance, customer service, cashiering, escrow administration, investor accounting and default management. It serves as a core application and database of record for first and second lien mortgages.mortgage loans.
BankruptcySM/ ForeclosureSM
This flexible and scalable solution can be used for managing and automating the wide range of different workflow processes involving distressed and non-performing loans. It provides a real-time integration with MSP® and increases process efficiencies while increasing processing volumes.
InvoicingSM
Sophisticated web-based solution that helps servicers save time and eliminate errors by automating every aspect of the billing and invoice process - from invoice set-up to post payment activities.
Empower®Servicing DigitalSM
A white-labeled mobile solution where consumers can review detailed information about their mortgage loan, home and neighborhood. This solution is powered by our data assets and Actionable Intelligence Platform ("AIPSM"), a unified framework for delivering actionable intelligence across the mortgage loan lifecycle.
Loss MitigationSM
This application provides servicers using MSP® with a comprehensive, integrated solution that supports industry standard retention and liquidation workouts. The system’s highly intuitive interface, built-in workflows and quality control capabilities help streamline the loss mitigation process and reduce risk.

ClaimsSM
This end-to-end, fully integrated solution helps servicers manage the entire default-related claims process. It facilitates considerable savings of time and resources, reduction of errors and decrease in penalties and curtailments.
Empower®
Dynamic, innovative enterprise-wide loan origination system used by lenders to originate their first mortgages,mortgage loans, home equity loans and lines of credit across the retail, wholesale, consumer-direct and correspondent lending channels. It provides functionality for every facet of the origination process, including first and second lien mortgage loan products support, loan fulfillment and closing, pre- and post-closing audit and compliance functions, product and pricing, electronic document management and industry-standard interfaces. This solution is supported by Borrower DigitalSM, which allows end consumers to prequalify and apply for loans using any device and helps servicers to enhance integrity and consistency of data.
LendingSpace®ExchangeSM
Comprehensive, end-to-end correspondent lendingThis platform designed specifically to support the entire correspondent process. A correspondent loan is a loan that is originated and funded by one lender and sold to another lender who services the loan or sells it on the secondary market. LendingSpace facilitates real-time communication between correspondent loan sellers and purchasers. It standardizes operations, enhances data integrity and helps ensure that process and compliance rules are consistently applied.
ExchangeSM
Platform that provides a fully interconnected network of originators, agents, settlement services providers and mortgage loan investors in the U.S. It currently connects lenders with more than 25,000 service providers. This secure and integrated solution allows lenders and their service providers to connect and do business electronically.
Expedite®Close
A suite of productsAn innovative, end-to-end closing solution that offers the flexibility and servicesscalability lenders need in an eClosing software solution. Based on client-defined rules, decisioning capabilities and transaction data, Expedite Close determines if a closing should use a paper, hybrid or complete digital process. The solution’s embedded rules and workflow identifies such factors as jurisdiction requirements, settlement agent processes, consumer preferences and investor requirements – so users don’t have to. Expedite Close can support paper and hybrid loan closings today as lenders work toward a full digital option.
Optimal BlueSM PPE
Product and pricing solutions used by lenders title underwriters, settlement agents and real estate professionalsmortgage brokers to automatecreate and streamline internal business processes, manage compliancemaintain competitive and accelerate the application-to-close cycle. Expedite’s data-enriched “transaction workspace” enables all participants to seamlessly interact throughout real estate transaction lifecycle.profitable offerings.
We build all of our software platforms to be scalable, secure, flexible, standards-based and web-connected for easy use by our clients. Further, we have a history of being able to bring solutions to market quickly due to investments we have made in integrating our software and development processes. Servicing DigitalSM and our artificial intelligence virtual assistant ("AIVASM"), which we acquired through our HeavyWater, Inc. acquisition, are two recent solution initiatives we introduced to the market to offer an enhanced digital experience along with the application of robotic process automation and adaptive learning. A description of each of these solutions is included below:
CompassPointSM
Servicing DigitalSM - A cutting-edge, interactive, customer-centric solution that delivers detailed, timely
Provides the tools, reporting, calculations and highly personalized information aboutautomation capabilities necessary to help lenders manage the market risk of their pipeline of interest rate locks. It also provides cash flow engines and modules to help lenders value and understand their portfolio of consumer’s home and the wealth that can be built from the underlying real estate asset. It enables servicers to strengthen their relationship with the customer.mortgage servicing rights.

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AIVA®
AIVASM -
An artificial intelligence virtual assistant that reads, comprehends and draws conclusions based on context to mimic cognitive thinking and build expertise over time. This scalable solution helps deliver operational efficiencies to reduce turn times and origination costs by automating many of the task-oriented and repetitive manual functions that lenders manage every day and accelerating the speed of processing.
We build all of our software platforms to be scalable, secure, flexible, standards-based and web-connected for easy use by our clients. Further, we have a history of being able to bring solutions to market quickly due to investments we have made in integrating our software and development processes.
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Data and Analytics
Our Data and Analytics segment supports and enhances our software solutions and is designed to help lenders and servicers make more informed decisions, improve performance, identify and predict risk and generate more qualified leads. We believe, based on our knowledge of the industry and competitors, that we have aggregated one of the largest residential real estate data sets in the United States that is derived from both proprietary and public data sources. Utilizing this data, subject to any applicable use restrictions, and our deep history and understanding of the mortgage market, we have created detailed real estate data solutions that assist in portfolio management, valuations, property records, lead generation and improved risk analysis for all aspects of origination, servicing, default and capital markets/investing. In addition, we deliver data, analytics and software solutions to customersclients in the real estate, title insurance, multiple listing service ("MLS")MLS and other verticals that rely on property data-centric solutions to make informed decisions and run their businesses.
Our primary data and analytics services are as follows:
Property data: A largenationwide collection of property information on real estate parcels in the United States. The data is delivered through a variety of distribution mechanisms, including web portals, application programming interfaces, bulk files and through integrations with our proprietary mortgage enterprise software platforms.
Title plant software: A software platform that helps title companies navigate a vast collection of data regarding property ownership, legal and vesting.
Multiple listing serviceMLS software solution: A software platform that helps regional Multiple Listing Service AssociationsMLS associations manage their local area property listings. The platform also enables membership management.
McDashSM
McDashSM loan data: An extensive repository of mortgage loan performance data, representing the majority of the mortgage loan industry. With advanced data-processing capabilities, customized record layouts and flexible delivery options, it offers current, reliable and high-quality information to meet our clients' needs.
AFTSM: Model that forecasts prepayments, default, delinquencies and losses on residential mortgage loans and securities. It allows servicers to enhance their collection strategies through our Dialer Optimizer solution, which offers the capability to risk rank the servicing portfolio based on expected loss and borrower payment pattern using a proven analytical model.
We also recently introduced to the market our Actionable Intelligence Platform ("AIPSM"), a unified framework for delivering actionable intelligence across the loan lifecycle. AIP supports origination, servicing and home equity businesses and is designed to address our clients' revenue, efficiencyneeds.
AFTSM: Model that forecasts prepayments, default, delinquencies and compliance initiatives.losses on residential mortgage loans and securities. It allows servicers to enhance their collection strategies through our Dialer OptimizerSM solution, which offers the capability to risk rank the servicing portfolio based on expected loss and borrower payment patterns using a proven analytical model.
Automated Valuation Models (AVMs). Industry-leading data, proprietary information, proven methodologies and advanced user and performance testing deliver exceptionally reliable automated property valuations.
Rapid Analytics Platform ("RAPSM"). An interactive data science platform that helps companies enhance performance, reduce risk and increase efficiencies by providing a single workspace to source data, execute queries, create advanced analytics and train machine learning models to deliver faster insights. Users of RAPSM have the ability to upload their own data on this platform and join it with Black Knight data.
Our Competitive Strengths
We believe our competitive strengths include the following:
Market leadership with comprehensive and integrated solutions. We are a leading provider of comprehensive and integrated solutions. We believe our leadership position is, in part, the result of our unique expertise and insight developed from over 55 years serving the needs of clients in the mortgage loan industry. We have used this insight to develop an integrated and comprehensive suite of proprietary software, data and analytics solutions to automate many of the mission-critical business processes across the entire homeownership lifecycle. These integrated solutions are designed to reduce manual processes, assist in improving organizational compliance and mitigating risk, and to ultimately deliver significant cost savings to our clients.
Our digital ecosystem encompasses various elements of the mortgage loan lifecycle. By migrating to a digital homebuying environment, we believe we provide modern solutions for an increasingly digital world.
Broad and deep client relationships with significant recurring revenues. We have long-standing, sticky relationships with our largest clients. We frequently enter into long-term contracts with our software solutions clients that contain a base fee that is contractually obligated. Our products are typically embedded within our clients' mission-critical workflow and decision-making processes across various parts of their organizations.
Extensive data assets and analytics capabilities. We develop and maintain large, accurate and comprehensive data sets on the mortgage loan and housing industry that we believe are competitively differentiated. Our unique data sets provide a combination of public and proprietary data, and each of our data records features a large number of attributes. Our data scientists utilize our data sets, subject to any applicable userestrictions, and comprehensive analytical capabilities to create highly customized reports, including models of customer behavior for originators and servicers, portfolio analytics for capital markets and government agencies and proprietary market insights for
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real estate agencies. Our

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data and analytics capabilities are also embedded into our software solutions and workflow products, providing our clients with integrated and comprehensive solutions.
Scalable and cost-effective operating model. We believe we have a highly attractive and scalable operating model derived from our market leadership, hosted software solutions and the large number of clients we serve. Our scalable operating model provides us with significant benefits. Our scale and operating leverage allows us to add incremental clients to our existing platforms with limited incremental cost. As a result, our operating model drives attractive margins and generates significant cash flow. Also, by leveraging our scale and leading market position, we are able to make cost-effective investments in our software solutions to assist with complex regulatory and compliance requirements, which we believe increases our value proposition to clients.
Our Strategy
Our comprehensive and integrated software solutions, robust data and analytic capabilities, differentiated business model, broad and deep client relationships and other competitive strengths enable us to pursue multiple growth opportunities. We intend to continue to expand our business and grow through the following key strategies:
Win new clients. We intend to attract new clients by demonstrating the value proposition provided by our software and comprehensive solutions offering. In particular, we believe there is a significant opportunity to penetrate the mid-tier mortgage loan originators and servicers market. We believe these institutions can benefit from our proven solutions suite in order to address complex regulatory requirements and compete more effectively in the evolving mortgage loan market. We intend to continue to pursue this channel and benefit from the low incremental cost of adding new clients to our scalable applications and infrastructure.
Cross-sell existing products. We believe our established client base presents a substantial opportunity for growth. We seek to capitalize on the trend of standardization and increased adoption of leading third-party solutions and increase the number of solutions provided to our existing client base. We intend to broaden and deepen our client relationships by cross-selling our suite of end-to-end software solutions, as well as our robust data and analytics. By helping our clients understand the full extent of our comprehensive solutions and the value of leveraging the multiple solutions we offer, we believe we can expand our existing relationships by allowing our clients to focus on their core businesses and their customers.
Win new clients. We intend to attract new clients by leveraging the value proposition provided by our software and comprehensive solutions offering. In particular, we believe there is a significant opportunity to penetrate the mid-tier mortgage originators and servicers market. We believe these institutions can benefit from our proven solutions suite in order to address complex regulatory requirements and compete more effectively in the evolving mortgage market. We intend to continue to pursue this channel and benefit from the low incremental cost of adding new customers to our scalable applications and infrastructure.
Solution development and innovation. Our long-term vision is to be the industry-leading provider for participants of the mortgage and consumer loan, real estate and capital markets verticals for their platform, data and analytic needs. Weintend to enhance what we believe is a leadership position by continuing to innovate new solutions with urgency and integrate those solutions with our solutions and refine the insight we provide to our clients.platforms. We have a strong track record of introducing and developing new solutions that span the homeownership lifecycle, are tailored to specific industry trends and enhance our clients' core operating functions. By working in partnership with key clients, we have been able to develop and market new and advanced solutions to our client base that meet the evolving demands of the mortgage and consumer loan, real estate and capital markets verticals. In addition, we will continue to develop and leverage insights from our large public and proprietary data assets to further improve our customerclient value proposition.
Selectively pursue strategic acquisitions. The core focus of our strategy is to grow organically. However, we may selectively evaluate strategic acquisition opportunities that would allow us to expand our footprint, broaden our client base and deepen our product and service offerings. We believe thatthere are meaningful synergies that result from acquiring small companies that provide best-in-class single point solutions. Integrating and cross-selling these point solutions into our broader client base and integrating acquisitions into our efficient operating environment would potentially result in revenues and cost synergies.
Our Clients
We have numerous clients in each category of service that we offer. A significant focus of our marketing efforts is on the toptop-tier and mid-tier U.S. mortgage loan originators and servicers. We also provide our solutions to a number of other financial institutions, investors, attorneys, trustees and real estate professionals.
The U.S. mortgage loan industry is concentrated among the top 25 mortgage institutions, and our most significant and long-term relationships tend to follow the industry landscape. We typically provide an extensivea growing number of solutions to each client. Because of the depth of these relationships, we derive a significant portion of our aggregate revenues from our largest clients.
DuringFor the year ended December 31, 2018, Wells Fargo, N.A.2020, one of our clients accounted for approximately 12% of our consolidated revenues and approximately 13%11% of our Software Solutions segment revenues. We also had onerevenues and another client that accounted for approximately 14%11% of our Data and Analytics segment revenues.
During No client accounted for more than 10% of our consolidated revenues for the year ended December 31, 2018,2020.
For the year ended December 31, 2020, our five largest clients accounted for approximately 34%30% of our consolidated revenues and approximately 36%32% of our Software Solutions segment revenues. However, the revenues in each case are spread across a range of services and are subject to multiple, separate contracts. Although the diversity of the services we provide to each

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each of these clients reduces the risk that we would lose all of the revenues associated with any of these clients, a significant deterioration in our relationships with or the loss of any one or more of these clients could have a significantmaterial effect on our results of operations.operations or financial condition. See Item 1A. Risk Factors of Part I of this Report.
Sales and Marketing
Our sales and marketing efforts are focused on both generatingwinning new clients as well as cross-selling our broad service offeringssolution set to existing clients.
We have teams of experienced sales personnel with subject matter expertise in particular services and in the needs of particular types of clients. A significant portion of our potential clientsthe companies in each of our business lines is targeted via direct and/or indirect field sales, as well as inbound and outbound telemarketing efforts.the markets we serve. Marketing activities include direct marketing, print and electronicdigital advertising, media relations, video, web-based activities, thought leadership, client meetings and conferences, tradeshow and convention activities and other targeted initiatives. We continue to adapt our sales and marketing efforts based on the current environment to offer a number of virtual tools and techniques that allow us to continue to engage with current and potential clients.
We engage with existing clients on a regular basis and continually focus on engaging with prospective clients. Given the broad range of solutions we offer, and the concentration and scale of many of our existing clients, we have thesignificant opportunity to expand our sales to our existing client base through cross-selling efforts. We have established a core team of account managers who cross-sell the full range of our servicessolutions to existing and potential clients at the toptop-tier and mid-tier U.S. mortgage loan originators and servicers, as well as a number of other financial institutions, investors and real estate professionals. The individuals who participate in this effort spend a significant amount of their time on sales and marketing efforts.
We engage in strategic account reviews, during which our executives share their knowledge of clients and the market in order to determine the best sales approach on a client-by-client basis. As a result, we believe we have created an effective cross-selling culture within our organization.
Research and Development
Our research and development activities relate primarily to the design, development and enhancement of our software applications. We expect to continue our practice of investing an appropriate level of resources to maintain, enhance and extend the functionality of our proprietary systems and existing software applications, to develop new and innovative software applications and systems in response to the needs of our clients and to enhance the capabilities surrounding our infrastructure. We work with our clients to determine the appropriate timing and approach to introducing technology or infrastructure changes to our applications and services.
Patents, Trademarks and Other Intellectual Property
We rely on a combination of contractual restrictions, internal security practices and copyright and trade secret laws to establish and protect our software, technology, data and expertise. Further, we have developed a number of brands that have accumulated goodwill in the marketplace, and we rely on the above to protect our rights in that area. We intend to continue our policy of taking all measures we deem necessary to protect our copyright, trade secret and trademark rights.
Competition
A number of theThe businesses in which we engage are highly competitive. Competitive factors in processing businesses include the quality of the technology-based application or service, application features and functions, ease of delivery and integration, ability of the provider to maintain, enhance and support the applications or services and pricing. We believe that our integrated software solutions and economies of scale in the mortgage processing businessloan origination and servicing markets provide us with a competitive advantage in each of these categories. Based on our knowledge of the industry and competitors, we also believe that no single competitor offers the depth and breadth of solutions we are able to offer.
Software Solutions. With respect to our Software Solutions segment, we compete with our clients' internal technology departments and other providers of similar systems, such as Ellie Mae,Intercontinental Exchange, Inc.,'s Mortgage Technology segment and Sagent Lending Technologies and Mortgage Cadence.Technologies. Competitive factors include the quality of the technology-based application or service, application features and functions, ease of delivery and integration, ability of the provider to maintain, enhance and support the applications or services and pricing. We believe that our integrated software solutions and economies of scale in the mortgage loan processing business provide us with a competitive advantage in each of these categories.
Data and Analytics. In our Data and Analytics segment, we primarily compete with CoreLogic, Inc., First American Financial Corporation, in-house capabilities and certain niche providers. We compete based on the breadth and depth of our data, the exclusive nature of some of our key data sets and the capabilities to create highly customized reports. We believe that the quality of the data we offer is distinguished by the broad range of our data sources, including non-public sources, the volume of records we maintain, our ability to integrate our data and analytics with our software solutions and the ability to leverage our market leading position in the mortgage loan origination and servicing industries.

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Government RegulationRegulations
Various aspects of our businesses are subject to federal and state regulations. Our failure to comply with any applicable laws and regulations could result in restrictions on our ability to provide certain services, as well as the possible imposition of civil fines and criminal penalties.
As a provider of electronic data processing to financial institutions, such as banks and credit unions, we are subject to regulatory oversight and examination by the Federal Financial Institutions Examination Council ("FFIEC"), an interagency body of the Federal Reserve Board ("FRB"), the CFPB,Consumer Financial Protection Bureau ("CFPB"), the Office of the Comptroller of the Currency ("OCC"), the Federal Deposit Insurance Corporation ("FDIC") and various other federal and state regulatory authorities. We also may be subject to possible review by state agencies that regulate banks in each state in which we conduct our electronic processing activities.
Our financial institution clients are required to comply with various privacy laws and regulations under state and federal law, including the Gramm-Leach-Bliley Act. These laws and regulations place restrictions on the use of non-public personal information. All financial institutions must disclose detailed privacy policies to their customers and offer them the opportunity to direct the financial institution not to share information with third parties. The regulations, however, permit financial institutions to share information with non-affiliated parties who perform services for the financial institutions. As a provider of services to financial institutions, we are required to comply with the same privacy regulations and are generally bound by the same limitations on disclosure of the information received from our clients as those that apply to the financial institutions themselves.
The most recent financial crisis of 2008 resulted in increased scrutiny of all parties involved in the mortgage loan industry by governmental authorities. This scrutiny has included federal and state governmental review of all aspects of the mortgage lending business, including an increased legislative and regulatory focus on consumer protection practices. Future legislative or regulatory changes are difficult to predict and new laws or regulations that may be implemented by the CFPB or other regulatory bodies may require us to change our business practices or cause us to incur increased costs to comply.
Many consumer advocates, privacy advocates and government regulators believe that existing laws and regulations do not adequately protect privacy or ensure the accuracy of consumer-related data. As a result, they have implemented or are seeking to implement further restrictions, such as the California Consumer Privacy Act ("CCPA"), the California Privacy Rights Act ("CPRA"), the New York Department of Financial Services Cybersecurity Requirements for Financial Services Companies ("NY DFS Cybersecurity Regulation") and the Vermont Act Relating to Data Brokers and Consumer Protection ("Vermont Data Broker Law"), on the acquisition, dissemination or commercial use of personal information within the public and private sectors and are also contemplating requirements relative to data accuracy and the ability of consumers to opt to have their personal data removed from databases such as ours. We are also subject to these state regulations.
Information Technology and Security
We are highly dependent on information technology networks and systems to securely process, transmit and store electronic information. Attacks on information technology systems continue to grow in frequency, complexity and sophistication.sophistication and we expect this trend to continue. Such attacks have become a point of focus for individuals, businesses and governmental entities. These attacks can create system disruptions, shutdowns or unauthorized disclosure of confidential information, including non-public personal information, consumer data and proprietary business information. Refer to the "Risks Related to Information Security" section of Item 1A. Risk Factors for additional information.
We remain focusedprotect our data assets by providing centralized security solutions and enforcing a defense-in-depth, centralized model that includes deterring, detecting, preventing, analyzing and containing security incidents. We focus on makingall areas of cybersecurity including threat and vulnerability management, security monitoring, identity and access management, phishing awareness, risk oversight, third-party risk management, disaster recovery and continuity management. We make strategic investments in information security to protect our clients and our information systems. This includes both capital expenditures and operating expenses onfor hardware, software, personnel and consulting services.
As our primary solutions and services evolve, we apply a comprehensive approach to the mitigation of identified security risks. We have established risk management policies, including those related to privacy, information security and cybersecurity, and we employ a broad and diversified set of risk monitoring and risk mitigation techniques.
Enterprise Risk Management: We also participatemaintain a comprehensive Enterprise Risk Management ("ERM") program that provides the framework to align our risk appetite and strategy to enhance management of enterprise risks, including information security risks. Through our ERM program, we analyze risks inherent to our products, services and businesses, and develop appropriate plans to mitigate those risks. The executive-level Enterprise Risk and Compliance Committee convenes regularly to discuss matters relating to our enterprise risk position and risk management, such as third-party risk, phishing, security incident response, application resiliency, environmental, social and governance responsibilities and external and internal vulnerabilities. The Risk Committee of our Board of Directors oversees the
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ERM and Compliance programs through regular reports from our Chief Risk Officer, Chief Information Security Officer and Chief Compliance Officer, and reports on these matters to our board of directors.
Compliance: Our Compliance function provides the standards and policies to mitigate identified risks, as well as training for our employees on applicable privacy, security, legal and regulatory requirements that provide ongoing enhancement of our security and risk culture.
Internal Audit: Our Internal Audit function provides provides independent and objective assurance services designed to improve the Company’s operations. Internal Audit focuses a significant portion of their time and resources to the audit of information technology and security. The Internal Audit department is established by the Audit Committee of the Board of Directors, and it directly oversees its results and operations.
Human Capital Management
We power the markets we serve by delivering cutting-edge solutions. Our employees are a key component of our success. Our most important priorities are the health and safety of our employees. Since March 2020, substantially all of our employees have been working from home. We instituted safety protocols and procedures throughout our facilities for essential employees who are on site. In addition, we expanded our employee benefits and other online resources to enable employees to focus on their physical, emotional and social well-being.
We are passionate about giving our employees the tools to equip them for success in industrytheir careers, providing the health and governmentalwellness benefits needed for physical, mental and social well-being, and delivering on diversity and inclusion initiatives to improve information security forlet every employee know they are valued and respected.
We realize our clients.individual differences are what strengthen us collectively. We are committed to supporting a culture that is representative of the unique values, opinions, cultures and needs of our employees, clients and communities. Through internal programs, including employee training and leadership development, comprehensive benefits and a hands-on leadership team, we support our employees throughout their career.
EmployeesWe strive to attract and retain the most talented employees in the industry by offering competitive compensation and investing in our employees' physical, mental and social well-being to help them achieve goals inside and outside of the office.
As of December 31, 2018,2020, we had approximately 4,700 employees and approximately 200 independent contractors.5,700 employees. None of our workforce currently is unionized. We have not experienced any work stoppages, and we consider our relations with employees to be good.
FinancialInformation by Segment
In addition to our two reporting segments, we have a corporate organization that consists primarily of general and administrative expenses that are not included in the otherour segments. For financial information by reporting segment, see Note 1921 tothe Notes to Consolidated Financial Statements.
Additional Information
Our website address is www.blackknightinc.com. We make available free of charge on or through our website our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports filed

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or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission ("SEC"). However, the information found on our website is not part of this or any other report.
Item 1A.Risk Factors
Item 1A.     Risk Factors
In addition to the normal risks of business, we are subject to significant risks and uncertainties, including those listed below and others described elsewhere in this Annual Report on Form 10-K. Any of the risks described herein could result in a significant or material adverse effect on our results of operations or financial condition.
IfRisks Related to Our Business
The extent to which health epidemics, including the current COVID-19 pandemic and measures taken in response thereto affect our business, results of operations, liquidity and financial conditions will depend on future developments, which are highly uncertain and are difficult to predict.
Our business and operations could be adversely affected by health epidemics, including the current COVID-19 pandemic, impacting the industries and communities in which we areand our clients, suppliers and business partners operate.
Global health concerns relating to the COVID-19 pandemic and related government actions taken to reduce the spread of the virus have been weighing on the macroeconomic environment, and the pandemic has significantly increased economic uncertainty and reduced economic activity.
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The pandemic has resulted in authorities implementing numerous measures to try to contain the virus, such as travel bans and restrictions, quarantines, shelter in place or total lock-down orders and business limitations and shutdowns. Governments around the globe have taken steps to mitigate some of the more severe anticipated economic effects of the virus, but there can be no assurance that such steps will be effective or achieve their desired results in a timely fashion.
The pandemic has adversely affected the operations of our clients, suppliers and business partners. On March 18, 2020, the U.S. Department of Housing and Urban Development ("HUD") and the Federal Housing Finance Agency ("FHFA") announced a 60-day moratorium on foreclosures and evictions. Likewise, the FHFA also announced forbearance programs for impacted borrowers, allowing mortgage payments to be suspended for up to 12 months. Managing the many aspects of forbearance programs mandated by the FHFA, HUD and the CARES Act may present operational challenges for many servicers of mortgage loans.
Subsequent to the CARES Act, the Federal Housing Administration ("FHA") extended the moratorium on mortgage loan foreclosures and evictions through at least June 30, 2021. In addition, many states have implemented additional guidance that extends their moratorium on mortgage loan foreclosures and evictions, and additional extensions of these moratoriums may be implemented in the future.
We may experience financial impacts due to a number of heightened risks, including:
lower foreclosure-related transactional revenues in the near term due to the mortgage loan foreclosure moratorium and mortgage loan forbearance plans offered as part of the CARES Act, which may have a negative effect on revenue growth;
clients' slow-down of implementations, which may delay revenues to future periods;
challenges to the availability and reliability of our data, solutions and services due to changes to normal operations, including the possibility of COVID-19 cases affecting our employees who may become sick and unable to protectwork or affecting the employees of our clients or other third parties on which we depend;
higher costs related to employee benefit plans, primarily medical costs, due to any potential increase in COVID-19 cases affecting our employees;
an increased volume of unanticipated client, regulatory and other third party requests for information systems againstand support, or additional regulatory requirements, which could require additional resources and costs to address; and
increased risk of data corruption, cyber-based attacks or network security breaches as opportunistic threat actors continue to identify innovative methods of stealing sensitive information by relying on the urgency associated with a COVID-19 pandemic scenario.
These risks may remain prevalent for a significant period of time and may adversely affect our business, results of operations and financial condition even after the COVID-19 pandemic has subsided.
The spread of COVID-19 has caused us to modify our business practices, including restricting employee travel, developing social distancing plans for our employees and canceling physical participation in meetings, events and conferences, and we may take further actions as may be required by government authorities or ifas we determine are unable to provide adequate security in the electronic transmissionbest interests of sensitive data, itour employees, clients and business partners. There is no certainty that such measures will be sufficient to mitigate the risks posed by the virus or will otherwise be satisfactory to government authorities.
The extent to which the COVID-19 pandemic affects our business, results of operations and financial condition will depend on future developments, which are highly uncertain and are difficult to predict, including, but not limited to, the duration and spread of the pandemic, its severity, the actions to contain the virus or treat its effect, and how quickly and to what extent normal economic and operating conditions can resume. Even after the COVID-19 pandemic has subsided, we may continue to experience materially adverse effects to our business as a result of the virus’s economic effect, including the availability of credit, adverse effects on our liquidity and any recession that has occurred.
There are no comparable events that provide guidance as to the effect the spread of COVID-19 may have, and, as a result, the ultimate effect of the pandemic is highly uncertain and subject to change. We do not yet know the full extent of the effects on our business, our operations or the economy. However, the effects could have a material adverse effect on our business, financial condition and results of operations.operations and heighten many of our known risks described below.
We are highly dependent on information technology networks and systems, including the Internet, to securely process, transmit and store electronic information. Security breaches
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Table of this infrastructure, including physical or electronic break-ins, computer viruses, attacks by hackers and similar breaches, and the evolving threat landscape can create system disruptions, shutdowns or unauthorized disclosure of confidential information, including non-public personal information, consumer data and proprietary business information. Cyber-based attacks, including those to extort payment in return for the release of sensitive information, are increasing. Unauthorized access, including through use of fraudulent schemes such as "phishing" schemes, could jeopardize the security of information stored in our systems. In addition, malware or viruses could jeopardize the security of information stored or used in a user's computer. If we are unable to prevent or detect such security or privacy breaches, our operations could be disrupted, or we may suffer loss of reputation, financial loss, lawsuits and regulatory imposed restrictions and penalties because of lost or misappropriated information, including sensitive consumer data, which could have a material adverse effect on our business, financial condition and results of operations. Likewise, our clients are increasingly imposing more stringent contractual obligations on us relating to our information security protections. If we are unable to maintain protections and processes at a level commensurate with that required by our large clients, it could negatively affect our relationships with those clients, increase our operating or litigation costs or subject us to liability under those contractual obligations, which could have a material adverse effect on our business, financial condition and results of operations.Contents

We rely on our top clients for a significant portion of our revenues and profits, which makes us susceptible to the same macro-economic and regulatory factors that affect our clients. If these clients are negatively affected by current economic or regulatory conditions or otherwise experience financial hardship or stress, or if we are unable to renew existing agreements or the terms of our relationships with these clients change, it could have a material adverse effect on our business, financial condition and results of operations.us.
Our clients are in a relatively consolidated industry and, as a result, a small number of our clients have accounted for a significant portion of our revenues. We expect that a limited number of our clients will continue to represent a significant portion of our revenues for the foreseeable future. The significant portion of our revenues that a limited number of our clients currently represent may increase in the future. During the year ended December 31, 2018, our largest client, Wells Fargo, N.A., or Wells Fargo, accounted for approximately 12% of our consolidated revenues, and2020, our five largest clients accounted for approximately 34%30% of our consolidated revenues.
Our clients face continued pressure in the current economic and regulatory climate. Many of our relationships with these clients are long-standing and are important to our business and results of operations, but there is no guarantee that we will be able to retain or renew existing agreements or maintain our relationships on acceptable terms or at all. Additionally, we rely on cross-selling our products and services to our existing clients as a source of growth. The deterioration in or termination of any of these relationships could significantly reduce our revenues and could have a material adverse effect on our business, financial condition and results of operations. As a result, we may be disproportionately affected by declining revenues from, or loss of, a significant client. In addition, by virtue of their significant relationships with us, these clients may be able to exert pressure on us with respect to the pricing of our services.
The time and expense associated with switching from our competitors' software and services to ours may limit our growth.
The costs for a mortgage lender or servicer to switch providers of software, data and analytics solutions and services can be significant and the process can take 12 to 18 months, or longer, to complete. As a result, potential clients may decide that it is not worth the time and expense to begin using our solutions and services, even if we offer competitive and economic advantages. If we are unable to convince these potentialprospective clients to switch to our software and services, our ability to increase market share will be limited, which could have a material adverse effect on our business, financial condition and results of operations.

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growth.
We typically provide service level commitments under our client contracts.contracts, including commitments to provide high-quality technical support services. If we fail to meet these contractual commitments, it may adversely affect our reputation and relationship with our clients or we could be obligated to provide credits or refunds for prepaid amounts related to unused subscription services or face contract terminations, which could adversely affect our business, financial condition and results of operations.have a material adverse effect on us.
Our client agreements typically provide service level commitments measured on a daily and monthly basis. If we are unable to meet the stated service level commitments or suffer extended periods of unavailability for our applications, we may be contractually obligated to provide these clients with service credits or refunds or we could face contract terminations. If we suffer unscheduled downtime that exceeds the allowed downtimes under our agreements with our clients or if we experience any extended service outages, it could have a material adverse effect on our business, financial condition and results of operations.
Any failure to offer high-quality technical support services may adversely affect our relationships with our clients and could have a material adverse effect on our business, financial condition and results of operations.
Once our applications and software are deployed, our clients depend on our support organization to resolve technical issues relating thereto. We may be unable to respond adequately to accommodate short-term increases in client demand for support services. We also may be unable to modify the format of our support services to compete with changes in support services provided by our competitors. Increased client demand for these services, without corresponding revenues, could increase costs and adversely affect our results of operations. In addition, our sales process is highly dependent on our applications and business reputation and on positive recommendations from our existing clients. Any failure to maintain high-quality technical support, or a market perception that we do not maintain high-quality support, could adversely affect our reputation and our ability to sell our applications to existing and prospective clients, any of which could have a material adverse effect on our business, financial condition and results of operations.
Our clients and we are subject to various governmental regulations, and a failure to comply with governmental regulations or changes in these regulations, including changes that may result from changes in the political landscape, could result in penalties, restrict or limit our or our clients' operations or make it more burdensome to conduct such operations, any of which could have a material adverse effect on our business, financial condition and results of operations.
Many of our clients' and our businesses are subject to various federal, state, local and foreign laws and regulations. Our failure to comply with applicable laws and regulations could restrict our ability to provide certain services or result in imposition of civil fines and criminal penalties, substantial regulatory and compliance costs, litigation expense, adverse publicity and loss of revenues.
As a provider of electronic data processing to financial institutions, such as banks and credit unions, we are subject to regulatory oversight and examination by the FFIEC, an interagency body of the FRB, the CFPB, the OCC, the FDIC and various other federal and state regulatory authorities. We also may be subject to possible review by state agencies that regulate banks in each state in which we conduct our electronic processing activities.
A portion of our Compass Analytics, LLC ("Compass Analytics") business provides risk management, loan sales (best execution) and general secondary marketing advisory and hedge execution services in concert with licensing Compass Analytics’ mortgage loan valuation and risk management analytics to its clients. Through this business, Compass Analytics may advise clients regarding their best practices, strategic relationships and workflow, but earns no commission or compensation for
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any trade execution or volume and does not have custody of any client funds or securities. Compass Analytics offers these advisory services to mortgage loan originators and servicers, including mortgage banks, community and commercial banks, credit unions, mortgage loan insurers, government agencies, investors, Federal Home Loan Banks and real estate investment trusts. As a result, Compass Analytics is registered with and regulated by the SEC as an investment adviser under the Investment Advisers Act of 1940, as amended ("Investment Advisers Act"). The failure by us to comply with applicable laws or regulations could result in fines, suspensions of individual employees or other sanctions, any of which could have a negative impact on our business, financial condition and results of operations. Even if an investigation or proceeding did not result in a fine or sanction or the fine or sanction imposed against us or our employees by a regulator were small in monetary amount, the adverse publicity relating to an investigation, proceeding or imposition of these fines or sanctions could harm our reputation and cause us to lose existing clients.
In addition, our businesses are subject to an increased degree of compliance oversight by regulators and by our clients. Specifically, the CFPB has authority to write rules affecting the business of, supervise, conduct examinations of and enforce compliance with federal consumer financial laws and regulations with respect to certain "non-depository covered persons" determined by the CFPB to be "larger participants" that offer consumer financial products and services. The CFPB and the prudential financial institution regulators such as the OCC also have the authority to examine us in our role as a service provider to large financial institutions. In addition, we believe some of our largest bank clients' regulators are requiring the banks to exercise greater oversight and perform more rigorous audits of their key service providers such as us.
The Real Estate Settlement Procedures Act ("RESPA") and related regulations generally prohibit the payment or receipt of fees or any other item of value for the referral of real estate-related settlement services. RESPA also prohibits fee shares or splits or unearned fees in connection with the provision of residential real estate settlement services, such as mortgage brokerage and real estate brokerage. Notwithstanding these prohibitions, RESPA permits payments for goods furnished or for services actually performed, so long as those payments bear a reasonable relationship to the market value of the goods or services provided. RESPA and related regulations may to some extent restrict our real estate-related businesses from entering into certain preferred alliance arrangements. The CFPB is responsible for enforcing RESPA.
Changes to laws and regulations and regulatory oversight of our clients and us, including those that may result from changes in the political landscape, may cause us to increase our prices in certain situations or decrease our prices in other situations, may restrict our ability to implement price increases or otherwise limit the manner in which we conduct our business. We may also incur additional expense in keeping our software solutions services up to date as laws and regulations change, and we may not be able to pass those additional costs on to our clients. In addition, in response to increased regulatory oversight, participants in the mortgage lending industry may develop policies pursuant to which they limit the extent to which they can rely on any one vendor or service provider. Conversely, in an environment with less stringent regulatory oversight, prospective clients may choose to retain their in-house platforms, or current service providers, or seek alternative service providers who provide services that are less compliance and quality oriented at a lower price point. If we are unable to adapt our products and services to conform to increased or evolving laws and regulations, or if these laws and regulations have a negative effect on our clients, we may experience

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client losses or increased operating costs, which could have a material adverse effect on our business, financial condition and results of operations.
There may be consolidation in our end client market, which could reduce the use of our services by our clients and could have a material adverse effect on our business, financial condition and results of operations.clients.
Consolidations among existing or potential clients could reduce the number of our clients and potential clients. If our clients merge with, are acquired by or sell their servicing portfolios to other entities that are not our clients, or that use fewer of our services, they may discontinue or reduce their use of our services. In addition, if potential clients merge, our ability to increase our client base may be adversely affected and the ability of our customersclients to exert pressure on our pricing may increase. Any of these developments could have a material adverse effect on our business, financial condition and results of operations.
Regulatory developments with respect to use of consumer data and public records could have a material adverse effect on our business, financial condition and results of operations.
Because our databases include certain public and non-public personal information concerning consumers, we are subject to government regulation and potential adverse publicity concerning our use of consumer data. We acquire, store, use and provide many types of consumer data and related services that are subject to regulation under the Fair Credit Reporting Act, the Gramm-Leach-Bliley Act, the Driver's Privacy Protection Act and, to a lesser extent, various other federal, state and local laws and regulations. These laws and regulations are designed to protect the privacy of consumers and to prevent security breaches, cyber-based attacks, other unauthorized access and misuse of personal information in the marketplace. Our failure to comply with these laws, or any future laws or regulations of a similar nature, could result in substantial regulatory penalties, litigation expense and loss of revenues, which could have a material adverse effect on our business, financial condition and results of operations.
In addition, some of our data suppliers face similar regulatory requirements and, consequently, they may cease to be able to provide data to us or may substantially increase the fees they charge us for this data, which may make it financially burdensome or impossible for us to acquire data that is necessary to offer our products and services. Further, many consumer advocates, privacy advocates and government regulators believe that existing laws and regulations do not adequately protect privacy or ensure the accuracy of consumer-related data. As a result, they have implemented or are seeking to implement further restrictions, such as the CCPA, NY DFS Cybersecurity Regulations and Vermont Data Broker Law, on the acquisition, dissemination or commercial use of personal information within the public and private sectors and are also contemplating requirements relative to data accuracy and the ability of consumers to opt to have their personal data removed from databases such as ours. Privacy laws may be interpreted and applied inconsistently from state to state and impose inconsistent or conflicting requirements. Complying with varying jurisdictional requirements could increase the cost and complexity of compliance. Any future laws, regulations or other restrictions limiting the dissemination or use of personal information may reduce the quality and availability of our solutions and services, which could have a material adverse effect on our business, financial condition and results of operations. Further, violations of privacy laws can result in significant penalties and damage to our brand and business.
Participants in the mortgage loan industry are subject to efforts by the government to regulate the mortgage loan industry or address the mortgage loan market and current economic environment, which could have a material adverse effect on our business, financial condition and results of operations.environment.
The mortgage loan industry is heavily regulated and continues to be subject to review by governmental authorities. Inquiries may include federal and state governmental review of all aspects of the mortgage lending business. Such efforts may include actions to address the housing market and the economy in general and to maintain rigorous mortgage loan servicing standards.
Additional state and federal government actions directed at housing and the mortgage loan industry may occur and could have a material adverse effect on our business, financial condition and results of operations.
Our clients' relationships with government-sponsored enterprises ("GSEs") are subject to change, which could have a material adverse effect on our business, financial condition and results of operations.change.
Our clients have significant relationships with Fannie Mae and Freddie Mac, which are GSEs tasked with working with financial institutions to provide liquidity to the mortgage loan market. The GSEs do this by purchasing loans from the lenders either for cash or in exchange for mortgage-backed securities that are backed by those loans and that, for a fee, carry the GSEs'
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guarantee of timely payment of interest and principal to investors of those mortgage-backed securities. Because our clients service the loans owned by GSEs, we provide solutions and services for many of those loans. As a result of these relationships, GSEs have been able to implement changes to our pricing structure on certain products and services we provide. GSEs or other governmental agencies may be able to exert similar pressure on the pricing of our solutions and services in the future, which could have a material adverse effect on our business, financial condition and results of operations.

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If we fail to adapt our solutions to technological changes or evolving industry standards and regulations, or if our ongoing efforts to upgrade, modernize or innovate our technology are not successful, we may not be able to achieve our growth strategies and we could lose clients and have difficulty attracting new clients for our solutions, which could have a material adverse effect on our business, financial condition and results of operations.solutions.
The markets for our solutions are characterized by constant technological changes, frequent introductions of new products and services and evolving industry standards and regulations. Our growth strategies and future success will be significantly affected by our ability to successfully enhance our current solutions, and to develop and introduce new solutions and services that address the increasingly sophisticated needs of our clients and their customers. These initiatives carry the risks associated with any new product or service development effort, including cost overruns, delays in delivery and performance issues. There can be no assurance that we will be successful in developing, marketing and selling new solutions and services that meet these changing demands, that we will not experience difficulties that could delay or prevent the successful development, introduction and marketing of these solutions and services or that our new solutions and services and their enhancements will adequately meet the demands of the marketplace and achieve market acceptance. If our efforts are unsuccessful, it could have a material adverse effect on our business, financial condition and results of operations.
We operate in a competitive business environment and, if we are unable to compete effectively, it could have a material adverse effect on our business, financial condition and results of operations.us.
The markets for our solutions are intensely competitive. Our competitors vary in size and in the scope and breadth of the services they offer. Some of our competitors have substantial resources. In addition, we expect that the markets in which we compete will continue to attract new competitors and new technologies. There can be no assurance that we will be able to compete successfully against current or future competitors or that competitive pressures we face in the markets in which we operate will not have a material adverse effect on our business, financial condition and results of operations.
Further, because many of our larger existing or potential clients have historically developed their key processing applications in-house, and therefore, view their system requirements from a make-versus-buy perspective, we often compete against our existing or potential clients' in-house capabilities. As a result, gaining new clients in our servicing and origination software businesses can be difficult. For banks and other potential clients, switching from an internally designed system to an outside vendor, or from one vendor of servicing and origination software services to a new vendor, is a significant undertaking. These potential clients worry about possible disadvantages such as loss of custom functionality, increased costs and business disruption. As a result, these potential clients often resist change. There can be no assurance that our strategies for overcoming potential clients' reluctance to change will be successful, and if we are unsuccessful, it could have a material adverse effect on our business, financial condition and results of operations.
To the extent the availability of free or relatively inexpensive information increases, the demand for some of our data and information solutions may decrease, which could have a material adverse effect on our business, financial condition and results of operations.decrease.
Public sources of free or relatively inexpensive information have become increasingly available, particularly through the Internet, and this trend is expected to continue. Governmental agencies in particular have increased the amount of information to which they provide free public access. Public sources of free or relatively inexpensive information may reduce demand for, or the price that clients are willing to pay for, our data and information solutions. To the extent that clients choose not to obtain data and information from us and instead rely on information obtained at little or no cost from these public sources, it could have a material adverse effect on our business, financial condition and results of operations.
We rely upon proprietary technology and information rights, and if we are unable to protect our rights, it could have a material adverse effect on our business, financial condition and results of operations.us.
Our success depends, in part, upon our intellectual property rights. We rely primarily on a combination of patents, copyrights, trade secrets, and trademark laws, and nondisclosure and other contractual restrictions on copying, distribution and creation of derivative products to protect our proprietary technology and information. This protection is limited, and our intellectual property could be used by others without our consent. In addition, patents may not be issued with respect to our pending or future patent applications, and our patents may not be upheld as valid or may not prevent the development of competitive products. Any infringement, disclosure, loss, invalidity of or failure to protect our intellectual property could have a material adverse effect on our business, financial condition and results of operations. Moreover, litigation may be necessary to enforce or protect our intellectual property rights, to protect our trade secrets or to determine the validity and scope of the proprietary rights of others. Such litigation could be time-consuming, result in substantial costs and diversion of resources and could have a material adverse effect on our business, financial condition and results of operations.

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If our applications, solutions, including those that contain "open source" software, or services are found to infringe the proprietary rights of others or fail to comply with the terms of one or more of these open source licenses, we may be required to change our business practices and may also become subject to significant costs and monetary penalties, any of which could have a material adverse effect on our business, financial condition and results of operations.
As our information technology applications and services develop, we may become increasingly subject to infringement claims. Any such claims, whether with or without merit, could:
be expensive and time-consuming to defend;
cause us to cease providing solutions that incorporate the challenged intellectual property;
require us to redesign our solutions, if feasible;
divert management's attention and resources; and
require us to enter into royalty or licensing agreements in order to obtain the right to use necessary technologies.
Any one or more of the foregoing outcomes could have a material adverse effect on our business, financial condition and results of operations. Additionally, we may be liable for damages for past infringement if a court determines that our software or technologies infringe upon a third party's patent or other proprietary rights.
Some of our solutions contain “open source” software, and any failure to comply with the terms of one or more of these open source licenses could negatively affect our business.penalties.
We use a limited amount of software licensed by its authors or other third parties under so-called “open source” licenses and may continue to use such software in the future. Some of these licenses contain requirements that we make available source code for modifications or derivative works we create based upon the open source software, and that we license such modifications or derivative works under the terms of a particular open source license or other license granting third parties certain rights of further use. By the terms of certain open source licenses, we could be required to release the source code of our proprietary software if we combine our proprietary software with open source software in a certain manner. Additionally, the terms of many open source licenses have not been interpreted by the United States or other courts, and there is a risk that these licenses could be construed in a manner that could impose unanticipated conditions or restrictions on our ability to commercialize our solutions. In addition to risks related to license requirements, usage of open source software can lead to greater risks than use of third-party commercial software, as open source licensors generally do not provide warranties or controls on origin of the software. We cannot be sure that all open source software is submitted for approval prior to use in our solutions. In addition, many of the risks associated with using open source software cannot be eliminated, and could, if not properly addressed, have a material adverse effect on our business, financial condition and results of operations.
IfAs our information technology applications and services develop, we are unablemay become increasingly subject to successfully consummate acquisitionsinfringement claims. Any such claims, whether with or experience delayswithout merit, could:
be expensive and time-consuming to defend;
cause us to cease providing solutions that incorporate the challenged intellectual property;
require us to redesign our solutions, if feasible;
divert management's attention and resources; and
require us to enter into royalty or licensing agreements in integrating acquisitions, itorder to obtain the right to use necessary technologies.
Any one or more of the foregoing outcomes could have a material adverse effect on our business, financial condition and results of operations.
One of our strategies to grow our business is to opportunistically acquire complementary businesses, technologies and services. This strategy will depend on our ability to find suitable acquisitions and finance them on acceptable terms. We may require additional debt or equity financing for future acquisitions, and doing so will be made more difficult by our indebtedness. Raising additional capital for acquisitions through debt financing could result in increased interest expense and may involve agreements that include covenants limiting or restricting our ability to take certain actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise additional capital for acquisitions through equity financing, the ownership interests of existing shareholders will be diluted.
If we are unable to acquire suitable acquisition candidates, we may experience slower growth. Further, we may face challenges in integrating any acquired business. These challenges include eliminating redundant operations, facilities and systems, coordinating management and personnel, retaining key employees, managing different corporate cultures and achieving cost reductions and cross-selling opportunities. Additionally, the acquisition and integration processes may disrupt our business and divert management attention and our resources. If we fail to successfully integrate acquired businesses, products, technologies and personnel, it could impair relationships with employees, clients and strategic partners, distract management attention from our core businesses, result in control failures and otherwise disrupt our ongoing business, any of which could have a material adverse effect on our business, financial condition and results of operations. We also may not be able to retain key management and other critical employees after an acquisition. In addition, we may be required to record future chargesliable for impairment of goodwill anddamages for past infringement if a court determines that our software or technologies infringe upon a third party's patent or other intangible assets resulting from such acquisitions.
Our reliance on third parties subjects us to risk and may disrupt or adversely affect our operations. In addition, we may not realize the full benefit of our third-party arrangements, which may result in increased costs, or may adversely affect the service levels we are able to provide our clients.
We rely upon third parties for various business process and information technology products and services, including cloud-based providers. Although we have contractual provisions with our providers that specify performance requirements, we do not ultimately control their performance, which may make our operations vulnerable to their performance failures. In addition, our failure to adequately monitor and regulate the performance of our third-party vendors could subject us to additional risk. Reliance

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on third parties also makes us vulnerable to changes in our vendors' businesses, financial condition and other matters outside of our control, including their violations of laws or regulations, which could increase our exposure to liability or otherwise increase the costs associated with the operation of our business. If for any reason our relationship with any of these third parties, including cloud-based providers, were to end unexpectedly, it could require a significant amount of cost and time to transition to new third-party service providers. The failure of our providers to perform as expected or as contractually required could result in significant disruptions and costs to our operations and to the services we provide to our clients, or could result in loss of revenues, which could have a material adverse effect on our business, financial condition and results of operations.proprietary rights.
We depend on our ability to access data from external sources to maintain and grow our businesses. If we are unable to access needed data from these sources or if the prices charged for these services increase, the quality, pricing and availability of our solutions may be adversely affected, which could have a material adverse effect on our business, financial condition and results of operations.affected.
We rely extensively upon data from a variety of external sources to maintain our proprietary and non-proprietary databases, including data from third-party suppliers, various government and public record sources and data contributed by our clients. Our data sources could cease providing or reduce the availability of their data to us, increase the price we pay for their data or limit our use of their data for a variety of reasons, including legislatively or judicially imposed restrictions on use. If a number of suppliers are no longer able or are unwilling to provide us with certain data, or if our public record sources of data become unavailable or too expensive, we may need to find alternative sources. If we are unable to identify and contract with suitable alternative data suppliers and efficiently and effectively integrate these data sources into our service offerings, we could experience service disruptions, increased costs and reduced quality of our services. Moreover, some of our data suppliers compete with us in certain product offerings, which may make us vulnerable to unpredictable price increases from them. Significant price increases could require us to seek other sources of data on more favorable economic terms, which may not be available at all. Loss of such access or the availability of data in the future on commercially reasonable terms or at all may reduce the quality and availability of our services and solutions, which could have a material adverse effect on our business, financial condition and results of operations.
Our international third-party service providers and our own international operations subject us to additional risks, which could have a material adverse effect on our business, financial condition and results of operations.risks.
Over the last few years, weWe have sought to reduce our costs by utilizing lower-cost labor in India. This countryoutside the United States. Other countries may be subject to higher degrees of political and social instability than the United States and may lack the infrastructure to withstand political unrest or natural disasters. Such disruptions can affect our ability to deliver our solutions on a timely basis, if at all, and to a lesser extent can decrease efficiency and increase our costs. Weakness of the U.S. dollar in relation to the currency used and higher inflation rates experienced in this countryother countries may also reduce anticipated savings. Furthermore, the practice of utilizing labor based in foreign countries has come under increased scrutiny in the United States and, as a result, many of our clients may require us to use labor based in the United States. We may not be able to pass on the increased costs of higher-priced United States-based labor to our clients, which could have a material adverse effect on our business, financial condition and results of operations.
In addition, Indiaother countries could adopt new legislation or regulations that could make it difficult, more costly or impossible for us to continue our foreign activities as currently being conducted. In addition, in many foreign countries,
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particularly in those with developing economies, it is common to engage in business practices that are prohibited by laws and regulations applicable to us, such as the Foreign Corrupt Practices Act ("FCPA") or other local anti-corruption laws. Any violations of FCPA or local anti-corruption laws by us or our subsidiaries, could result in substantial financial and other penalties, which could have a material adverse effect on our business, financial condition and results of operations.
We have substantial investments in recorded goodwill and other intangible assets as a result of prior acquisitions, and an economic downturn or troubled mortgage market could cause these investments to become impaired, requiring write-downs that could have a material adverse effect on our results of operations.
Goodwill was $2.3 billion, or approximately 64% of our total assets, as of December 31, 2018. Other intangible assets, net were $188.0 million, or approximately 5% of our total assets. Current accounting rules require that goodwill and other indefinite lived intangible assets be assessed for impairment at least annually or whenever changes in circumstances indicate that the carrying amount may not be recoverable. Current accounting rules require that intangible assets with finite useful lives be assessed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Factors that may indicate the carrying value of our intangible assets, including goodwill, may not be recoverable include, but are not limited to, significant underperformance relative to historical or projected future results of operations, a significant decline in our stock price and market capitalization, and negative industry or economic trends. No goodwill or other intangible assets impairment charge was recorded during 2018. However, if there is an economic downturn in the future, the carrying amount of our goodwill or other intangible assets may no longer be recoverable, and we may be required to record an impairment charge, which could have a material adverse effect on our results of operations. We will continue to monitor our market capitalization and the effect of the economy to determine if there is an impairment of goodwill or other intangible assets in future periods.

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Our investment in D&B may expose us to certain risks, which could have a material adverse effect on our results of operations.
On February 8, 2019, an investment consortium completed the acquisition of D&B. We invested $375.0 million as part of this transaction. Refer to Note 3 to the Notes to Consolidated Financial Statements for additional information.
D&B’s strategy is designed to drive long-term sustainable growth as one global company delivering content through modern channels to serve customer needs with their forward-leaning culture. The achievement of their strategic initiatives depends on a number of factors, including but not limited to their ability to maintain the integrity of their brand and reputation, customer demand for their products, the effect of macro-economic challenges on their customers and vendors, their reliance on third parties to provide data and certain operational services and their ability to protect their information technology. D&B may not be able to successfully implement their strategic initiatives in accordance with their expectations, or in the timeframe they desire, which may result in us not realizing our expected return on investment, or a negative return on investment.
D&B has undertaken a strategic and operational review of their business to help them find ways to accelerate value realization, including certain cost saving initiatives. Based on this review, D&B intends to undertake certain strategic and cost saving initiatives, which they believe will help them to achieve this goal. They cannot guarantee they will be able to successfully implement these strategic or cost saving initiatives. Furthermore, they may be unable to achieve, or may be delayed in achieving, some or all of the benefits from such initiatives. Additionally, even if they achieve these goals, they may not receive the expected benefits of the initiatives, or the costs of implementing these initiatives could exceed the related benefits. If they are unable to successfully implement these initiatives, if these initiatives are not as successful as planned or if they do not receive the expected benefits of these initiatives, they may not be able to meet their value realization expectations, which may result in us not realizing our expected return on investment, or a negative return on investment.
We expect our investment will be accounted for under the equity method of accounting, through which we will record our proportionate share of their net earnings or loss in our consolidated financial statements. Equity-method investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. If our equity-method investment is not recoverable, we may be required to record an impairment charge, which could have a material adverse effect on our results of operations.
If we fail to develop widespread brand awareness cost-effectively, it could have a material adverse effect on our business, financial condition and results of operations.
We believe that developing and maintaining widespread awareness of our brand in a cost-effective manner is critical to our ability to achieve widespread acceptance of our software solutions and attract new clients. Brand promotion activities may not generate client awareness or increase revenues, and even if they do, any increase in revenues may not offset the expenses we incur in building our brand. If we fail to successfully promote and maintain our brand, or incur substantial expenses, we may fail to attract or retain clients necessary to realize a sufficient return on our brand-building efforts, or to achieve the widespread brand awareness that is critical for broad client adoption of our applications, which could have a material adverse effect on our business, financial condition and results of operations.
We may experience system failures with respect to our software solutions resulting in damage or interruptionservice interruptions that could harm our business and reputation and expose us to potential liability.
We depend heavily upon the computer systems and our existing technology infrastructure located in our data centers. Certain system interruptions or events beyond our control could interrupt or terminate the delivery of our solutions and services to our clients and may interfere with our suppliers' ability to provide necessary data to us and our employees' ability to perform their responsibilities.
These potential interruptions include, but are not limited to, damage or interruption from hurricanes, floods, fires, power losses, telecommunications outages, cyber-based attacks, terrorist attacks, acts of war, human errors and similar events. Our U.S. corporate offices and one of our data centers are located in Jacksonville, Florida, which is an area that is at high risk of hurricane and flood damage. In addition, acts of terrorism, which may be targeted at metropolitan areas that have higher population density than rural areas, could cause disruptions in our business or the economy as a whole. The servers that we use through various third-party service providers may also be vulnerable to similar disruptions, which could lead to interruptions, delays and loss of critical data. Such service providers may not have sufficient protection or recovery plans in certain circumstances, and our insurance may not be sufficient to compensate us for losses that may occur.
Defects in our software solutions, errors or delays in the processing of electronic transactions, or other difficulties could result in:
interruption of business operations;
delay in market acceptance;
us, or our clients, missing a regulatory deadline;
additional development and remediation costs;

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diversion of technical and other resources;
loss of clients;
negative publicity; or
exposure to liability claims.
Any one or more of the foregoing occurrences could have a material adverse effect on our business, financial condition and results of operations. Although we attempt to limit our potential liability through disclaimers and limitation-of-liability provisions in our license and client agreements, we cannot be certain that these measures will be successful in limiting our liability.
We may experience delays or difficulty in developing or implementing new, enhanced or existing software, data or hosting solutions, which may negatively affect our relationships with existing and potential clients, reduce or delay the generation of revenues or increase development and implementation costs, which could have a material adverse effect on our business, financial condition and results of operations.costs.
Our future financial performance depends upon the successful development, implementation and client acceptance of new, existing and enhanced versions of our software and hosting solutions. We continually seek to develop enhancements to our solutions, including updates in response to changes in applicable laws, as well as new offerings to supplement our existing solutions. As a result, we are subject to the risks inherent in the development and integration of new technologies, including defects or undetected errors in our software solutions, difficulties in installing or integrating our technologies on platforms used by our clients or other unanticipated performance, stability and compatibility problems. Any of these problems could result in material delays in the introduction or acceptance of our solutions, increased costs, decreased client satisfaction, breach of contract claims, harm to our industry reputation and reduced or delayed revenues. If we are unable to implement existing solutions or deliver new solutions or upgrades or other enhancements to our existing solutions on a timely and cost-effective basis, it could have a material adverse effect on our business, financial condition and results of operations.
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In addition, as a significant focus of our sales efforts is on the top U.S. mortgage loan originators and servicers, larger clients may demand more complex integration, implementation services and features, which may result in implementations that take longer than we forecast or delays in these clients using our solutions. Furthermore, if implementations take longer than planned or these clients delay their use of our solutions, we may be required to delay revenue recognition on some of these transactions until the technical or implementation requirements have been met, and we may not generate revenues from these clients as quickly as we had forecast.
Because our revenues from clients in the mortgage lending industry are affected by the strength of the economy and the housing market generally, including the volume of real estate transactions, a change in any of these conditions could have a material adverse effect on our business, financial condition and results of operations.us.
Our revenues are primarily generated from software and hosting solutions, professional services and data solutions we provide to the mortgage loan industry and, as a result, a weak economy or housing market may have a material adverse effect on our business, financial condition and results of operations. The volume of mortgage loan origination and residential real estate transactions is highly variable and reductions in these transaction volumes could have a direct effect on the revenues we generate from our software solutions business and some of our data and analytics businesses.
The revenues we generate from our servicing software solutions primarily depend upon the total number of mortgage loans processed on MSP®, which tends to be comparatively consistent regardless of economic conditions. However, in the event that a difficult economy or other factors lead to a decline in levels of home ownership and a reduction in the number of mortgage loans outstanding and we are not able to counter the effect of those events with increased market share or higher fees, our MSP® revenues could be adversely affected. Moreover, negative economic conditions, including increased unemployment or interest rates or a downturn in other general economic factors, among other things, could adversely affect the performance and financial condition of some of our clients in many of our businesses, which may have a material adverse effect on our business, financial condition and results of operations if these clients go bankrupt or otherwise exit certain businesses.
A weaker economy and housing market tend to increase the volume of consumer mortgage loan defaults, which can increase revenues from our applications focused on supporting default management functions. However, government regulation of the mortgage loan industry in general, and the default and foreclosure process in particular, has greatly slowed the processing of defaulted mortgagesmortgage loans and has changed the way many of our clients address mortgage loans in default. A downturn in the origination market and a concurrent slowdown or change in the way mortgage loans in default are addressed could have a material adverse effect on our business, financial condition and results of operations.
We may fail to attract and retain enough qualified employees to support our technology and operations, which could have an adverse effect on our ability to expand our business and service our clients.
Our indebtednessbusiness relies on large numbers of skilled employees, and our success depends on our ability to attract, train and retain a sufficient number of qualified employees. If our attrition rate increases, our operating efficiency and productivity may decrease. We compete for employees not only with other companies in our industry but also with companies in other industries, such as software services, engineering services and financial services companies, and there is a limited pool of employees who have the skills and training needed to do our work. If our business continues to grow, the number of people we will need to hire may increase. We will also need to increase our hiring if we are not able to maintain our attrition rate through our current recruiting and retention policies. Increased competition for employees could have a negativematerial adverse effect on our financing optionsability to expand our business and liquidity position.service our clients, as well as cause us to incur greater personnel expenses and training costs.
Risks Related to Our Investment in DNB
Our investment in DNB may expose us to certain risks, which could have a material adverse effect on our financial condition and results of operations.
As of December 31, 2018,2020, we had approximately $1.3 billionhave invested $492.6 million in Dun & Bradstreet Holdings, Inc. (“DNB”). Refer to Note 4 to the Notes to Consolidated Financial Statements for additional information.
DNB may not be successful in developing and implementing its strategic plans to transform its businesses, including realigning management, simplifying and scaling technology, expanding and enhancing data and optimizing its client services. If the development or implementation of total debt outstanding.

its plans are not successful, DNB may not produce the revenue, margins or earnings that it expects, including offsetting the impact of adverse economic conditions that may exist currently or develop in the future. DNB may also face delays or difficulties in implementing technological, organizational and operational improvements, including its plans to leverage its data insights in new functional areas and utilize existing data architecture to generate high contribution incremental revenue streams, which could adversely affect its ability to successfully compete. In addition, the costs associated with implementing such plans may be more than anticipated and DNB may not have sufficient financial resources to fund all of the desired or necessary investments required in connection with its plans. The existing and future execution of its strategic and operating plans to transform its business will, to some extent, also be dependent on external factors that DNB cannot control. In addition, these strategic and operational plans need to be continually reassessed to meet the challenges and
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needs of its business in order for DNB to remain competitive. The failure to implement and execute its strategic and operating plans in a timely manner or at all, realize or maintain the cost savings or other benefits or improvements associated with such plans, have financial resources to fund the costs associated with such plans or incur costs in excess of anticipated amounts, or sufficiently assess and reassess these plans could have a material adverse effect on its business, financial condition and results of operations, which may result in us not realizing our expected return on investment, or a negative return on investment.
Our indebtednessinvestment is accounted for under the equity method of accounting, through which we record our proportionate share of DNB's net earnings or loss in our consolidated financial statements. Equity-method investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. If our equity-method investment is not recoverable, we may be required to record an impairment charge, which could have important consequencesa material adverse effect on our financial condition and results of operations.
DNB has elected to us, including:take advantage of the ‘‘controlled company’’ exemption to the corporate governance rules for publicly listed companies, which could make their common stock less attractive to some investors or otherwise harm their stock price.
making us more vulnerable to economic downturns and adverse developments in our business, which may cause usBecause DNB qualifies as a ‘‘controlled company’’ under the corporate governance rules for publicly listed companies, DNB is not required to have difficulty borrowing money ina majority of its Board of Directors be independent under the future for working capital, capital expenditures, acquisitions or other purposes and may limit our ability to pursue other business opportunities and implement certain business strategies;
requiring us to use a portionapplicable rules of the money we earnNYSE, nor is it required to pay principalhave a compensation committee or a corporate governance and interest on our debt, which could reduce the amountnominating committee comprised entirely of money availableindependent directors, and its audit committee is not required to finance operations, acquisitions and other business activities;
exposing us to the riskbe comprised entirely of increased interest rates as $1.3 billion in principal amount of our debt bears interest atindependent directors for a floating rate as of December 31, 2018 (an increaseperiod of one percentage point inyear following the applicable interest rate could cause an increase in interest expenseIPO. Accordingly, should the interests of approximately $13.2 million on an annual basis ($2.7 millionthe investor consortium, including Cannae Holdings, LLC ("Cannae"), affiliates of Thomas H. Lee Partners, L.P. ("THL"), Black Knight and CC Capital Partners LLC, differ from those of other stockholders, the effect of our current interest rate swaps) based on the principal outstanding as of December 31, 2018, which may make it more difficult for us to service our debt);
exposing us to costs and risks associated with agreements limiting our exposure to higher interest rates, as such agreementsother stockholders may not offer complete protection from these risks, and wehave the same protections afforded to stockholders of companies that are subject to the risk that one or moreall of the counterpartiescorporate governance rules for publicly-listed companies. DNB's status as a controlled company could make its common stock less attractive to these agreements may failsome investors or otherwise harm its stock price and, thus, the value of our investment.
Risks Related to satisfy their obligations under such agreements; andInformation Security
causing a competitive disadvantageIf we are unable to protect our information systems against data corruption, cyber-based attacks or network security breaches, including breaches involving third-party vendors, or if we are unable to provide adequate security in the electronic transmission of sensitive data, it could have higher levelsa material adverse effect on us.
We are highly dependent on information technology networks and systems, including the Internet, to securely process, transmit and store electronic information. Security breaches of debt thanthis infrastructure, including physical or electronic break-ins, computer viruses, attacks by hackers and similar breaches, and the evolving threat landscape can create system disruptions, shutdowns or unauthorized disclosure of confidential information, including non-public personal information, consumer data and proprietary business information. Cyber-based attacks, including those to extort payment in return for the release of sensitive information, are increasing. Unauthorized access, including through use of fraudulent schemes such as "phishing" schemes, could jeopardize the security of information stored in our competitors by reducingsystems. In addition, malware or viruses could jeopardize the security of information stored or used in a user's computer. If we are unable to prevent or detect such security or privacy breaches or our flexibility in respondingthird-party vendors are unable to changing businessprevent or detect such breaches, our operations could be disrupted, or we may suffer loss of reputation, financial loss, lawsuits and economic conditions,regulatory-imposed restrictions and penalties because of lost or misappropriated information, including increased competition.
Risks associated with our indebtednesssensitive consumer data, which could have a material adverse effect on our business, financial condition and results of operations.
Despite Likewise, our indebtedness, we still may be able to incur significant additional amounts of debt, which could further exacerbate the risks associated with our existing indebtedness.
We and our subsidiaries may be able to incur substantial additional indebtedness in the future. Although the 2018 Credit Agreement governing the 2018 Facilities, as defined in Note 11 to the Notes to Consolidated Financial Statements, imposes operating and financial restrictionsclients are increasingly imposing more stringent contractual obligations on our activities, these restrictions are subject to a number of significant qualifications and exceptions, and under certain circumstances, the amount of indebtedness that could be incurred in compliance with these restrictions could be substantial. If new debt is addedus relating to our outstanding debt levels, the risks relatedinformation security protections. If we are unable to maintain protections and processes at a level commensurate with that required by our indebtedness that we will facelarge clients, it could increase.
Certain ofnegatively affect our financing arrangementsrelationships with those clients, increase our operating or litigation costs or subject us to various restrictions that could limit our operating flexibility.
The 2018 Credit Agreement governing the 2018 Facilities imposes operating and financial restrictions on our activities, and future debt instruments may as well. These restrictions include compliance with, or maintenance of, certain financial tests and ratios, including a minimum interest coverage ratio and maximum leverage ratio, and limit or prohibit our ability to, among other things:
create, incur or assume any additional debt and issue preferred stock;
create, incur or assume certain liens;
redeem and/or prepay certain subordinated debt we might issue in the future;
pay dividends on our stock or repurchase stock;
make certain investments and acquisitions;
enter into or permit to existliability under those contractual limits on the ability of our subsidiaries to pay dividends to us;
enter new lines of business;
engage in mergers and acquisitions;
engage in specified sales of assets; and
enter into transactions with affiliates.
These restrictions on our ability to operate our business could limit our ability to take advantage of financing, mergers and acquisitions and other corporate opportunities,obligations, which could have a material adverse effect on our business, financial condition and results of operations.
We may not be ableRegulatory developments with respect to generate sufficient cash to service alluse of our indebtednessconsumer data and may be forced to take other actions to satisfy our obligations under our outstanding debt instruments, which may not be successful.
Our ability to make scheduled payments on or refinance our debt obligations depends on our financial condition and results of operations, which are subject to prevailing economic and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond our control. We may be unable to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness. Our inability to generate sufficient cash flows to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all,public records could have a material adverse effect on us.
Because our business, financial conditiondatabases include certain public and resultsnon-public personal information concerning consumers, we are subject to government regulation and potential adverse publicity concerning our use of operations. If we cannot make scheduled payments on our debt, we will beconsumer data. We acquire, store, use and provide many types of consumer data and related services that are subject to regulation under the Fair Credit Reporting Act, the Gramm-Leach-Bliley Act, the Driver's Privacy Protection Act and, to a lesser extent, various other federal, state and local laws and regulations. These laws and regulations are designed to protect the privacy of consumers and to prevent security breaches, cyber-based attacks, other unauthorized access and misuse of personal information in defaultthe marketplace. Our failure to comply with these laws, or any future laws or regulations of a similar nature, could result in substantial regulatory penalties, litigation expense and holdersloss of our outstanding debt could declare all outstanding principal and interest to be due and payable, and we could be forced into bankruptcy or liquidation.

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Our risk management policies and procedures, including those related to cybersecurity, may prove inadequate for the risks we face,revenues, which could have a material adverse effect on our business, financial condition and results of operations.
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In addition, some of our data suppliers face similar regulatory requirements and, consequently, they may cease to be able to provide data to us or may substantially increase the fees they charge us for this data, which may make it financially burdensome or impossible for us to acquire data that is necessary to offer our products and services. Further, many consumer advocates, privacy advocates and government regulators believe that existing laws and regulations do not adequately protect privacy or ensure the accuracy of consumer-related data. As a result, they have implemented or are seeking to implement further restrictions, such as the CCPA, CPRA, NY DFS Cybersecurity Regulations and Vermont Data Broker Law, on the acquisition, dissemination or commercial use of personal information within the public and private sectors and are also contemplating requirements relative to data accuracy and the ability of consumers to opt to have their personal data removed from databases such as ours. Privacy laws may be interpreted and applied inconsistently from state to state and impose inconsistent or conflicting requirements. Complying with varying jurisdictional requirements could increase the cost and complexity of compliance. Any future laws, regulations or other restrictions limiting the dissemination or use of personal information may reduce the quality and availability of our solutions and services, which could have a material adverse effect on our business, financial condition and results of operations. Further, violations of privacy laws can result in significant penalties and damage to our brand and business.
Our reliance on third parties subjects us to risk and may disrupt or adversely affect our operations. In addition, we may not realize the full benefit of our third-party arrangements, which may result in increased costs, or may adversely affect the service levels we are able to provide our clients.
We rely upon third parties for various business process and technology-related products and services, including cloud-based providers. Although we have contractual provisions with our providers that specify performance requirements, we do not ultimately control their performance, which may make our operations vulnerable to their performance failures. In addition, our failure to adequately monitor and regulate the performance of our third-party vendors could subject us to additional risk. Reliance on third parties also makes us vulnerable to changes in our vendors' businesses, financial condition and other matters outside of our control, including their violations of laws or regulations, which could increase our exposure to liability or otherwise increase the costs associated with the operation of our business. If for any reason our relationship with any of these third parties, including cloud-based providers, were to end unexpectedly, it could require a significant amount of cost and time to transition to new third-party service providers. The failure of our providers to perform as expected or as contractually required could result in significant disruptions and costs to our operations and to the services we provide to our clients, or could result in loss of revenues, which could have a material adverse effect on our business, financial condition and results of operations.
Our policies and procedures, including those related to cybersecurity, may prove inadequate for the risks we face.
We have devoted significant resources to develop our risk management policies and procedures and expect to continue to do so in the future. Nonetheless, our risk management strategies may not be fully effective in mitigating our risk exposure in all market environments or against all types of risk, including risks that are unidentified or unanticipated. If our solutions change and as the markets in which we operate evolve, our risk management strategies may not always adapt to such changes. Some of our methods of managing risk are based upon our use of observed historical market behavior and management's judgment. Other of our methods of managing risk depend on the evaluation of information regarding markets, customers, catastrophe occurrence or other matters that are publicly available or otherwise accessible to us. This information may not always be accurate, complete, up-to-date or properly evaluated. As a result, these methods may not predict future risk exposures, which could be significantly greater than the historical measures or available information indicate. In addition, management of operational, legal and regulatory risks requires, among other things, policies and procedures to record and verify large numbers of transactions and events, which may not be fully effective. While we employ a broad and diversified set of risk monitoring and risk mitigation techniques, those techniques and the judgments that accompany their application cannot anticipate every economic and financial outcome or the timing of such outcomes. If our risk management efforts are ineffective, we could suffer losses that could have a material adverse effect on our business, financial condition and results of operations. In addition, we could be subject to litigation, particularly from our clients, and sanctions or fines from regulators.
Risk Related to Our Structure
Certain executive officers and members of our Board of Directors and certain of our officers and directors have or will have interests and positions that could present potential conflicts.
We are party to a variety of related party agreementsCertain executive officers and relationships with FNF. Onemembers of our executive officers is employed by FNF and fourBoard of our directorsDirectors serve on the boardBoard of directorsDirectors of FNF. Also, on February 8, 2019, we invested in D&B. Concurrent with the closing of this transaction, our Executive Chairman began serving as Executive Chairman of D&B,other entities or are employed by other entities, including DNB, Trasimene Capital Management, LLC ("Trasimene"), FNF, THL and our Chief Executive Officer ("CEO") also began serving as CEO of D&B. Five of our directors, including Mr. Foley and Mr. Jabbour, also serve on the board of directors of D&B. Due to the combination of these factors, D&B is considered to be a related party as of February 8, 2019.Cannae.
As a result of the foregoing, there may be circumstances where one of ourcertain executive officers and certain directors may be subject to conflicts of interest with respect to, among other things: (i) our ongoing relationships with DNB, Trasimene, FNF, THL or D&B, including any related party agreements;Cannae; (ii) the quality, pricing and other terms associated with services that we provide to FNFDNB, Trasimene or D&B,FNF, or that they provide to us, under related party agreements;us; (iii) business opportunities arising for any of us, DNB, Trasimene, FNF, THL or D&B;Cannae; and (iv) conflicts of time with respect to matters potentially or actually involving or affecting us.
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We have in place a code of business conduct and ethics prescribing procedures for managing conflicts of interest and our chief compliance officer and audit committee are responsible for the review, approval or ratification of any potential conflicts of interest transactions. Additionally, we expect that interested directors will abstain from decisions with respect to conflicts of interest as a matter of practice. However, there can be no assurance that such measures will be effective, that we will be able to resolve all potential conflicts or that the resolution of any such conflicts will be no less favorable to us than if we were dealing with an unaffiliated third party.
Our senior leadership team is criticalRefer to Note 6 to the Notes to Consolidated Financial Statements for more information related to our continued success,related party relationships and the loss of such personnel could have a material adverse effect on our business, financial condition and results of operations.
Our future success substantially depends on the continued service and performance of the members of our senior leadership team. These personnel possess business and technical capabilities that are difficult to replace. We have attempted to mitigate this risk by entering into long-term (two to three year) employment contracts with the members of our senior management operating team and providing long-term incentive compensation with multi-year vesting provisions. If we lose key members of our senior management operating team or are unable to effect smooth transitions from one executive to another as part of our succession plan, we may not be able to effectively manage our current operations or meet ongoing and future business challenges, and this could have a material adverse effect on our business, financial condition and results of operations.
We may fail to attract and retain enough qualified employees to support our operations, which could have an adverse effect on our ability to expand our business and service our clients.
Our business relies on large numbers of skilled employees, and our success depends on our ability to attract, train and retain a sufficient number of qualified employees. If our attrition rate increases, our operating efficiency and productivity may decrease. We compete for employees not only with other companies in our industry but also with companies in other industries, such as software services, engineering services and financial services companies, and there is a limited pool of employees who have the skills and training needed to do our work. If our business continues to grow, the number of people we will need to hire will increase. We will also need to increase our hiring if we are not able to maintain our attrition rate through our current recruiting and retention

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policies. Increased competition for employees could have a material adverse effect on our ability to expand our business and service our clients, as well as cause us to incur greater personnel expenses and training costs.
We may not be able to effectively achieve our growth strategies, which could adversely affect our business, financial condition and results of operations.
Our growth strategies depend in part on maintaining our competitive advantage with current solutions in new and existing markets, as well as our ability to develop new technologies and solutions to serve such markets. There can be no assurance that we will be able to compete successfully in new markets or continue to compete effectively in our existing markets. If we fail to introduce new technologies or solutions effectively or on a timely basis, or if we are not successful in introducing or obtaining regulatory or market acceptance for new solutions, we may lose market share and our results of operations or cash flows could be adversely affected.
Current and future litigation, investigations or other actions against us could be costly and time consuming to defend.transactions.
We are from time to time subject to legal proceedings and claims that arise in the ordinary course of business, such as claims brought by our clients in connection with commercial disputes and employment claims made by our current or former employees. Litigation can result in substantial costs and may divert management's attention and resources, which may seriously harm our business, financial condition and results of operations. From time to time, we also receive requests for information from various state and federal regulatory authorities, some of which take the form of civil investigative demands or subpoenas. Some of these regulatory inquiries may result in the assessment of fines for violations of regulations or settlements with such authorities requiring a variety of remedies.
Although certain matters may be subject to a cross-indemnity agreement between Black Knight Financial Services, LLC ("BKFS LLC") and ServiceLink Holdings, LLC ("ServiceLink"), there can be no assurance that we will not incur additional material costs and expenses in connection with any potential future investigations or claims, including but not limited to fines or penalties and legal costs, or be subject to other remedies, any of which could have a material adverse effect on our business, financial condition and results of operations. Insurance may not cover such investigations and claims, may not be sufficient for one or more such investigations and claims and may not continue to be available on terms acceptable to us. An investigation or claim brought against us that is uninsured or underinsured could result in unanticipated costs, management distraction or reputational harm, which could have a material adverse effect on our business, financial condition and results of operations.
The distribution by FNF of the shares of New BKH common stock to the holders of FNF Group common stock on a pro-rata basis (the "Spin-off") could result in significant tax liability to FNF and to holders of FNF Group common stock, and under certain circumstances, we may have a significant indemnity obligation to FNF, which is not limited in amount or subject to any cap, if the Spin-off is treated as a taxable transaction due to our acts or failure to act.
FNF received a private letter ruling from the Internal Revenue Service (“IRS”) in connection with the Spin-off, and an opinion of Deloitte Tax LLP, tax advisor to FNF, to the effect that certain contributions made by FNF to Black Knight Holdings, Inc. ("BKHI") and the Spin-off qualify as a tax-free reorganization under Sections 368(a) and 355 of the Internal Revenue Code (the “IRC”) and a distribution to which Sections 355 and 361 of the IRC applies, respectively. The IRS private letter ruling and the opinion are based upon various factual representations and assumptions and, in the case of the opinion, certain undertakings, made by FNF and Black Knight. Any inaccuracy in the representations or assumptions upon which such tax opinion was based, or failure by FNF or Black Knight to comply with any undertakings made in connection with such tax opinion, could alter the conclusions reached in such opinion. Opinions with respect to these matters are not binding on the IRS or the courts. As a result, the conclusions expressed in these opinions could be challenged by the IRS and a court could sustain such a challenge.
Even if the Spin-off otherwise qualifies for tax-free treatment under Sections 355, 361 and 368(a) of the IRC, the Spin-off would result in a significant U.S. federal income tax liability to FNF (but not to holders of FNF Group common stock) under Section 355(e) of the IRC if one or more persons acquire a 50% or greater interest (measured by vote or value) in the stock of Black Knight as part of a plan or series of related transactions that includes the Spin-off. Current U.S. federal income tax law generally creates a presumption that any acquisitions of the stock of Black Knight within two years before or after the Spin-off are part of a plan that includes the Spin-off, although the parties may be able to rebut that presumption. The process for determining whether an acquisition is part of a plan under these rules is complex, inherently factual and subject to interpretation of the facts and circumstances of a particular case. We do not expect that the mergers and the interest exchange agreement between BKFS and certain affiliates of Thomas H. Lee Partners, L.P. ("THL") (the "THL Interest Exchange"), by themselves, will cause Section 355(e) to apply to the Spin-off. Notwithstanding the IRS ruling and the opinion of Deloitte Tax LLP described above, Black Knight might inadvertently cause or permit a prohibited change in the ownership of Black Knight to occur, thereby triggering a tax liability to FNF. If the Spin-off is determined to be taxable to FNF, FNF would recognize gain equal to the excess of the fair market value of the New BKH Corp. ("New BKH") common stock held by it immediately before the Spin-off over FNF’s tax basis therein. Open market purchases of Black Knight common stock by third parties without any negotiation with Black Knight will generally not cause Section 355(e) of the IRC to apply to the Spin-off.

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In connection with the Spin-off, we entered into a tax matters agreement (the "Tax Matters Agreement") with FNF pursuant to which we are obligated to indemnify FNF for (i) any action by Black Knight, or the failure to take any action within our control which, negates the tax-free status of the transactions; or (ii) direct or indirect changes in ownership of Black Knight equity interests that cause the Spin-off to be a taxable event to FNF as a result of the application of Section 355(e) of the IRC or to be a taxable event as a result of a failure to satisfy the “continuity of interest” or “device” requirements for tax-free treatment under Section 355 of the IRC.
If it is subsequently determined, for whatever reason, that the Spin-off does not qualify for tax-free treatment, holders of FNF Group common stock immediately prior to the Spin-off could incur significant tax liabilities.
We may decide to forgo certain transactions in order to avoid the risk of incurring significant tax-related liabilities.
Under the Tax Matters Agreement, we covenanted not to take or fail to take any reasonably required action, following the Spin-off, which action or failure to act, would (i) be inconsistent with any covenant or representation made by Black Knight in any document related to the Spin-off, or (ii) prevent, or be reasonably likely to prevent, the tax-free status of the Spin-off. Further, the Tax Matters Agreement requires us to generally indemnify FNF for any taxes or losses resulting from any action by Black Knight or our subsidiaries, or the failure to take any action within our control which, negates the tax-free status of the Spin-off; or direct or indirect changes in ownership of Black Knight equity interests that cause the Spin-off to be a taxable event to FNF as a result of the application of Section 355(e) of the IRC or to be a taxable event as a result of a failure to satisfy the “continuity of interest” or “device” requirements for tax-free treatment under Section 355 of the IRC. As a result, we may determine to forgo certain transactions that might have otherwise been advantageous in order to preserve the tax-free treatment of the Spin-off.
In particular, we may determine to continue to operate certain of our business operations for the foreseeable future even if a liquidation or sale of such business might have otherwise been advantageous. Moreover, in light of the mergers as well as certain other transactions that might be treated as part of a plan that includes the Spin-off for purposes of Section 355(e) of the IRC (as discussed above), we may determine to forgo certain transactions, including share repurchases, stock issuances, asset dispositions or other strategic transactions for some period of time following the mergers. In addition, our indemnity obligation under the Tax Matters Agreement might discourage, delay or prevent a third party from entering into a change of control transaction with us for some period of time following the Spin-off.
We will be restricted from pursuing certain potential business opportunities under the non-competition agreement.
In connection with the Distribution, we entered into a non-competition agreement with FNF pursuant to which we agreed to certain restrictions on the scope of the business that we may conduct for the ten-year10-year period following completion of the transactions,Distribution, including that we are prohibited from (i) engaging in title generation/escrow services, appraisal or default and field services work (other than technology solutions for such settlement services) without the prior written consent of FNF (subject to an exception allowing us to acquire a business engaged in such restricted services if at least 90% of such business’ revenues is contributed by activities other than such restricted services) and (ii) engaging in certain transactions, such as a merger, sale of assets or sale of greater than 5% of its equity interests, with a buyer that derives 10% or more of its revenues from such restricted services. Although we do not presently engage in any of these restricted services and our current business is not restricted, as a result of these restrictions, we may have to forgo certain transactions that might have otherwise been advantageous in compliance with our obligations under the non-competition agreement.
In particular, the restriction on engaging in a merger, sale of assets or sale of greater than 5% of its equity interests with a buyer that derives 10% or more of its revenues from restricted services may discourage a third party engaged in such restricted services from pursuing such a transaction with us during the ten-year10-year period following completionthe Distribution.
General Risk Factors
If we are unable to successfully consummate acquisitions or experience delays in integrating acquisitions, it could have a material adverse effect on us.
One of our strategies to grow our business is to opportunistically acquire complementary businesses, technologies and services. This strategy will depend on our ability to find suitable acquisitions and may depend on financing them on acceptable terms. We may require additional debt or equity financing for future acquisitions, and doing so may be made more difficult by our indebtedness. Raising additional capital for acquisitions through debt financing could result in increased interest expense and may involve agreements that include covenants limiting or restricting our ability to take certain actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise additional capital for acquisitions through equity financing, the ownership interests of existing shareholders will be diluted.
If we are unable to acquire suitable acquisition candidates, we may experience slower growth. Further, we may face challenges in integrating any acquired business, including our acquisition of Optimal Blue. These challenges may include eliminating redundant operations, facilities and systems, coordinating management and personnel, retaining key employees, managing different corporate cultures, integrating relationships with clients, vendors and business partners while achieving revenue synergies, cost reductions and cross-selling opportunities. The Optimal Blue acquisition involves numerous operational, strategic, financial, accounting, legal, tax and other risks, including potential liabilities associated with the acquired business. Difficulties in integrating Optimal Blue and our ability to manage the combined company, may result in the combined company performing differently than expected, in operational challenges or in the delay or failure to realize anticipated revenue synergies and cost-related efficiencies, and could have an adverse effect on our financial condition, results of operations or cash flows.
Additionally, the acquisition and integration processes may disrupt our business and divert management attention and our resources. If we fail to successfully integrate acquired businesses, products, technologies and personnel, it could impair relationships with employees, clients and strategic partners, distract management attention from our core businesses, result in control failures and otherwise disrupt our ongoing business, any of which could have a material adverse effect on our business, financial condition and results of operations. The anticipated benefits and cost savings of an acquisition may not be realized fully or at all, may take longer to realize than expected or could have other adverse effects that we do not currently foresee. In addition, we may be required to record future charges for impairment of goodwill and other intangible assets resulting from such acquisitions.
We have substantial investments in recorded goodwill and other intangible assets, and an extended economic downturn or troubled mortgage market could cause these investments to become impaired.
Goodwill and other intangible assets are assessed for impairment annually or whenever changes in circumstances indicate that the carrying amount may not be recoverable. Factors that may indicate the carrying value of our intangible assets, including
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goodwill, may not be recoverable include, but are not limited to, significant underperformance relative to historical or projected future results of operations, a significant decline in our stock price and market capitalization, and negative industry or economic trends. However, if there is an extended economic downturn in the future, the carrying amount of our goodwill or other intangible assets may no longer be recoverable, and we may be required to record an impairment charge, which could have a material adverse effect on our results of operations.
Our indebtedness could have a negative effect on our financing options and liquidity position, and certain of our financing arrangements subject us to various restrictions that could limit our operating flexibility.
As of December 31, 2020, we had approximately $2.2 billion of total debt outstanding.
Our indebtedness could have important consequences to us, including:
requiring us to use a portion of the transactions.money we earn to pay principal and interest on our debt, which could reduce the amount of money available to finance operations, acquisitions and other business activities;
exposing us to costs and risks associated with agreements limiting our exposure to higher interest rates, as such agreements may not offer complete protection from these risks, and subjecting us to the risk that one or more of the counterparties to these agreements may fail to satisfy their obligations under such agreements;
limiting our flexibility in planning for or responding to changing business and economic conditions, including increased competition, by causing us to have difficulty borrowing money in the future for working capital, capital expenditures, acquisitions or other purposes and possibly limiting our ability to pursue other business opportunities and implement certain business strategies;
imposing operating and financial restrictions on our activities, including compliance with, or maintenance of, certain financial tests and ratios, including a minimum interest coverage ratio and maximum leverage ratio, and limit or prohibit our ability to, among other things, take advantage of financing, mergers and acquisitions and other corporate opportunities; and
exposing us to possible losses in connection with our interest rate swaps that are indexed in LIBOR as result of proposed changes to LIBOR reporting practices or the pending replacement of LIBOR with an alternative reference rate.
Our ability to make scheduled payments on or refinance our debt obligations depends on our financial condition and results of operations, which are subject to prevailing economic and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond our control. Our inability to generate sufficient cash flows to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all, could have a material adverse effect on our business, financial condition and results of operations. If we cannot make scheduled payments on our debt, we will be in default and holders of our outstanding debt could declare all outstanding principal and interest to be due and payable, and we could be forced into bankruptcy or liquidation. Risks associated with our indebtedness could have a material adverse effect on our business, financial condition and results of operations.
Our senior leadership team is critical to our continued success, and the loss of such personnel could have a material adverse effect on us.
Our future success substantially depends on the continued service and performance of the members of our senior leadership team. These personnel possess business and technical capabilities that are difficult to replace. We have attempted to mitigate this risk by entering into long-term (two to three year) employment contracts with the members of our senior management operating team and providing long-term incentive compensation with multi-year vesting provisions. If we lose key members of our senior management operating team or are unable to effect smooth transitions from one executive to another as part of our succession plan, we may not be able to effectively manage our current operations or meet ongoing and future business challenges, and this could have a material adverse effect on our business, financial condition and results of operations.
Current and future litigation, investigations or other actions against us could be costly and time consuming to defend.
We are from time to time subject to legal proceedings and claims that arise in the ordinary course of business, such as claims brought by our clients in connection with commercial disputes and employment claims made by our current or former employees.
On November 5, 2019, Black Knight Servicing Technologies, LLC (“BKST”), a wholly-owned indirect subsidiary of Black Knight, filed a Complaint and Demand for Jury Trial (the “Black Knight Complaint”) against PennyMac Loan Services, LLC (“PennyMac”). Shortly after the filing of the Black Knight Complaint, on November 6, 2019, PennyMac filed an Antitrust Complaint (the “PennyMac Complaint”) against Black Knight. Refer to Note 14 to the Notes to Consolidated Financial Statements for more information related to the PennyMac litigation matter.
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Litigation can result in substantial costs and may divert management's attention and resources, which may seriously harm our business, financial condition and results of operations. From time to time, we also receive requests for information from various state and federal regulatory authorities, some of which take the form of civil investigative demands or subpoenas. Some of these regulatory inquiries may result in the assessment of fines for violations of regulations or settlements with such authorities requiring a variety of remedies.
There can be no assurance that we will not incur additional material costs and expenses in connection with any potential future investigations or claims, including but not limited to fines or penalties and legal costs, or be subject to other remedies, any of which could have a material adverse effect on our business, financial condition and results of operations. Insurance may not cover or be sufficient for such investigations and claims and may not continue to be available on terms acceptable to us. An investigation or claim brought against us that is uninsured or underinsured could result in unanticipated costs, management distraction or reputational harm, which could have a material adverse effect on our business, financial condition and results of operations.
Our charter and bylaws and provisions of Delaware law may discourage or prevent strategic transactions, including a takeover of our company, even if such a transaction would be beneficial to our shareholders.
Provisions contained in our charter and bylaws and provisions of the Delaware General Corporation Law ("DGCL") could delay or prevent a third partyus from entering into a strategic transaction with us,a third party, as applicable, even if such a transaction would benefit our shareholders. For example, our charter and bylaws:
divide our Board of Directors into three classes with staggered three-year terms, which may delay or prevent a change of our management or a change of control;
authorize the issuance of "blank check" preferred stock that could be issued by us upon approval of our Board of Directors to increase the number of outstanding shares of capital stock, making a takeover more difficult and expensive;
provide that directors elected prior to 2020 may be removed from office only for cause and that any vacancy on our Board of Directors may only be filled by a majority of our directors then in office, which may make it difficult for other shareholders to reconstitute our Board of Directors;
provide that special meetings of the shareholders may be called only upon the request of a majority of our Board of Directors or by the chairman of the Board of Directors or our chief executive officer; and
require advance notice to be given by shareholders for any shareholder proposals or director nominees.

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By virtue of not opting out of Section 203 of the DGCL in our amended and restated certificate of incorporation, we are subject to Section 203 of the DGCL, which prohibits a publicly held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after the time the shareholder became an interested stockholder, subject to certain exceptions, including if, prior to such time, the board of directors approved the business combination or the transaction which resulted in the shareholder becoming an interested stockholder. "Business combinations" include mergers, asset sales and other transactions resulting in a financial benefit to the "interested stockholder." Subject to various exceptions, an "interested stockholder" is a person who, together with his or her affiliates and associates, owns or within three years did own 15% or more of the corporation's outstanding voting stock. These restrictions generally prohibit or delay the accomplishment of mergers or other takeover or change of control attempts that are not approved by a company's boardBoard of directors.Directors.
These restrictions and provisions could keep us from pursuing relationships with strategic partners and from raising additional capital, which could impede our ability to expand our business and strengthen our competitive position. These restrictions could also limit shareholder value by impeding a sale of us.
The market price of our common stock may be volatile, and you may lose all or part of your investment.
The market price of our common stock could fluctuate significantly, and you may not be able to resell your shares at or above the price at which your shares were acquired. Those fluctuations could be based on various factors, including those described above and the following:
our operating performance and the performance of our competitors and fluctuations in our operating results;
the public's reaction to our press releases, our other public announcements and our filings with the SEC;
changes in earnings estimates or recommendations by research analysts who follow us or other companies in our industry;
global, national or local economic, legal and regulatory factors unrelated to our performance;
announcements of positive news by us or our competitors, such as announcements of new products, services, strategic investments or acquisitions;
announcements of negative news by us or our competitors, such as announcements of poorer than expected results of operations, data breaches or significant litigation;
actual or anticipated variations in our or our competitors' operating results, and our and our competitors' growth rates;
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failure by us or our competitors to meet analysts' projections or guidance we or our competitors may give the market;
changes in laws or regulations, or new interpretations or applications of laws and regulations, that are applicable to our business;
changes in accounting standards, policies, guidance, interpretations or principles;
the arrival or departure of key personnel;
the number of shares publicly traded;
future sales or issuances of our common stock, including sales, distributions or issuances by us, our officers or directors and our significant shareholders; and
other developments affecting us, our industry or our competitors.
In addition, in recent years the stock market has experienced significant price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. These fluctuations have often been unrelated or disproportionate to the operating performance of those companies. These broad market fluctuations, as well as general economic, political and market conditions such as recessions or interest rate changes, may cause declines in the market price of our common stock, and you may not realize any return on your investment in us and may lose some or all of your investment.
As we primarily operate in a single industry, we are especially vulnerable to these factors to the extent that they affect our industry or our products. In the past, securities class action litigation has often been initiated against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert our management's attention and resources, and could also require us to make substantial payments to satisfy judgments or to settle litigation.
If securities or industry analysts publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
The trading market for our common stock is influenced in part by the research and reports that securities or industry analysts publish about us or our business. If one or more of the analysts who cover us downgrades our common stock or publishes inaccurate or unfavorable research about our business, our stock price could decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our common stock could decrease, which could cause our stock price and trading volume to decline.
We do not intend to pay dividends for the foreseeable future.
We may retain future earnings, if any, for future operations, expansion and debt repayment. We have not paid cash dividends to date and have no current plans to pay any cash dividends for the foreseeable future. As a result of our current dividend policy,

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you may not receive any return on an investment in our common stock unless you sell our common stock for a price greater than that which you paid for it. Any future determination to declare and pay cash dividends will be at the discretion of our Board of Directors and will depend on, among other things, our financial condition, results of operations, cash requirements, contractual restrictions and such other factors as our Board of Directors deems relevant.

Item 1B.Unresolved Staff Comments
Item 1B.    Unresolved Staff Comments
None.
Item 2.Properties
Item 2.    Properties
Our corporate headquarters is located at 601 Riverside Avenue,in Jacksonville, Florida 32204, whichin an office building that we own. We alsoIn addition, we own a facility in Sharon, Pennsylvania. As of December 31, 2018, weor lease other office space, as follows:data centers and other facilities in the United States and India.

LocationNumber of locations
California4
Texas3
Florida3
Colorado2
Other states (1)9
India2
__________________
(1)Represents one location in each of nine states.
Item 3.Legal Proceedings
Item 3.    Legal Proceedings
For a description of our legal proceedings, see Note 1314 to the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Report, which is incorporated by reference into this Part I, Item 3.


Item 4.Mine Safety Disclosure
Item 4.    Mine Safety Disclosure
Not applicable.
PART II
Item 5.
Item 5.    Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities
On May 26, 2015, we completed the our initial public offering ("IPO") of 18,000,000 sharesEquity Securities
Shares of BKFS Class Aour common stock par value $0.0001 per share ("Class A common stock"), at an offering price of $24.50 per share. We granted the underwriters a 30-day option to purchase an additional 2,700,000 shares of BKFS Class A common stock at the offering price, which was exercised in full. A total of 20,700,000 shares of Class A common stock were issued on May 26, 2015.
BKFS Class A common stock wasare listed on the New York Stock Exchange ("NYSE") and tradedtrade under the trading symbol "BKFS" from May 20, 2015 through September 29, 2017, the date of the Distribution, as defined in Note 1 to the Notes to Consolidated Financial Statements. Prior to that time, there was no public market for BKFS Class A common stock. There was no established public trading market for BKFS Class B common stock.
We completed the Distribution on September 29, 2017. Shares of Black Knight, Inc. (formerly known as Black Knight Holdco Corp.) common stock are listed on the NYSE and have been trading under the trading symbol "BKI" since October 2, 2017.
Information concerning securities authorized for issuance under our equity compensation plans will be included in Item 12 of Part III of this Report.

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Share Repurchase Program
The following table summarizes share repurchases under our share repurchase program described below during the year ended December 31, 2018:
Period in 2018 Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced program (1) Maximum number of shares that may yet be purchased under the program (2)
January 
 $
 
 6,809,879
February 2,000,000
 46.41
 2,000,000
 4,809,879
March 1,000,000
 48.63
 1,000,000
 3,809,879
April 
 
 
 3,809,879
May 
 
 
 3,809,879
June 
 
 
 3,809,879
July 
 
 
 3,809,879
August 
 
 
 3,809,879
September 
 
 
 3,809,879
October 
 
 
 3,809,879
November 
 
 
 3,809,879
December 
 
 
 3,809,879
Total 3,000,000
 $47.15
 3,000,000
 3,809,879

(1)On January 31, 2017, our Board of Directors authorized a three-year share repurchase program, effective February 3, 2017, under which we may repurchase up to 10 million shares of BKFS Class A common stock through February 2, 2020, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and other restrictions. In connection with the Distribution, our Board of Directors approved a share repurchase program authorizing the repurchase of shares of BKI common stock consistent with the previous BKFS share repurchase program.
(2)As of the last day of the applicable month.


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PERFORMANCE GRAPH
The following graph shows a comparison of the cumulative total return for our common stock from May 20, 2015 (the date BKFS Class A common stock commenced trading on the NYSE) through December 31, 2018, and the S&P 500 Index and the S&P North American Technology Sector Index from May 20, 2015 through December 31, 2018. The data for the S&P 500 Index and the S&P North American Technology Sector Index assumes reinvestment of dividends. The graph assumes an initial investment of $100.00, and the cumulative returns are based on the market price as of each year end. Note that historic stock price performance is not necessarily indicative of future stock price performance.
graph2018.jpg
*$100 invested on May 20, 2015 in Black Knight or each respective index, including reinvestment of dividends.
Copyright© 2019 Standard & Poor's, a division of S&P Global. All rights reserved.
  December 31,
 Initial2015201620172018
Black Knight$100.00$121.95$139.43$162.86$166.21
S&P 500 Index$100.00$97.41$109.06$132.87$127.05
S&P North American Technology Sector Index$100.00$102.61$114.97$156.64$159.58
.
On January 31, 2019,29, 2021, the closing price of our common stock on the NYSE was $49.19$81.69 per share. We had 6,3546,125 holders of record of our common stock.stock as of January 31, 2021. The actual number of shareholders is greater than this number of record holders, and includes shareholders who are beneficial owners but whose shares are held in street name by brokers and other nominees.
There were no unregistered sales of equity securities during the years ended December 31, 2018,2020, 2019 and 2018.
Within 120 days after the close of our fiscal year, we intend to file with the SEC a definitive proxy statement pursuant to Regulation 14A of the Exchange Act, which will include information concerning securities authorized for issuance under our equity compensation plans and other matters required by Items 10 through 14 of Part III of this Report.
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Share Repurchase Program
On January 31, 2017, our Board of Directors authorized a three-year share repurchase program, under which we could repurchase up to 10 million shares of Black Knight Financial Services, Inc. ("BKFS") Class A common stock through February 2, 2020, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and 2016.other restrictions. In connection with the Distribution, our Board of Directors approved a share repurchase program authorizing the repurchase of shares of BKI common stock consistent with the previous BKFS share repurchase program.
On February 12, 2020, our Board of Directors approved a three-year share repurchase program authorizing us to repurchase up to 10 million shares of our outstanding common stock through February 12, 2023, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and other restrictions. This share repurchase program replaced our previous share repurchase program that expired on February 2, 2020.
There were no share repurchases during the year ended December 31, 2020.
Performance Graph
The following graph shows a comparison of the cumulative total return for our common stock, the S&P 500 Index and the S&P North American Technology Sector Index from December 31, 2015 through December 31, 2020. The data for the S&P 500 Index and the S&P North American Technology Sector Index assumes reinvestment of dividends. The graph assumes an initial investment of $100, and the cumulative returns are based on the market price as of each year-end. Note that historic stock price performance is not necessarily indicative of future stock price performance.

bki-20201231_g1.jpg
*$100 invested on December 31, 2015 in Black Knight or each respective index, including reinvestment of dividends.
Copyright© 2021 Standard & Poor's, a division of S&P Global. All rights reserved.
December 31,
201520162017201820192020
Black Knight$100$114$134$136$195$267
S&P 500 Index$100$112$136$130$171$203
S&P North American Technology Sector Index$100$114$156$161$230$333
Item 6.
Item 6.    Selected Financial Data
See Part II, Item 6. Selected Financial Data
The information set forth below should be read in conjunction with the Consolidated Financial Statements, Notes to Consolidated Financial Statements, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and other information included elsewhere in thisour Annual Report on Form 10-K.
Acquisition of LPS by FNF and Internal Reorganization
On January 2, 2014, FNF acquired Lender Processing Services, Inc. ("LPS") (the "Acquisition"), and as a result, LPS became an indirect, wholly-owned subsidiary of FNF.

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Following the Acquisition, on January 3, 2014, a series of transactions were effected (the "Internal Reorganization"), pursuant to which (i) LPS was converted into a limited liability company and renamed Black Knight InfoServ, LLC ("BKIS"); (ii) the former Transaction Services businesses of LPS were transferred by BKIS to Black Knight Holdings, Inc. ("BKHI"), a wholly-owned subsidiary of FNF, and contributed by BKHI to ServiceLink; (iii) Black Knight Financial Services, LLC ("BKFS LLC") acquired all of the membership interests of BKIS; and (iv) all of the outstanding membership interests of Commerce Velocity were contributed by BKHI to BKFS LLC.
As a result of the Internal Reorganization, BKFS LLC acquired substantially all of the former Technology, Data and Analytics segment of LPS and Fidelity National Commerce Velocity, LLC ("Commerce Velocity"), a former indirect subsidiary of FNF. BKFS LLC did not acquire the former Transaction Services segment of LPS.
Following the Internal Reorganization, BKFS LLC issued, in the aggregate, 35.0% of the membership interests ("Units") of BKFS LLC, to (i) certain affiliates ("THL Affiliates") of Thomas H. Lee Partners, L.P. ("THL"), and (ii) THL Black Knight I Holding Corp. and THL Investors Black Knight I Holding Corp. (together, the "THL Intermediaries"), each of which is an affiliate of THL, formed10-K for the purpose of holding investments in BKFS LLC. As consideration for the Units of BKFS LLC, THL contributed $350.0 million.
Following the Internal Reorganization and the subsequent issuance of Units to THL, BKFS LLC was majority owned by FNF through its wholly-owned subsidiary, BKHI, and certain affiliates of FNF and BKHI, and minority owned by THL through the THL Affiliates and THL Intermediaries.
Contribution of Property Insight
On June 2, 2014, two wholly-owned subsidiaries of FNF contributed their respective interests in Property Insight, LLC ("Property Insight") to BKFS LLC. In connectionyear ended December 31, 2019, filed with the Property Insight contribution, BKFS LLC issued an additional 6.4 million Units to certain affiliates of BKHI. As a result of this issuance, THL Affiliates' and THL Intermediaries' combined percentage ownership in BKFS LLC was reduced from 35.0% to 32.9%, and FNF's percentage of beneficial ownership of BKFS LLC increased from 65.0% to 67.1%.
In accordance with U.S. generally accepted accounting principles ("GAAP") requirementsSEC on February 28, 2020, for transactions between entities under common control, the Consolidated and Combined Financial Statements of BKFS LLC were adjusted to reflect Commerce Velocity and Property Insight as of October 16, 2013, the date on which BKFS LLC was formed. LPS is considered the legal predecessor of BKFS LLC. Forselected financial reporting purposes, BKFS LLC, including Commerce Velocity and Property Insight, is a predecessor for the day ended January 1, 2014. The successor period is presented as BKFS LLC for periods subsequent to January 1, 2014 through May 25, 2015, the day prior to the IPO, BKFS for the period from May 26, 2015, the date we completed our IPO, through September 29, 2017, the date of the Distribution, and Black Knight, Inc. for the period from September 30, 2017, the day subsequent to the Distribution, through December 31, 2018.
Realignment of Property Insight
Effective January 1, 2017, Property Insight realigned its commercial relationship with FNF. In connection with the realignment, Property Insight employees responsible for title plant posting and maintenance were transferred to FNF. Under the new commercial arrangement, we continue to own the title plant technology and retain sales responsibility for third parties, other than FNF. As a result of the realignment, we no longer recognize revenues or expenses related to title plant posting and maintenance, but charge FNF a license fee for use of the technology to access and maintain the title plant data. Had the realignment taken place on January 1, 2016, our 2016 revenues and expenses would have been lower by approximately $30 million with essentially no effect to operating income. This transaction did not result in any gain or loss.
Distribution of FNF's Ownership Interest and Related Transactions
On September 29, 2017, we completed a tax-free plan whereby FNF distributed to FNF Group shareholders all 83.3 million shares of BKFS Class B common stock that it owned through a series of transactions (the "Distribution") as defined in Note 1 of the Notes to Consolidated Financial Statements.
Following the closing of the transactions, shares of Black Knight, Inc. common stock are listed on the New York Stock Exchange under the trading symbol “BKI”, and began trading on October 2, 2017. Under the organizational documents of Black Knight, Inc., the rights of the holders of shares of Black Knight, Inc. common stock are substantially the same as the rights of former holders of BKFS Class A common stock.
As a result of the Distribution and related transactions, our Consolidated Statements of Earnings and Comprehensive Earnings reflect an effective tax rate more closely aligned with other C - corporations in the U.S. and no longer reflect net earnings attributable to noncontrolling interests.


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Selected Historical Consolidated and Combined Financial Data of Black Knight
The Consolidated Statements of Earnings data for the years ended December 31, 2019, 2018, 2017 and 2016 and the Consolidated Balance Sheets data as of December 31, 2018 and 2017 are derived from the audited Consolidated Financial Statements of Black Knight included in this Annual Report on Form 10-K. The Combined Statements of Operations data for the years ended December 31, 2015 and 2014 and the Consolidated Balance Sheets data as of December 31, 2016, 2015 and 2014 are derived from the audited Consolidated and Combined Financial Statements of BKFS and BKFS LLC not included or incorporated by reference into this Annual Report on Form 10-K.2016.

24
 Year ended December 31,
 2018 2017 2016 2015 2014
          
 (In millions, except per share data)
Statements of Operations Data:         
Revenues$1,114.0
 $1,051.6
 $1,026.0
 $930.7
 $852.1
Expenses:         
Operating expenses625.4
 569.5
 582.6
 538.2
 514.9
Depreciation and amortization217.0
 206.5
 208.3
 194.3
 188.8
Transition and integration costs6.6
 13.1
 2.3
 8.0
 119.3
Total expenses849.0
 789.1
 793.2
 740.5
 823.0
Operating income265.0
 262.5
 232.8
 190.2
 29.1
Other income and expense:         
Interest expense, net(51.7) (57.5) (67.6) (89.8) (128.7)
Other expense, net(7.1) (12.6) (6.4) (4.6) (12.0)
Total other expense, net(58.8) (70.1) (74.0) (94.4) (140.7)
Earnings (loss) from continuing operations before income taxes206.2
 192.4
 158.8
 95.8
 (111.6)
Income tax expense (benefit)37.7
 (61.8) 25.8
 13.4
 (5.3)
Net earnings (loss) from continuing operations168.5
 254.2
 133.0
 82.4
 (106.3)
Loss from discontinued operations, net of tax
 
 
 
 (0.8)
Net earnings (loss)168.5
 254.2
 133.0
 82.4
 (107.1)
Less: Net earnings (loss) attributable to noncontrolling interests
 71.9
 87.2
 62.4
 (107.1)
Net earnings attributable to Black Knight$168.5
 $182.3
 $45.8
 $20.0
 $
          
     

 May 26, 2015 through December 31, 2015  
 Year ended December 31,   
 2018 2017 2016   
Net earnings per share attributable to Black Knight common shareholders:         
Basic$1.14
 $2.06
 $0.69
 $0.31
  
Diluted$1.14
 $1.47
 $0.67
 $0.29
  
Weighted average shares of common stock outstanding:         
Basic147.6
 88.7
 65.9
 64.4
  
Diluted148.2
 152.4
 67.9
 67.9
  

 December 31,
 2018 2017 2016 2015 2014
 (In millions)
Balance Sheets Data:         
Cash and cash equivalents$20.3
 $16.2
 $133.9
 $186.0
 $61.9
Total assets$3,653.4
 $3,655.9
 $3,762.0
 $3,703.7
 $3,598.3
Total debt (current and long-term)$1,336.7
 $1,434.1
 $1,570.2
 $1,661.5
 $2,135.1

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Selected Historical Consolidated Financial Data of LPS
The Consolidated Statement of Operations data for the day ended January 1, 2014 and the Consolidated Balance Sheet data as of January 1, 2014 are derived from the audited Consolidated Financial Statements of LPS not included or incorporated by reference into this Annual Report on Form 10-K.
 
Day ended
January 1, 2014
(In millions, except per share data)
Statements of Operations Data: 
Revenues$
Net loss from continuing operations$(39.0)
Net loss$(39.0)
Balance Sheets Data: 
Cash and cash equivalents$278.4
Total assets$2,446.6
Total debt (current and long-term)$1,068.1
Cash dividends per share$

Selected Quarterly Financial Data of Black Knight (Unaudited)
Selected quarterly financial data is as follows:
 Quarter Ended
 March 31, June 30, September 30, December 31,
        
 (In millions, except per share data)
2018       
Revenues$270.3
 $276.6
 $281.7
 $285.4
Earnings before income taxes$55.2
 $47.1
 $53.8
 $50.1
Net earnings$42.7
 $40.0
 $43.0
 $42.8
Basic earnings per share$0.29
 $0.27
 $0.29
 $0.29
Diluted earnings per share$0.29
 $0.27
 $0.29
 $0.29
2017       
Revenues$258.1
 $262.2
 $263.8
 $267.5
Earnings before income taxes and noncontrolling interests$39.9
 $38.3
 $53.1
 $61.1
Net earnings$33.9
 $29.2
 $43.9
 $147.2
Net earnings attributable to Black Knight$12.2
 $8.2
 $14.7
 $147.2
Basic earnings per share attributable to Black Knight$0.18
 $0.12
 $0.22
 $0.98
Diluted earnings per share attributable to Black Knight$0.18
 $0.11
 $0.21
 $0.97

Item 7.Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations
The statements in the discussion and analysis regarding industry outlook, our expectations regarding the performance of our business, our liquidity and capital resources and the other non-historical statements are forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in "Risk Factors" and "Statement Regarding Forward-Looking Information." Our actual results may differ materially from those contained in or implied by the forward-looking statements. You should read the following discussion together with the sections entitled "Risk Factors," "Selected Historical Financial Data," "Liquidity and Capital Resources" and the consolidated financial statements and the related notes thereto included elsewhere in this Annual Report on Form 10-K.
Except as otherwise indicated or unless the context otherwise requires, all references to "Black Knight," the "Company," "we," "us" or "our" (1) prior to the Distribution (as defined in the "Distribution of FNF's Ownership Interest and Related Transactions" section below), are to Black Knight Financial Services, Inc., a Delaware corporation, and its subsidiaries ("BKFS") and (2) after the Distribution, are to Black Knight, Inc., a Delaware corporation, and its subsidiaries ("BKI").

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Overview
We are a leading provider of integratedan award-winning software, data and analytics solutions tocompany that drives innovation in the mortgage lending and consumer loan,servicing and real estate industries, as well as the capital and capital markets verticals. Oursecondary markets. Businesses leverage our robust, integrated solutions facilitate and automate many of the mission-critical business processes across the entire homeownership lifecycle. We are committedlife cycle to being a premier business partner thathelp retain existing clients, gain new clients, mitigate risk and operate more effectively. Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering exceptional client support to achieve their strategic goals realize greater success and better serve their customers by delivering best-in-class software, services and insights with a relentless commitment to excellence, innovation, integrity and leadership.customers.
We have market-leading vertical software solutions combined with comprehensive real estate data and extensive analytic capabilities. Our solutions are utilized by U.S. mortgage loan originators and servicers, as well as other financial institutions, investors and real estate professionals, to support mortgage lending and servicing operations, analyze portfolios and properties, operate more efficiently, meet regulatory compliance requirements and mitigate risk.
We believe the breadth and depth of our comprehensive end-to-end, integrated solutions and the insight we provide to our clients differentiate us from other software providers and position us particularly well for evolving opportunities. We have served the mortgage loan and real estate industries for over 55 years and utilize this experience to design and develop solutions that fit our clients' ever-evolving needs. The cost of origination and servicing are at historically high levels according to the Mortgage Bankers Association ("MBA"). Our proprietary software solutions and data and analytics capabilities are designed to reduce manual processes, improvesupport compliance and quality, mitigate risk and deliver significant cost savings to our clients. Our scale allows us to continually and cost-effectively invest in our business in order to meet evolving industry requirements and maintain our position as ana provider of industry-standard platformplatforms for mortgage loan market participants.
The table below summarizes the number of active first and second lien mortgagesmortgage loans on our mortgage loan servicing software solution and the related market data, reflecting our leadership in the mortgage loan servicing software solutions market (in millions):
First lien mortgages Second lien mortgages Total first and second lien mortgagesFirst lienSecond lienTotal first and second lien
2018 2017 2018 2017 2018 2017202020192020201920202019
Active loans32.1
 31.6
 2.5
 2.0
 34.6
 33.6
Active loans32.431.23.52.735.933.9
Market size51.8
(1)51.2
(1) 13.4
(2)15.4
(2)65.2
 66.6
Market size53.4(1)53.0(1)12.4(2)13.4(2)65.866.4
Market share62% 62% 19% 13% 53% 50%Market share61%59%28%20%55%51%

(1)
(1)    According to the December Black Knight Mortgage Monitor Reports as of December 31, 2018 and 2017 for U.S. first lien mortgages.
(2)According to the October 2018 and November 2017 Equifax National Consumer Credit Trends Reports as of September 30, 2018 and 2017, respectively, for U.S. second lien mortgages.
Our business is organized into two segments:
Software Solutions - offers software and hosting solutions that support loan servicing, loan origination and settlement services.
Data and Analytics - offers data and analytics solutions to the Black Knight Mortgage Monitor Reports as of December 31, 2020 and 2019 for U.S. first lien mortgage real estateloans.
(2)    According to the January 2021 and capital markets verticals. These solutions include property ownership data,December 2019 Equifax National Consumer Credit Trends Reports as of January 4, 2021 and September 30, 2019, respectively, for U.S. second lien data, servicing data, automated valuation models, collateral risk scores, prepayment and default models, lead generation, multiple listing service solutions and other data solutions.mortgage loans.
We offer our solutions to a wide range of clients across the mortgage and consumer loan, real estate and capital markets verticals. The quality and breadth of our solutions contribute to the long-standing nature of our relationships with our clients, the majority of whom enter into long-term contracts across multiple products that are embedded in their mission critical workflow and decision processes, particularly in the Software Solutions segment. Given the contractual nature of our revenues and stickiness of our client relationships, our revenues are highly visible and recurring in nature. Due to our integrated suite of solutions and our scale, we are able to drive significant operating leverage, which we believe enables our clients to operate more efficiently while allowing us to generate strong margins and cash flows.
Recent Developments
Acquisitions
2018 Acquisitions
On May 31, 2018, we completed our acquisition of HeavyWater, Inc. ("HeavyWater"), a provider of artificial intelligence and machine learning to the financial services industry. Heavywater's AIVA solution will be integrated into our premier solutions and will allow clients to deploy artificial intelligence and machine learning within other parts of their organizations to help enhance efficiency, effectiveness and accuracy.
On November 6, 2018, we completed the acquisition of Ernst Publishing Co., LLC and two related entities (collectively, "Ernst"), a provider of technology and closing cost data for the real estate and mortgage industries. Ernst's capabilities will be

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integrated into our premier suite of origination solutions and will augment our existing fee engine to create a unified access point for all fee-related needs.
2016 Acquisitions
On May 16, 2016, we completed our acquisition of eLynx Holdings, Inc. ("eLynx"), a leading lending document and data delivery platform that we now refer to as our eLending business. On June 22, 2016, we completed our acquisition of Motivity Solutions, Inc. ("Motivity"), which provides customized mortgage business intelligence software solutions.
Refer to Note 3 to the Notes to Consolidated Financial Statements for additional information related to our acquisitions.
Segment Realignment
On January 1, 2018, we realigned the composition of our two reportable segments. Certain enterprise business intelligence offerings in our Data and Analytics segment were moved to our Software Solutions segment. This change aligns with our go-to-market strategy and with the internal management of our business operations, including the allocation of resources and assessment of performance. Prior period results have been reclassified to conform to the current segment presentation.
Our Corporate Structure
Prior to the Distribution, BKFS conducted its business through Black Knight Financial Services, LLC ("BKFS LLC") and its subsidiaries. We had a sole managing member interest in BKFS LLC, which granted us the exclusive authority to manage, control and operate the business and affairs of BKFS LLC and its subsidiaries, pursuant to the terms of its Second Amended and Restated Limited Liability Company Agreement ("LLC Agreement"). Under the terms of the LLC Agreement, we are authorized to manage the business of BKFS LLC, including enter into contracts, manage bank accounts, hire employees and agents, incur and pay debts and expenses, merge or consolidate with other entities and pay taxes. We consolidated BKFS LLC in our consolidated financial statements and reported noncontrolling interests related to the membership interests ("Units") in BKFS LLC held by Black Knight Holdings, Inc. ("BKHI") and certain affiliates of THL ("THL Affiliates"). Our shareholders indirectly controlled BKFS LLC through our managing member interest.
FNF, through BKHI, and certain THL affiliates held Units and a number of shares of BKFS Class B common stock equal to the number of Units held by each such owner.
Prior to the Distribution, our corporate structure, as described above, was commonly referred to as an "Up-C" structure, which is often used by partnerships and limited liability companies when they undertake an initial public offering. Our Up-C structure allowed the owners of BKFS LLC to realize tax benefits associated with ownership interests in an entity that was treated as a partnership, or "passthrough" entity, for income tax purposes. These benefits included limiting entity level corporate taxes. Because Units were exchangeable for cash from BKFS LLC or, at our option, shares of BKFS Class A common stock, the Up-C structure also provided the owners of BKFS LLC potential liquidity that holders of privately held limited liability companies are not typically afforded. The owners of BKFS LLC also had voting rights in Black Knight equal to those of holders of BKFS Class A common stock through their ownership of shares of BKFS Class B common stock. BKFS also held Units and received the same benefits as the other holders of Units on account of its ownership in an entity treated as a partnership, or passthrough entity, for income tax purposes. Meanwhile, holders of BKFS Class A common stock had economic and voting rights similar to those of holders of common stock of non-Up-C structured public companies.
Generally, we received a pro-rata share of any distributions made by BKFS LLC to its members, which included us, BKHI and certain THL Affiliates. However, pursuant to the LLC Agreement, BKFS LLC was required to make tax distributions to help each of the holders of the Units pay taxes according to such holder's allocable share of taxable income rather than on a pro-rata basis. Additionally, tax distributions were required to be made based upon an assumed tax rate. Funds used by BKFS LLC to satisfy its tax distribution obligations were not available for reinvestment in our business.
BKFS was a holding company and its sole asset was its interest in BKFS LLC. BKFS, through its sole managing member interest, had 100% of the voting power in BKFS LLC and, through its ownership of Units, had 44.5% of the economic interests in BKFS LLC immediately following our initial public offering. Investors in BKFS held an indirect interest in BKFS LLC through us.
Subsequent to the Distribution and related transactions, BKFS LLC is an indirect wholly-owned subsidiary of BKI, and we no longer have any noncontrolling interests in BKFS LLC. In addition, the Up-C structure is no longer in place.
Business Trends and Conditions
GeneralMarkets
The U.S. mortgage loan market is large, and the loan lifecycle is complex and consists of several stages. The mortgage loan lifecycle includes origination, servicing and default. MortgagesMortgage loans are originated to finance home purchases or refinance existing mortgages.mortgage loans. Once a mortgage loan is originated, it is serviced on a periodic basis by mortgage servicers, which
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may not be the lenders that originated

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the mortgage.mortgage loan. Furthermore, if a mortgage experiencesloan goes into default, it triggers a set of multifaceted processes with an assortment of potential outcomes depending on a mix of variables.
Underlying the three major componentsstages of the mortgage loan lifecycle are the software, data and analytics support behind each process, which hashave become increasingly critical to industry participants due to the complexity of regulatory requirements.participants. As the industry has grown in complexity, participants have responded by outsourcing to large scalelarge-scale specialty providers, automating manual processes and seeking end-to-end solutions that support the processes required to manage the entire mortgage loan lifecycle.
Recent Developments
2020 Acquisitions
On March 3, 2020, we completed the acquisition of Collateral Analytics, LLC ("Collateral Analytics"), a provider of real estate products and tools to support appraisers, appraisal management companies, lenders, investors and government agencies. The acquisition is integrated into our Data and Analytics segment and enhances our real estate solutions and automated valuation model offerings.
On August 27, 2020, we completed the acquisition of DocVerify, a solution that provides proof of the integrity of digital documents, enabling organizations across a wide range of industries to streamline processes, safeguard sensitive information and reduce costs. DocVerify is reported within our Software Solutions segment and helps accelerate our goal of digitizing the entirety of the real estate and mortgage continuum as DocVerify’s trusted and proven digital document verification capabilities are integrated with Expedite®Close, our digital closing platform.
Optimal Blue Acquisition
On July 26, 2020, we entered into a definitive equity purchase agreement with affiliates of private equity firm GTCR, LLC, to purchase Optimal Blue, LLC ("Optimal Blue"), a leading provider of secondary market solutions and actionable data services. We also entered into forward purchase agreements with Cannae Holdings, LLC ("Cannae") and affiliates of Thomas H. Lee Partners, L.P. (“THL”) (collectively, the "FPAs"), whereby Cannae and affiliates of THL agreed to each acquire 20% of the equity interests of a newly formed entity, Optimal Blue Holdco, LLC ("Optimal Blue Holdco"), for a purchase price of $289.0 million. Optimal Blue Holdco was formed for the purpose of acquiring Optimal Blue and certain affiliates.
On September 15, 2020, we completed a series of transactions and completed the acquisition of Optimal Blue. In connection with the acquisition of Optimal Blue, we contributed $762.0 million in cash and our Compass Analytics business to Optimal Blue Holdco. As of December 31, 2020, we own 60% of Optimal Blue Holdco.
Optimal Blue Holdco is subject to the consolidation guidance related to variable interest entities as set forth in Accounting Standards Codification ("ASC") Topic 810, Consolidation ("ASC 810"). We are the primary beneficiary of Optimal Blue Holdco through our controlling interest and possess the rights established in the Amended and Restated Limited Liability Company Agreement of Optimal Blue Holdco (the" OB Holdco LLC Agreement"). As such, we control Optimal Blue Holdco and its subsidiaries and consolidate its financial position and results of operations. Intercompany transactions between us and Optimal Blue Holdco and its subsidiaries are eliminated in consolidation. Refer to Note 2 — Significant Accounting Policies to the Notes to Consolidated Financial Statements for additional information.
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Redeemable noncontrolling interests represent the collective 40% equity interest owned by Cannae and THL in Optimal Blue Holdco. We have call rights on THL's and Cannae’s equity interests in Optimal Blue Holdco that are exercisable beginning September 15, 2023 at a call price equal to the greater of (i) the fair market value of such interests and (ii) an amount that would result in the multiple of THL’s or Cannae’s return on investment to equal 2.0, as applicable. In addition, THL and Cannae have the right to put their respective interests in Optimal Blue Holdco to (i) Optimal Blue Holdco if there is a change of control of Black Knight or (ii) Optimal Blue Holdco, BKT or Black Knight that are exercisable beginning September 15, 2023. We have the option to satisfy the purchase price, which shall be equal to the fair market value of such interest, in connection with the exercise of any put or call right either in cash or Black Knight common stock other than a put in connection with a change of control of Black Knight, in which case the purchase price is payable only in cash. The equity interests will be settled at the current fair value at the time we receive notice of the put election as determined by the parties or by a third party appraisal under the terms of OB Holdco LLC Agreement.
Refer to Note 3 — Business Acquisitions to the Notes to Consolidated Financial Statements for additional information related to our current and prior years acquisitions.
DNB Investment
On July 6, 2020, Dun & Bradstreet Holdings, Inc. ("DNB") closed its previously announced initial public offering ("DNB IPO") and we invested $100.0 million in the DNB private placement. In connection with the closing of the DNB IPO and the DNB private placement, our limited partner interests in Star Parent, L.P. were exchanged for 54.8 million shares of DNB common stock (the "DNB Investment"), which represents ownership of 13.0% of DNB. As of December 31, 2020, DNB's closing share price was $24.90 and the fair value of our investment in DNB was $1,365.8 million. As of December 31, 2020, assuming a statutory tax rate of 25.3%, the estimated after tax value of our investment in DNB is $1,144.8 million.
On January 8, 2021, DNB completed its acquisition of Bisnode Business Information Group AB (the "Bisnode acquisition"). In connection with the Bisnode acquisition, DNB issued an additional 6.2 million shares of common stock, which resulted in a decrease in our ownership interest in DNB to 12.8%.
Business Trends and Conditions
COVID-19 Pandemic
On March 11, 2020, the World Health Organization ("WHO") declared the COVID-19 outbreak to be a global pandemic. In addition to the devastating effects on human life, the pandemic is having a negative ripple effect on the global economy, leading to disruptions and volatility in the global financial markets. Most U.S. states and many countries have issued policies intended to stop or slow the further spread of the disease.
COVID-19 and the U.S.'s response to the pandemic are significantly affecting the mortgage and real estate industries. On March 18, 2020, the U.S. Department of Housing and Urban Development ("HUD") and the Federal Housing Finance Agency ("FHFA") announced a 60-day moratorium on mortgage loan foreclosures and evictions. Likewise, the FHFA also announced mortgage loan forbearance programs for certain borrowers that allow mortgage loan payments to be suspended for up to 12 months.
On March 27, 2020 the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act") was signed into law in an effort to provide economic assistance to workers, families and businesses and codified the actions of HUD and the FHFA.
Subsequent to the CARES Act, the Federal Housing Administration ("FHA") extended the moratorium on mortgage loan foreclosures and evictions through at least June 30, 2021. In addition, many states have implemented additional guidance that extends their moratorium on mortgage loan foreclosures and evictions, and additional extensions of these moratoriums may be implemented in the future.
There are no comparable events that provide guidance as to the effect the COVID-19 pandemic may have, and, as a result, the ultimate effect of the pandemic is uncertain and subject to change. We do not yet know the full extent of the effects on the economy, the markets we serve, our business or our operations.
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Black Knight Response and the Effect on Our Business
We continue to execute on our business continuity plans to address the challenges related to the ongoing COVID-19 pandemic. Since March 2020, substantially all of our employees have been working from home. We are following the requirements and protocols published by the U.S. Centers for Disease Control, the WHO and country, state and local governments. Our most important priorities are the health and safety of our employees and helping the communities where we work and live. We continue to assess when and how we will begin to lift the actions put in place as part of our business continuity plans, including working from home and travel restrictions, while we continue to offer our clients the high level of service they have come to expect from us. We believe our transition to working from home has been successful and has not significantly affected our results of operations, financial condition, cash flows or control environment as of and for the year ended December 31, 2020.
The extraordinary effects of the broad-based response to the COVID-19 pandemic have delayed the timing of certain revenues. Specifically, the current mortgage loan foreclosure moratorium and forbearance plans offered as part of the CARES Act are reducing the number of foreclosures being processed on our BankruptcySM/ForeclosureSM and InvoicingSM software solutions for which revenue is recognized as transactions occur. For the year ended December 31, 2020, approximately $37 million in revenues were delayed beyond 2020. Many of our clients continue to work from home while experiencing origination volume increases as well as an elevated number of customer service calls. As a result, we initially saw delays to some of our implementation timelines, but continue to make progress while many of our clients and team members continue to work remotely. Our teams are focused on supporting our clients in this shifting landscape and stand ready to deliver our solutions.
Our clients have realized there will be significant changes in how their customers want to, or are able to, interact with them throughout the pandemic and beyond. In reaction to these changes, our clients are prioritizing automated technology solutions that enable them to remotely engage with their customers and provide streamlined ways of performing the core functions of their businesses, all while maintaining regulatory compliance in an environment that is rapidly changing. We believe our solutions are well-positioned to help our clients address these needs.
We partner with many of the industry’s leading lenders and servicers and believe it is our duty to serve in a leadership role as we manage through this crisis and beyond. From the start of the COVID-19 crisis, we have worked to provide leadership on behalf of our clients and to provide them with actionable intelligence, including our monthly Mortgage Monitor report and our McDash Flash Forbearance Tracker. We have also published in-depth white papers, held town hall meetings with our clients and have had frequent meetings with senior executives at our clients, government agencies and industry associations. We believe the in-depth data and insights we offer are essential for both mortgage market participants and government entities as we work together to address the economic ramifications of the crisis.
Our investment and innovation in digital mortgage loan solutions have made it possible for a majority of the mortgage application, underwriting and closing processes to happen online and remotely. Our industry-leading servicing system and a mortgage loan contributory data set represents a majority of the U.S. market and is modeled to represent the entire U.S. market. Our robust analytics and seamless integration ties them all together and allows for real-time visibility into the majority of active mortgage loans and a holistic view of the homeownership lifecycle. The depth of our integrated software, data and analytics enables clients to see what the effects of the pandemic mean for their business and industry. Our clients use these robust solutions for modeling, forecasting and reserve setting, which is critical, especially in this current environment.
Market Trends
Market trends that have spurred lenders and servicers to seek software, data and analytics solutions are as follows:
GrowingIntegral role of technology in the U.S. mortgage loan industry. BanksOver the past few years, banks and other lenders and servicers have become increasingly focused on automation and workflow management to operate more efficiently and meet their regulatory requirements.requirements as well as using technology to enhance the consumer experience during the mortgage loan origination, closing and servicing processes. Since the start of the pandemic, our clients have become increasingly aware that digital solutions are integral to their ability to stay connected with their customer base in times when face-to-face interactions are not possible. We believe technology providers must be able to support the complexity and dynamic nature of the market, display extensive industry knowledge and possess the financial resources to make the necessary investments in technology and software to support lenders. This includes an enhanced digital experience along with the application of artificial intelligence, robotic process automation and adaptive learning.
Lenders increasingly focused on core operations. As a result of regulatory scrutiny and the higher cost of doing business, we believe lenders have become more focused on their core operations and customers. We believe lenders are increasingly shifting from in-house solutions to third-party solutions that provide a more comprehensive and efficient solution. Lenders require these providers to deliver best-in-class solutions and deep domain expertise and to assist them in maintaining regulatory compliance.
IncreasedHeightened demand for enhanced transparency and analytic insight. As U.S. mortgage loan market participants work to minimize the risk in lending, servicing and capital markets, they rely on the integration of data and analytics with solutions that enhance the decision-making process. These industry participants rely on large comprehensive third-party databases coupled with enhanced analytics to achieve these goals. The pandemic is putting pressure on the U.S. economy, affecting millions of American jobs and creating a high-level of uncertainty in the volume of work that our clients are facing with possible
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delinquent mortgage loans. Mortgage loan market participants are eager for timely data and insights to help them plan and react to the changing environment.
Regulatory changes and oversight. Most U.S. mortgage loan market participants are subject to a high level of regulatory oversight and regulatory requirements as federal and state governments have enacted various new laws, rules and regulations. One example of such legislation is the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank Act"), which contained broad changes for many sectors of the financial services and lending industries and established the Consumer Financial Protection Bureau ("CFPB"), the federal regulatory agency responsible for regulating consumer financial protection within the United States. It is our experience that mortgage lenders have become more focused on minimizing the risk of non-compliance with regulatory requirements and are looking toward solutions that assist them in complying with their regulatory requirements. We expect this trend to continue as additional governmental programs and regulations have been recently enacted to address the economic concerns resulting from the pandemic, and our clients have had to adapt their systems and processes in record time to the shifting landscape. In addition, recent high-profile data security incidents have resulted in an increased focus on data security by our clients and our clients' regulators.regulators have elevated their focus on privacy and data security while many of our clients’ employees are working from home and in light of an increased level of cybersecurity incidents. We expect the industry focus on privacy and data security to continue to increase.
Mortgage MarketOur Business Segments
Our business is organized into two segments: Software Solutions and Data and Analytics.
Software Solutions
Our Software Solutions segment offers software and hosting solutions that support loan servicing, loan origination and settlement services. Our software solutions revenues were 84%, 86% and 86% of our consolidated revenues for the years ended December 31, 2020, 2019 and 2018, respectively.
The largest component offollowing table summarizes our business,software solutions revenues (in millions):
Year ended December 31,% of segment revenues
202020192018202020192018
Servicing software solutions$777.7 $815.5 $799.0 75%81%83%
Origination software solutions262.5 196.8 163.0 25%19%17%
Software Solutions$1,040.2 $1,012.3 $962.0 100%100%100%
Our servicing software solutions primarily generatesinclude our core servicing software solution that automates loan servicing, including loan setup and ongoing processing, customer service, accounting, reporting to the secondary mortgage market and investors and web-based workflow information systems. Our servicing software solutions primarily generate revenues based on the number of active loans outstanding on our system, which has been very stablestable; however, we have some exposure to foreclosure and growing.bankruptcy loan volumes, which can fluctuate based on economic cycles and other factors.
Before the pandemic, foreclosure start volumes were already at historic lows. Our servicing software business has some exposuresolutions that are more sensitive to defaulted loan volumes; however, outsideforeclosure volumes were approximately 2% of our consolidated revenues for the year ended December 31, 2020. As a result of the most recent financial crisis,effects of the numberbroad-based response to the COVID-19 pandemic, we have seen lower foreclosure-related transactional revenues due to the mortgage loan foreclosure moratorium and expect this trend to continue due to the mortgage loan forbearance plans offered as part of the CARES Act. As of February 16, 2021, Black Knight’s McDash Flash Forbearance Tracker estimated 2.7 million homeowners, or 5.1% of all U.S. mortgage loans, were in COVID-19 mortgage loan forbearance plans.
Our origination software solutions primarily include our solutions that fall into seriously delinquent status has been quite stable.
automate and facilitate the origination of mortgage loans and provide an interconnected network allowing the various parties and systems associated with lending transactions to exchange data quickly and efficiently. For our origination software solutions, our loan origination system revenues are based on closed loan volumes subject to minimum base softwaresubscription fees that are contractually obligated. These arrangements limitobligated, which limits our exposure to declines in origination volumes involumes. Some of our origination software business. Our lending solutions business isare exposed to fluctuationsvariances in origination volumes, primarily related to refinance volumes due to the nature of the services provided. Given the near record low level of mortgage loan rates, we have seen elevated volumes related to refinance originations. We expect this trend to continue during the first half of 2021 followed by a subsequent decline in origination volumes during the second half of 2021. Despite the initial decline with stay-at-home orders and similar restrictive mitigation measures issued in various parts of the country for an unknown duration, we have seen some improvement in purchase origination volumes due to pent-up demand and the current interest rate environment. Our origination software solutions that are more sensitive to origination volumes were approximately 6% of our consolidated revenues for the year ended December 31, 2020.
Finally, ourData and Analytics
Our Data and Analytics segment offers data and analytics solutions to the mortgage, real estate and capital markets verticals. These solutions include property ownership data, lien data, servicing data, automated valuation models, collateral risk scores, behavioral models, a multiple listing service software solution and other data solutions. Our data and analytics business is predominantly based on longer-term strategic data licenses, other data licenses and subscription-based revenues. Our data and
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analytics business has some exposurerevenues were 16%, 14% and 14% of our consolidated revenues for the years ended December 31, 2020, 2019 and 2018, respectively. Our data and analytics solutions that are more sensitive to fluctuations in home buying activity and origination volumes were approximately 5% of our consolidated revenues for the year ended December 31, 2020 and relate to services where we provide data related tonecessary for title insurance and other settlement service-relatedservice activities.

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Regulatory Requirements
There continues to be a high level of legislative and regulatory focus on consumer protection practices. As a result, federal and state governments have enacted various new laws, rules and regulations. One example of such legislation is the Dodd-Frank Act, which contained broad changes for many sectors of the financial services and lending industries and established the CFPB, the federal regulatory agency responsible for regulating consumer financial protection within the U.S. This has led banks and other lenders to seek software solutions that assist them in satisfying their regulatory compliance obligations in the face of a changing regulatory environment. We have developed solutions that target this need, which has resulted in additional revenues.
The CFPB has issued guidance that applies to "supervised service providers," which the CFPB has defined to include service providers, like us, to CFPB-supervised banks and non-banks. In addition, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act") contains the Mortgage Reform and Anti-Predatory Lending Act that imposes additional requirements on lenders and servicers of residential mortgage loans. Future legislative or regulatory changes are difficult to predict, and new laws or regulations that may be implemented by the CFPB or other regulatory bodies may require us to change our business practices or incur increased costs to comply.
Critical Accounting Policies and Estimates
Our discussion and analysis of our financial condition and results of operations is based upon audited consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). The preparation of these consolidated financial statements requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures with respect to contingent liabilities and assets at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Certain of our accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. On an ongoing basis, we evaluate our estimates including those related to revenue recognition, goodwill and other intangible assets and computer software. These judgments are based on our historical experience, terms of our existing contracts, our evaluation of trends in the industry, information provided by our clients and information available from outside sources as appropriate. Our actual results may differ from those estimates. See Note 2 to the Notes to Consolidated Financial Statements for additional description of the significant accounting policies that have been followed in preparing our Consolidated Financial Statements.consolidated financial statements.
The accounting policies described below are those we consider to be the most critical to an understanding of our financial condition and results of operations and that require the most complex and subjective management judgment.
Revenue Recognition
We recognize revenues in accordance with Financial Accounting Standards Board ("FASB"), Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers ("ASC 606"). Recording revenuesAt times, revenue recognition requires significant judgment, including determining whether an arrangement includesespecially for our complex arrangements that include multiple performance obligations, whether anyor deliverables, such as arrangements that include the implementation of several software solutions over a period of time as well as post-implementation subscription fees and support for those obligations are distinct and cannot be combined and allocationsolutions. The amount of the transaction price to each performance obligation basedrevenues we recognize in a particular period depends on the relative standalone selling prices ("SSP"). Clients receive certain contract elements over time.value we allocate to the products and services delivered during that period. Changes to the elements in an arrangement or, in our determination, to the relative SSP for these elements,estimates could materially affect the amount of earned and unearned revenues reflected in our consolidated financial statements.results of operations.
The primaryOur judgments relating to ourfor revenue recognition include determining whetherrelate to (i) the contract with a client exists; (ii)identifying performance obligations within the arrangement, including whether those obligations are identified;distinct or should be combined; (ii) determining the standalone selling price ("SSP") for each performance obligation; and (iii) determining the transaction priceeffect of contract modifications.
Delivery of our primary software solutions is determined; (iv) the transaction price is allocated to performance obligations; and (v) theoften considered a distinct performance obligations are satisfied by transferring control of the product or service to the client. Transfer of control is typically evaluated from the client's perspective.
At contract inception, we determine whether we satisfy the performance obligation over time or at a point in time. Revenues from software and hosting solutions are primarily recognized ratably over time or as fee-bearing usages occur. Revenues fromobligation; however, certain licensesagreements that require a significant level of integration, interdependency and interrelation with integral updates are generally recognized ratably over time as services are performed. Distinctinclude complex, proprietary implementation-related professional services revenues are primarily billed on a time and materials basis, and revenues are recognized over time as the services are performed. Revenues from data solutions related to a license for historical data or the license portion of certain distinct term licenses are recognized at a point in time upon delivery, while the remaining arrangement consideration allocated to updates is recognized ratably over the period the updates are provided.
We are often party to multiple concurrent contracts or contracts pursuant to which a client may purchase a combination of goods and services. These situations require judgment to determine whether multiple contractsif the software solution and related implementation professional services should be combined into one performance obligation.
The SSP for many of our solutions and services is based on observable selling prices. However, when observable selling prices are not available, judgment and analysis is required to establish an estimated SSP through consideration of all reasonably available information, including market conditions, demands, trends, our specific factors and information about the client or class of client. The adjusted market approach is generally used when observable inputs are not available or limited.
Contract modifications require judgment to determine if the modification should be accounted for as (i) a single arrangement. In making this determination, we consider whetherseparate contract, (ii) the economicstermination of the individual contracts cannot be understood without referenceoriginal contract and creation of a new contract or (iii) a cumulative catch-up adjustment to the wholeoriginal contract. When evaluating contract modifications, we must identify the performance obligations of the modified contract and multiple promises represent one singledetermine both the allocation of revenues to the remaining performance obligations and the period of recognition for each identified performance obligation.
DueComputer Software
For computer software products to be sold, leased or marketed, all costs incurred to establish the large number, broad naturetechnological feasibility are research and average size of individual contracts wedevelopment costs and are a partyexpensed as they are incurred. Costs incurred subsequent to the effect of judgments and assumptions we apply in recognizing revenues for any single contract is not likely to have a material effect on our consolidated

establishing
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operations. However,technological feasibility, such as programmers' salaries, related payroll costs and costs of independent contractors, are capitalized and amortized commencing on the broader accounting policy assumptions that we apply across similar arrangementsdate of general release to clients. Judgment is required in determining when technological feasibility of a product is established. The timing of when various research and development projects become technologically feasible or classes of clients could significantly influenceready for release can cause fluctuations in the timing and amount of research and development costs that are expensed or capitalized in any given period. Generally, we amortize capitalized costs on a straight-line basis. However, we use an accelerated amortization method equal to the ratio of revenues generated by the software solution in the current year as a percentage of the estimated current and future revenues over its estimated useful life if that ratio is greater than the percentage to be amortized using the straight-line method.
Purchase Accounting
We are required to allocate the purchase price of acquired businesses to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values, with the excess recorded as goodwill. We generally engage third-party valuation specialists to assist us in making fair value determinations. The third-party valuation specialists generally use discounted cash flow models, which require internally-developed assumptions, to determine the acquisition fair value of client relationship intangible assets and developed technology software assets. Assumptions for client relationship asset valuations generally include forecasted revenue attributable to existing customer contracts and relationships, estimated annual attrition, forecasted earnings before interest, taxes, depreciation and amortization margin and estimated weighted average cost of capital and discount rates. Assumptions for software asset valuations generally include forecasted revenue attributable to the software assets, obsolescence rates, estimated royalty rates and estimated weighted average cost of capital and discount rates.
If the initial accounting for a business combination is incomplete by the end of the reporting period during which the combination took place, we are required to record provisional amounts in our financial statements for items for which the accounting has not been completed. Measurement period adjustments to provisional purchase price allocations are recognized in the period in which they are determined, with the effect on earnings of changes in depreciation, amortization or other income resulting from such changes calculated as if the accounting had been completed on the acquisition date. Any new assets or liabilities identified during the measurement period are recognized as of the acquisition date. The measurement period ends the sooner of one year from the acquisition date or when we receive the information we were seeking about facts and circumstances that existed as of the acquisition date or learn that more information is not obtainable.
Refer to Note 3 to the Notes to Consolidated Financial Statements for discussion of our results of operations.acquisitions during years ended December 31, 2020, 2019 and 2018.
Goodwill and Other Intangible Assets
We have significant intangible assets that were recorded in connection with business acquisitions. These assets primarily consist of client relationships and the excess of purchase price over the fair value of identifiable net assets acquired (goodwill).
As of December 31, 2018, Goodwill was $2,329.7 million. Goodwill is not amortized, but is tested for impairment annually or more frequently if circumstances indicate potential impairment. In evaluating the recoverabilityimpairment, through a comparison of goodwill, we consider the amount of excess fair value over the carrying value of each reporting unit, the period of time since a reporting unit's lastfair value to its carrying value. A qualitative or quantitative testassessment of factors that may indicate a potential for impairment include macroeconomic conditions, industry and market changes, our overall financial performance, changes in share price and other factors to determine whetherevents or not to first perform a qualitative test. When performing the annual goodwill impairment analysis based on review of qualitative factors, we evaluate if events andchanges in circumstances exist that lead to a determination that the fair value of each reporting unit is more likely than not greater than its carrying amount. Based oncould negatively affect us. If the results of thisa qualitative analysis or other factors mentioned above, assessment indicate a potential for impairment, a quantitative goodwill impairment test may be completed.is performed. The quantitative process of determining whether or not an asset, such as goodwill, is impaired or recoverable relies on a weighted average of multiple valuation methods, primarily a combination of an income approach and a market approach. The income approach includes the present value of estimated future cash flows, while the market approach uses earnings multiples of similar guideline public companies. Such projections are inherently uncertain and, accordingly, actual future cash flows may differ materially from projected cash flows.uncertain. A quantitative goodwill impairment analysis is sensitive to changes in estimates of future net cash flows and discount rates. Changes to these estimates might result in material changes in the fair value of the reporting units and determination of the recoverability of goodwill that may result in charges against earnings and a reduction in the carrying value of our goodwill.We completed our annual goodwill impairment analysis in each of the past three years and, as a result, no impairment charges were recorded to goodwill in 2018, 2017 and 2016.
As of December 31, 2018, Other intangible assets, net of accumulated amortization, were $188.0 million, which consist primarily of client relationships. Long-lived assets and intangiblerelationship assets. Intangible assets with definite useful lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The valuation of these assets involves significant estimates and assumptions concerning matters such as client retention, future cash flows and discount rates. If any of these assumptions change, it could affect the recoverability of the carrying value of these assets. Client relationships are amortized over their estimated useful lives using an accelerated method that takes into consideration expected client attrition rates over a period of up to 10 years from the acquisition date. AllIndefinite-lived intangible assets that have been determined to have indefinite lives are not amortized, but are reviewed for impairment at least annually in accordance with ASC Topic 350, Intangibles-Goodwill and Other ("ASC 350"). The initial determination of estimated useful lives and the allocation of the purchase price to the fair values of the intangible assets other than goodwill require significant judgment and may affect the amount of future amortization of such intangible assets.
Definite-lived intangible assets are amortized over their estimated useful lives ranging from 3 to 10 years using accelerated methods. There is an inherent uncertainty in determining the expected useful life of or cash flows to be generated from intangible assets. We have not historically experienced material changes in these estimates but could be subject to them in the future.
Computer Software
Computer software includes the fair value of software acquired in business combinations, purchased software and capitalized software development costs. As of December 31, 2018, computer software, net of accumulated amortization, was $405.6 million. Purchased software is recorded at cost and amortized using the straight-line method over its estimated useful life. Software acquired in business combinations is recorded at fair value and amortized using straight-line or accelerated methods over the estimated useful life, ranging from 3 to 10 years.
Capitalized software development costs are accounted for in accordance with either ASC Topic 985, Software, Subtopic 20, Costs of Software to Be Sold, Leased, or Marketed ("ASC 985-20") or ASC 350, Subtopic 40, Internal-Use Software ("ASC 350-40"). For computer software products to be sold, leased or marketed (ASC 985-20 software), all costs incurred to establish the technological feasibility are research and development costs and are expensed as they are incurred. Costs incurred subsequent to establishing technological feasibility, such as programmers' salaries, related payroll costs and costs of independent contractors, are capitalized and amortized on a product-by-product basis commencing on the date of general release to clients. We do not capitalize any costs once the product is available for general release to clients. For internal-use computer software products (ASC 350-40 software), internal and external costs incurred during the preliminary project stage are expensed as they are incurred. Internal and external costs incurred during the application development stage are capitalized and amortized on a product-by-product basis commencing on the date the software is ready for its intended use. We do not capitalize any costs once the software is ready for its intended use. Internally developed software costs are amortized using straight-line or accelerated methods over the estimated useful life. Useful lives of computer software range from 3 to 10 years.

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We also assess the recorded value of computer software for impairment on a regular basis by comparing the carrying value to the estimated future cash flows to be generated by the underlying software asset. There is an inherent uncertainty in determining the expected useful life of or cash flows to be generated from computer software. We have not historically experienced material changes in these estimates but could be subject to them in the future.350.
Factors Affecting the Comparability of Our Results of Operations
Our results of operations for periods prior to the adoption of ASC 606, Tax Reform Act and Distribution are not comparable to periods thereafter. Our historical results of operations aremay not be comparable to our results of operations in future periods as a result of these and a number of other factors. In addition, our results of operations may vary from period to period. Set forth below is a brief discussion of the key factors affecting the comparability of our results of operations.
Revenues. On January1, 2018September 15, 2020, we adopted ASC 606 usingcompleted a series of transactions and completed the modified retrospective approach. Under this method, we recognized the cumulative effectacquisition of applying the new revenue recognition standard to existing revenue contracts that were active as of the adoption date as an adjustment to the opening balance of Retained earnings.Optimal Blue. The reported results for 2018 reflect2020 include revenues of $37.6 million from our acquisition of Optimal Blue.
Investments in Unconsolidated Affiliates. In 2019, we completed our D&B Investment for an economic ownership of approximately 18.1%. Our Net earnings for the applicationyear ended December 31, 2019 include our equity in losses of ASC 606, whileStar Parent for the comparative information has not been restatedperiod from February 8, 2019 to December 31, 2019. In 2020, in connection with the closing of DNB IPO and continues to be reported under the related accounting standardsDNB
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Private Placement, our limited partner interests in effectStar Parent were exchanged for those periods.54.8 million shares of DNB common stock, which represents ownership of 13.0% of DNB. Our Net earnings for the year ended December 31, 2020 include a non-cash gain of $88.2 million recognized as a result of DNB IPO and concurrent private placement. Refer to Note 144 to the Notes to Consolidated Financial Statements for additional information related to the effect of adopting ASC 606.DNB Investment.
Income Taxes. On December 22, 2017, the Tax Cuts and Jobs Act of 2017 ("Tax Reform Act") was signed into law. Among other provisions, the Tax Reform Act reduced the federal statutory corporate income tax rate from 35% to 21%. During the fourth quarter of 2017, we recorded a one-time non-cash net tax benefit of $110.9 million related to the revaluation of our deferred income tax assets and liabilities as a result of the Tax Reform Act. The effect of this adjustment on our 2017 effective tax rate was (57.6)%. Our effective tax rate for the years ended December 31, 2018, 2017 and 2016 was 18.3%, (32.1)% and 16.2%, respectively. Refer to Note 17 to the Notes to Consolidated Financial Statements for additional information related to the reconciliation of our federal tax rate to our effective tax rate.
Redeemable Noncontrolling interests. Prior to the Distribution,Interests. Redeemable noncontrolling interests represented BKHI and certain of its affiliates'represent the collective 40% equity interest owned by Cannae and THL and certain THL affiliates' share of net earnings or loss and of equity in BKFS LLC. Subsequent to the Distribution and related transactions, we no longer have any noncontrolling interests in BKFS LLC.Optimal Blue Holdco. Refer to Note 1 to the Notes to Consolidated Financial Statements for additional information related to the Distribution.Redeemable noncontrolling interests.
Key Components of Results of Operations
Revenues
We generate revenues through contractual arrangements we enter into with our clients to provide products or services either individually or in combination with one another as part of an integrated offering of multiple services. These arrangements occasionally include offerings from more than one segment to the same client.
Software Solutions
Our Software Solutions segment revenues are primarily derived from software and hosting solutions and professional services. Revenues from software and hosting solutions are typically volume-based agreements driven by factors such as the number of accounts processed, transactions processed and computer resources utilized. Professional services consistsconsist of pre-implementation and post-implementation support and services and are primarily billed on a time and materials basis. Professional services may also include dedicated teams provided as part of agreements with software and hosting solutions clients.
Data and Analytics
Our Data and Analytics segment revenues are primarily derived from property ownership data, lien data, servicing data, automated valuation models, collateral risk scores, behavioral models, a multiple listing service software solution and other data solutions.
Expenses
The following is a brief description of the components of our expenses:
Operating expenses primarily include compensation costs, including benefitsequity-based compensation and equity-based compensation,benefits, hardware and software maintenance costs, third-party software subscription costs, cloud computing costs, rent-related costs and professional services.
Transition and integration costs for 2020 and 2019 primarily consisted of costs associated with acquisitions and expense reduction initiatives. In 2018, these costs primarily representconsisted of costs associated with executive transition, transition-related costs from the transfer ofas we transferred certain corporate functions from FNF following the Distribution and acquisition-related costs. Transition and integration costs for 2017 primarily consisted of legal and professional fees related to the Distribution and transition-related costs following the Distribution. In 2016, these costs consisted of acquisition-related costs and professional services related to the Distribution.
associated with acquisitions.

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Depreciation and amortization expense consists of our depreciation related to investments in property and equipment, including hardware, as well as amortization of purchased and developed software and other intangible assets, principallyprimarily client relationship assets recorded in connection with acquisitions. It also includes the amortization of previously deferred contract costs.
Interest expense, net consists primarily of interest expense on our borrowings, a guarantee fee that we paid FNF for their guarantee of our senior notes prior to the Senior Notes Redemption, amortization of our debt issuance costs bond premium and original issue discount, payments on our interest rate swaps, commitment fees on our revolving credit facility and administrative agent fees net of capitalized interest and interest income. See Note 11 in
Other income, net for 2020 primarily related to a recognized gain for the Notes to Consolidated Financial Statements forresolution of a more detailed discussion of our Interest expense and our senior notes redemption.
legacy legal matter. Other expense, net for 2019 primarily related to legal fees. Other expense, net for 2018 primarily related to the loss on extinguishment of debt and costs incurred in connection with our debt refinancing on April 30, 2018. Other expense, net for 2017 primarily consisted of losses on the extinguishment of debt and costs incurred in connection with our senior notes redemption, term A loan and revolving credit facility refinancing and the term B loan repricing, partially offset by the resolution of a legacy legal matter. Other expense, net for 2016 primarily consisted of legal fees associated with litigation matters.
Income tax expense (benefit) represents federal, state, local and foreign taxes based on income attributabletaxes.
Equity in losses of unconsolidated affiliates, net of tax primarilyrepresents the effect of our investment in DNB, which is accounted for as an equity-method investment. Refer to Black Knight. In 2017, it also includes a one-time, non-cash net tax benefit of $110.9 million relatedNote 4 to the revaluation of our deferred income tax assets and liabilities as a result of the Tax Reform Act.Notes to Consolidated Financial Statements for additional information.
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Results of Operations
Key Performance Metrics
We use non-GAAP financial measures such as Adjusted Revenues, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Earnings and Adjusted Net Earnings Per Share for financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe these non-GAAP financial measures are useful for investors in evaluating our overall financial performance. We believe these measures provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to key metrics used by management in financial and operational decision-making, including determining a portion of executive compensation. We also present these non-GAAP financial measures because we believe investors, analysts and rating agencies consider them useful in measuring our ability to meet our debt service obligations. By disclosing these non-GAAP financial measures, we believe we offer investors a greater understanding of, and an enhanced level of transparency into, the means by which our management operates the Company. These non-GAAP financial measures are not measures presented in accordance with GAAP, and our use of these terms may vary from that of others in our industry. These non-GAAP financial measures should not be considered as an alternative to revenues, net earnings, net earnings per share or any other measures derived in accordance with GAAP as measures of operating performance or liquidity.
Adjusted Revenues, Adjusted EBITDA and Adjusted EBITDA Margin for the Software Solutions and Data and Analytics segments are presented in conformity with ASC Topic 280, Segment Reporting. These measures are reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. For these reasons, these measures are excluded from the definition of non-GAAP financial measures under the Securities and Exchange Commission's ("SEC") Regulation G and Item 10(e) of Regulation S-K.
Adjusted Revenues — We define Adjusted Revenues as Revenues adjusted to include the revenues that were not recorded by us during the periods presented due to the deferred revenue purchase accounting adjustment recorded in accordance with GAAP. These adjustments are reflected in Corporate and Other.
Adjusted EBITDA — We define Adjusted EBITDA as Net earnings, with adjustments to reflect the addition or elimination of certain statement of earnings items including, but not limited to:
Depreciation and amortization;
Impairment charges;
Interest expense, net;
Income tax expense (benefit);
Other expense, net;
deferred revenue purchase accounting adjustment;
equity-based compensation, including related payroll taxes;
costs associated with debt and/or equity offerings, including the Distribution;
spin-off related transition costs;
acquisition-related costs, including ongoing costs pursuant to a purchase agreement; and
costs associated with executive transition.
These adjustments are reflected in Corporate and Other.
Adjusted EBITDA Margin — Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by Adjusted Revenues.
Adjusted Net Earnings - We define Adjusted Net Earnings as Net earnings with adjustments to reflect the addition or elimination of certain statement of earnings items including, but not limited to:
the net incremental depreciation and amortization adjustments associated with the application of purchase accounting;
deferred revenue purchase accounting adjustment;
equity-based compensation, including related payroll taxes;
costs associated with debt and/or equity offerings, including the Distribution;
spin-off related transition costs;
acquisition-related costs, including ongoing costs pursuant to a purchase agreement;
costs associated with executive transition;
significant legal and regulatory matters; and
adjustment for income tax expense primarily related to assuming the conversion of all the shares of Class B common stock into shares of Class A common stock prior to the Distribution, the tax effect of the non-GAAP adjustments, the revaluation of our net deferred tax liability related to purchase accounting, equity-based compensation and debt modifications and the deferred tax revaluation adjustment as a result of the Tax Reform Act.
Adjusted Net Earnings Per Share- Adjusted Net Earnings Per Share is calculated by dividing Adjusted Net Earnings by the

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diluted weighted average shares of common stock outstanding. For the periods prior to the Distribution, the denominator includes the effect of assuming the exchange of all shares of Class B common stock into shares of Class A common stock at the beginning of the respective period.
Consolidated Results of Operations
The following tables present certain financial data for the periods indicated (dollars in millions):
 Year ended December 31,
202020192018
Revenues$1,238.5 $1,177.2 $1,114.0 
Expenses:
Operating expenses669.6 646.0 625.4 
Depreciation and amortization270.7 236.2 217.0 
Transition and integration costs31.4 5.4 6.6 
Total expenses971.7 887.6 849.0 
Operating income266.8 289.6 265.0 
Operating margin21.5 %24.6 %23.8 %
Interest expense, net(62.9)(63.5)(51.7)
Other income (expense), net16.4 (1.4)(7.1)
Earnings before income taxes and equity in earnings (losses) of unconsolidated affiliates220.3 224.7 206.2 
Income tax expense41.6 41.9 37.7 
Earnings before equity in earnings (losses) of unconsolidated affiliates178.7 182.8 168.5 
Equity in earnings (losses) of unconsolidated affiliates, net of tax67.1 (74.0)— 
Net earnings245.8 108.8 168.5 
Net losses attributable to redeemable noncontrolling interests18.3 — — 
Net earnings attributable to Black Knight$264.1 $108.8 $168.5 
Net earnings per share attributable to Black Knight common shareholders:
Diluted$1.73 $0.73 $1.14 
Weighted average shares of common stock outstanding:
Diluted152.9 148.6 148.2 
 Year ended December 31,
 2018 2017 2016
Revenues$1,114.0
 $1,051.6
 $1,026.0
Expenses:     
Operating expenses625.4
 569.5
 582.6
Depreciation and amortization217.0
 206.5
 208.3
Transition and integration costs6.6
 13.1
 2.3
Total expenses849.0
 789.1
 793.2
Operating income265.0
 262.5
 232.8
Operating margin23.8% 25.0% 22.7%
Interest expense, net(51.7) (57.5) (67.6)
Other expense, net(7.1) (12.6) (6.4)
Earnings before income taxes206.2
 192.4
 158.8
Income tax expense (benefit)37.7
 (61.8) 25.8
Net earnings$168.5
 $254.2
 $133.0
      
Earnings per share:     
Net earnings per share attributable to Black Knight common shareholders:     
Diluted$1.14
 $1.47
 $0.67
Weighted average shares of common stock outstanding:     
Diluted148.2
 152.4
 67.9
      
Non-GAAP Financial Measures     
Adjusted Revenues$1,116.5
 $1,056.1
 $1,033.3
Adjusted EBITDA$542.5
 $505.8
 $463.1
Adjusted EBITDA Margin48.6% 47.9% 44.8%
Adjusted Net Earnings$277.9
 $209.6
 $175.4
Adjusted Net Earnings Per Share$1.87
 $1.38
 $1.15

Reconciliations of the above non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the tables below (in millions):
 Year ended December 31,
 2018 2017 2016
Revenues$1,114.0
 $1,051.6
 $1,026.0
Deferred revenue purchase accounting adjustment2.5
 4.5
 7.3
Adjusted Revenues$1,116.5
 $1,056.1
 $1,033.3


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 Year ended December 31,
 2018 2017 2016
Net earnings$168.5
 $254.2
 $133.0
Depreciation and amortization217.0
 206.5
 208.3
Interest expense, net51.7
 57.5
 67.6
Income tax expense (benefit)37.7
 (61.8) 25.8
Other expense, net7.1
 12.6
 6.4
EBITDA482.0
 469.0
 441.1
Deferred revenue purchase accounting adjustment2.5
 4.5
 7.3
Equity-based compensation51.4
 19.2
 12.4
Debt and/or equity offering expenses0.7
 7.5
 0.6
Spin-off related transition costs2.2
 5.6
 
Acquisition-related costs1.3
 
 1.7
Executive transition costs2.4
 
 
Adjusted EBITDA$542.5
 $505.8
 $463.1
Adjusted EBITDA Margin48.6% 47.9% 44.8%

 Year ended December 31,
 2018 2017 2016
Net earnings$168.5
 $254.2
 $133.0
Depreciation and amortization purchase accounting adjustment90.6
 92.2
 90.1
Deferred revenue purchase accounting adjustment2.5
 4.5
 7.3
Equity-based compensation51.4
 19.2
 12.4
Debt and/or equity offering expenses6.5
 20.1
 0.6
Spin-off related transition costs2.4
 5.8
 
Acquisition-related costs1.3
 
 1.7
Executive transition costs2.4
 
 
Legal and regulatory matters0.8
 (0.3) 6.4
Income tax expense adjustment(48.5) (75.2) (76.1)
Tax Reform Act adjustment
 (110.9) 
Adjusted Net Earnings$277.9
 $209.6
 $175.4
      
Adjusted Net Earnings Per Share$1.87
 $1.38
 $1.15
Weighted Average Adjusted Shares Outstanding148.2
 152.4
 152.7

Year Ended December 31, 20182020 Compared to Year Ended December 31, 20172019
Segment Financial Results
Revenues
Consolidated Revenues were $1,114.0 million in 2018 and $1,051.6 million in 2017, an increase of $62.4 million, or 6%. The change in revenues is discussed further at the segment level below.

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The following table sets forth revenues by segment for the periods presented (in millions):
Year ended December 31, Year ended December 31,Variance
2018 201720202019$%
Software Solutions$962.0
 $904.5
Software Solutions$1,040.2 $1,012.3 $27.9 %
Data and Analytics154.5
 151.6
Data and Analytics198.7 165.4 33.3 20 %
Corporate and Other (1)(2.5) (4.5)
Corporate and Other(1)
(0.4)(0.5)0.1 NM
Total$1,114.0
 $1,051.6
Total$1,238.5 $1,177.2 $61.3 %

(1)Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.
(1)    Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.
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Software Solutions
Revenues were $962.0$1,040.2 million in 20182020 compared to $904.5$1,012.3 million in 2017,2019, an increase of $57.5$27.9 million, or 6%3%. Our servicing software solutions revenues increased 7%decreased 5%, or $52.5$37.8 million, primarily driven by loan growth on MSP®as increased revenues from new and existing clients which increased 4.3%on MSP® were more than offset by the effect of client deconversions and approximately $37 million of lower revenues related to 34.4 millionaverage loans, an increase in our average revenue per loan and cross-salesthe effect of lower foreclosure related volumes due to existing clients.the foreclosure moratorium as part of the CARES Act. Our origination software solutions revenues increased 3%33%, or $5.0$65.7 million, primarily driven by 31% growth inrevenues of $37.6 million from our loanacquisition of Optimal Blue, increased revenues from new clients and higher origination system solutions and a software license fee in our Lending Solutions business,volumes, partially offset by higher license and termination fees in the effect of lower volumes on our Exchange and eLending platforms primarily as a result of the 26% decline in refinancing originations as reported by the Mortgage Bankers Association.prior year.
Data and Analytics
Revenues were $154.5$198.7 million in 20182020 compared to $151.6$165.4 million in 2017,2019, an increase of $2.9$33.3 million, or 2%20%. The increase was primarily driven by growth inhigher origination volumes, strong sales execution and revenues of $10.8 million from our property dataacquisition of Collateral Analytics.
EBITDA and multiple listing service businesses, partially offsetEBITDA margin
The following tables set forth EBITDA (in millions) and EBITDA margin by upfront revenues from long-term strategic license deals in 2017.segment for the periods presented:
Operating Expenses
 Year ended December 31,Variance
20202019$%
Software Solutions$604.6 $599.6 $5.0 %
Data and Analytics64.8 42.0 22.8 54 %
Consolidated Operating expenses were $625.4
 Year ended December 31,Variance
20202019Basis points
Software Solutions58.1 %59.2 %(110)
Data and Analytics32.6 %25.4 %720
Software Solutions
EBITDA was $604.6 million in 20182020 compared to $569.5$599.6 million in 2017,2019, an increase of $55.9$5.0 million, or 10%.1%, with an EBITDA margin of 58.1%, a decrease of 110 basis points from the prior year. The changes in operating expenses are discussed further atEBITDA margin decrease was driven by revenue mix primarily related to high incremental margins associated with the lower foreclosure related revenues due to the foreclosure moratorium and higher revenues from acquisitions with margins slightly below the segment level below.average.
Data and Analytics
EBITDA was $64.8 million in 2020 compared to $42.0 million in 2019, an increase of $22.8 million, or 54%, with an EBITDA margin of 32.6% in 2020 compared to 25.4% in 2019. The EBITDA margin increase was primarily driven by incremental margins on revenue growth.
Consolidated Financial Results
Operating Expenses
The following table sets forth operating expenses by segment for the periods presented (in millions):
 Year ended December 31,Variance
20202019$%
Software Solutions$435.6 $412.7 $22.9 %
Data and Analytics133.9 123.4 10.5 %
Corporate and Other(1)
100.1 109.9 (9.8)(9)%
Total$669.6 $646.0 $23.6 %

 Year ended December 31,
 2018 2017
Software Solutions$394.8
 $388.0
Data and Analytics115.0
 113.2
Corporate and Other115.6
 68.3
Total$625.4
 $569.5
Software Solutions
(1)    Operating expenses were $394.8for Corporate and Other include equity-based compensation, including certain related payroll taxes, of $40.6 million and $51.7 million in 2018 compared to $388.0 million in 2017, an increase of $6.8 million, or 2%. 2020 and 2019, respectively.
The increase was primarily due to higher personnel costs, hardware and software maintenance costs in support of business growth and the effect of the HeavyWater and Ernst acquisitions, partially offset by increased capitalization of software development costs.
Data and Analytics
Operating expenses were $115.0 million in 2018 compared to $113.2 million in 2017, an increase of $1.8 million, or 2%. The increaseExpenses was primarily driven by the effect of current and prior year acquisitions, higher net personnel expense, software subscription and maintenance costs, and data acquisition costs.
Corporate and Other
Operating expenses were $115.6 million in 2018 compared to $68.3 million in 2017, an increase of $47.3 million, or 69%. The increase was primarily drivencosts, partially offset by a $32.0 million increase inlower equity-based compensation, medical costs and travel related costs.
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Table of which $6.9 million of the increase related to accelerated expense, $8.9 million of higher incentive bonus expense and incremental costs following the Distribution.Contents

Depreciation and Amortization
Consolidated Depreciation and amortization was $217.0 million in 2018 compared to $206.5 million in 2017, an increase of $10.5 million, or 5%. The changes in depreciation and amortization are discussed further at the segment level below.

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The following table sets forth depreciationDepreciation and amortization by segment for the periods presented (in millions):
Year ended December 31, Year ended December 31,Variance
2018 201720202019$%
Software Solutions$112.9
 $101.2
Software Solutions$120.9 $123.9 $(3.0)(2)%
Data and Analytics14.1
 12.8
Data and Analytics15.1 15.9 (0.8)(5)%
Corporate and Other (1)90.0
 92.5
Corporate and Other(1)
134.7 96.4 38.3 40 %
Total$217.0
 $206.5
Total$270.7 $236.2 34.5 15 %

(1)Depreciation and amortization for Corporate and Other primarily represents net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in accordance with GAAP.
Software Solutions
(1)    Depreciation and amortization was $112.9 millionfor Corporate and Other primarily represents net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in 2018 compared to $101.2 million in 2017, an increase of $11.7 million, or 12%. accordance with GAAP.
The increase in Depreciation and amortization is primarily due todriven by the effect of amortization of deferred contract costs related to new client winsacquired intangible assets and software and new hardware and software placed in service.
Data and Analytics
Depreciation and amortization was $14.1 million in 2018 compared to $12.8 million in 2017, an increaseservice as a result of $1.3 million, or 10%. The increase is primarily due to higher software amortization from new software placed in service for new solutions and enhancements for existing solutions.client wins.
Transition and Integration Costs
Consolidated Transition and integration costs were $6.6$31.4 million in 20182020 compared to $13.1$5.4 million in 2017, a decrease of $6.5 million.2019. Transition and integration costs in 20182020 and 2019 primarily consisted of costs associated with executive transition, transition-relatedacquisitions, including transaction costs from the transfer of certain corporate functions from FNF following the Distribution and acquisition-related costs. Transition and integration costs in 2017 primarily consisted of legal and professional fees$15.0 million related to the Distributionacquisition of Optimal Blue, and transition-related costs following the Distribution.expense reduction initiatives.
Operating Income (Loss)Interest Expense, Net
Consolidated Operating incomeInterest expense, net was $265.0$62.9 million in 20182020 compared to $262.5$63.5 million in 2017, an increase2019, a decrease of $2.5$0.6 million, or 1%. The change in operating income (loss) is discussed further at the segment level below.
The following table sets forth operating income (loss)decrease was primarily driven by segment for the periods presented (in millions):
 Year ended December 31,
 2018 2017
Software Solutions$454.3
 $415.3
Data and Analytics25.4
 25.6
Corporate and Other(214.7) (178.4)
Total$265.0
 $262.5
Software Solutions
Operating income was $454.3 million in 2018 compared to $415.3 million in 2017, an increase of $39.0 million, or 9%. Operating margin was 47.2% in 2018 compared to 45.9% in 2017. The increase in operating income is primarily due to revenue growth within servicing software,lower average interest rates, partially offset by higher depreciation and amortization.
Data and Analytics
Operating income was $25.4 million in 2018 compared to $25.6 million in 2017, a decrease of $0.2 million. Operating margin was 16.4% in 2018 compared to 16.9% in 2017. The decrease in operating income is primarily due to data acquisition costs and higher software amortization.
Corporate and Other
Operating loss was $214.7 million in 2018 compared to $178.4 million in 2017, an increase of $36.3 million, or 20%. The increase in loss was primarily driven by an increase in equity-based compensation, incentive bonus accruals and incremental costsaverage debt balances following the Distribution.

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Interest Expense, Net
Consolidated Interest expense, net was $51.7 million in 2018 compared to $57.5 million in 2017, a decrease of $5.8 million, or 10%. The decrease is driven by the lower outstanding debt balance in 2018 and interest savings from the Senior Notes redemption in April 2017.Optimal Blue.
Other Expense, Net
ConsolidatedOther income, net was $16.4 million in 2020 compared to Other expense, net was $7.1$1.4 million in 2018 compared to $12.6 million in 2017.2019. The 20182020 amounts wereare primarily related to a recognized gain of $18.5 million for the loss on extinguishmentresolution of debt and costs incurreda legacy legal matter. The 2019 amounts are primarily related to legal fees.
Income Tax Expense
Income tax expense was $41.6 million in connection with our debt refinancing on April 30, 2018, as discussed2020 compared to $41.9 million in 2019. Our effective tax rate was 18.9% in 2020 compared to 18.6% in 2019. Refer to Note 11 to the Notes to Consolidated Financial Statements. The 2017 amount primarily consisted of losses on the extinguishment of debt and costs incurred in connection with our senior notes redemption, term A loan and revolving credit facility refinancing and the term B loan repricing, as discussed in Note 11 19to the Notes to Consolidated Financial Statements and well as a resolution of a legacy legal matter.
Income Tax Expense (Benefit)
Consolidated Income tax expense was $37.7 million in 2018 compared to a benefit of $61.8 million in 2017. Our effective tax rate was 18.3% in 2018 compared to (32.1)% in 2017. Our effective tax rate for 2018 includes the effect of a reduction in our blended state tax rate, a prior year return to provision adjustment, higher than expected tax credits and excess tax benefitsmore information related to the vestingcomponents of our effective tax rate.
Equity in Earnings (Losses) of Unconsolidated Affiliates, Net of Tax
Equity in earnings (losses) of unconsolidated affiliates, net of tax consists of the restricted shares of our common stock. The effective tax rate for 2017 was lower than the typical federal and state statutory rate because of the effect of the Tax Reform Act and our noncontrolling interests prior following (in millions):
Year ended December 31,
20202019
Equity in losses of unconsolidated affiliates, net of tax$(26.1)$(74.0)
Gain related to DNB IPO and concurrent private placement, net of tax88.2 — 
Sale of an equity method investment, net of tax5.0 — 
Equity in earnings (losses) of unconsolidated affiliates, net of tax$67.1 $(74.0)
Refer to Note 4to the Distribution, partially offset by the effect of certain discrete items recorded during 2017.
Adjusted Revenues
Notes to Consolidated Adjusted Revenues were $1,116.5 millionFinancial Statements for more information related to our investment in 2018 compared to $1,056.1 million in 2017, an increase of $60.4 million, or 6%. The increase was primarily driven by growth in our servicing software solutions.
Adjusted EBITDA and Adjusted EBITDA Margin
Consolidated Adjusted EBITDA was $542.5 million in 2018 compared to $505.8 million in 2017, an increase of $36.7 million, or 7%. The changes in Adjusted EBITDA are discussed further at the segment level below.
Consolidated Adjusted EBITDA Margin was 48.6% in 2018 compared to 47.9% in 2017, an increase of 70 basis points. The changes in Adjusted EBITDA Margin are discussed further at the segment level below.
The following tables set forth Adjusted EBITDA (in millions) and Adjusted EBITDA Margin by segment for the periods presented:
 Year ended December 31,
 2018 2017
Software Solutions$567.2
 $516.5
Data and Analytics39.5
 38.4
Corporate and Other(64.2) (49.1)
Total$542.5
 $505.8
 Year ended December 31,
 2018 2017
Software Solutions59.0% 57.1%
Data and Analytics25.6% 25.3%
Corporate and OtherN/A
 N/A
Total48.6% 47.9%
Software Solutions
Adjusted EBITDA was $567.2 million in 2018 compared to $516.5 million in 2017, an increase of $50.7 million, or 10%, with an Adjusted EBITDA Margin of 59.0%, an increase of 190 basis points from the prior year. The increase was primarily driven by incremental margins on revenue growth.

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Data and Analytics
Adjusted EBITDA was $39.5 million in 2018 compared to $38.4 million in 2017, an increase of $1.1 million, or 3%, with an Adjusted EBITDA Margin of 25.6% in 2018 compared to 25.3% in 2017, an increase of 30 basis points from the prior year. The Adjusted EBITDA Margin increase was primarily due to incremental margins on revenue growth.
Adjusted Net Earnings and Adjusted Net Earnings Per Share
Adjusted Net Earnings was $277.9 million in 2018 compared to $209.6 million in 2017, an increase of $68.3 million, or 33%. Adjusted Net Earnings Per Share was $1.87 in 2018 compared to $1.38 in 2017, an increase of $0.49, or 36%. The increase was primarily driven by increased earnings from revenue growth and lower income tax expense and interest expense.DNB.
Year Ended December 31, 20172019 Compared to Year Ended December 31, 20162018
Revenues
Consolidated Revenues were $1,051.6 millionSee Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in 2017our Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on February 28, 2020, for a discussion of our consolidated results of operations for 2019 compared to $1,026.0 million in 2016, an increase of $25.6 million, or 2%. The change in revenues is discussed further at the segment level below.2018.
The following table sets forth revenues by segment for the periods presented (in millions):
 Year ended December 31,
 2017 2016
Software Solutions$904.5
 $860.7
Data and Analytics151.6
 172.6
Corporate and Other(4.5) (7.3)
Total$1,051.6
 $1,026.0
Software Solutions
Revenues were $904.5 million in 2017 compared to $860.7 million in 2016, an increase of $43.8 million, or 5%. Our servicing software business grew 8%, or $57.2 million, primarily driven by higher loan volumes on MSP, which increased 3.3% to 33.0 millionaverage loans, price increases and higher transactional volumes. Our origination software business declined 8%, or $13.4 million, primarily driven by lower Exchange volumes as a result of a decline in refinancing originations, consulting revenues and client contract termination fees, partially offset by incremental revenues from business acquisitions.
Data and Analytics
Revenues were $151.6 million in 2017 compared to $172.6 million in 2016, a decrease of $21.0 million, or 12%. The decrease was driven by the effect of the Property Insight realignment, partially offset by growth in our property data and multiple listing service businesses. Had the realignment taken place on January 1, 2016, revenues for 2016 would have been lower by $30.1 million.
Operating Expenses
Consolidated Operating expenses were $569.5 million in 2017 compared to $582.6 million in 2016, a decrease of $13.1 million, or 2%. The changes in operating expenses are discussed further at the segment level below.
The following table sets forth operating expenses by segment for the periods presented (in millions):
 Year ended December 31,
 2017 2016
Software Solutions$388.0
 $374.6
Data and Analytics113.2
 144.4
Corporate and Other68.3
 63.6
Total$569.5
 $582.6
Software Solutions
Operating expenses were $388.0 million in 2017 compared to $374.6 million in 2016, an increase of $13.4 million, or 4%. The increase was primarily due to business acquisitions and the effect of costs associated with the Data Hub®.
Data and Analytics
Operating expenses were $113.2 million in 2017 compared to $144.4 million in 2016, a decrease of $31.2 million, or 22%. The decrease was primarily driven by the Property Insight realignment.

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Corporate and Other
Operating expenses were $68.3 million in 2017 compared to $63.6 million in 2016, an increase of $4.7 million, or 7%. The increase was primarily driven by an increase in equity-based compensation and professional fees, partially offset by lower incentive bonus expense.
Depreciation and Amortization
Consolidated Depreciation and amortization was $206.5 million in 2017 compared to $208.3 million in 2016, a decrease of $1.8 million, or 1%. The changes in depreciation and amortization are discussed further at the segment level below.
The following table sets forth depreciation and amortization by segment for the periods presented (in millions):
 Year ended December 31,
 2017 2016
Software Solutions$101.2
 $107.0
Data and Analytics12.8
 8.0
Corporate and Other (1)92.5
 93.3
Total$206.5
 $208.3

(1)Depreciation and amortization for Corporate and Other primarily represents net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in accordance with GAAP.
Software Solutions
Depreciation and amortization was $101.2 million in 2017 compared to $107.0 million in 2016, a decrease of $5.8 million, or 5%. The decrease is primarily due to lower amortization of deferred contract costs and software.
Data and Analytics
Depreciation and amortization was $12.8 million in 2017 compared to $8.0 million in 2016, an increase of $4.8 million, or 60%. The increase is primarily due to an increase in depreciation from computer hardware and amortization of new software development.
Transition and Integration Costs
Consolidated Transition and integration costs were $13.1 million in 2017 compared to $2.3 million in 2016, an increase of $10.8 million. Transition and integration costs for 2017 primarily consisted of legal and professional fees related to the Distribution and transition-related costs following the Distribution. In 2016, these costs consisted of acquisition-related costs and professional services related to the Distribution.
Operating Income (Loss)
Consolidated Operating income was $262.5 million in 2017 compared to $232.8 million in 2016, an increase of $29.7 million, or 13%. The change in operating income (loss) is discussed further at the segment level below.
The following table sets forth operating income (loss) by segment for the periods presented (in millions):
 Year ended December 31,
 2017 2016
Software Solutions$415.3
 $379.1
Data and Analytics25.6
 20.2
Corporate and Other(178.4) (166.5)
Total$262.5
 $232.8
Software Solutions
Operating income was $415.3 million in 2017 compared to $379.1 million in 2016, an increase of $36.2 million, or 10%. Operating margin was 45.9% in 2017 compared to 44.0% in 2016. The increase in operating income is primarily due to revenue growth within servicing software, partially offset by higher depreciation and amortization and the effect of expenses associated with the Data Hub®.

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Data and Analytics
Operating income was $25.6 million in 2017 compared to $20.2 million in 2016, an increase of $5.4 million. Operating margin was 16.9% in 2017 compared to 11.7% in 2016. The increase in operating income is primarily due to incremental revenues excluding the Property Insight realignment.
Corporate and Other
Operating loss was $178.4 million in 2017 compared to $166.5 million in 2016, an increase of $11.9 million, or 7%. The increase was primarily driven by an increase in equity-based compensation and legal and professional fees related to the Distribution, partially offset by lower incentive bonus expense.
Interest Expense, Net
Consolidated Interest expense, net was $57.5 million in 2017 compared to $67.6 million in 2016, a decrease of $10.1 million, or 15%. The decrease is driven by interest savings from the term B loan repricing and debt refinancing.
Other Expense, Net
Consolidated Other expense, net was $12.6 million in 2017 compared to $6.4 million in 2016, an increase of $6.2 million, or 97%. The 2017 amount primarily consisted of losses on the extinguishment of debt and costs incurred in connection with our senior notes redemption, term A loan and revolving credit facility refinancing and the term B loan repricing as well as a resolution of a legacy tax matter. Other expense, net for 2016 primarily consisted of legal fees associated with litigation matters.
Income Tax Expense
Consolidated Income tax benefit was $61.8 million in 2017 compared to Income tax expense of $25.8 million in 2016. Our effective tax rate was (32.1)% in 2017 compared to 16.2% in 2016. The change is primarily due to an adjustment of $110.9 million related to the revaluation of our net deferred income tax liability as a result of the Tax Reform Act. The effect of this adjustment on our 2017 effective tax rate was (57.6)%, partially offset by a higher effective tax for the period following the Distribution as we no longer have any noncontrolling interests.
Adjusted Revenues
Consolidated Adjusted Revenues were $1,056.1 million in 2017 compared to $1,033.3 million in 2016, an increase of $22.8 million, or 2%. The increase was primarily driven by growth in our servicing software solutions and business acquisitions, partially offset by the effect of the Property Insight realignment and lower Exchange volumes as a result of a decline in refinancing originations.
Adjusted EBITDA and Adjusted EBITDA Margin
Consolidated Adjusted EBITDA was $505.8 million in 2017 compared to $463.1 million in 2016, an increase of $42.7 million, or 9%. The changes in Adjusted EBITDA are discussed further at the segment level below.
Consolidated Adjusted EBITDA Margin was 47.9% in 2017 compared to 44.8% in 2016, an increase of 310 basis points. The changes in Adjusted EBITDA Margin are discussed further at the segment level below.
The following tables set forth Adjusted EBITDA (in millions) and Adjusted EBITDA Margin by segment for the periods presented:
 Year ended December 31,
 2017 2016
Software Solutions$516.5
 $486.1
Data and Analytics38.4
 28.2
Corporate and Other(49.1) (51.2)
Total$505.8
 $463.1
 Year ended December 31,
 2017 2016
Software Solutions57.1% 56.5%
Data and Analytics25.3% 16.3%
Corporate and OtherN/A
 N/A
Total47.9% 44.8%

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Software Solutions
Adjusted EBITDA was $516.5 million in 2017 compared to $486.1 million in 2016, an increase of $30.4 million, or 6%, with an Adjusted EBITDA Margin of 57.1%, an increase of 60 basis points from the prior year. The Adjusted EBITDA Margin increase was primarily driven by incremental margins on revenue growth, partially offset by costs associated with the Data Hub®.
Data and Analytics
Adjusted EBITDA was $38.4 million in 2017 compared to $28.2 million in 2016, an increase of $10.2 million, or 36%, with an Adjusted EBITDA Margin of 25.3% compared to 16.3% in 2016, an increase of 900 basis points from the prior year. The Adjusted EBITDA Margin increase was primarily due to the effect of the Property Insight realignment and incremental revenue growth.
Adjusted Net Earnings and Adjusted Net Earnings Per Share
Adjusted Net Earnings was $209.6 million in 2017 compared to $175.4 million in 2016, an increase of $34.2 million, or 19%. Adjusted Net Earnings Per Share was $1.38 in 2017 compared to $1.15 in 2016, an increase of $0.23, or 20% . The increase was primarily driven by increased earnings from revenue growth and lower interest expense.
Liquidity and Capital Resources
Cash Requirements
Our primary sources of liquidity are our existing cash and cash equivalents balances, cash flows from operations and borrowings on our revolving credit facility. As of December 31, 2020, we had cash and cash equivalents of $34.7 million, debt principal of $2,213.7 million and available capacity of $702.3 million on our revolving credit facility. Our existing credit facility matures on April 30, 2023.
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Our primary cash requirements include operating expenses, debt service payments (principal and interest), capital expenditures (including property, equipment and computer software expenditures) and tax-related payments and may include business acquisitions and share repurchases and business acquisitions.repurchases.
As of December 31, 2018, we had cash and cash equivalents of $20.3 million and debt principal of $1,349.8 million. We believe that our cash flows from operations and available cash and cash equivalents are sufficient to meet our liquidity needs, including the repayment of our outstanding debt, for at least the next 12 months. We anticipate that to the extent that we require additional liquidity, it will be funded through borrowings on our revolving credit facility, the incurrence of other indebtedness, equity issuance or a combination thereof. We cannot be assured that we will be able to obtain this additional liquidity on reasonable terms, or at all. The loss of the largest lender on our revolving credit facility would reduce our borrowing capacity by $68.0$102.5 million. Additionally, our liquidity and our ability to meet our obligations and fund our capital requirements are also dependent on our future financial performance, which is subject to general economic, financial and other factors that are beyond our control. Accordingly, we cannot be assured that our business will generate sufficient cash flows from operations or that future borrowings will be available from additional indebtedness or otherwise to meet our liquidity needs. Although we have no specific current plans to do so, if we decide to pursue one or more significant acquisitions, we may incur additional debt or sell additional equity to finance such acquisitions.
On February 8, 2019,The CARES Act allows us to defer payments of our share of social security taxes until December 31, 2021 and 2022. As of December 31, 2020, we invested $375.0have deferred $14.8 million in The Dun & Bradstreet Corporation ("D&B") for an economic ownership of approximately 18%. This investment was funded by borrowings on our revolving credit facility. Refer to Note 3 to the Notes to Consolidated Financial Statements for additional informationpayments related to our investment in D&B.employer social security taxes.
Cash Flows
The following table provides a summary of cash flows from operating, investing and financing activities for the periods presented (in millions):
Year ended December 31,Year ended December 31,Variance
2018 2017 20162020201920182020 v. 20192019 v. 2018
Cash flows provided by operating activities$435.5
 $351.1
 $325.7
Cash flows provided by operating activities$415.4 $378.3 $435.5 $37.1 $(57.2)
Cash flows used in investing activities(144.1) (84.7) (230.2)Cash flows used in investing activities(2,089.2)(551.0)(144.1)(1,538.2)(406.9)
Cash flows used in financing activities(287.3) (384.1) (147.6)
Cash flows provided by (used in) financing activitiesCash flows provided by (used in) financing activities1,693.1 167.8 (287.3)1,525.3 455.1 
Net increase (decrease) in cash and cash equivalents$4.1
 $(117.7) $(52.1)Net increase (decrease) in cash and cash equivalents$19.3 $(4.9)$4.1 $24.2 $(9.0)
Operating Activities
The $84.4$37.1 million increase in cash provided by operating activities in 20182020 compared to 20172019 is primarily related to increasedhigher earnings excludingand the prior year effecttiming of the Tax Reform Act andpayments for employer payroll taxes, partially offset by acquisition-related payments. The $57.2 million decrease in cash provided by operating activities in 2019 compared to 2018 was primarily related to the timing and amount of cash receipts for Trade receivables, net. The $25.4 million increase in cash provided by operating activities in 2017 compared to 2016 isnet, higher payments primarily related to increased earnings excludingincome taxes and incentive bonus, and the effecttiming of the Tax Reform Act, partially offset by the increase in working capital.

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payments for Trade accounts payable and other accrued liabilities.
Investing Activities
The $59.4$1,538.2 million increase in cash used in investing activities in 20182020 compared to 20172019 is primarily related to the HeavyWater and Ernst acquisitions andacquisition of Optimal Blue, partially offset by higher capital expendituresinvestments related to Star Parent in 2018.2019. The $145.5$406.9 million decreaseincrease in cash used in investing activities in 20172019 compared to 20162018 was primarily related to investments in Star Parent and our acquisition of Compass Analytics.
Financing Activities
The $1,525.3 million increase in cash provided by financing activities in 2020 compared to 2019 is primarily related to business acquisitionsthe issuance by BKIS of $1.0 billion in 2016.
Financing Activities
aggregate principal amount of 3.625% senior unsecured notes due 2028 (the "Senior Notes"), contributions from affiliates of Cannae and THL to their redeemable noncontrolling interests in Optimal Blue Holdco and cash proceeds received from our underwritten common stock offering, partially offset by higher net payments on our revolving credit facility. The $96.8 million decrease in cash used in financing activities in 2018 compared to 2017 is primarily related to tax distributions to BKFS LLC members and the senior notes redemption fee in 2017. The $236.5$455.1 million increase in cash used inprovided by financing activities in 20172019 compared to 20162018 was primarily related to purchases of treasury stock,an incremental debt-related payments, net of borrowings, and higher tax distributionsborrowing to BKFS LLC members.fund our DNB Investment as well as fewer share repurchases.
Financing
For a description of our financing arrangements, see Note 1112 to the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Report, which is incorporated by reference into this Part II Item 7.
Contractual Obligations
Our long-term contractual obligations generally include our debt and related interest payments, data processing and maintenance commitments and operating and finance lease payments on certain offor our offices, data centers, property and equipment. These long-term contractual obligations extend through 2028.
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As of December 31, 2018,2020, our required annual payments relating to these contractual obligations were as follows (in millions):
Payments due by period
   Payments due by periodTotal20212022-20232024-2025Thereafter
Debt(1)
Debt(1)
$2,213.7 $73.5 $1,140.2 $— $1,000.0 
Interest on debt(2)
Interest on debt(2)
365.4 77.8 116.9 72.5 98.2 
Data processing and maintenance commitmentsData processing and maintenance commitments91.1 47.3 43.4 0.4 — 
 Total 2019 2020-2021 2022-2023 Thereafter
Long-term debt $1,349.8
 $53.2
 $128.2
 $1,168.4
 $
Interest on long-term debt (1) 218.6
 53.4
 102.7
 62.5
 
Data processing and maintenance commitments 151.6
 66.3
 85.3
 
 
Operating lease payments 31.0
 11.1
 15.5
 3.7
 0.7
Operating lease payments45.6 13.6 15.8 8.9 7.3 
Other (2) 7.2
 1.7
 3.3
 2.2
 
Other(3)
Other(3)
3.9 1.7 2.2 — — 
Total $1,758.2
 $185.7
 $335.0
 $1,236.8
 $0.7
Total$2,719.7 $213.9 $1,318.5 $81.8 $1,105.5 
___________________
(1)These calculations include the effect of our interest rate swaps and assume that (a) applicable margins remain constant; (b) our term A loan and revolving credit facility variable rate debt is priced at the one-month LIBOR rate in effect as of December 31, 2018; (c) only mandatory debt repayments are made; and (d) no refinancing occurs at debt maturity.
(2)
(1)    Includes finance lease obligations.
(2)    These calculations include the effect of our interest rate swaps and assume that (a) applicable margins remain constant; (b) our term A loan and revolving credit facility variable rate debt is priced at the one-month LIBOR rate in effect as of December 31, 2020; (c) only mandatory debt repayments are made; and (d) no refinancing occurs at debt maturity.
(3)    Other includes commitment fees on our revolving credit facility and rating agencies fees.

Share Repurchase Program
On January 31, 2017, our Board of Directors authorized a three-year share repurchase program, under which we could repurchase up to 10 million shares of Black Knight Financial Services, Inc. ("BKFS") Class A common stock through February 2, 2020, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and other restrictions. In connection with the Distribution, our Board of Directors approved a share repurchase program authorizing the repurchase of shares of BKI common stock consistent with the previous BKFS share repurchase program.
A summary of share repurchases under our share repurchase programfor the periods covered in this report is as follows (in millions, except for per share amounts):
YearTotal number of shares repurchasedAggregate purchase priceAverage price paid per shareShares remaining under repurchase authorization as of December 31,
20183.0 $141.5 $47.15 3.8 
20190.2 11.9 $57.94 3.6 
Total3.2 $153.4 $47.84 
Year Total number of shares repurchased Aggregate purchase price Average price paid per share Shares remaining as of December 31,
 BKI BKFS Class A   
2017 2.0
 1.2
 $136.7
 $42.87
 6.8
2018 3.0
 
 141.5
 47.15
 3.8
Total 5.0
 1.2
 $278.2
 $44.94
  
On February 12, 2020, our Board of Directors approved a three-year share repurchase program authorizing us to repurchase up to 10.0 million shares of our outstanding common stock through February 12, 2023, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and other restrictions. We did not make any repurchases under this program during the year ended December 31, 2020.
Indemnifications and Warranties
We often agree to indemnify our clients against damages and costs resulting from claims of patent, copyright, trademark infringement or breaches of confidentiality associated with use of our software through software licensing agreements. Historically, we have not made any payments under such indemnifications, but continue to monitor the conditions that are subject to the indemnifications to identify whether a loss has occurred that is both probable and estimable that would require recognition. In addition, we warrant to clients that our software operates substantially in accordance with the software specifications. Historically, no costs have been incurred related to software warranties and none are expected in the future, and as such, no accruals for warranty costs have been made.

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Off-Balance Sheet Arrangements
We do not have any material off-balance sheet arrangements other than operating leases and interest rate swaps.
Recent Accounting Pronouncements
See Note 2 to the Notes to Consolidated Financial Statements for a description of recent accounting pronouncements.
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Item 7A.Quantitative and Qualitative Disclosure about Market Risk
Item 7A.    Quantitative and Qualitative Disclosure about Market Risk
In the normal course of business, we are routinely subject to a variety of risks, as described in Item 1A. Risk Factors of Part I of this Report and in our other filings with the SEC.
The risks related to our business also include certain market risks that may affect our debt and other financial instruments. At present, we face the market risks primarily associated with interest rate movements on our outstanding debt.
Market Risk
We regularly assess market risks and have established policies and business practices designed to protect against the adverse effects of these exposures.We are exposed to market risks primarily from changes in interest rates. We use interest rate swaps to manage interest rate risk. We do not use interest rate swaps for trading purposes, to generate income or to engage in speculative activity.
Interest Rate Risk
In addition to existing cash balances and cash provided by operating activities, we use fixed and variable rate debt to finance our operations.
Our Senior Notes represent our fixed-rate long-term debt. Refer to Note 12 to the Notes to Consolidated Financial Statements. The carrying value of our Senior Notes was $988.1 million, net of original issue discount and debt issuance costs, as of December 31, 2020. The fair value of our Senior Notes was approximately $1,026.3 million as of December 31, 2020. The potential reduction in fair value of the Senior Notes from a hypothetical 10 percent increase in market interest rates would not be material to the overall fair value of debt.    
We enter into interest rate swap agreements to hedge forecasted monthly interest rate payments on our variable rate debt. We are exposed to interest rate risk on theseour debt obligations and related interest rate swaps. As of December 31, 2018,2020, we had $1,316.9$1,196.1 million in long-term debt principal outstanding from our 2018 Facilities, as defineddescribed in Note 1112 to the Notes to Consolidated Financial Statements, all of which is variable rate debt.
TheAs of December 31, 2020, the 2018 Facilities represent our long-term debt obligations as of December 31, 2018 exposed to interest rate risk. We performed a sensitivity analysis based on the principal amount of debt as of December 31, 2018,2020, as well as the effect of our interest rate swaps. Further, in this sensitivity analysis, the change in interest rates is assumed to be applicable for an entire year. An increase or decrease of 100 basis points in the applicable interest rate would cause an increase orin interest expense of $12.0 million on an annual basis ($2.5 million including the effect of our current interest rate swaps). A decrease in the applicable rate to 0% would cause a decrease in interest expense of $13.2$1.6 million on an annual basis ($2.70.3 million including the effect of our current interest rate swaps) as the 1-week and 1-month LIBOR rate was 2.52%were approximately 0.10% and 0.15%, respectively, as of December 31, 2018.2020.
We have entered into interest rate swap agreements to hedge forecasted monthly interest rate payments on our variable rate debt. On May 29, 2018, we entered into an interest rate swap agreement with a forward starting date of January 31, 2019. As of December 31, 2018,2020, we have the following interest rate swaps agreements (collectively, the "Swap Agreements") (in millions):
Effective dates Notional amount Fixed ratesEffective datesNotional amountFixed rates
February 1, 2016 through January 31, 2019 $200.0
 1.01%
February 1, 2016 through January 31, 2019 $200.0
 1.01%
March 31, 2017 through March 31, 2022 $200.0
 2.08%March 31, 2017 through March 31, 2022$200.0 2.08%
September 29, 2017 through September 30, 2021 $200.0
 1.69%September 29, 2017 through September 30, 2021$200.0 1.69%
April 30, 2018 through April 30, 2023 $250.0
 2.61%April 30, 2018 through April 30, 2023$250.0 2.61%
January 31, 2019 through January 31, 2023 $300.0
 2.65%January 31, 2019 through January 31, 2023$300.0 2.65%
Under the terms of the Swap Agreements, we receive payments based on the 1-month LIBOR rate (approximately 2.52%0.15% as of December 31, 2018)2020).
The Swap Agreements wereare designated as cash flow hedging instruments. A portion of the amount included in Accumulated other comprehensive earningsloss is reclassified into Interest expense, net as a yield adjustment as interest payments are made on the hedged debt. In accordance with the authoritative guidance for fair value measurements, theThe inputs used to determine the estimated fair value of our interest rate swaps are levelLevel 2 inputs. We considered our own credit risk and the credit risk of the counterparties when determining the fair value of our Swap Agreements.

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Item 8.Financial Statements and Supplementary Data
Item 8.    Financial Statements and Supplementary Data
BLACK KNIGHT, INC. AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
 
Page

Number

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Report of Independent Registered Public Accounting Firm


To the Shareholders and Board of Directors
Black Knight, Inc.:
Opinion on Internal Control Over Financial Reporting
We have audited Black Knight, Inc. and subsidiaries’subsidiaries' (the "Company")Company) internal control over financial reporting as of December 31, 2018,2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018,2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”)(PCAOB), the consolidated balance sheets of the Company as of December 31, 20182020 and 2017,2019, the related consolidated statements of earnings and comprehensive earnings, equity, and cash flows for each of the years in the three-year period ended December 31, 2018,2020, and the related notes (collectively, the “consolidatedconsolidated financial statements”)statements), and our report dated February 22, 201926, 2021 expressed an unqualified opinion on those consolidated financial statements.
The Company acquired HeavyWater, Inc. ("HeavyWater") on May 31, 2018 and Ernst Publishing Co.,Optimal Blue, LLC and two related entities (collectively, "Ernst") on November 6, 2018,(Optimal Blue) during 2020, and management excluded from its assessment of the effectiveness of the Company'sCompany’s internal control over financial reporting as of December 31, 2018, HeavyWater's and Ernst's2020, Optimal Blue’s internal control over financial reporting associated with approximately 1.4% of total assets of 1.0% and 0.1% of total revenues of 3.0% included in the consolidated financial statements of the Company as of and for the year ended December 31, 2018.2020. Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of HeavyWater and Ernst.Optimal Blue.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management'sManagement’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG LLP
Jacksonville, Florida
February 22, 201926, 2021

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Report of Independent Registered Public Accounting Firm




To the Shareholders and Board of Directors
Black Knight, Inc.:
Opinion on the ConsolidatedFinancial Statements
We have audited the accompanying consolidated balance sheets of Black Knight, Inc. and subsidiaries (the “Company”)Company) as of December 31, 20182020 and 2017,2019, the related consolidated statements of earnings and comprehensive earnings, equity, and cash flows for each of the years in the three‑year period ended December 31, 2018,2020, and the related notes (collectively, the “consolidatedconsolidated financial statements”)statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 20182020 and 2017,2019, and the results of its operations and its cash flows for each of the years in the three‑year period ended December 31, 2018,2020, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”)(PCAOB), the Company’s internal control over financial reporting as of December 31, 2018,2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 22, 201926, 2021 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
ChangeInvestment in Accounting PrincipleStar Parent, L.P.
As discussed in Notes 2 and 14Note 4 to the consolidated financial statements, the Company has changed its methodmade an investment in Star
Parent, L.P., the ultimate parent of accounting for revenueThe Dun & Bradstreet Corporation, on February 8, 2019.
Acquisition of Optimal Blue, LLC
As discussed in Notes 2 and costs in 2018 in response3 to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers.consolidated financial statements, the Company acquired Optimal Blue, LLC (Optimal Blue) on September 15, 2020.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Assessment of revenue recognition for contracts with multiple performance obligations or modifications
As discussed in Notes 2 and 16to the consolidated financial statements, the Company is often party to multiple concurrent contracts or contracts in which a customer may purchase a combination of products and services. For contracts with customers that contain various combinations of products and services, the Company must evaluate whether the promises within the contract are capable of being distinct and are distinct in the context of the contract. Distinct products or services are accounted for as separate performance obligations, while non-distinct products or services are combined with others to form a single performance obligation. Given the nature of the Company’s product and service offerings, there is complexity in determining whether the promises are separate performance obligations or a combined performance obligation. Further, arrangements with customers may change to reflect new pricing and/or
41


scope of services. For contract modifications, the Company must assess the relevant facts and circumstances to determine if the contract should be accounted for as a separate contract, prospectively or through a cumulative catch-up adjustment. The identification of performance obligations, specifically for revenue contracts with professional services, as well as the determination as to whether a contract modification has occurred and the related accounting treatment, influence the amount and timing of revenue recognition.
We identified the assessment of revenue recognition for contracts with multiple performance obligations or modifications as a critical audit matter. Specifically, the critical audit matter related to the Company’s identification of performance obligations for revenue contracts with professional services, the determination as to whether a contract modification occurred for certain contracts with customers and the resulting accounting treatment. This was due to the extensive audit effort and complex auditor judgment required to evaluate the Company’s contracts in these circumstances.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the revenue recognition process. This included controls over the Company’s review of customer contracts for the identification of performance obligations, determination if a modification has occurred, and determination of the accounting treatment for contract modifications. For selected new and modified revenue arrangements, we assessed the Company’s (1) identification of performance obligations, (2) identification of contract modifications, and (3) analysis of the accounting treatment for contract modifications, by evaluating the Company’s analysis of the revenue arrangements as compared to the revenue recognition standard and the underlying contracts and/or statements of work. In addition, for a sample of professional services revenue transactions, we assessed the Company’s identification of distinct and non-distinct performance obligations by evaluating the Company’s analysis through comparison to contract source documents and correspondence or through involvement of information technology professionals in discussions with the Company’s product and service technicians.
Evaluation of the acquisition-date fair value of the client relationship intangible assets and computer software assets acquired in the Optimal Blue transaction
As discussed in Notes 2 and 3 to the consolidated financial statements, on September 15, 2020, the Company acquired Optimal Blue in a business combination. As a result of the transaction, the Company acquired client relationship intangible assets associated with the generation of future income from Optimal Blue’s existing clients and computer software assets associated with Optimal Blue’s technology applications. The acquisition-date fair value for the client relationship intangible assets and computer software assets was $602.5 million and $79.7 million, respectively.
We identified the evaluation of the acquisition-date fair value of the client relationship intangible assets and computer software assets acquired in the Optimal Blue transaction as a critical audit matter. There was a high degree of subjectivity in evaluating the discounted cash flow models used to determine the acquisition-date fair value of the client relationship intangible assets and computer software assets. The discounted cash flow models included certain internally-developed assumptions for which there was limited observable market information, and the fair value of such assets are sensitive to changes. The internally-developed assumptions for client relationship intangible assets that were more sensitive to changes included 1) forecasted revenues attributable to client contracts, 2) estimated annual attrition, and 3) weighted-average cost of capital (WACC), including estimated discount rates. For computer software assets, the internally-developed assumptions that were more sensitive to changes included 1) forecasted revenues attributable to software assets and 2) estimated royalty rate.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s acquisition-date valuation process, including controls over the development of the above assumptions. We compared the Company’s estimates of:
forecasted revenue attributable to client relationship intangible assets and computer software assets to Optimal Blue’s historical actual results and to the Company’s peers,
forecasted annual attrition to Optimal Blue’s historical client attrition data and industry data, and
royalty rate to third-party royalty rates of similar computer software licenses.
We assessed the assumptions for comparison to those of a market participant, including consideration of recent similar market transactions. In addition, we involved valuation professionals with specialized skills and knowledge, who assisted in:
evaluating the Company’s determined WACC by comparing it to the WACCs of the Company’s peers,
evaluating the Company’s discount rates, by comparing them against a discount rate that was independently developed using publicly available market data for comparable entities,
42


evaluating the Company’s selected royalty rate, by comparing it against a royalty rate range that was independently developed using publicly available market data for comparable licensing activities, and
testing the Company’s model utilized to estimate the fair value of the client relationship intangible assets and computer software assets.
/s/ KPMG LLP
We have served as the Company’s auditor since 2007.
Jacksonville, Florida
February 22, 201926, 2021

43




BLACK KNIGHT, INC.
Consolidated Balance Sheets
(In millions, except share data)
 
December 31,December 31,
2018 201720202019
ASSETS   ASSETS
Current assets: 
  
Current assets:  
Cash and cash equivalents$20.3
 $16.2
Cash and cash equivalents$34.7 $15.4 
Trade receivables, net172.3
 201.8
Trade receivables, net182.2 175.1 
Prepaid expenses and other current assets67.3
 44.6
Prepaid expenses and other current assets70.4 64.8 
Receivables from related parties6.2
 18.1
Receivables from related parties0.2 
Total current assets266.1
 280.7
Total current assets287.3 255.5 
Property and equipment, net177.1
 179.9
Property and equipment, net163.1 176.9 
Computer software, net405.6
 416.8
Computer software, net498.3 406.0 
Other intangible assets, net188.0
 231.6
Other intangible assets, net692.3 150.0 
Goodwill2,329.7
 2,306.8
Goodwill3,613.4 2,361.4 
Investments in unconsolidated affiliatesInvestments in unconsolidated affiliates470.5 294.9 
Deferred contract costs, netDeferred contract costs, net172.3 159.3 
Other non-current assets286.9
 240.1
Other non-current assets193.3 158.8 
Total assets$3,653.4
 $3,655.9
Total assets$6,090.5 $3,962.8 
LIABILITIES AND EQUITY   LIABILITIES AND EQUITY
Current liabilities: 
  
Current liabilities:  
Trade accounts payable and other accrued liabilities$67.8
 $65.0
Trade accounts payable and other accrued liabilities$88.1 $65.3 
Accrued compensation and benefits65.8
 51.9
Accrued compensation and benefits79.3 65.5 
Current portion of long-term debt52.5
 55.1
Current portion of debtCurrent portion of debt73.0 79.1 
Deferred revenues52.9
 59.6
Deferred revenues50.9 50.9 
Total current liabilities239.0
 231.6
Total current liabilities291.3 260.8 
Deferred revenues106.8
 100.7
Deferred revenues92.7 98.0 
Deferred income taxes, net220.9
 224.6
Deferred income taxesDeferred income taxes284.0 185.3 
Long-term debt, net of current portion1,284.2
 1,379.0
Long-term debt, net of current portion2,121.9 1,465.1 
Other non-current liabilities16.0
 11.2
Other non-current liabilities94.9 55.1 
Total liabilities1,866.9
 1,947.1
Total liabilities2,884.8 2,064.3 
Commitments and contingencies (Note 13)

 

Commitments and contingencies (Note 14)Commitments and contingencies (Note 14)00
Redeemable noncontrolling interestsRedeemable noncontrolling interests578.0 
Equity: 
  Equity: 
Common stock; $0.0001 par value; 550,000,000 shares authorized; 153,241,851 shares issued and 149,358,973 shares outstanding as of December 31, 2018, and 153,430,030 shares issued and 151,430,030 shares outstanding as of December 31, 2017
 
Preferred stock; $0.0001 par value; 25,000,000 shares authorized; issued and outstanding, none as of December 31, 2018 and 2017
 
Common stock; $0.0001 par value; 550,000,000 shares authorized; 160,085,413 shares issued and 157,014,712 shares outstanding as of December 31, 2020, and 153,062,920 shares issued and 149,697,754 shares outstanding as of December 31, 2019Common stock; $0.0001 par value; 550,000,000 shares authorized; 160,085,413 shares issued and 157,014,712 shares outstanding as of December 31, 2020, and 153,062,920 shares issued and 149,697,754 shares outstanding as of December 31, 2019
Preferred stock; $0.0001 par value; 25,000,000 shares authorized; issued and outstanding, NaN as of December 31, 2020 and 2019Preferred stock; $0.0001 par value; 25,000,000 shares authorized; issued and outstanding, NaN as of December 31, 2020 and 2019
Additional paid-in capital1,585.8
 1,593.6
Additional paid-in capital2,053.7 1,586.8 
Retained earnings381.1
 201.4
Retained earnings757.4 490.6 
Accumulated other comprehensive earnings0.3
 3.9
Treasury stock, at cost, 3,882,878 shares as of December 31, 2018 and 2,000,000 shares as of December 31, 2017(180.7) (90.1)
Total equity1,786.5
 1,708.8
Total liabilities and equity$3,653.4
 $3,655.9
Accumulated other comprehensive lossAccumulated other comprehensive loss(38.8)(20.2)
Treasury stock, at cost, 3,070,701 shares as of December 31, 2020 and 3,365,166 shares as of December 31, 2019Treasury stock, at cost, 3,070,701 shares as of December 31, 2020 and 3,365,166 shares as of December 31, 2019(144.6)(158.7)
Total shareholders' equityTotal shareholders' equity2,627.7 1,898.5 
Total liabilities, redeemable noncontrolling interests and shareholders' equityTotal liabilities, redeemable noncontrolling interests and shareholders' equity$6,090.5 $3,962.8 
See Notes to Consolidated Financial Statements.



50
44




BLACK KNIGHT, INC.
Consolidated Statements of Earnings and Comprehensive Earnings
(In millions, except per share data)

Year ended December 31,Year ended December 31,
2018 2017 2016202020192018
Revenues$1,114.0
 $1,051.6
 $1,026.0
Revenues$1,238.5 $1,177.2 $1,114.0 
Expenses:     Expenses:
Operating expenses625.4
 569.5
 582.6
Operating expenses669.6 646.0 625.4 
Depreciation and amortization217.0
 206.5
 208.3
Depreciation and amortization270.7 236.2 217.0 
Transition and integration costs6.6
 13.1
 2.3
Transition and integration costs31.4 5.4 6.6 
Total expenses849.0
 789.1
 793.2
Total expenses971.7 887.6 849.0 
Operating income265.0
 262.5
 232.8
Operating income266.8 289.6 265.0 
Other income and expense:     Other income and expense:
Interest expense, net(51.7) (57.5) (67.6)Interest expense, net(62.9)(63.5)(51.7)
Other expense, net(7.1) (12.6) (6.4)
Other income (expense), netOther income (expense), net16.4 (1.4)(7.1)
Total other expense, net(58.8) (70.1) (74.0)Total other expense, net(46.5)(64.9)(58.8)
Earnings before income taxes206.2
 192.4
 158.8
Income tax expense (benefit)37.7
 (61.8) 25.8
Earnings before income taxes and equity in earnings (losses) of unconsolidated affiliatesEarnings before income taxes and equity in earnings (losses) of unconsolidated affiliates220.3 224.7 206.2 
Income tax expenseIncome tax expense41.6 41.9 37.7 
Earnings before equity in earnings (losses) of unconsolidated affiliatesEarnings before equity in earnings (losses) of unconsolidated affiliates178.7 182.8 168.5 
Equity in earnings (losses) of unconsolidated affiliates, net of taxEquity in earnings (losses) of unconsolidated affiliates, net of tax67.1 (74.0)
Net earnings168.5
 254.2
 133.0
Net earnings245.8 108.8 168.5 
Less: Net earnings attributable to noncontrolling interests
 71.9
 87.2
Net losses attributable to redeemable noncontrolling interestsNet losses attributable to redeemable noncontrolling interests18.3 
Net earnings attributable to Black Knight$168.5
 $182.3
 $45.8
Net earnings attributable to Black Knight$264.1 $108.8 $168.5 
Other comprehensive (loss) earnings:     Other comprehensive (loss) earnings:
Unrealized holding (losses) gains, net of tax (1)(0.7) 3.7
 (1.1)
Reclassification adjustments for (gains) losses included in net earnings,
net of tax (2)
(2.7) 0.4
 0.5
Total unrealized (losses) gains on interest rate swaps, net of tax(3.4) 4.1
 (0.6)
Unrealized holding losses, net of tax(1)
Unrealized holding losses, net of tax(1)
(23.9)(18.0)(0.7)
Reclassification adjustments for losses (gains) included in net earnings,
net of tax(2)
Reclassification adjustments for losses (gains) included in net earnings,
net of tax(2)
12.2 (2.7)
Total unrealized losses on interest rate swaps, net of taxTotal unrealized losses on interest rate swaps, net of tax(11.7)(18.0)(3.4)
Foreign currency translation adjustment, net of tax (3)(0.2) 
 (0.1)
Foreign currency translation adjustment, net of tax(3)
(0.1)(0.1)(0.2)
Other comprehensive (loss) earnings(3.6) 4.1
 (0.7)
Comprehensive earnings attributable to noncontrolling interests
 74.1
 86.0
Unrealized losses on investments in unconsolidated affiliates(4)
Unrealized losses on investments in unconsolidated affiliates(4)
(6.8)(3.4)
Other comprehensive lossOther comprehensive loss(18.6)(21.5)(3.6)
Comprehensive earnings$164.9
 $260.5
 $131.1
Comprehensive earnings227.2 87.3 164.9 
Net losses attributable to redeemable noncontrolling interestsNet losses attributable to redeemable noncontrolling interests18.3 
Comprehensive earnings attributable to Black KnightComprehensive earnings attributable to Black Knight$245.5 $87.3 $164.9 
     
Year ended December 31,
2018 2017 2016
Earnings per share:     
Net earnings per share attributable to Black Knight common shareholders:     Net earnings per share attributable to Black Knight common shareholders:
Basic$1.14
 $2.06
 $0.69
Basic$1.74 $0.74 $1.14 
Diluted$1.14
 $1.47
 $0.67
Diluted$1.73 $0.73 $1.14 
Weighted average shares of common stock outstanding (see Note 4):     
Weighted average shares of common stock outstanding (see Note 5):Weighted average shares of common stock outstanding (see Note 5):
Basic147.6
 88.7
 65.9
Basic152.0 147.7 147.6 
Diluted148.2
 152.4
 67.9
Diluted152.9 148.6 148.2 

(1)Net of income tax (benefit) expense of $(0.2) million, $2.1 million, and $(0.7) million for the years ended December 31, 2018, 2017 and 2016, respectively.
(1)    Net of income tax benefit of $8.1 million, $6.1 million and $0.2 million for the years ended December 31, 2020, 2019 and 2018, respectively.
(2) Amounts reclassified to net earnings relate to losses (gains) losses on interest rate swaps and are included in Interest expense, on the Consolidated Statements of Earnings and Comprehensive Earnings. Amount isnet above. Amounts are net of income tax (benefit) expense of $(1.0)$4.1 million $0.3for the year ended December 31, 2020 and income tax benefit of $1.0 million and $0.3for the year ended December 31, 2018.
(3) Net of income tax benefit of less than $0.1 million for the years ended December 31, 2018, 20172020 and 2016, respectively.
(3) Net of2019 and income tax benefit of $0.1 million for the year ended December 31, 2018.

(4) Net of income tax benefit of $2.3 million and $1.1 million for the years ended December 31, 2020 and 2019, respectively.

See Notes to Consolidated Financial Statements.

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51

Table of Contents



BLACK KNIGHT, INC.
Consolidated Statements of Equity
(In millions)
Common stockAdditional paid-in capitalRetained earningsAccumulated other comprehensive earnings (loss)Treasury stock
Shares$Shares$Total equity
Balance, December 31, 2017153.4 $— $1,593.6 $201.4 $3.9 2.0 $(90.1)$1,708.8 
Cumulative effect of ASC 606 adoption— — — 11.2 — — — 11.2 
Adjusted balance, January 1, 2018153.4 — 1,593.6 212.6 3.9 2.0 (90.1)1,720.0 
Grant of restricted shares of common stock— — (52.2)— — (1.1)52.2 — 
Forfeitures of restricted shares of common stock— — 0.6 — — — (0.6)— 
Tax withholding payments for restricted share vesting(0.2)— (9.4)— — — (9.4)
Vesting of restricted shares granted from treasury stock— — 0.7 — — — (0.7)— 
Purchases of treasury stock— — — — — 3.0 (141.5)(141.5)
Equity-based compensation expense— — 50.7 — — — — 50.7 
Net earnings— — — 168.5 — — — 168.5 
Foreign currency translation adjustment— — — — (0.2)— — (0.2)
Unrealized losses on interest rate swaps, net— — — — (3.4)— — (3.4)
Receipt from finalization of tax distribution— — 1.8 — — — — 1.8 
Balance, December 31, 2018153.2 — 1,585.8 381.1 0.3 3.9 (180.7)1,786.5 
Effect of ASU 2018-02 adoption (Note 2)— — — (1.0)1.0 — — — 
Adjusted balance, January 1, 2019153.2 — 1,585.8 380.1 1.3 3.9 (180.7)1,786.5 
Grant of restricted shares of common stock— — (43.7)— — (0.9)43.7 — 
Forfeitures of restricted shares of common stock— — 3.1 — — 0.1 (3.1)— 
Tax withholding payments for restricted share vesting(0.1)— (15.9)— — — — (15.9)
Vesting of restricted shares granted from treasury stock— — 6.7 — — 0.1 (6.7)— 
Purchases of treasury stock— — — — — 0.2 (11.9)(11.9)
Equity-based compensation expense— — 50.8 — — — — 50.8 
Net earnings— — — 108.8 — — — 108.8 
Foreign currency translation adjustment— — — — (0.1)— — (0.1)
Equity-based compensation expense of unconsolidated affiliates— — — 1.7 — — — 1.7 
Unrealized losses on interest rate swaps, net— — — — (18.0)— — (18.0)
Other comprehensive loss on investments in unconsolidated
affiliates
— — — — (3.4)— — (3.4)
Balance, December 31, 2019153.1 $— $1,586.8 $490.6 $(20.2)3.4 $(158.7)$1,898.5 

46

Table of Contents

 Black Knight Financial Services, Inc. Black Knight, Inc.              
 Class A common stock Class B common stock Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive (loss) earnings Treasury stock    
 Shares $ Shares $ Shares $    Shares $ Noncontrolling interests Total equity
Balance,
December 31, 2015
68.3
 $
 84.8
 $
 
 $
 $798.9
 $19.9
 $(0.1) 
 $
 $1,026.3
 $1,845.0
Issuance of restricted shares of Class A common stock0.8
 
 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation expense
 
 
 
 
 
 11.9
 
 
 
 
 
 11.9
Net earnings
 
 
 
 
 
 
 45.8
 
 
 
 87.2
 133.0
Foreign currency translation adjustment
 
 
 
 
 
 
 
 (0.1) 
 
 
 (0.1)
Unrealized losses on interest rate swaps
 
 
 
 
 
 
 
 (0.6) 
 
 (1.2) (1.8)
Tax distributions
 
 
 
 
 
 
 
 
 
 
 (48.6) (48.6)
Balance,
December 31, 2016
69.1
 
 84.8
 
 
 
 810.8
 65.7
 (0.8) 
 
 1,063.7
 1,939.4
Issuance of restricted shares of Class A common stock1.0
 
 
 
 
 
 
 
 
 
 
 
 
Forfeitures of restricted shares of Class A common stock(0.1) 
 
 
 
 
 
 
 
 
 
 
 
Exchange of Class B common stock for Class A common stock0.2
 
 (0.2) 
 
 
 
 
 
 
 
 
 
Tax withholding payments for restricted share vesting(0.1) 
 
 
 (0.1) 
 (6.1) 
 
 
 
 
 (6.1)
Purchases of treasury stock
 
 
 
 
 
 
 
 
 3.2
 (136.7) 
 (136.7)
Equity-based compensation expense
 
 
 
 
 
 18.7
 
 
 
 
 
 18.7
Net earnings
 
 
 
 
 
 
 182.3
 
 
 
 71.9
 254.2
Unrealized gains on interest rate swaps, net
 
 
 
 
 
 
 
 4.1
 
 
 2.2
 6.3
Tax distributions to members
 
 
 
 
 
 
 
 
 
 
 (75.3) (75.3)
Distribution of FNF's ownership interest and related transactions(70.1) 
 (84.6) 
 153.5
 
 770.2
 (46.6) 0.6
 (1.2) 46.6
 (1,062.5) (291.7)
Balance,
December 31, 2017

 
 
 
 153.4
 
 1,593.6
 201.4
 3.9
 2.0
 (90.1) 
 1,708.8
Cumulative effect of ASC 606 adoption (Note 14 )        
 
 
 11.2
 
 
 
 
 11.2
Adjusted balance,
January 1, 2018
        153.4
 
 1,593.6
 212.6
 3.9
 2.0
 (90.1) 
 1,720.0
Grant of restricted shares of common stock        
 
 (52.2) 
 
 (1.1) 52.2
 
 
Forfeitures of restricted shares of common stock        
 
 0.6
 
 
 
 (0.6) 
 
Tax withholding payments for restricted share vesting        (0.2) 
 (9.4) 
 
 
 
 
 (9.4)
Vesting of restricted shares granted from treasury stock        
 
 0.7
 
 
 
 (0.7) 
 
Purchases of treasury stock        
 
 
 
 
 3.0
 (141.5) 
 (141.5)
Equity-based compensation expense        
 
 50.7
 
 
 
 
 
 50.7
Net earnings        
 
 
 168.5
 
 
 
 
 168.5
Foreign currency translation adjustment        
 
 
 
 (0.2) 
 
 
 (0.2)
Unrealized losses on interest rate swaps, net        
 
 
 
 (3.4) 
 
 
 (3.4)
Receipt from finalization of tax distribution        
 
 1.8
 
 
 
 
 
 1.8
Balance,
December 31, 2018
        153.2
 $
 $1,585.8
 $381.1
 $0.3
 3.9
 $(180.7) $
 $1,786.5
BLACK KNIGHT, INC.

Consolidated Statements of Equity - (Continued)
(In millions)
Common stockAdditional paid-in capitalRetained earningsAccumulated other comprehensive lossTreasury stock
Shares$Shares$Total
shareholders'
equity
Redeemable noncontrolling interests
Balance, December 31, 2019153.1 $— $1,586.8 $490.6 $(20.2)3.4 $(158.7)$1,898.5 $
Effect of ASU 2016-13 adoption (Note 2)— — — (1.1)— — — (1.1)— 
Adjusted balance at January 1, 2020153.1 — 1,586.8 489.5 (20.2)3.4 (158.7)1,897.4 
Issuance of common stock, net of underwriters' discount and issuance costs7.1 — 484.2 — — — — 484.2 — 
Grant of restricted shares of common stock— — (24.9)— — (0.5)24.9 — — 
Forfeitures of restricted shares of common stock— — 0.6 — — — (0.6)— — 
Tax withholding payments for restricted share vesting(0.1)— (22.4)— — — — (22.4)— 
Vesting of restricted shares granted from treasury stock— —��10.2 — — 0.2 (10.2)— — 
Equity-based compensation expense— — 39.4 — — — — 39.4 — 
Contributions received for redeemable noncontrolling interests in Optimal Blue Holdco, LLC— — — — — — — — 578.0 
Fair value adjustment to redeemable noncontrolling
interests
— — (18.3)— — — — (18.3)18.3 
Deferred income taxes recognized related to the contribution of Compass Analytics to Optimal Blue Holdco, LLC— — (1.9)— — — — (1.9)— 
Net earnings (loss)— — — 264.1 — — — 264.1 (18.3)
Equity-based compensation expense of unconsolidated affiliates— — — 3.8 — — — 3.8 — 
Foreign currency translation adjustment— — — — (0.1)— — (0.1)— 
Unrealized losses on interest rate swaps, net— — — — (11.7)— — (11.7)— 
Other comprehensive loss on investments in unconsolidated affiliates— — — — (6.8)— — (6.8)— 
Balance, December 31, 2020160.1 $— $2,053.7 $757.4 $(38.8)3.1 $(144.6)$2,627.7 $578.0 


See Notes to Consolidated Financial Statements.

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BLACK KNIGHT, INC.
Consolidated Statements of Cash Flows
(In millions)
Year ended December 31,
202020192018
Cash flows from operating activities: 
Net earnings$245.8 $108.8 $168.5 
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization270.7 236.2 217.0 
Amortization of debt issuance costs and original issue discount3.4 2.9 3.1 
Loss on extinguishment of debt, net5.8 
Deferred income taxes, net(20.6)(3.7)(7.5)
Equity in (earnings) losses on unconsolidated affiliates, net of tax(67.1)74.0 
Equity-based compensation39.4 50.8 50.9 
Changes in assets and liabilities, net of acquired assets and liabilities:
Trade and other receivables, including receivables from related parties7.5 7.4 44.5 
Prepaid expenses and other assets(3.2)(0.9)(41.5)
Deferred contract costs(46.9)(40.9)(44.8)
Deferred revenues(20.7)(15.6)(6.4)
Trade accounts payable and other liabilities7.1 (40.7)45.9 
Net cash provided by operating activities415.4 378.3 435.5 
Cash flows from investing activities: 
Additions to property and equipment(23.9)(22.4)(30.0)
Additions to computer software(89.3)(81.5)(73.1)
Business acquisitions, net of cash acquired(1,869.4)(52.8)(43.4)
Investments in unconsolidated affiliate(100.0)(392.6)
Proceeds from sale of investment in unconsolidated affiliate8.4 
Asset acquisition(15.0)
Other investing activities(1.7)2.4 
Net cash used in investing activities(2,089.2)(551.0)(144.1)
Cash flows from financing activities: 
Net proceeds from issuance of common stock, before offering expenses484.6 
Costs directly associated with issuance of common stock(0.4)
Issuance of senior unsecured notes, net of original issue discount990.0 
Revolver borrowings600.6 876.0 676.9 
Revolver payments(862.9)(648.5)(649.4)
Term loan borrowings258.6 
Term loan payments(54.7)(31.3)(418.5)
Contributions received for redeemable noncontrolling interests578.0 
Purchases of treasury stock(11.9)(141.5)
Receipt from finalization of tax distribution1.8 
Finance lease payments(13.0)
Tax withholding payments for restricted share vesting(22.4)(15.9)(9.4)
Debt issuance costs(2.4)(5.8)
Other financing activities(4.3)(0.6)
Net cash provided by (used in) financing activities1,693.1 167.8 (287.3)
Net increase (decrease) in cash and cash equivalents19.3 (4.9)4.1 
Cash and cash equivalents, beginning of period15.4 20.3 16.2 
Cash and cash equivalents, end of period$34.7 $15.4 $20.3 
Supplemental cash flow information: 
Interest paid, net$(46.8)$(59.9)$(48.0)
Income taxes paid, net$(52.5)$(51.6)$(32.8)
 Year ended December 31,
 2018 2017 2016
Cash flows from operating activities:   
  
Net earnings$168.5
 $254.2
 $133.0
Adjustments to reconcile net earnings to net cash provided by operating activities:     
Depreciation and amortization217.0
 206.5
 208.3
Amortization of debt issuance costs, bond premium and original issue discount3.1
 3.5
 2.7
Loss on extinguishment of debt, net5.8
 12.6
 
Deferred income taxes, net(7.5) (78.4) 3.2
Equity-based compensation50.9
 18.9
 12.4
Changes in assets and liabilities, net of acquired assets and liabilities:     
Trade and other receivables, including receivables from related parties44.5
 (52.5) (6.4)
Prepaid expenses and other assets(41.5) 1.7
 (11.2)
Deferred contract costs(44.8) (48.5) (51.9)
Deferred revenues(6.4) 35.6
 26.2
Trade accounts payable and other liabilities45.9
 (2.5) 9.4
Net cash provided by operating activities435.5
 351.1
 325.7
Cash flows from investing activities:   
  
Additions to property and equipment(30.0) (27.4) (38.1)
Additions to computer software(73.1) (53.3) (41.9)
Business acquisitions, net of cash acquired(43.4) 
 (150.2)
Other investing activities2.4
 (4.0) 
Net cash used in investing activities(144.1) (84.7) (230.2)
Cash flows from financing activities:   
  
Borrowings935.5
 480.0
 55.0
Debt repayments(1,067.9) (214.8) (149.0)
Purchases of treasury stock(141.5) (136.7) 
Senior Notes redemption
 (390.0) 
Senior Notes redemption fee
 (18.8) 
Distributions to members
 (75.3) (48.6)
Receipt from finalization of tax distribution1.8
 
 
Capital lease payments
 (13.8) (5.0)
Tax withholding payments for restricted share vesting(9.4) (6.1) 
Debt issuance costs(5.8) (8.6) 
Net cash used in financing activities(287.3) (384.1) (147.6)
Net increase (decrease) in cash and cash equivalents4.1
 (117.7) (52.1)
Cash and cash equivalents, beginning of period16.2
 133.9
 186.0
Cash and cash equivalents, end of period$20.3
 $16.2
 $133.9
Supplemental cash flow information:   
  
Interest paid$(48.0) $(56.7) $(60.2)
Income taxes paid, net$(32.8) $(15.7) $(21.9)


See Notes to Consolidated Financial Statements.




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BLACK KNIGHT, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Except as otherwise indicated or unless the context otherwise requires, all references to "Black Knight," the "Company," "BKFS," "we," "us" or "our" (1) prior to the Distribution (as defined in Note 1 — Basis of Presentation), are to Black Knight Financial Services, Inc., a Delaware corporation, and its subsidiaries ("BKFS") and (2) after the Distribution, are to Black Knight, Inc., a Delaware corporation ("BKI"), and its subsidiaries ("BKI").subsidiaries.
(1)Basis of Presentation
(1)Basis of Presentation
The accompanying audited consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), and all adjustments considered necessary for a fair presentation have been included. All significant intercompany accounts and transactions have been eliminated.
As a result of the Distribution and the THL Interest Exchange on September 29, 2017 (each as defined below), Black Knight, Inc. became the new public company and owns 100% of BKFS; therefore, we no longer have any noncontrolling interests as of September 30, 2017. Our underlying business remained the same and, for this reason, we did not have a change in reporting entity in accordance with GAAP.
The periods presented represent the consolidated financial position, results of operations and cash flows of: (1) BKI from September 30, 2017, the day subsequent to the Distribution, through December 31, 2018; and (2) BKFS prior to the Distribution.
Description of Business
We are a leading provider of integrated software, data and analytics solutions to the mortgage and consumer loan, real estate and capital markets verticals. Our solutions facilitate and automate many of the mission-critical business processes across the homeownership lifecycle. BKFS was incorporated in the State of DelawareWe are committed to being a premier business partner that clients rely on October 27, 2014,to achieve their strategic goals, realize greater success and BKI was incorporated in the State of Delaware on February 3, 2017.better serve their customers by delivering best-in-class software, services and insights with a relentless commitment to excellence, innovation, integrity and leadership.
Reporting Segments
We conduct our operations through two2 reporting segments, (1) Software Solutions and (2) Data and Analytics. See further discussion in Note 19—21 — Segment Information.
Distribution of FNF's Ownership Interest and Related Transactions
On September 29, 2017, we completed a tax-free plan whereby Fidelity National Financial, Inc. and its subsidiaries ("FNF") distributed all 83.3 million shares of BKFS Class B common stock that it owned to FNF Group shareholders through a series of transactions (the "Distribution"). The Distribution was consummated through four newly-formed corporations, New BKH Corp. ("New BKH"), Black Knight, Inc. (formerly known as Black Knight Holdco Corp.), New BKH Merger Sub, Inc. ("Merger Sub One") and BKFS Merger Sub, Inc. ("Merger Sub Two"), as follows:
Black Knight Holdings, Inc. ("BKHI"), a wholly-owned subsidiary of FNF, contributed all of its 83.3 million shares of BKFS Class B common stock and all of its units of Black Knight Financial Services, LLC ("BKFS LLC") to New BKH in exchange for 100% of the shares of New BKH common stock;
Following which BKHI converted into a limited liability company and distributed to FNF all of the shares of New BKH common stock held by BKHI;
Immediately thereafter, FNF distributed the shares of New BKH common stock to the holders of FNF Group common stock on a pro-rata basis (the "Spin-off");
Immediately following the Spin-off, Merger Sub One merged with and into New BKH (the "New BKH merger");
In the New BKH merger, each outstanding share of New BKH common stock (other than shares owned by New BKH) was exchanged for one share of Black Knight, Inc. common stock. New BKH shares owned by New BKH immediately prior to the New BKH merger were canceled for no consideration. As a result of the Spin-Off and the New BKH merger, FNF Group shareholders received 0.3066322 shares of Black Knight, Inc. common stock for each share of FNF Group common stock they held;
Immediately following the New BKH merger, Merger Sub Two merged with and into Black Knight Financial Services, Inc. (the "BKFS merger");
In the BKFS merger, each outstanding share of BKFS Class A common stock, par value $0.0001 per share ("Class A common stock") (other than shares owned by BKFS) was exchanged for one share of Black Knight, Inc. common stock. Shares of BKFS Class A common stock owned by BKFS, otherwise referred to as treasury stock, immediately prior to the BKFS merger were canceled for no consideration; and

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Black Knight, Inc. is the public company following the completion of the Distribution.
Shares of Black Knight, Inc. common stock are listed on the New York Stock Exchange under the trading symbol “BKI”, and began trading on October 2, 2017. Under the organizational documents of Black Knight, Inc., the rights of the holders of shares of Black Knight, Inc. common stock are substantially the same as the rights of former holders of BKFS Class A common stock.
On June 8, 2017, Black Knight, Inc., BKFS and certain affiliates of Thomas H. Lee Partners, L.P. ("THL") entered into an interest exchange agreement (the "THL Interest Exchange"). Immediately following the completion of the Distribution, affiliates of THL contributed to Black Knight, Inc. all of their BKFS Class B common stock and all of their membership interests in BKFS LLC ("Units") in exchange for a number of shares of Black Knight, Inc. common stock equal to the number of shares of BKFS Class B common stock contributed. Following the completion of the Distribution and the THL Interest Exchange, the shares of BKFS Class B common stock were canceled.
For additional details of the effects of the Distribution, the THL Interest Exchange and other related transactions, see "Share Repurchase Program" within this note, Note 2 — (2)Significant Accounting Policies, Note 15 Equity-Based Compensation, Note 16 Employee Stock Purchase Plan and 401(k) Plan and Note 17 — Income Taxes.
Realignment of Property Insight
Effective January 1, 2017, Property Insight, LLC ("Property Insight"), an indirect subsidiary of Black Knight that provides information used by title insurance underwriters, title agents and closing attorneys to source and underwrite title insurance for real property sales and transfer, realigned its commercial relationship with FNF. In connection with the realignment, Property Insight employees responsible for title plant posting and maintenance were transferred to FNF. Under the new commercial arrangement, we continue to own the title plant technology and retain sales responsibility for third parties, other than FNF. As a result of the realignment, we no longer recognize revenues or expenses related to title plant posting and maintenance, but charge FNF a license fee for use of the technology to access and maintain the title plant data. This transaction did not result in any gain or loss.
Share Repurchase Program
On January 31, 2017, our board of directors approved a three-year share repurchase program, effective February 3, 2017, authorizing us to repurchase up to 10.0 million shares of BKFS Class A common stock from time to time through February 2, 2020, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and other restrictions. In connection with the Distribution, our board of directors approved a share repurchase program authorizing the repurchase of shares of Black Knight, Inc. common stock consistent with the previous share repurchase program. The timing and volume of share repurchases will be determined by our management based on ongoing assessments of the capital needs of the business, the market price of our common stock and general market conditions.
A summary of share repurchases under our share repurchase program is as follows (in millions, except for per share amounts):
Year Total number of shares repurchased Aggregate purchase price Average price paid per share Shares remaining as of December 31,
 BKI BKFS Class A   
2017 2.0
 1.2
 $136.7
 $42.87
 6.8
2018 3.0
 
 141.5
 47.15
 3.8
Total 5.0
 1.2
 $278.2
 $44.94
  
Refer to Note 5 Related Party Transactions for additional information related to the repurchase of shares of BKI common stock.
(2)Significant Accounting Policies
The following describes our significant accounting policies that have been followed in preparing the accompanying consolidated financial statements.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Principles of Consolidation
Prior toThe consolidated financial statements include the Distribution, BKFS LLC was subject toaccounts of BKI, its wholly-owned subsidiaries and non-wholly owned subsidiaries in which we have a controlling financial interest either through voting rights or means other than voting rights. Intercompany transactions and balances have been eliminated in consolidation. Where our ownership interest in a consolidated subsidiary is less than 100%, the consolidation guidance related to variable interest entities as set forth in Accounting Standards Codification ("ASC") Topic 810, Consolidation ("ASC 810"). As the sole managing member of BKFS LLC, we had the exclusive authority to manage, control and operate the business and affairs of BKFS LLC and its subsidiaries, pursuant to the terms of the limited liability company agreement ("LLC Agreement"). Under the terms of the LLC Agreement, we were authorized to manage the business of BKFS LLC, including the authority to enter into contracts, manage bank accounts, hire employees and agents, incur and pay debts and expenses, merge or consolidate with other entities and pay taxes. Because we were the primary beneficiary through our sole managing member interest and possessed the rights established in the LLC Agreement, in accordance with the requirements of ASC 810, we controlled BKFS LLC and appropriately consolidated the operations thereof.
We accounted for noncontrolling interests in accordance with ASC 810 prior to the Distribution. Noncontrolling interests represented BKHI and certain of its affiliates' and THL and certain THL affiliates ("THL Affiliates")'interests’ share of net earnings or loss and of equity in BKFS LLC. BKFS Class A shareholders indirectly controlled BKFS LLC through our managing member interest. BKFS Class B shareholders had a noncontrolling interest in BKFS LLC. Their share of equity in BKFS LLC is reflected in Noncontrolling interests in our Consolidated Balance Sheets and their share of net earnings or loss in BKFS LLCthese non-wholly owned subsidiaries is reported in Netour consolidated balance sheets as a separate component of equity or within temporary equity. The noncontrolling interests’ share of the net earnings attributable to noncontrolling interests(loss) of these non-wholly owned subsidiaries is reported in our Consolidated Statements of Earnings and Comprehensive Earnings.Earnings as an adjustment to our net earnings to arrive at Net earnings or loss attributable to noncontrolling interests do not include expenses incurred directly by us, including income tax expense attributableBlack Knight.
We consolidate variable interest entities (“VIEs”) if we are considered the primary beneficiary because we have (a) the power to us.
Subsequentdirect matters that most significantly impact the VIEs economic performance and (b) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the distribution, BKFSVIE. For VIEs where we are not the primary beneficiary, we use the equity method of accounting to report their results. The determination of the primary beneficiary involves judgment. Refer to the “Investments in Unconsolidated Affiliates” section below for additional information related to our equity method investments.
Optimal Blue Holdco, LLC (“Optimal Blue Holdco”), a non-wholly owned subsidiary, is an indirect wholly-owned subsidiaryconsidered a VIE. We are the primary beneficiary of BKI.Optimal Blue Holdco through our controlling interest and our rights established in the Amended and Restated Limited Liability Company Agreement of Optimal Blue Holdco dated September 15, 2020 (the “OB Holdco LLC Agreement”). The OB Holdco LLC Agreement was amended on November 24, 2020 to reflect the issuance of Class B units (“OB PIUs”), but this amendment did not affect the controlling interest and our rights established in the OB Holdco LLC Agreement. As a result,such, we no longer have any noncontrolling interestscontrol Optimal Blue Holdco and its subsidiaries and consolidate its financial position and results of operations. Intercompany transactions between us and Optimal Blue Holdco and its subsidiaries are eliminated in BKFS LLC.consolidation. Refer to the “Redeemable Noncontrolling Interests” section below and Note 3 — Business Acquisitions for additional information.
Management Estimates
The preparation of these consolidated 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from our estimates.
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Cash and Cash Equivalents
Highly liquid instruments purchased with original maturities of three months or less are considered cash equivalents. Cash equivalents are invested with high credit quality financial institutions and consist of short-term investments, such as demand deposit accounts, money market accounts, money market funds and time deposits. The carrying amounts of these instruments reported in the Consolidated Balance Sheets approximate their fair value because of their immediate or short-term maturities.
Cash and cash equivalents consists ofare unrestricted and include the following (in millions):
December 31,
20202019
Cash$27.1 $8.2 
Cash equivalents7.6 7.2 
Cash and cash equivalents$34.7 $15.4 
 December 31,
 2018 2017
Unrestricted:   
Cash$9.5
 $13.1
Cash equivalents10.8
 1.3
Unrestricted cash and cash equivalents20.3
 14.4
Restricted cash equivalents (1)
 1.8
Cash and cash equivalents$20.3
 $16.2
_______________
(1)Restricted cash equivalents related to our former subsidiary, I-Net Reinsurance Limited, were held in trust until the final reinsurance policy expired.
Trade Receivables, Net
The carrying amounts reported in the Consolidated Balance Sheets for Trade receivables, net approximate their fair value because of their short-term nature.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

A summary of Trade receivables, net of allowance for doubtful accountscredit losses is as follows (in millions):
December 31,
20202019
Trade receivables — billed$136.4 $136.6 
Trade receivables — unbilled47.9 39.8 
Trade receivables184.3 176.4 
Allowance for credit losses(2.1)(1.3)
Trade receivables, net$182.2 $175.1 
 December 31,
 2018 2017
Trade receivables — billed$136.6
 $159.6
Trade receivables — unbilled37.0
 44.1
Trade receivables173.6
 203.7
Allowance for doubtful accounts(1.3) (1.9)
Trade receivables, net$172.3
 $201.8
In addition to the amounts above, we have unbilled receivables that we do not expect to collect within the next year included in Other non-current assets in our Consolidated Balance Sheets. Billings for these receivables are based on contractual terms. Refer to Note 1011 Other Non-Current Assets.
TheAllowance for Credit Losses
We record our billed and unbilled trade receivables and contract assets at their amortized cost less an allowance for doubtful accounts represents management's estimate of those balancesestimated credit losses that are uncollectible asnot expected to be recovered over the assets' remaining lifetime based on management’s expectation of collectability. We base our estimate on multiple factors including historical experience with bad debts, our relationship with our clients and their credit quality, the aging of respective asset balances, current macroeconomic conditions and management’s expectations of conditions in the future. Our allowance for expected credit losses is based on management’s assessment of the balance sheet date.collectability of assets with similar risk characteristics. We determinepool our respective asset balances based on risk characteristics primarily related to financial asset type, extent of client relationship, product/solution, business division and delinquency status.
Subsequent changes in the allowance based on known troubled accounts, historical experience and other currently available evidence.are recorded in Operating expenses. We write off trade receivables in the period when the likelihood of collection of a trade receivable balance is considered remote.
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
The rollforward of allowance for doubtful accountscredit losses for Trace Receivables, net is as follows (in millions):
Year ended December 31,
202020192018
Beginning balance$(1.3)$(1.3)$(1.9)
Effect of ASU 2016-13 adoption(1)
(0.5)— — 
Bad debt expense(1.2)(1.6)(0.6)
Write-offs, net of recoveries0.9 1.6 1.2 
Ending balance$(2.1)$(1.3)$(1.3)

  Year ended December 31,
  2018 2017 2016
Beginning balance $(1.9) $(2.2) $(2.5)
Bad debt expense (0.6) (0.8) (0.6)
Write-offs, net of recoveries 1.2
 1.1
 0.9
Ending balance (1.3) (1.9) (2.2)
(1)    On January 1, 2020, we adopted ASU 2016-13, Financial Instruments — Credit Losses, as well as several other related updates. Refer to section "Recent Accounting Pronouncements" below for details.
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consistsconsist of the following (in millions):
December 31,December 31,
2018 201720202019
Prepaid expenses$43.9
 $36.1
Prepaid expenses$39.7 $37.1 
Contract assets14.8
 
Contract assets, netContract assets, net20.9 19.5 
Other current assets8.6
 8.5
Other current assets9.8 8.2 
Prepaid expenses and other current assets$67.3
 $44.6
Prepaid expenses and other current assets$70.4 $64.8 
Contract Assets
A contract asset represents our expectation of receiving consideration in exchange for products or services that we have transferred to our client. Contract assets and liabilities, or deferred revenues, are determined and nettedpresented on a net basis at the contract level since the rights and obligations in a contract with a client are interdependent. In contrast, a receivable is our right to consideration that is unconditional except for the passage of time required before payment of that consideration is due. The difference in timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables, contract assets and deferred revenues from client advances and deposits. We account for receivables in accordance with ASCAccounting Standards Codification ("ASC") Topic 310, Receivables (“ASC 310”), and assess both contract assets and receivables for impairment in accordance with ASC 310.the guidance. There were no impairment charges related to contract assets for the year ended December 31, 2018.years presented.
Our short-term contract assets, including related party contract assets are included in Prepaid expenses and other current assets in our Consolidated Balance Sheets. Refer to Note 5 — Related Party Transactions. Our long-term contract assets are included in Other non-current assets in our Consolidated Balance Sheets. Refer to Note 1011 Other Non-Current Assets.
Property and Equipment, Net
Property and equipment, net is recorded at cost, less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method based on the following estimated useful lives of the related assets: 30 years for buildings

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

and 3 to 7 years for furniture, fixtures and computer equipment. Leasehold improvements are amortized using the straight-line method over the lesser of the initial term of the respective lease or the estimated useful life of such asset.
Computer Software, Net
Computer software, net includes the fair value ofinternally developed software, purchased software, software acquired in business combinations purchased software and internally developed software,asset acquisitions, less accumulated amortization. Software acquired in business combinations is recorded at its fair value and amortized using the straight-line method over its remaining estimated useful life, ranging from 3 to 10 years. Purchased software is recorded at cost and amortized using the straight-line method over its estimated useful life, ranging from 3 to 7 years. Software acquired in business combinations is recorded at its fair value and amortized using the straight-line method over its remaining estimated useful life.
Internal development costs are accounted for in accordance with ASC Topic 985, Software, Subtopic 20, Costs of Software to Be Sold, Leased, or Marketed, or ASC Topic 350, Intangibles - Goodwill and Other, Subtopic 40, Internal-Use Software. Judgment is required in determining the classification of our development costs under these two topics, especially for
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
development of new software products in which marketing strategies may still be in development. We may rely on past practice in cases where that provides the best evidence.
For computer software products to be sold, leased or marketed, all costs incurred to establish the technological feasibility are research and development costs and are expensed as they are incurred. Costs incurred subsequent to establishing technological feasibility, such as programmersprogrammers' salaries, related payroll costs and costs of independent contractors, are capitalized and amortized on a product-by-product basis commencing on the date of general release to customers.clients. We do not capitalize any costs once the product is available for general release to customers. Amortization expenseclients. Judgment is recordedrequired in determining when technological feasibility of a product is established. The timing of when various research and development projects become technologically feasible or ready for release can cause fluctuations in the amount of research and development costs that are expensed or capitalized in any given period. Generally, we amortize capitalized costs on a straight-line basis. However, we use an accelerated amortization method equal to the ratio of revenues generated by the software solution in the current year as a percentage of the estimated current and future revenues over its estimated useful life if that ratio is greater than the percentage to be amortized using the straight-line method over themethod. The estimated remaining software life which generally ranges from 5 to 10 years. We also assess the recorded value for impairment on a regular basis by comparing the carrying value to the estimated future cash flows to be generated by the underlying software asset.
For internal-use computer software products, internal and external costs incurred during the preliminary project stage are expensed as they are incurred. Internal and external costs incurred during the application development stage are capitalized and amortized on a product-by-product basis commencing on the date the softwareproduct is ready for its intended use. We do not capitalize any costs once the software is ready for its intended use. Amortization expense is recorded ratablyusing the straight-line method over the software's estimated useful life, generally ranging from 5 to 7 years.
We also assess the recorded value for impairment on a regular basis by comparing the carrying value to the estimated future cash flows to be generated by the underlying software asset.
Other Intangible Assets, Net
Other intangible assets, net consist primarily of customerclient relationships that are recorded in connection with acquisitions at their fair value based on the results of a valuation analysis, less accumulated amortization. Customer relationshipsIntangible assets, other than those with indefinite lives, are amortized over their estimated useful lives ranging from 3 to 10 years from the acquisition date using either a straight-line or accelerated method. Client relationships are amortized using an accelerated method that takes into consideration expected customerclient attrition rates over a period of up to 10 years from the acquisition date.
Our property records database, which is an intangible asset not subject to amortization, is included in Other non-current assets in our Consolidated Balance Sheets. Refer to Note 1011 Other Non-Current Assets.
Impairment Testing
Long-lived assets, including property and equipment, computer software and other intangible assets with definite useful lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. We did not have any events or circumstances indicating impairment of our long-lived assets for the years ended December 31, 2018, 2017 or 2016.presented.
Goodwill
Goodwill represents the excess of cost over the fair value of identifiable assets acquired and liabilities assumed in business combinations. Goodwill is not amortized and is tested for impairment annually, or more frequently if circumstances indicate potential impairment, through a comparison of fair value to the carrying amount. Goodwill is tested for impairment at the reporting unit level. In evaluating the recoverability of goodwill, we consider the amount of excess fair value over the carrying value of each reporting unit, the period of time since a reporting unit's last quantitative test, and other factors to determine whether or not to first perform a qualitative test. When performing an annual goodwill impairment analysis based on a review of qualitative factors, we evaluate if events and circumstances exist that lead to a determination that the fair value of each reporting unit is more likely than not greater than its carrying amount. If we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we perform a quantitative impairment test. The quantitative test includes determining the fair value of a reporting unit based on a weighted average of multiple valuation methods, primarily a combination of an income approach and a market approach, which are Level 3 and Level 2 inputs, respectively. The income approach includes the present value of estimated future cash flows, while the market approach uses earnings multiples of similar guideline public companies. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not impaired
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and further testing is not required. We did not have any events or circumstances indicating impairment of our goodwill during the years ended December 31, 2018, 2017presented.
Investments in Unconsolidated Affiliates
Investments in entities that we have the ability to exercise significant influence over, but not control, are accounted for using the equity method of accounting. Under the equity method of accounting, investments are recorded at the initial cost and 2016.are adjusted for subsequent additional investments and our share of earnings or losses and distributions. We record our share of equity-based compensation expense of unconsolidated affiliates as an adjustment to our investment with a related adjustment to our equity.

Star Parent, L.P. (“Star Parent”), a former non-wholly owned subsidiary (and former parent of Dun & Bradstreet Holdings, Inc. (“DNB”)), was considered a VIE. For the 2019 and 2020 periods in which we had a minority interest in Star Parent, we were a limited partner and did not have the power to direct the activities that most significantly affected Star Parent's economic performance. We did not provide any implicit or explicit liquidity guarantees or principal value guarantees to Star Parent. For these reasons, we were not the primary beneficiary and accounted for our investment using the equity method of accounting. Our investment in Star Parent was recorded within Investments in unconsolidated affiliates on our Consolidated Balance Sheets, and related earnings and losses were recorded in Equity in earnings (losses) of unconsolidated affiliates, net of tax in our Consolidated Statements of Earnings and Comprehensive Earnings.
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DNB but are considered to have the ability to exercise significant influence, but not control, primarily through a combination of our investment in DNB, an agreement with certain other DNB investors pursuant to which we agreed to collectively vote together on matters related to the election of DNB directors for a period of three years following the DNB IPO and our shared Chief Executive Officer. For these reasons, we account for our investment using the equity method of accounting. Our investment in DNB is recorded within Investments in unconsolidated affiliates on our Consolidated Balance Sheets, and related earnings and losses are recorded in Equity in earnings (losses) of unconsolidated affiliates, net of tax in our Consolidated Statements of Earnings and Comprehensive Earnings. Refer to Note 4 – Investments in Unconsolidated Affiliates for additional information.
Deferred Contract Costs, Net
We capitalize incremental contract acquisition costs that relate directly to an existing contract or a specific anticipated contract, and are expected to be recovered. Costs that would have been incurred regardless of whether the contract was obtained are expensed as incurred. As a practical expedient, we expense incremental costs of obtaining a contract if the amortization period of the asset would be one year or less.
We also consider whether to capitalize costs to fulfill a contract that may be incurred before we commence performance on an obligation. These costs represent incremental, recoverable external costs and certain internal costs that are directly related to the contract and are primarily associated with costs of resources involved in installation of systems, processes and data conversion.
Deferred contract costs are amortized on a systematic basis consistent with the transfer to the client of the goodssolutions or services to which the asset relates. We consider the explicit term of the contract with the client, expected renewals and the rate of change related to our solutions in determining the amortization period, which ranges from 5 to 10 years.
In the event indications exist that a deferred contract cost balanceasset related to a particular contract may not be recoverable, undiscounted estimated cash flows of the total period over which economic benefits for providing the related products or services are expected to be received are projected and compared to the unamortized deferred contract cost balance. If the projected cash flows and any unrecognized revenues are not adequate to recover the unamortized cost, balance, the balancean impairment charge would be adjusted with a charge to earningsrecorded to reduce the carrying amount to the contract's net realizable value, including any termination fees provided for under the contract, in the period such a determination is made.
Our deferred contract costs are included in Other non-current assets in our Consolidated Balance Sheets. Refer to Note 10 — Other Non-Current Assets. Amortization expense for deferred contract costs is included in Depreciation and amortization in our Consolidated Statements of Earnings and Comprehensive Earnings. Refer to the "Depreciation and Amortization" section below.
Leases
We determine if an arrangement is a lease at contract inception. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments according to the arrangement. Operating and finance lease right-of-use assets and lease liabilities are recognized as of the commencement date based on the present value of the lease payments over the lease term. We use the implicit rate when it is readily determinable. Otherwise, we
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use our incremental borrowing rate based on the information available as of the commencement date in determining the present value of lease payments. The lease term we use for the valuation of our right-of-use assets and lease liabilities may include options to extend or terminate the lease when it is reasonably certain that we will exercise those options. Lease expense is recognized on a straight-line basis over the expected lease term. From time to time, we may abandon one or more of our leased assets. Upon abandonment, we accelerate the amortization of right-of-use assets within lease expense.
Right-of-use assets and lease liabilities are recognized for our leases. Right-of-use assets for our operating leases are included in Other non-current assets in our Consolidated Balance Sheets. Refer to Note 11 — Other Non-Current Assets. Right-of-use assets for our finance leases are included in Property and equipment, net in our Consolidated Balance Sheets. Refer to Note 7 — Property and Equipment. For discussion of our operating and finance lease liabilities refer to Note 12 — Long-Term Debt andNote 15 — Leases.
Trade Accounts Payable and Other Accrued Liabilities
The carrying amount reported in the Consolidated Balance Sheets for Trade accounts payable and other accrued liabilities approximates fair value because of their short-term nature.
Trade accounts payable and other accrued liabilities consist of the following (in millions):
December 31,
20202019
Income taxes payable$13.6 $5.5 
Lease liabilities, current13.5 12.3 
Accrued interest12.8 0.2 
Other taxes payable and accrued10.7 6.6 
Trade accounts payable8.9 13.0 
Other28.6 27.7 
Trade accounts payable and accrued liabilities$88.1 $65.3 
Deferred Revenues
Deferred revenues, or contract liabilities, represent our obligation to transfer products or services to our client for which we have received consideration, or an amount of consideration is due, from the client. During the years ended December 31, 2020, 2019 and 2018, revenues recognized related to the amount included in the Deferred revenues balance at the beginning of each year were $49.5 million, $55.9 million and $51.7 million, respectively.
Deferred Compensation Plan
Certain management-level employees of Black Knight are participants in the Black Knight Deferred Compensation Plan. Participant benefits are provided by a funded rabbi trust. The compensation withheld from the participants, together with investment income, is recorded as a deferred compensation obligation to participants. The assets of the funded rabbi trust are included in Other non-current assets in our Consolidated Balance Sheets. Refer to Note 11 — Other Non-Current Assets. As of December 31, 2020 and 2019, $19.3 million and $14.6 million, respectively, of the related liability is included in Other non-current liabilities on the Consolidated Balance Sheets. As of each December 31, 2020 and 2019, $0.9 million of the related liability is included in Trade accounts payable and other accrued liabilities on the Consolidated Balance Sheets.
Loss Contingencies
ASC Topic 450, Contingencies, requires that we accrue for loss contingencies associated with outstanding litigation, claims and assessments, as well as unasserted claims for which management has determined it is probable that a loss contingency exists and the amount of loss can be reasonably estimated. Refer to Note 1314 Commitments and Contingencies. Legal fees are expensed as incurred.
Deferred Compensation Plan
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Redeemable Noncontrolling Interests
Redeemable noncontrolling interests represent the collective 40% equity interest in Optimal Blue Holdco owned by Cannae Holdings, LLC ("Cannae") and affiliates of Thomas H. Lee Partners, L.P. ("THL"). We have call rights on THL's and Cannae’s equity interests in Optimal Blue Holdco that are exercisable beginning September 15, 2023 at a call price equal to the Distribution, certaingreater of (i) the fair market value of such interests and (ii) an amount that would result in the multiple of THL’s or Cannae’s return on investment to equal 2.0, as applicable. In addition, THL and Cannae have the right to put their respective interests in Optimal Blue Holdco at a price equal to the fair market value of such interests to (i) Optimal Blue Holdco if there is a change of control of Black Knight or (ii) Optimal Blue Holdco, Black Knight Technologies ("BKT") or Black Knight that are exercisable beginning September 15, 2023. We have the option to satisfy the purchase price in connection with the exercise of any put or call right either in cash or Black Knight common stock other than a put in connection with a change of control of Black Knight, in which case the purchase price is payable only in cash. The equity interests will be settled at the current fair market value, at the time we either provide notice of the call election or receive notice of the put election, as determined by the parties or by a third party appraisal under the terms of OB Holdco LLC Agreement.
As these redeemable noncontrolling interests provide for redemption features not solely within our control, they are presented on our Consolidated Balance Sheets outside of shareholders' equity. We recognize any changes in the redemption price related to these redeemable noncontrolling interests as they occur through Additional paid-in capital.
Treasury Shares
Shares held in treasury are at cost. We charge the cost in excess of par value to Retained earnings when we cancel or retire treasury shares.
Revenues
We recognize revenues primarily relating to software and hosting solutions, professional services and data solutions. We are often party to multiple concurrent contracts or contracts that combine multiple solutions and services. These situations require judgment to determine if multiple contracts should be combined and accounted for as a single arrangement. In making this determination, we consider (i) the economics of each individual contract and whether or not it was negotiated on a standalone basis and (ii) if multiple promises represent a single performance obligation. Many times these arrangements include offerings from more than one segment to the same client.
At contract inception, we assess the performance obligations, or deliverables, we have agreed to provide in the contract and determine if they are individually distinct or if they should be combined with other performance obligations. We combine performance obligations when an individual performance obligation does not have standalone value to our client. For example, we typically combine the delivery of complex, proprietary implementation-related professional services with the delivery of the related software solution.
Contract modifications require judgment to determine if the modification should be accounted for as (i) a separate contract, (ii) the termination of the original contract and creation of a new contract or (iii) a cumulative catch-up adjustment to the original contract. When evaluating contract modifications, we must identify the performance obligations of the modified contract and determine both the allocation of revenues to the remaining performance obligations and the period of recognition for each identified performance obligation.
We include any fixed consideration within our contracts as part of the total transaction price. Generally, we include an estimate of the variable amount within the total transaction price and update our assumptions over the duration of the contract. We do not include taxes collected from clients and remitted to governmental authorities. The transaction price is allocated to our performance obligations in proportion to their relative standalone selling prices (“SSP”). SSP is the price for which we would sell a distinct solution or service separately to a client and is determined at contract inception. For a majority of our management level employeesrevenues, we have observable selling prices for our related solutions and directors participated inservices. However, if observable selling prices are not available, establishing SSP requires significant judgment. The estimated SSP considers all reasonably available information, including market conditions, demands, trends, our specific factors and information about the FNF Deferred Compensation Plan (the "FNF DCP").client or class of client. The FNF DCP permitted participants to defer receiptadjusted market approach is generally used for new solutions and services or when observable inputs are limited or not available.
The following describes the nature of partour primary sources of their current compensation. Participant benefits for the FNF DCP were provided by a funded rabbi trust. The compensation withheld from FNF DCP participants, together with investment income on the FNF DCP, was recorded as a deferred compensation obligation to participants. The underlying rabbi trustrevenue and the related liability was historically carried by FNF. Asrevenue recognition policies:
Software and Hosting Solutions Revenues
Software and hosting solutions revenues are primarily comprised of software as a result of the Distribution, the liability to Black Knight participants in the FNF DCP,service (“SaaS”) offerings for various systems that perform processing and workflow management as well as provide data and analytics. To a lesser extent, we sell
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software licenses where hosting services may or may not be included in the arrangement. Contracts for software and hosting solutions typically span five to seven years.
For our SaaS offerings, we promise our clients to stand ready to provide continuous access to our processing platforms and perform an unspecified quantity of processing services for a specified term. For this reason, processing services are generally viewed as a stand-ready performance obligation comprised of a series of distinct daily services. We typically satisfy these performance obligations over time as the services are provided. A time-elapsed output method is used to measure progress because our efforts are expended evenly throughout the period given the nature of the promise is a stand-ready service. We evaluate our variable payment terms related to these revenues, and they generally meet the criteria for allocating variable consideration entirely to one or more, but not all, performance obligations in a contract. Accordingly, when the criteria are met, variable amounts based on the number and type of services performed during a period are allocated to and recognized on the day in which we perform the related assetsservices. Fixed fees for processing services are generally recognized ratably over the contract period.
Our software licenses generally have significant standalone functionality to our clients upon delivery. Our software licenses are generally considered distinct performance obligations, and revenue allocated to the software license is typically recognized at a point in time upon delivery of the funded rabbi trust, were transferredlicense.
In conjunction with software licenses, we commonly provide our clients with additional services such as maintenance as well as associated implementation and other professional services related to the newly-formed Black Knight Deferred Compensation Plan (the "BK DCP") insoftware license. Maintenance is typically comprised of technical support and unspecified updates and upgrades. We generally satisfy these performance obligations evenly using a non-cash transaction. The termstime-elapsed output method over the contract term given there is no discernible pattern of performance. When a software license contract also includes professional services that provide significant modification or customization of the BK DCPsoftware license, we combine the software license and professional services into a single performance obligation, and revenues for the combined performance obligation are recognized as the professional services are provided consistent with the termsmethods described below for professional services revenues.
We have contracts where the licensed software is offered in conjunction with hosting services. The licensed software may be considered a separate performance obligation from the hosting services if the client can take possession of the former FNF DCP. The assetssoftware during the contractual term without incurring a significant penalty and if it is feasible for the client to run the software on its own infrastructure or hire a third party to host the software. If the licensed software and hosting services are separately identifiable, license revenue is recognized when the hosting services commence and it is within the client’s control to obtain a copy of the funded rabbi trustsoftware, and hosting revenue is recognized using the time-elapsed output method as the service is provided. If the software license is not separately identifiable from the hosting service, then the related revenues for the combined performance obligation is recognized ratably over the hosting period.
Professional Services Revenues
Professional services revenues are generally comprised of implementation, conversion, programming, training and consulting services associated with our SaaS and licensed software agreements. Professional services such as training, dedicated teams and consulting services are generally distinct. Distinct professional services revenues are primarily billed on a time and materials basis, and revenues are recognized over time as the services are performed. A portion of our professional services revenues are derived from contracts for dedicated personnel resources who are often working full-time at a client site and under the client's direction. These revenues generally recur as contracts are renewed.
In assessing whether implementation services provided on SaaS or licensed software agreements are a distinct performance obligation, we consider whether the services are both capable of being distinct (i.e., the client can benefit from the services alone or in combination with other resources that are readily available to the client) and distinct within the context of the contract (i.e., separately identifiable from the other performance obligations in the contract). Professional services that are not distinct from an associated solution or offering are recognized over the common measure of progress for the overall performance obligation (typically a time-elapsed output measure that corresponds to the period over which the solution or offering is made available to the client).
Data Solutions Revenues
Revenues from data solutions are primarily from licenses for historical data and valuation-related analytical services and are generally distinct. License fees are recognized at a point in time upon delivery. Revenues allocated to data updates are recognized ratably over the period the updates are provided. In addition, to the extent that we provide continuous access to data through a hosted software platform, we recognize revenues ratably over the contract term.
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Operating Expenses
Operating expenses include all costs, excluding depreciation and amortization, incurred by us to produce revenues. Operating expenses primarily include compensation costs, including equity-based compensation and benefits, software and hardware maintenance costs, professional services fees, rent-related costs, software subscription costs and cloud computing costs. Equity-based compensation is included within Corporate and Other in Note 21—Segment Information.
General and administrative expenses, which are primarily included in Operating expenses within Corporate and Other non-current assets. Refer toin Note 10 — Other Non-Current Assets. As of December 31, 2018, $10.9 million of the related liability is included in Other non-current liabilities21—Segment Information, include compensation costs, including benefits and $0.7 million of the related liability is included in Trade accounts payableequity-based compensation, professional services fees, insurance, rent-related costs, software subscription costs and other accrued liabilities oncosts associated with the Consolidated Balance Sheets.enterprise risk, finance, human resources, marketing, legal and other support functions.
Equity-Based Compensation
We expense employee equity-based payments under ASC Topic 718, Compensation—Stock Compensation, which requires compensation cost formeasured using the grant date fair value of equity-based payments to be recognized over the requisite service period, which generally equals the vesting period. For awards with a performance condition, we recognize compensation cost under the graded vesting method over the requisite service period of the award, which at times results in accelerated recognition of the cost. We estimateddo not recognize compensation cost if the grant date fair valueperformance condition is not considered probable of achievement. If at any point we determine that the equity-based awards issued in the formperformance condition is improbable of profits interests using the Black-Scholes option pricing model. achievement, we reverse any previously recognized compensation cost for that award.
The fair value of our restricted stock awards is measured based on the closing market price of our stock on the grant date. The fair value of OB PIUs is measured using the Black-Scholes model. Income tax effects of awards are recorded in our Consolidated Statements of Earnings and Comprehensive Earnings when the awards vest or are settled. We account for forfeitures as they occur.

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Earnings Per Share
Basic earnings per share is computed by dividing Net earnings attributable Refer to Black Knight by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing Net earnings attributable to Black Knight, adjusted as necessaryNote 17 — Equity for the effect of potentially dilutive securities, by the number of weighted-average shares outstanding during the period and the effect of securities that would have a dilutive effect on earnings per share. See Note 4—Earnings Per Share for a more detailed discussion.
Deferred Revenues
Deferred revenues represent our obligation to transfer products or services to our client for which we have received consideration, or an amount of consideration is due, from the client. During the year ended December 31, 2018, revenues recognized related to the amount included in the Deferred revenues balance at January 1, 2018 was $51.7 million.
Revenue Recognition
The following describes our primary types of revenues and our revenue recognition policies as they pertain to the types of contractual arrangements we enter into with our clients to provide products or services either individually or in combination with one another as part of an integrated offering of multiple services. These arrangements occasionally include offerings from more than one segment to the same client.
We recognize revenues primarily relating to software and hosting solutions, professional services and data solutions. In some cases, these services are offered in combination with one another, and in other cases we offer them individually. Revenues from software and hosting solutions are typically volume-based agreements depending on factors such as the number of accounts processed, transactions processed and computer resources utilized.
In accordance with ASC Topic 606, Revenue from Contracts with Customers ("ASC 606"), revenues are recognized when control of the promised goods or services is transferred to our clients, in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods and services. To achieve this core principle, we apply the following five steps:
1.
Identify the contract with a client. A contract with a client exists when: (1) we and the client have approved the contract and both parties are committed to perform their respective obligations; (2) we can identify each party’s rights regarding the products or services to be transferred; (3) we can identify the payment terms for the products or services to be transferred; (4) the contract has commercial substance as our future cash flows are expected to change; and (5) it is probable that we will collect substantially all of the consideration to which we are entitled in exchange for the products or services. Any subsequent contract modifications are analyzed to determine the treatment of the contract modification as a separate contract, prospectively or through a cumulative catch-up adjustment.
2.
Identify the performance obligations in the contract. Performance obligations are promises to transfer a good or service to the client. Performance obligations may be each individual promise in a contract, or may be groups of promises within a contract that significantly affect one another. To the extent a contract includes multiple promises, we must apply judgment to determine whether promises are capable of being distinct and distinct in the context of the contract. If these criteria are not met, the promises are accounted for as a combined performance obligation. Promises that are often considered distinct include our primary software and hosting solutions, while certain ancillary services are generally not distinct within the context of a contract. Professional services such as training, dedicated teams and consulting services are generally distinct. Data solutions that support our software products also include licenses and valuation related analytical services that are generally distinct.
3.
Determine the transaction price. The transaction price is the total amount of consideration to which we expect to be entitled in exchange for transferring promised products and services to a client. Variable consideration refers to any consideration that changes during or after our performance or is contingent on the outcome of future events. Variable consideration is included in the transaction price if, in our judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. We estimate the amount of variable consideration that should be included in the transaction price utilizing either the most likely amount method or expected value method. The most prevalent form of variable consideration in our arrangements is a volume-based fee, which is generally estimated utilizing the most likely amount method based primarily on historical experience and expectations of future events. The amount of variable consideration is estimated at the contract’s inception, and we update the estimates of variable consideration throughout the life of the contract or until the variable feature becomes fixed.
4.
Allocate the transaction price to performance obligations in the contract. The allocation of the transaction price to performance obligations is generally done in proportion to their standalone selling prices (“SSP”). SSP is the price that

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we would sell a distinct product or service separately to a client and is determined at contract inception. At times, there will be observable selling prices for our goods and services, such as for our mortgage servicing software platform. If SSP is not available through the analysis of observable inputs, this step is subject to significant judgment and additional analysis so that we can establish an estimated SSP. The estimated SSP considers all reasonably available information, including market conditions, demands, trends, our specific factors and information about the client or class of clients. The adjusted market approach is generally used for new products or solutions or when observable inputs are not available or limited.
5.
Recognize revenues when or as the company satisfies a performance obligation. We recognize revenues when, or as, distinct performance obligations are satisfied by transferring control of the product or service to the client. A performance obligation is considered transferred when the client obtains control of the product or service. Transfer of control is typically evaluated from the client's perspective. At contract inception, we determine whether we satisfy the performance obligation over time or at a point in time. Revenues from software and hosting solutions are primarily recognized ratably over time or as fee-bearing usages occur. Revenues from certain licenses that require a significant level of integration, interdependency and interrelation with integral updates are generally recognized ratably over time as services are performed. Distinct professional services revenues are primarily billed on a time and materials basis, and revenues are recognized over time as the services are performed. Revenues from data solutions related to a license for historical data or the license portion of certain distinct term licenses are recognized at a point in time upon delivery, while the remaining arrangement consideration allocated to updates is recognized ratably over the period the updates are provided.
Contracts with Multiple Performance Obligations
We are often party to multiple concurrent contracts or contracts pursuant to which a client may purchase a combination of goods and services. At contract inception, we determine whether multiple contracts will be combined and accounted for as a single arrangement. Combination is generally required when the economics of the individual contracts cannot be understood without reference to the whole. While certain contracts may be combined, they are reviewed to determine if the contract has multiple distinct performance obligations. These situations require judgment to determine whether the multiple promises are separate performance obligations. Once we have determined the performance obligations, we determine the transaction price, which includes estimating the amount of variable consideration to be included in the transaction price, if any. We then allocate the transaction price to each performance obligation in the contract based on a relative SSP method unless specific criteria for allocating variable consideration are met. If those criteria are met, which typically is the case for volume-based fees, variable fees are allocated only to the obligation to which they relate. In either case, the corresponding revenues are recognized as the related performance obligations are satisfied.
Operating Expenses
Operating expenses include all costs, excluding depreciation and amortization, incurred by us to produce revenues. Operating expenses primarily include compensation costs, including benefits and equity-based compensation, hardware and software maintenance costs, third-party software costs, rent-related costs and professional services. Equity-based compensation is included within Corporate and Other in Note 19—Segment Information.
General and administrative expenses, which are primarily included in Operating expenses within Corporate and Other in Note 19—Segment Information, include compensation costs, including benefits and equity-based compensation, hardware and software maintenance costs, term licensing costs, rent-related costs and other costs associated with the marketing, human resources, legal, enterprise risk, finance and other support functions. General and administrative expenses also include certain professional and legal fees and costs of advertising and other marketing-related programs.information.
Depreciation and Amortization
Depreciation and amortization includes depreciation of property and equipment and amortization of computer software, other intangible assets and deferred contract costs. Depreciation and amortization on the Consolidated Statements of Earnings and Comprehensive Earnings include the following (in millions):
 Year ended December 31,
 2018 2017 2016
Property and equipment$32.4
 $29.0
 $28.4
Computer software94.5
 84.0
 78.0
Other intangible assets57.2
 67.8
 76.4
Deferred contract costs32.9
 25.7
 25.5
Total$217.0
 $206.5
 $208.3

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Year ended December 31,
202020192018
Computer software$110.4 $97.3 $94.5 
Other intangible assets86.6 59.3 57.2 
Deferred contract costs33.9 42.9 32.9 
Property and equipment39.8 36.7 32.4 
Total$270.7 $236.2 $217.0 
Computer software amortization for the year ended December 31, 2018 includes accelerated amortization of $1.7 million related to certain internally developed software. Deferred contract costs amortization for the years ended December 31, 2018, 20172020, 2019 and 20162018 includes accelerated amortization of $3.4$0.1 million, $3.3$6.2 million and $4.1$3.4 million, respectively.
Transition and Integration Costs
Transition and integration costs for 2018 primarily represent costs primarily associated with acquisitions, expense reduction initiatives, executive transition transition-related costs from the transfer of certain corporate functions from FNF following the Distribution and acquisition-related costs. Transition and integration costs for 2017 primarily consisted of legal and professional fees related to the Distribution and transition-related costs following the Distribution. In 2016, these costs consisted of acquisition-related costs and professional services related to the Distribution.other transition-related costs.
Interest Expense, Net
Interest expense, net consists primarily of interest expense on our borrowings, a guarantee fee that we paid FNF for their guarantee of our senior notes prior to the Senior Notes Redemption (as defined in Note 11—Long Term Debt), amortization of our debt issuance costs bond premium and original issue discount, payments on our interest rate swaps, commitment fees on our revolving credit facility and administrative agent fees net of capitalized interest and interest income. Debt issuance costs are amortized using the effective interest method over the expected repayment period of the debt.
Income Taxes
Black Knight is treated as a corporation under applicable federal and state income tax laws. We are subject to income tax in the U.S. and certain state jurisdictions in which we operate and record the tax effects as a part of the tax accounting process of preparing the consolidated financial statements. Our India subsidiary is subject to income tax in India.
The tax accounting process involves calculating actual current tax expense together with assessing basis differences resulting from differing recognition of items for income tax and GAAP accounting purposes. These differences result in current and deferred income tax assets and liabilities, which are included within the Consolidated Balance Sheets. Deferred tax assets and
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liabilities are measured using enacted tax rates expected to apply to taxable earnings in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of changes in tax rates and laws in future periods, if any, is reflected in the consolidated financial statements in the period enacted. We must then assess the likelihood that deferred income tax assets will be recovered from future taxable earnings and, to the extent we believe that recovery is not likely, establish a valuation allowance. We believe that based on our historical pattern of taxable earnings, projections of future earnings, tax planning strategies, reversing taxable timing differences and other relevant evidence, we will produce sufficient earnings in the future to realize recorded deferred income tax assets. To the extent we establish a valuation allowance or increase an allowance in a period, we would reflect the increase as expense within Income tax expense in the Consolidated Statements of Earnings and Comprehensive Earnings.
Determination of income tax expense requires estimates and can involve complex issues that may require an extended period to resolve. Further, the estimated level of annual earnings before income tax can cause the overall effective income tax rate to vary from period to period. We believe our tax positions comply with applicable tax law, and we adequately provide for any known tax contingencies. Final determination of prior-year tax liabilities, either by settlement with tax authorities or expiration of statutes of limitations, could be materially different than estimates reflected in assets and liabilities and historical income tax expense. The outcome of these final determinations could have a material effect on our income tax expense, net earnings or cash flows in the period that determination is made.
We record interest and penalties related to income taxes, if any, as a component of Income tax expense on the Consolidated Statements of Earnings and Comprehensive Earnings.
Refer to Note 19—Income Taxes for additional information.
Earnings Per Share
Basic net earnings per share is computed by dividing Net earnings attributable to Black Knight is treated as a corporation under applicable federal and state income tax laws. Followingby the Distribution and THL Interest Exchange, we no longer have any noncontrolling interests. Deferred tax assets and liabilities are recognized for temporary differences betweenweighted-average number of shares of common stock outstanding during the financial reporting basis and the tax basis of the corporate subsidiaries' assets and liabilities and expected benefits of utilizing anyperiod. Diluted net operating loss carryforwards.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable earnings in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of changes in tax rates and laws in future periods, if any, is reflected in the consolidated financial statements in the period enacted.
Treasury Shares
Shares held in treasury are at cost. Shares held in treasury at the time of the Distribution were canceled for no consideration. In connection with this transaction, we made a policy election to charge the cost in excess of par value to Retained earnings when we cancel or retire treasury shares.

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Recent Accounting Pronouncements
Revenue Recognition (ASC 606)
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606) as well as several other related updates, which were codified as ASC 606. On January 1, 2018, we adopted this update using the modified retrospective method. Under this method, we recognized the cumulative effect of applying the new revenue recognition standard to existing revenue contracts that were active as of the adoption date as an adjustment to the opening balance of Retained earnings. The reported results for the year ended December 31, 2018 reflect the application of ASC 606, while the comparative information has not been restated and continues to be reported under the related accounting standards in effect for those periods. The adoption of ASC 606 represents a change in accounting principle that is intended to more closely align revenue recognition with the delivery of our services and provides financial statement readers with enhanced disclosures.
The effect of ASC 606 on our consolidated financial statements as of December 31, 2018 and for year ended December 31, 2018 is disclosed in Note 14Revenues.
Leases (ASC Topic 842, Leases ("ASC 842"))
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under this update, lessees will be required to recognize the following for all leases (with the exception of leases with a term of 12 months or less) at the commencement date: (1) a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use ("ROU") asset, which is an asset that represents the lessee's right to use, or control the use of, a specified asset for the lease term. Leases will be classified as finance or operating, with such classification affecting the pattern and classification of expense recognition in the statement of earnings. Under this update, lessor accounting remains largely unchanged. The FASB has also issued other updates since this time that add further clarification. The new lease standard and related updates are effective for us on January 1, 2019.
In preparation for ASC 842, we have formed a project team that evaluated the requirements of ASC 842 and assessed the scope of existing lease agreements and other existing service contracts that are not considered leases under the current guidance. We applied an integrated approach to analyzingper share includes the effect of ASC 842, including a review of accounting policiesunvested restricted stock awards and practices, evaluating differences from applying the requirements of the new standard to our existing agreements and business practices and assessing the need for any changes in our processes, accounting systems and design of relevant internal controls.
The primary effect of adopting the new standard relates to the recognition of our operating leases on our Consolidated Balance Sheets and providing additional disclosures about our leasing activities. Based upon our assessment, we did not identify a material change in our leasing activities. On the adoption date, we expect to recognize ROU assets and lease liabilities of approximately $28 million to $30 million on our Consolidated Balance Sheets for our operating leases.
ASC 842 provides a number of optional practical expedients. We have elected the practical expedient to combine lease and non-lease components when determining the fair value of the ROU asset and lease liability. We also have elected the practical expedient to exclude leases with an initial term of 12 months or less.
Entities are able to apply ASC 842 at the adoption date and recognize a cumulative effect adjustment to the opening balance of Retained earnings in the period of adoption. We will adopt ASC 842 on January 1, 2019 using this transition method.
Other Accounting Pronouncements
In October 2018, the FASB issued ASU 2018-16, Derivatives and Hedging (Topic 815). This update expands the permissible benchmark interest rates tomay include the Secured Overnight Financing Rate ("SOFR") and the Overnight Index Swap ("OIS") Rate as benchmark interest rates for hedge accounting purposes. For entities that have not already adopted ASU 2017-12, the guidance in this update is required to be adopted concurrently with ASU 2017-12. This update is required to be applied prospectively to qualifying new or redesignated hedging relationships entered into on and after the date of adoption. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.
In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. This update more closely aligns the accounting treatment of implementation costs for cloud solutions to the treatment of costs to develop or obtain internal-use software. Costs incurred during the planning and post-implementation stages are typically expensed, while costs incurred during the development stage are typically capitalized. The capitalized implementation costs are to be expensed over the term of the hosting arrangement including renewal options to the extent those options are expected to be utilized.  This update also requires the capitalized implementation costs to be presented in the consolidated financial statements consistent with

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the presentation of the ongoing fees and payments associated with the cloud arrangement. This update is effective for fiscal years beginning after December 15, 2019 with early adoption permitted. We will adopt this update as of January 1, 2019 and apply the amendments in this update prospectively to implementation costs incurred after the date of adoption. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. This update removes, modifies and adds certain disclosure requirements for fair value measurements. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 with early adoption permitted. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.
In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. This update allows a reclassification from Accumulated other comprehensive earnings to Retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 ("Tax Reform Act"). As this update only relates to the reclassification of the income tax effects of the Tax Reform Act, the underlying guidance that requires the effect of a changeunvested OB PIUs in tax law or rates is included in income from continuing operations is not affected. This update also requires certain disclosures about stranded tax effects. This update is effective in fiscal years beginning after December 15, 2018, with early adoption permitted. The amendments within this update should be applied either in the period of adoption or retrospectivelyfuture periods. Refer to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Reform Act is recognized. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.Note 5—Earnings Per Share for more information.
In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. This update expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. This update also includes certain targeted improvements to ease the application of current guidance related to the assessment of hedge effectiveness. This update is effective for fiscal years beginning after December 15, 2018. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.Business Acquisitions
In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This update eliminates Step 2 of the goodwill impairment test that required a hypothetical purchase price allocation. Rather, entities should apply the same impairment assessment to all reporting units and recognize an impairment loss for the amount by which a reporting unit's carrying amount exceeds its fair value, without exceeding the total amount of goodwill allocated to that reporting unit. Entities will continue to have the option to perform a qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. This update is effective prospectively for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019 with early adoption permitted. We do not expect this update to have a material effect on our consolidated financial statements and related disclosures.
In June 2016, the FASB issued ASU 2016-13, Financial InstrumentsCredit Losses. This guidance significantly changes how companies measure and recognize credit impairment for many financial assets. The new Current Expected Credit Loss Model will require companies to immediately recognize an estimate of credit losses expected to occur over the remaining life of the financial assets included in the scope of this standard, which include trade receivables. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses. Among other updates, it clarified that impairment of operating lease receivables should be accounted for under ASC 842. Both of these updates are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for annual and interim periods in fiscal years beginning after December 15, 2018. We do not expect this update to have a material effect on our consolidated financial statements and related disclosures.
(3)Business Acquisitions and Other Investment
We include the results of operations of acquired businesses beginning on the respective acquisition dates. The purchase price is allocated to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values at the acquisition date, with the excess recorded as goodwill. Measurement period adjustments to provisional purchase price allocations are recognized in the period in which they are determined, with the effect on earnings of changes in depreciation, amortization or other income resulting from such changes calculated as if the accounting had been completed on the acquisition date. Acquisition-related costs are expensed as incurred.
Recent Accounting Pronouncements
Recently Adopted Pronouncements
Current Expected Credit Losses (ASC Topic 326, Financial Instruments - Credit Losses ("ASC 326"))
In June 2016, the Financial Accounting Standards Board ("FASB") issued Accountings Standards Update ("ASU") 2016-13, Financial InstrumentsCredit Losses, as well as several other related updates, which were codified as ASC 326. This update significantly changes how companies measure and recognize credit impairment for many financial assets. The new standard requires companies to immediately recognize an estimate of credit losses expected to occur over the remaining life of the financial assets included in the scope of this standard.
Our financial assets that are included in the scope of these updates are primarily trade receivables and contract assets. We applied an integrated approach to analyzing the effects of ASC 326, including developing accounting policies and positions, evaluating differences from applying the requirements of the new standard to our previous business practices and assessing the need for any changes in our processes and design of internal controls.
The primary effect of adopting the new standard relates to the changes in our estimated credit losses and providing additional disclosures about our financial assets that are included in the scope of this new standard. Based on our assessment, we did not identify a material change in our financial condition, results of operations or business practices.
We adopted ASC 326 on January 1, 2020 using a modified retrospective approach. The effect of this adoption was an adjustment of $1.1 million, net of tax, to our opening Retained earnings on our Consolidated Statements of Equity.
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Other Accounting Pronouncements
In October 2018, the FASB issued ASU 2018-16, Derivatives and Hedging (Topic 815). This update expanded the permissible benchmark interest rates to include the Secured Overnight Financing Rate and the Overnight Index Swap Rate as benchmark interest rates for hedge accounting purposes. We adopted this update on January 1, 2019. This update is required to be applied prospectively to qualifying new or redesignated hedging relationships entered into on and after the date of adoption. We did not enter into new hedging relationships in 2020. We continue to monitor developments related to London Interbank Offered Rate ("LIBOR") transition date and effects it may have on our strategy, systems and processes. Interest rates related to our credit agreement are based on the Eurodollar rate, which is based on LIBOR. The terms of our interest rate swap agreements are also based on LIBOR.
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. This update removed, modified and added certain disclosure requirements for fair value measurements. We adopted this update on January 1, 2020 and applied its amendments prospectively. This update did not have a material effect on our consolidated financial statements and related disclosures.
In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. This update allowed a reclassification from Accumulated other comprehensive earnings to Retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 ("Tax Reform Act"). We adopted this update on January 1, 2019 and reclassified $1.0 million from Accumulated other comprehensive (loss) earnings to Retained earnings.
In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This update eliminated step 2 of the goodwill impairment test that required a hypothetical purchase price allocation. Rather, entities should apply the same impairment assessment to all reporting units and recognize an impairment loss for the amount by which a reporting unit's carrying amount exceeds its fair value, without exceeding the total amount of goodwill allocated to that reporting unit. Entities continue to have the option to perform a qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. We adopted this update on January 1, 2020 and applied its amendments prospectively. This update did not have a material effect on our consolidated financial statements and related disclosures.
Not Yet Adopted Pronouncements
In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This update simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity's own equity. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021 with early adoption permitted but no earlier than fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.
In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This update provides for optional financial reporting alternatives to reduce the cost and complexity associated with the accounting for contracts and hedging relationships affected by reference rate reform. The accommodations are effective for all entities through December 31, 2022. They may be applied from the beginning of the interim period that includes the issuance of this update. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.
In January 2020, the FASB issued ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815). The amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. This update also clarifies certain interactions between the guidance to account for certain equity securities, equity method investments and the guidance in Topic 815, including measuring certain purchased options and forward contracts to acquire investments. This update is effective prospectively for fiscal years beginning after December 15, 2020, with early adoption permitted. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.
In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This update simplifies accounting for income taxes by eliminating some exceptions to the general approach in ASC
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Topic 740, Income Taxes, related to intraperiod tax allocation, the methodology for calculating income tax in an interim period and the recognition of deferred tax liabilities for outside basis differences. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020 with early adoption permitted. The amendments in this update should be applied on either a retrospective basis, modified retrospective basis or prospectively, depending on the provision within the amendment. We do not expect the adoption of this update to have a material effect on our consolidated financial statements and related disclosures.
(3)    Business Acquisitions
2020 Acquisitions
During the year ended December 31, 2018,2020, we completed the acquisitions of HeavyWater, Inc.the equity interests of Collateral Analytics, LLC ("HeavyWater"Collateral Analytics"), the technology assets and Ernst Publishing Co.,business of DocVerify and the equity interests of Optimal Blue, LLC and two related entities (collectively, "Ernst"certain affiliates ("Optimal Blue"). Neither acquisitionNone of these acquisitions met the definition of "significant" pursuant to Article 3 of Regulation S-X (§210.3-05) either individually or in the aggregate. Further the individual and aggregate results of

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operations are not material to our consolidated financial statements and related disclosures. Further details of each acquisition are discussed below.
2018 Acquisitions
HeavyWater
On May 31, 2018, we completed our acquisition of HeavyWater, a provider of artificial intelligence and machine learning to the financial services industry. HeavyWater's AIVASM solution reads, comprehends and draws conclusions based on context to mimic cognitive thinking and build expertise over time. Heavywater's AIVASM solution will be integrated into our premier solutions and will allow clients to deploy artificial intelligence and machine learning within other parts of their organizations to help enhance efficiency, effectiveness and accuracy.
Ernst
On November 6, 2018, we completed the acquisition of Ernst, a provider of technology and closing cost data for the real estate and mortgage industries. Ernst's capabilities will be integrated into our premier suite of origination solutions and will augment our existing fee engine to create a unified access point for all fee-related needs.
Allocation of Purchase Price
The purchase price for each of the acquisitions was allocated to the assets acquired and liabilities assumed based on their estimated fair value at the acquisition date.
The fair value of the acquired Computer software and Other intangible assets waswere primarily determined using a third-party valuation based on significant estimates and assumptions, including levelLevel 3 inputs, which are judgmental in nature. These estimates and assumptions include the projected timing and amount of future cash flows and discount rates reflecting the risk inherent in the future cash flowsflows.
Collateral Analytics and future market prices. DocVerify Acquisitions
On March 3, 2020, we completed the acquisition of Collateral Analytics, a provider of real estate products and tools to support appraisers, appraisal management companies, lenders, investors and government agencies. Collateral Analytics is reported within our Data and Analytics segment because it enhances our real estate solutions and automated valuation model offerings.
On August 27, 2020, we completed the acquisition of DocVerify, a solution that provides proof of the integrity of digital documents, enabling organizations across a wide range of industries to streamline processes, safeguard sensitive information and reduce costs. DocVerify is reported within our Software Solutions segment and helps accelerate Black Knight’s goal of digitizing the entirety of the real estate and mortgage continuum as DocVerify’s trusted and proven digital document verification capabilities are integrated with Expedite®Close, our digital closing platform.
These estimates are preliminaryacquisitions were not material individually or in the aggregate to our consolidated financial statements.
Total consideration, net of cash acquired, was $73.5 million in the aggregate for Collateral Analytics and subject to adjustmentsDocVerify. The total consideration was as we complete our valuation process with respect to follows (in millions):
Cash paid$74.1 
Contingent consideration3.1 
Less: cash acquired(3.7)
Total consideration, net$73.5 
The following table summarizes the total purchase price consideration and the fair value amounts recognized for the assets acquired and liabilities assumed (in millions):
Total consideration, net$73.5 
Computer software$8.2 
Other intangible assets18.1 
Goodwill46.9 
Other current and non-current assets4.1 
Total assets acquired77.3 
Total liabilities assumed3.8 
Net assets acquired$73.5 
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The Collateral Analytics purchase agreement requires us to pay additional cash consideration based on earnings before interest expense, income tax provision and depreciation and amortization ("EBITDA") over a three-year period beginning April 1, 2020. The DocVerify purchase agreement requires us to pay additional cash consideration based on revenues recognized over a two-year period beginning January 1, 2021. In accordance with ASC Topic 805, Business Combinations ("ASC 805"), we will recognize the majority of this consideration as compensation cost over the related period due to ongoing employment requirements. Refer to Note 13 — Fair Value Measurements for additional information.
Estimated Useful Lives of Computer Software and Other Intangible Assets Acquired
As of the acquisition dates, the preliminary gross carrying value and weighted average estimated useful lives of Computer software and Other intangible assets acquired consisted of the following (dollars in millions):
Gross carrying valueWeighted average
estimated life
(in years)
Computer software$8.2 5
Other intangible assets:
Client relationships16.4 10
Trade names1.1 3
Non-compete agreements0.6 4
Other intangible assets18.1 
Total gross carrying value$26.3 
Optimal Blue Acquisition
On July 26, 2020, we entered into a definitive equity purchase agreement with affiliates of private equity firm GTCR, LLC, to purchase Optimal Blue, a leading provider of secondary market solutions and Goodwill.actionable data services. We also entered into forward purchase agreements with Cannae and affiliates of THL (collectively, the "FPAs"), whereby Cannae and affiliates of THL agreed to each acquire 20% of the equity interests of a newly formed entity, Optimal Blue Holdco, for a purchase price of $289.0 million. Optimal Blue Holdco was formed for the purpose of acquiring Optimal Blue.
On September 15, 2020, we completed a series of transactions and completed the acquisition of Optimal Blue. In connection with the acquisition of Optimal Blue, we contributed $762.0 million in cash and Compass Analytics, LLC ("Compass Analytics") to Optimal Blue Holdco. In addition, Black Knight InfoServ, LLC ("BKIS"), our indirect, wholly-owned subsidiary, provided $500.0 million in cash in exchange for a note with Optimal Blue Holdco (the "OB Holdco Note"). The OB Holdco Note bears interest at a rate of 6.125%, which is payable on a semi-annual basis beginning March 1, 2021, and matures on September 1, 2028. Immediately prior to the closing of the Optimal Blue acquisition, we, together with BKT, our indirect, wholly-owned subsidiary, Optimal Blue Holdco, Cannae and THL, entered into the OB Holdco LLC Agreement. As of December 31, 2020, we own 60% of Optimal Blue Holdco. Optimal Blue is reported within our Software Solutions segment because it enhances our robust set of software solutions and includes additional product, pricing and eligibility capabilities.
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Total consideration, paid, net of cash received,acquired was $43.4 millionapproximately $1.8 billion for 100% of the equity interests in HeavyWater and Ernst.Optimal Blue. The total consideration paid was as follows (in millions):
Cash paid$44.0
Less: cash acquired(0.6)
Total consideration paid, net$43.4
Cash paid$1,828.3 
Less: cash acquired(29.3)
Total consideration, net$1,799.0 
The following table summarizes the total purchase price consideration and the preliminary fair value amounts recognized for the assets acquired and liabilities assumed (in millions):
Total consideration, net$1,799.0 
Trade receivables$11.3 
Computer software79.7 
Other intangible assets610.8 
Goodwill (Note 10)1,206.0 
Other current and non-current assets13.3 
Total assets acquired1,921.1 
Deferred income taxes101.4 
Current and other non-current liabilities20.7 
Total liabilities assumed122.1 
Net assets acquired$1,799.0 
The fair value of Computer software, Other intangible assets, Goodwill and certain assumed liabilities, including estimated liabilities for pre-acquisition tax exposure, is preliminary and subject to adjustments as we complete our valuation process.
For the year ended December 31, 2020, we incurred direct transaction costs of $15.0 million in connection with the acquisition of Optimal Blue. Transaction costs are included in Transition and integration costs on the Consolidated Statements of Earnings and Comprehensive Earnings.
For the period September 15, 2020 through December 31, 2020, Optimal Blue's revenues of $37.6 million and pre-tax loss of $19.0 million are included in our Consolidated Statements of Earnings and Comprehensive Earnings.
Estimated Useful Lives of Computer Software and Other Intangible Assets Acquired
As of the acquisition dates (indate, the preliminary gross carrying value and weighted average estimated useful lives of Computer software and Other intangible assets acquired consisted of the following (dollars in millions):
Gross carrying valueWeighted average
estimated life
(in years)
Computer software$79.7 5
Other intangible assets:
Client relationships602.5 10
Trade names5.2 3
Non-compete agreements3.1 5
Other intangible assets610.8 
Total gross carrying value$690.5 

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Total purchase price consideration$43.4
  
Trade receivables$1.3
Prepaid expenses and other current assets2.1
Computer software8.4
Other intangible assets13.6
Goodwill (Note 9)22.9
Total assets acquired48.3
Trade accounts payable and other accrued liabilities3.1
Deferred revenues (current)0.9
Deferred income taxes, net0.9
Total liabilities assumed4.9
Net assets acquired$43.4
Unaudited Pro Forma Results
Pursuant to ASC 805, unaudited pro forma results of operations for the years ended December 31, 2020 and 2019, assuming the acquisition had occurred as of January 1, 2019, are presented below (in millions, except per share amounts):
Year ended December 31,
20202019
Revenues$1,320.0 $1,267.3 
Net earnings$200.6 $4.3 

The unaudited pro forma results include certain pro forma adjustments that were directly attributable to the acquisition, assuming the acquisition had occurred on January 1, 2019, including the following:
additional amortization expense that would have been recognized relating to the acquired intangible assets;
adjustments to interest expense to reflect the additional debt we incurred related to partially finance the acquisition; and
a reduction of expenses for acquisition-related transaction costs of $15.0 million for the year ended December 31, 2020.
2019 Acquisition
On September 13, 2019, we completed the acquisition of Compass Analytics, a financial technology provider of advanced pricing and valuation solutions to support loan officers and capital market professionals. Compass Analytics is reported within our Software Solutions segment because this acquisition expands our footprint in capital markets, adds mortgage servicing rights valuation capabilities to our solutions and establishes end-to-end connectivity and pricing between originators and mortgage investors. Total consideration, net of cash received, was $61.8 million for 100% of the equity interests in Compass Analytics. Additionally, we incurred direct transaction costs of $0.2 million for the year ended December 31, 2019 that are included in Transition and integration costs on the Consolidated Statements of Earnings and Comprehensive Earnings.
During the year ended December 31, 2020, we recorded a measurement period adjustment of $0.9 million to reduce our estimated liabilities for pre-acquisition tax exposure.
The purchase agreement requires us to pay additional cash consideration based on revenues recognized over a two-year period from the acquisition date. We recorded a contingent consideration liability of $9.0 million as part of the Compass Analytics acquisition. In accordance with ASC 805, the portion of the estimated payment that was not recognized as contingent consideration at the time of the acquisition will be expensed ratably over a two-year period due to an ongoing employment requirement. As of December 31, 2019, the amount of contingent consideration liability included in Trade accounts payable and other accrued liabilities was $4.2 million. As of December 31, 2019, the contingent consideration liability included in Other non-current liabilities in our Consolidated Balance Sheets was $4.8 million. The contingent consideration was subject to remeasurement at each reporting date until settlement. During 2020, an agreement related to the Compass Analytics contingent consideration payout was amended to a set contractual amount. As of December 31, 2020, $4.3 million was included in Trade accounts payable and other accrued liabilities related to the previous contingent consideration payout. Refer to Note 13 — Fair Value Measurements.
2018 Acquisitions
HeavyWater
On May 31, 2018, we completed our acquisition of HeavyWater, Inc. ("HeavyWater"), a provider of artificial intelligence and machine learning to the financial services industry. HeavyWater is reported within our Software Solutions segment. HeavyWater's AIVASM solution reads, comprehends and draws conclusions based on context to mimic cognitive thinking and build expertise over time. HeavyWater's AIVASM solution is being integrated into our premier solutions and allows clients to deploy artificial intelligence and machine learning within other parts of their organizations to help enhance efficiency, effectiveness and accuracy.
Ernst
On November 6, 2018, we completed the acquisition of Ernst Publishing Co., LLC and two related entities (collectively, "Ernst"), a provider of technology and closing cost data for the real estate and mortgage industries. Ernst is reported within our Software Solutions segment. Ernst's capabilities are being integrated into our premier suite of origination solutions and augment our existing fee engine to create a unified access point for all fee-related needs.
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Total consideration paid, net of cash received, was $43.4 million for 100% of the equity interests in HeavyWater and Ernst. Additionally, we incurred direct transaction costs of $0.1 million for the year ended December 31, 2018 that are included in Transition and integration costs on the Consolidated Statements of Earnings and Comprehensive Earnings.

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Estimated Useful Lives of Property and Equipment, Computer Software and Other Intangible Assets Acquired
As of the respective acquisition dates, the gross carrying value and weighted average estimated useful lives of Property and equipment, Computer software and Other intangible assets acquired during the year ended December 31, 2018 consisted of the following (dollars in millions):
 Gross carrying value 
Weighted average
estimated life
(in years)
Computer software$8.4
 5
Other intangible assets:
 
Customer relationships12.1
 10
Non-compete agreements1.3
 5
Trade names0.2
 3
Other intangible assets13.6
  
Total gross carrying value$22.0
  
2016 Acquisitions
eLynx
On May 16, 2016, we completed our acquisition of eLynx Holdings, Inc. ("eLynx"), a leading lending document and data delivery platform that we now refer to as our eLending business. Our eLending business helps clients in the financial services and real estate industries electronically capture and manage documents and associated data throughout the document lifecycle. We purchased eLynx to augment our origination software business. This acquisition positions us to electronically support the full mortgage origination process. Total consideration paid, net of cash received, was $115.0 million, for 100% of the equity interests. Additionally, we incurred direct transaction costs of $1.2 million for the year ended December 31, 2016 that are included in Transition and integration costs on the Consolidated Statements of Earnings and Comprehensive Earnings.
Motivity
On June 22, 2016, we completed our acquisition of Motivity Solutions, Inc. ("Motivity"), which provides customized mortgage business intelligence software solutions. Motivity, along with our LoanSphere product suite, including the Data Hub®, provides clients with deeper insights into their origination and servicing operations and portfolios. Total consideration paid, net of cash received, was $35.2 million for 100% of the equity interests. Additionally, we incurred direct transaction costs of $0.4 million for the year ended December 31, 2016 that are included in Transition and integration costs on the Consolidated Statements of Earnings and Comprehensive Earnings.
OtherDNB Investment
On August 8, 2018, an investment consortium (the “Consortium”) including Cannae, Holdings, Inc. (“Cannae”) and affiliates of Bilcar, LLC, CC Capital Partners LLC, Bilcar, LLC and funds associated with THL along with other investors entered into equity commitments in connection with the acquisition of The Dun & Bradstreet Corporation, a Delaware corporation ("D&B") (the "D&B Acquisition")., a global leader in commercial data and analytics that provides various services helping companies improve their operational performance. Contemporaneously, D&B entered into an Agreement and Plan of Merger (the "D&B Merger"Merger Agreement") by and among D&B, Star Parent, L.P., a Delaware limited partnership ("Star Parent"), and Star Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Star Parent, ("Star Merger Sub"), pursuant to which, upon the terms and subject to the conditions set forth in thethrough a series of transactions, D&B Merger Agreement, Star Merger Sub would merge with and into D&B (the "Star Merger"), with D&B surviving the Star Merger asbe a wholly-owned subsidiary of Star Parent.Parent (the "D&B Acquisition").
On January 24, 2019, we entered into an assignmentAssignment and investment agreement with QIA FIG Holding LLC, Cannae, and Star Parent in connection with our $375.0 million investmentInvestment Agreement as part of the Consortium.
On February 8, 2019, the Consortium completed the previously announced D&B Acquisition for $145.00 in cash for each share of D&B common stock then outstanding, and we funded awhich included our $375.0 million investment in Star Parent (the "February 2019 D&B Investment") funded through borrowingsa borrowing on our revolving credit facility. On July 1, 2019, we invested an additional $17.6 million in Star Parent (together with the February 2019 D&B Investment, collectively, the “D&B Investment”) in exchange for our pro-rata share of additional limited partner interests issued by Star Parent related to D&B's acquisition of Lattice Engines, Inc.
In connection with the closing,D&B Investment, we were issued certain limited partner interests in Star Parent, representing approximately 18%18.1% of the outstanding common equity of Star Parent.
D&B isOur maximum exposure related to our variable interests in Star Parent was limited to our investment and commitments to maintain our pro-rata share of limited partner interests.
The table below summarizes the carrying amount of our investment and our maximum exposure related to our variable interests in Star Parent (in millions):
December 31, 2019
Total assetsMaximum exposure
Investment in Star Parent$291.3 $291.3 
DNB IPO and Private Placement
On July 6, 2020, Dun & Bradstreet Holdings, Inc. ("DNB"), previously a global leaderwholly-owned subsidiary of Star Parent, closed its previously announced initial public offering of 90.0 million shares of common stock, which included 11.7 million shares of common stock issued pursuant to the exercise by the underwriters of their option to purchase additional shares in commercial datafull (the "DNB IPO"). The DNB IPO was priced at $22.00 per share, resulting in gross proceeds to DNB of $2.4 billion when combined with $400.0 million of aggregate proceeds from a concurrent private placement offering (the "DNB Private Placement") and analytics that provides various services helping companies improve their operational performance.before deducting underwriting discounts and commissions and other offering expenses payable by DNB. Shares of DNB common stock began trading on the New York Stock Exchange ("NYSE") under the ticker symbol "DNB" on July 1, 2020.

On July 6, 2020, we invested $100.0 million in the DNB Private Placement. In connection with the closing of the DNB IPO and the DNB Private Placement, our limited partner interests in Star Parent were exchanged for 54.8 million shares of DNB common stock (the "DNB Investment"), which represents ownership of 13.0% of DNB.
As of December 31, 2020, DNB's closing share price was $24.90, and the fair value of our investment in DNB was $1,365.8 million before tax.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(4)Earnings Per Share
Basic earnings per shareSummarized consolidated financial information for DNB (Successor) and Star Parent (Predecessor) is computedpresented below (in millions):
December 31,
20202019
Current assets$874.0 $417.9 
Non-current assets8,345.4 8,694.9 
Total assets$9,219.4 $9,112.8 
Current liabilities, including short-term debt$825.3 $1,090.4 
Non-current liabilities4,816.4 5,412.9 
Total liabilities5,641.7 6,503.3 
Cumulative preferred series A stock1,030.6 
Total equity3,577.7 1,578.9 
Total liabilities and shareholders' equity$9,219.4 $9,112.8 
Year ended December 31, 2020For the period
February 8 to December 31, 2019
Revenues$1,738.1 $1,413.9 
Loss before provision for income taxes and equity in net income of affiliates$(219.3)$(540.0)
Net loss$(106.5)$(425.8)
Net loss attributable to DNB (Successor)/Star Parent
(Predecessor)
$(175.6)$(546.3)
The effective tax rate of DNB for the year ended December 31, 2020 differs by dividing Net earnings attributable to Black Knight bymore than 5% from the weighted-average numberapplicable statutory federal income tax rate of shares of common stock outstanding during the period.
For the periods presented, potentially dilutive securities include unvested restricted stock awards and the shares of BKFS Class B common stock prior21.0%, primarily due to the Distribution.impact of the CARES Act.
The summarized consolidated financial information was obtained from the audited consolidated financial statements of DNB as of December 31, 2020 and for the year ended December 31, 2020, and from the audited consolidated financial statements of Star Parent as of December 31, 2019 and for the period February 8 to December 31, 2019.
During years ended December 31, 2020 and 2019, we recorded equity in earnings related to our DNB Investment of $62.1 million, net of income tax expense of $21.0 million, and equity in losses related to our investment in Star Parent of $73.9 million, net of income tax benefit of $25.0 million, respectively. For the year ended December 31, 2017, the numerator2020, Equity in the dilutedearnings (losses) of unconsolidated affiliates, net earnings per share calculation is adjusted to reflect ourof tax includes a non-cash gain of $88.2 million, net of income tax expense at an expected effective tax rate assuming the conversionof $29.8 million as a result of the DNB IPO and concurrent DNB Private Placement.
On January 8, 2021, DNB completed its acquisition of Bisnode Business Information Group AB (the "Bisnode acquisition"). In connection with the Bisnode acquisition, an additional 6.2 million shares were issued by DNB, which resulted in a decrease in our ownership interest in DNB to 12.8%.
Other Investment
On May 15, 2020, we sold our interest in an equity method investment and recognized a gain of BKFS Class B common stock into shares$5.0 million, net of BKFS Class A common stock on a one-for-one basis prior to the Distribution. The effective tax, ratewhich is included in Equity in earnings (losses) of unconsolidated affiliates, net of tax in our Consolidated Statements of Earnings and Comprehensive Earnings for the year ended December 31, 20172020. In connection with the sale, we received $8.4 million in cash at closing and recorded a long-term receivable of $1.8 million, which is included in Other non-current assets in our Consolidated Balance Sheets. The original investment was (16.7)%, including the effect of the benefit relatednot material to the revaluation of our net deferred income tax liability and certain other discrete items recorded during 2017. For the year ended December 31, 2017, the denominator includes approximately 63.1 million shares of BKFS Class B common stock outstanding prior to the Distribution. However, for the year ended December 31, 2016, the 84.8 million shares of BKFS Class B common stock have been excluded in computing diluted net earnings per share because including them on an "if-converted" basis would have an antidilutive effect. The denominator also includes the dilutive effect of approximately 0.6 million, 0.6 million and 2.0 million shares of unvested restricted shares of common stock for the years ended December 31, 2018, 2017 and 2016, respectively.
The shares of BKFS Class B common stock did not share in the earnings or losses of Black Knight and were, therefore, not participating securities. Accordingly, basic and diluted net earnings per share of BKFS Class B common stock have not been presented.
The computation of basic and diluted earnings per share is as follows (in millions, except per share amounts):Knight.
65
 Year ended December 31,
 2018 2017 2016
Basic:     
Net earnings attributable to Black Knight$168.5
 $182.3
 $45.8
Shares used for basic net earnings per share:     
Weighted average shares of common stock outstanding147.6
 88.7
 65.9
Basic net earnings per share$1.14
 $2.06
 $0.69
      
Diluted:     
Earnings before income taxes  $192.4
  
Income tax benefit excluding the effect of noncontrolling interests  (32.2)  
Net earnings  $224.6
  
Net earnings attributable to Black Knight$168.5
   $45.8
Shares used for diluted net earnings per share:     
Weighted average shares of common stock outstanding147.6
 88.7
 65.9
Dilutive effect of unvested restricted shares of common stock0.6
 0.6
 2.0
Weighted average shares of BKFS Class B common stock outstanding
 63.1
 
Weighted average shares of common stock, diluted148.2
 152.4
 67.9
Diluted net earnings per share$1.14
 $1.47
 $0.67

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(5)    Earnings Per Share
(5)Related Party Transactions
Diluted net earnings per share include the effect of unvested restricted stock awards. In 2020, the outstanding OB PIUs were excluded from the diluted earnings per share calculations because the effect of their inclusion was antidilutive. The following table sets forth the computation of basic and diluted earnings per share (in millions, except per share amounts):
Year ended December 31,
202020192018
Basic:
Net earnings attributable to Black Knight$264.1 $108.8 $168.5 
Shares used for basic net earnings per share:
Weighted average shares of common stock outstanding152.0 147.7 147.6 
Basic net earnings per share$1.74 $0.74 $1.14 
Diluted:
Net earnings attributable to Black Knight$264.1 $108.8 $168.5 
Shares used for diluted net earnings per share:
Weighted average shares of common stock outstanding152.0 147.7 147.6 
Dilutive effect of unvested restricted shares of common stock0.9 0.9 0.6 
Weighted average shares of common stock, diluted152.9 148.6 148.2 
Diluted net earnings per share$1.73 $0.73 $1.14 
(6)    Related Party Transactions
DNB
As of February 8, 2019, along with its predecessor entities, DNB is considered to be a related party primarily due to the combination our investment in DNB, our shared Chief Executive Officer and certain shared board members. On July 6, 2020, we invested an additional $100.0 million in connection with the DNB Private Placement. Refer to Note 4 — Investments in Unconsolidated Affiliates.
As of December 31, 2020 and December 31, 2019, we had a related party receivable of less than $0.1 million and $0.2 million, respectively, from DNB and its predecessors. During the year ended December 31, 2020, we entered into a services agreement with DNB. For the year ended December 31, 2020, the services provided were less than $0.1 million.
Trasimene
During the year ended December 31, 2020, we entered into a non-exclusive advisory services agreement with Trasimene Capital Management, LLC ("Trasimene") for services that may include evaluating, negotiating and closing various acquisition, financing and strategic corporate transactions. Transaction fees for services provided are primarily based on the size of the transaction and do not exceed market rates. Trasimene is considered a related party because the Chairman of our Board of Directors owns a controlling interest in Trasimene. During the year ended December 31, 2020, we recognized $8.3 million in fees with Trasimene primarily related to our acquisition of Optimal Blue, which are included in Transition and integration costs in our Consolidated Statements of Earnings and Comprehensive Earnings.
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
FNF
We are party to certain related party agreements, including certain agreements with Fidelity National Financial, Inc. ("FNF"), including agreements that were entered into when we were related parties, to provide software, data and analytics services, as well as corporate shared services and information technology. We are also a party to certain other agreements under which we incur other expenses or receive revenues from FNF. As a result of the Distribution,spin-off from Fidelity National Financial, Inc. ("FNF") on September 29, 2017 (the "Distribution"), FNF and Black Knight are separate independent companies. FNF no longer has an ownership interest in us; however, FNF isus, but was still considered to be a related party primarilyuntil December 1, 2019 due to the combination of certain shared board members, members of senior management and various agreements. As of December 1, 2019, the Chairman of our Board of Directors, who also serves as the Chairman of FNF's Board of Directors, no longer serves as one of our executive officers, and FNF is no longer considered a related party.
A summary of the revenues and expenses, net from FNF for the periods we were related parties is as follows (in millions):
Year ended December 31,
2019(1)
2018
Revenues$59.5 $57.6 
Operating expenses12.5 12.1 

(1) Transactions with FNF are summarized through November 30, 2019, the date after which FNF is no longer considered a related party.

THL
We were party to certain related party agreements with THL until May 11, 2018, the date of an underwritten secondary offering of shares of our common stock by affiliates of THL. As a result of this offering, certain affiliates of THL no longer have an ownership interest in us and are no longer considered related parties. NaN managing directors of THL currently serve on our Board of Directors.
A summary of underwritten secondary offerings of shares of our common stock by affiliates of THL for the periods we were related parties is as follows (in millions):
May 11,
2018
March 15, 2018February 15, 2018
Number of shares sold by affiliates of THL12.1 8.0 8.0 
Number of shares Black Knight repurchased from the underwriter1.0 2.0 
Shares owned by affiliates of THL immediately after each offering12.1 20.1 
 
May 11,
2018
 March 15, 2018 February 15, 2018 November 24, 2017 
May 12,
2017 (1)
Number of shares sold by affiliates of THL12.1
 8.0
 8.0
 7.0
 5.8
Number of shares Black Knight repurchased from the underwriter
 1.0
 2.0
 2.0
 
Shares owned by affiliates of THL immediately after each offering
 12.1
 20.1
 28.1
 35.1

(1)Includes the effect of an option for the underwriter to purchase an additional 0.8 million shares, which was exercised in full and closed on May 18, 2017.

As of February 8, 2019, D&B is considered to be a related party primarily due to the combination of certain shared board members, members of executive management and our investment. Refer to Note 3—Business Acquisitions and Other Investment. Transactions with FNF and THL are described below.
FNF
We have various agreements with FNF to provide software, data and analytics services, as well as corporate shared services and information technology. We are also a party to certain other agreements under which we incur other expenses or receive revenues from FNF.
A detail of the revenues and expenses, net from FNF is as follows (in millions):
67
 Year ended December 31,
 2018 2017 2016
Revenues$57.6
 $56.8
 $73.5
Operating expenses12.1
 12.3
 15.6
Guarantee fee
 1.2
 3.9
We paid to FNF a guarantee fee of 1.0% of the outstanding principal of the Senior Notes (as defined in Note 11—Long Term Debt) in exchange for the guarantee by FNF of the Senior Notes. The guarantee fee was included in Interest expense, net on the Consolidated Statements of Earnings and Comprehensive Earnings. On April 26, 2017, the Senior Notes were redeemed, and we are no longer required to pay a guarantee fee.
In connection with our 2018 Credit Agreement (as defined in Note 11 — Long-Term Debt), FNF no longer hold any principal amount of our debt. As of December 31, 2017, FNF held $48.8 million of principal amount of our Term B Loan (as defined in Note 11—Long Term Debt) from our 2015 Credit Agreement, as amended.
THL
Two managing directors of THL currently serve on our Board of Directors. We purchased software and systems services from certain entities over which THL exercises control. Transactions with THL are summarized through May 11, 2018, the date THL is no longer considered a related party.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

A detail of the expenses, net from THL is as follows (in millions):
 Year ended December 31,
 2018 2017 2016
Operating expenses$
 $0.3
 $1.3
Software and software-related purchases
 
 1.1
Consolidated Statements of Earnings and Comprehensive Earnings
A detailsummary of related party items included in Revenues is as follows (in millions):
Year ended December 31,
2019(1)
2018
Software services$40.2 $35.9 
Data and analytics services19.3 21.7 
Total related party revenues$59.5 $57.6 

(1) Transactions with FNF are summarized through November 30, 2019, the date after which FNF is no longer considered a related party.
 Year ended December 31,
 2018 2017 2016
Data and analytics services$21.7
 $24.0
 $47.2
Servicing, origination and default software services35.9
 32.8
 26.3
Total related party revenues$57.6
 $56.8
 $73.5

A detailsummary of related party items included in Operating expenses (net of expense reimbursements) is as follows (in millions):
Year ended December 31,
2019(1)
2018
Data entry, indexing services and other operating expenses$8.8 $8.2 
Corporate services3.8 4.9 
Technology and corporate services(0.1)(1.0)
Total related party expenses, net$12.5 $12.1 

(1) Transactions with FNF are summarized through November 30, 2019, the date after which FNF is no longer considered a related party.
 Year ended December 31,
 2018 2017 2016
Data entry, indexing services and other operating expenses$8.2
 $5.1
 $9.6
Corporate services4.9
 9.2
 10.4
Technology and corporate services(1.0) (1.7) (3.1)
Total related party expenses, net$12.1
 $12.6
 $16.9
Consolidated Balance Sheets
A detail of related party items included in Prepaid expenses and other current assets is as follows (in millions):
 December 31,
 2018 2017
Contract assets$4.8
 $
Prepaid fees
 0.1
Total related party prepaid expenses and other current assets$4.8
 $0.1
As of December 31, 2018, related party deferred revenues of $0.1 million are included in Deferred revenues (current) in our Consolidated Balance Sheets.
We believe the amounts earned from or charged by us under each of the foregoing arrangements are fair and reasonable. We believe our service arrangements are priced within the range of prices we offer to third parties, except for certain corporate services provided to FNF and certain corporate services provided by FNF, which are at cost. However, the amounts we earned or that were charged under these arrangements were not negotiated at arm's length and may not represent the terms that we might have obtained from an unrelated third party.

(7)    Property and Equipment
Property and equipment consist of the following (in millions):
December 31,
20202019
Land$11.9 $11.9 
Computer equipment238.3 234.1 
Buildings and improvements84.8 81.2 
Furniture, fixtures and other equipment12.4 11.2 
Leasehold improvements7.5 7.1 
Property and equipment354.9 345.5 
Accumulated depreciation and amortization(191.8)(168.6)
Property and equipment, net$163.1 $176.9 
On December 31, 2019, we entered into finance lease agreements for certain computer equipment. The leased equipment was valued at $13.7 million, net of prepaid maintenance and $0.3 million of imputed interest, and is included in Property and equipment, net on the Consolidated Balance Sheets. Refer to Note 12 — Long-Term Debt andNote 15 — Leases for additional information related to our finance leases.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(6)    Property and Equipment
Property and equipment, net consists of the following (in millions):
 December 31,
 2018 2017
Land$11.9
 $11.9
Buildings and improvements71.1
 65.8
Leasehold improvements6.7
 5.4
Computer equipment208.9
 203.1
Furniture, fixtures and other equipment11.0
 9.3
Property and equipment309.6
 295.5
Accumulated depreciation and amortization(132.5) (115.6)
Property and equipment, net$177.1
 $179.9
(7)(8)    Computer Software
Computer software, net consists of the following (in millions):
December 31,
20202019
Internally developed software$998.5 $808.2 
Purchased software89.8 78.9 
Computer software1,088.3 887.1 
Accumulated amortization(590.0)(481.1)
Computer software, net$498.3 $406.0 
 December 31,
 2018 2017
Internally developed software$746.0
 $679.4
Purchased software60.7
 45.7
Computer software806.7
 725.1
Accumulated amortization(401.1) (308.3)
Computer software, net$405.6
 $416.8
In the fourth quarter of 2019, we entered into agreements to acquire software in exchange for a combination of cash consideration and certain of our products and services. The software was acquired for $32.0 million, of which $6.5 million was received as of December 31, 2019 and resulted in non-cash investing activity of $4.8 million for the year ended December 31, 2019. Software valued at $25.5 million was received in the first quarter of 2020 and resulted in non-cash investing activity of $10.5 million for the year ended December 31, 2020.
Internally developed software and purchased software are inclusive of amounts acquired through acquisitions. Refer to Note 3 — Business Acquisitions for further discussion.
Estimated amortization expense on computer software for the next five fiscal years is as follows (in millions):
2019 (1)$93.6
202092.5
202177.8
202268.0
202359.4
2021(1)
$122.7 
2022123.0 
2023114.4 
202462.0 
202544.0 

(1)Assumes assets not in service as of December 31, 2018
(1)    Assumes assets not in service as of December 31, 2020 are placed in service equally throughout the year.
(8)
(9)    Other Intangible Assets
Other intangible assets net consistsconsist of the following (in millions):
 December 31, 2020December 31, 2019
Gross carrying
amount
Accumulated
amortization
Net carrying
amount
Gross carrying
amount
Accumulated
amortization
Net carrying
amount
Client relationships$1,206.0 $(525.9)$680.1 $587.1 $(441.4)$145.7 
Other19.2 (7.0)12.2 9.1 (4.8)4.3 
Total intangible assets$1,225.2 $(532.9)$692.3 $596.2 $(446.2)$150.0 
  December 31, 2018 December 31, 2017
  Gross carrying
amount
 Accumulated
amortization
 Net carrying
amount
 Gross carrying
amount
 Accumulated
amortization
 Net carrying
amount
Customer relationships $568.0
 $(382.8) $185.2
 $555.9
 $(326.0) $229.9
Other 6.9
 (4.1) 2.8
 5.3
 (3.6) 1.7
Total intangible assets $574.9
 $(386.9) $188.0
 $561.2
 $(329.6) $231.6
IntangibleClient relationships and other intangible assets other than those with indefinite lives, are amortized over their estimated useful lives ranging frominclusive of amounts acquired through acquisitions. Refer to Note 3 to 10 years from the acquisition date using either a straight-line or accelerated method.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Business Acquisitions for further discussion.
Estimated amortization expense on other intangible assets for the next five fiscal years is as follows (in millions):
2021$151.7 
2022129.0 
2023105.8 
202481.3 
202568.3 

69
2019$58.2
202047.2
202136.3
202225.2
202314.2
(9)    Goodwill
Goodwill consists of the following (in millions):
 Software Solutions Data and Analytics Corporate and Other Total
Balance, December 31, 2016$2,131.7
 $172.1
 $
 $2,303.8
Activity3.0
 
 
 3.0
Balance, December 31, 20172,134.7
 172.1
 
 2,306.8
HeavyWater and Ernst acquisitions (Note 3)22.9
 
 
 22.9
Balance, December 31, 2018$2,157.6
 $172.1
 $
 $2,329.7
For the 2018 increase in Goodwill, $19.7 million is deductible for tax purposes, and $3.2 million is not deductible for tax purposes. The increase in Goodwill in 2017 is related to the eLynx measurement period adjustment recorded during the first quarter of 2017.
(10)    Other Non-Current Assets
Other non-current assets consists of the following (in millions):
 December 31,
 2018 2017
Deferred contract costs, net of accumulated amortization$161.3
 $136.1
Property records database59.9
 59.7
Prepaid expenses18.3
 4.0
Contract assets17.0
 
Deferred compensation plan related assets11.1
 11.7
Unrealized gains on interest rate swaps6.2
 6.7
Unbilled receivables5.0
 14.6
Other8.1
 7.3
Other non-current assets$286.9
 $240.1

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(10)    Goodwill
Goodwill consists of the following (in millions):
Software SolutionsData and AnalyticsCorporate and OtherTotal
Balance, December 31, 2018$2,157.6 $172.1 $$2,329.7 
Compass Analytics acquisition (Note 3)31.7 31.7 
Balance, December 31, 20192,189.3 172.1 2,361.4 
Optimal Blue acquisition (Note 3)1,206.0 1,206.0 
Other acquisitions (Note 3)20.5 25.5 46.0 
Balance, December 31, 2020$3,415.8 $197.6 $$3,613.4 
The increase in Goodwill related to our Optimal Blue acquisition is partially deductible for tax purposes. The increase in Goodwill related to our Collateral Analytics, DocVerify and Compass Analytics acquisitions is deductible for tax purposes.
(11)    Other Non-Current Assets
Other non-current assets consist of the following (in millions):
December 31,
20202019
Property records database$60.5 $60.1 
Contract assets, net56.5 37.8 
Right-of-use assets41.1 26.4 
Deferred compensation plan related assets19.5 15.2 
Prepaid expenses4.9 8.1 
Unbilled receivables, net1.1 3.5 
Other9.7 7.7 
Other non-current assets$193.3 $158.8 
(12)    Long-Term Debt
Long-term debt consists of the following (in millions):
December 31,
20202019
Term A Loan$1,148.4 $1,203.1 
Revolving Credit Facility47.7 310.0 
Senior Notes1,000.0 
Other17.6 41.7 
Total long-term debt principal2,213.7 1,554.8 
Less: current portion of long-term debt(73.0)(79.1)
Long-term debt before debt issuance costs and discount2,140.7 1,475.7 
Less: debt issuance costs and discount(18.8)(10.6)
Long-term debt, net of current portion$2,121.9 $1,465.1 
70

 December 31, 2018 December 31, 2017
 Principal Debt
issuance
costs
 Discount Total Principal 
Debt
issuance
costs
 Discount Total
Term A Loan$1,234.4
 $(6.9) $
 $1,227.5
 $1,004.3
 $(7.0) $
 $997.3
Term B Loan
 
 
 
 390.0
 (2.5) (1.4) 386.1
Revolving Credit Facility82.5
 (5.4) 
 77.1
 55.0
 (4.3) 
 50.7
Other32.9
 
 (0.8) 32.1
 
 
 
 
Total long-term debt1,349.8
 (12.3) (0.8) 1,336.7
 1,449.3
 (13.8) (1.4) 1,434.1
Less: Current portion of long-term debt53.2
 (0.2) (0.5) 52.5
 55.5
 (0.4) 
 55.1
Long-term debt, net of current portion$1,296.6
 $(12.1) $(0.3) $1,284.2
 $1,393.8
 $(13.4) $(1.4) $1,379.0
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Principal Maturities of Debt
As of December 31, 2018,2020, principal maturities, including payments related to our finance leases, are as follows (in millions):
2019$53.2
202065.7
202162.5
2021$73.5 
2022109.4
2022111.7 
20231,059.0
20231,028.5 
ThereafterThereafter1,000.0 
Total$1,349.8
Total$2,213.7 
2018 Credit Agreement
On April 30, 2018, our indirect subsidiary, Black Knight InfoServ, LLC ("BKIS")BKIS entered into an amended and restated credit and guaranty agreement (the “2018 Credit Agreement”) with JPMorgan Chase Bank, N.A. as administrative agent, the guarantors party thereto, the other agents party thereto and the lenders party thereto. The 2018 Credit Agreement was amended on August 7, 2020 to facilitate the issuance of the Senior Notes, as defined below.
The 2018 Credit Agreement, as amended, provided for (i) a $1,250.0 million term loan A facility (the “2018 Term A Loan”) and (ii) a $750.0 million revolving credit facility (the “2018 Revolving Credit Facility” and, together with the 2018 Term A Loan, collectively, the “2018 Facilities”), the proceeds of which were used to repay in full the Term A Loan, Term B Loan and Revolving Credit Facility outstanding under the 2015 Credit Agreement,credit agreement, as amended (defined below).amended.
The 2018 Term A Loan and the 2018 Revolving Credit Facility bear interest at rates based upon, at the option of BKIS, either (i) the base rate plus a margin of between 25 and 50 basis points depending on the total leverage ratio of BKFS LLC and its restricted subsidiaries on a consolidated basis (the “Consolidated Leverage Ratio”) or (ii) the Eurodollar rate plus a margin of between 125 and 150 basis points depending on the Consolidated Leverage Ratio. In addition, BKIS will paypays an unused commitment fee of between 15 and 20 basis points on the undrawn commitments under the 2018 Revolving Credit Facility, also depending on the Consolidated Leverage Ratio.
As of December 31, 2018,2020, the 2018 Term A Loan and the 2018 Revolving Credit Facility bear interest at the Eurodollar rate plus a margin of 150 basis points. As of December 31, 2018,2020, we have $667.5$702.3 million of unused capacity on the 2018 Revolving Credit Facility and pay an unused commitment fee of 20 basis points. During the year ended December 31, 2018, there were $676.9 million of incremental borrowings and $649.4 million of payments on our 2018 Revolving Credit Facility. During the year ended December 31, 2017, there were $180.0 million of incremental borrowings and $175.0 million of payments on our Revolving Credit Facility. As of December 31, 2018,2020, the interest rates on the 2018 Term A Loan and the 2018 Revolving Credit Facility were 4.02%1.64% and 3.92%1.81%, respectively.

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The 2018 Facilities are guaranteed by all of BKIS’s wholly-owned domestic restricted subsidiaries and BKFS LLC, a Delaware limited liability company and the direct parent company of BKIS, and are secured by associated collateral agreements that pledge a lien on substantially all of BKIS’s assets, including fixed assets and intangibles, and the assets of the guarantors, in each case, subject to customary exceptions.
The 2018 Term A Loan is subject to amortization of principal, payable in quarterly installments on the last day of each fiscal quarter equal to the percentage set forth below of the initial aggregate principal amount of the term loans for such fiscal quarter:
Payment DatesPercentage
December 31, 20182019 through and including March 31, 20200.63%
Commencing on June 30, 2020 through and including March 31, 20221.25%
Commencing on June 30, 2022 through and including March 31, 20232.50%
The remaining principal balance of the 2018 Term A Loan is due upon maturity. Pursuant to the terms of the 2018 Credit Agreement, the loans under the 2018 Term A Loan and the 2018 Revolving Credit Facility mature on April 30, 2023.
For the year ended December 31, 2018, the amount included in Other expense, net on the Consolidated Statements of Earnings and Comprehensive Earnings related to the April 30, 2018 refinancing was $5.8 million.
2015 Credit AgreementSenior Notes
On May 27, 2015,August 26, 2020, BKIS entered into a creditcompleted the issuance and guaranty agreement (the "2015 Credit Agreement") with JPMorgan Chase Bank, N.A., as administrative agent, the guarantors party thereto and the other agents and lenders party thereto. The 2015 Credit Agreement provided for (i) an $800.0 million term loan A facility (the "Term A Loan"), (ii) a $400.0 million term loan B facility (the "Term B Loan") and (iii) a $400.0 million revolving credit facility (the "Revolving Credit Facility", and collectively with the Term A Loan and Term B Loan, the "Facilities"). The Facilities were guaranteed by substantially allsale of BKIS's wholly-owned domestic restricted subsidiaries and BKFS LLC, and were secured by associated collateral agreements that pledge a lien on virtually all of BKIS's assets, including fixed assets and intangible assets, and the assets of the guarantors.
Term B Loan Repricing
On February 27, 2017, BKIS entered into a First Amendment to Credit and Guaranty Agreement (the "2015 Credit Agreement First Amendment") with JPMorgan Chase Bank, N.A. as administrative agent. The 2015 Credit Agreement First Amendment reduced the pricing applicable to the loans under the Term B Loan by 75 basis points. Pursuant to the 2015 Credit Agreement First Amendment, the Term B Loan bore interest at rates based upon, at the option of BKIS, either (i) the base rate plus a margin of 125 basis points, or (ii) the Eurodollar rate plus a margin of 225 basis points, subject to a Eurodollar rate floor of 75 basis points. The Term B Loan was to mature on May 27, 2022. In addition, the terms of the 2015 Credit Agreement First Amendment permitted the Distribution. The amount included in Other expense, net on the Consolidated Statements of Earnings and Comprehensive Earnings related to the Term B Loan repricing was $1.1 million.
The Term B Loan was subject to amortization of principal, payable in equal quarterly installments on the last day of each fiscal quarter, which commenced on September 30, 2015, with 1.0% of the initial aggregate advances thereunder to be payable each year prior to the maturity date of the Term B Loan, and the remaining initial aggregate advances thereunder to be payable at the Term B Loan maturity date.
Term A Loan and Revolver Refinancing
On April 26, 2017, BKIS entered into a Second Amendment to Credit and Guaranty Agreement (the “2015 Credit Agreement Second Amendment”) with the JPMorgan Chase Bank, N.A. as administrative agent, the guarantors party thereto, the other agents party thereto and the lenders party thereto. The 2015 Credit Agreement Second Amendment increased (i) the$1.0 billion aggregate principal amount of the Term A Loan by $300.0 million to $1,030.0 million3.625% senior unsecured notes due 2028 (the "Senior Notes"). The Senior Notes have a coupon rate of 3.625% and (ii) the aggregate principal amountmature on September 1, 2028. Interest is paid semi-annually in arrears on September 1 and March 1 of commitments under the Revolving Credit Facility by $100.0 million to $500.0 million.each year, commencing March 1, 2021. The 2015 Credit Agreement Second Amendment also reduced the pricing applicable to the loans under the Term A Loan and Revolving Credit Facility by 25 basis points and reduced the unused commitment fee applicable to the Revolving Credit Facility by 5 basis points. The Term A Loan and Revolving Credit Facility bore interest at rates based upon, at the option of BKIS, either (i) the base rate plus a margin of between 25 and 100 basis points depending on the total leverage ratio of BKFS LLC and its restricted subsidiaries on a consolidated basis (the “Consolidated Leverage Ratio”) or (ii) the Eurodollar rate plus a margin of between 125 and 200 basis points depending on the Consolidated Leverage Ratio, subject to a Eurodollar rate floor of zero basis points. In addition, BKIS was required to pay an unused commitment fee of between 15 and 30 basis points on the undrawn commitments under the Revolving Credit Facility, also depending on the Consolidated Leverage Ratio. Pursuant to the terms of the 2015 Credit Agreement Second Amendment, the Term A Loan and the

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Revolving Credit Facility were to matureobligations under the Senior Notes are fully and unconditionally guaranteed, jointly and severally, on February 25, 2022. The amount included in Other expense, net onan unsecured basis by the Consolidated Statements of Earnings and Comprehensive Earnings related to the Term A Loan and Revolving Credit Facility refinancing was $3.3 million. The 2015 Credit Agreement Second Amendment was replaced bysame guarantors that guarantee the 2018 Credit Agreement (collectively, the “Guarantors”). The Senior Notes are effectively subordinated to any obligations that are secured, including obligations under the 2018 Credit Agreement, to the extent of the value of the assets securing those obligations. The Senior Notes are structurally subordinated to all liabilities of BKIS' subsidiaries that do not guarantee the Senior Notes. The net proceeds of the offering, along with cash on April 30, 2018.hand and contributions from Cannae and THL, were used to partially finance the acquisition of Optimal Blue.
The Senior Notes were issued pursuant to an indenture (the “Indenture”), dated as of August 26, 2020, between BKIS, the Guarantors and Wells Fargo Bank, National Association, as trustee. BKIS may redeem up to 40% of the Senior Notes using the proceeds of certain equity offerings completed before September 1, 2023 at a redemption price equal to 103.625% of their principal amount plus accrued and unpaid interest, if any, up to, but not including the redemption date. In addition, at any time prior to September 1, 2023, BKIS may redeem some or all of the Senior Notes at a price equal to 100% of their principal amount, plus accrued and unpaid interest, if any, up to, but not including, the redemption date, plus the “make-whole” premium. Thereafter, BKIS may redeem the Senior Notes, in whole or in part, at the redemption prices set forth in the Indenture, plus accrued and unpaid interest, if any, up to, but not including, the redemption date. Upon the occurrence of certain events constituting a change of control, BKIS may be required to make an offer to repurchase the Senior Notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest, if any, up to, but not including, the date of purchase.
The Senior Notes are subject to customary covenants, including among others, customary events of default.
Other Debt
On April 1, 2018, we entered into a financing agreement for $32.9 million, with a stated interest rate of 0% and an imputed interest rate of 3.4%, primarily related to certain data processing and maintenance services. QuarterlyOn December 31, 2019, we entered into an amendment to the financing agreement for an additional $16.3 million, with a stated interest rate of 0% and an imputed interest rate of 3.3%. Under the terms of the amendment, quarterly payments are due beginning January 1, 20192, 2020 through April 1, 2020.January 2, 2023. As of December 31, 2018, $21.42020, $9.5 million is included in the Current portion of long-term debt in our Consolidated Balance Sheets and $6.4 million is included in Long-term debt, net of current portion in our Consolidated Balance Sheets.
Senior NotesFinance Leases
Through April 25, 2017, BKIS had 5.75% senior notes,On December 31, 2019, we entered into one-year finance lease agreements, with a stated interest paid semi-annually, which were scheduled to mature on April 15, 2023 (the "Senior Notes").rate of 0% and an imputed interest rate of 3.3% and bargain purchase options for certain computer equipment. The Senior Notes were senior unsecured obligations, registered under the Securities Actfinance lease liabilities of 1933$1.2 million and contained customary affirmative, negative$14.1 million as of December 31, 2020 and financial covenants, and events of default for indebtedness of this type (with grace periods, as applicable, and lender remedies). On April 26, 2017, we redeemed the remaining $390.0 million in aggregate principal of the outstanding Senior Notes at a price of 104.825% (the "Senior Notes Redemption") and paid $0.7 million in accrued interest. The amount2019, respectively, are included in Other expense, netthe Current portion of debt on our Consolidated Balance Sheets. For the Consolidated Statements of Earningsyear ended December 31, 2020, non-cash financing and Comprehensive Earningsinvesting activity was $1.2 million related to the Senior Notes Redemption was $8.2 million.
On May 27, 2015, BKIS, Black Knight Lending Solutions, Inc. ("BKLS," and, together with BKIS, the "Issuers"), the guarantors named therein (the "Guarantors") and U.S. Bank National Association, as trustee (the "Trustee"), entered into the Third Supplemental Indenture (the "Third Supplemental Indenture")unpaid portion of our finance lease agreements. Refer to the Indenture, dated as of October 12, 2012, governing the Senior Notes, among the Issuers, the Guarantors party thereto and the Trustee (as supplemented to date, the "Indenture"). The Third Supplemental Indenture supplemented the Indenture to add the Guarantors as guarantors of the Issuers' obligations under the Indenture and the Senior Notes. As the Guarantors consisted of substantially all of the subsidiaries of BKHI, with the exception of two insignificant subsidiaries, the consolidated financial statements present all of the required guarantor financial statements, and we have not presented separate guarantor financial statements.
On January 2, 2014, upon consummation of the Acquisition, Lender Processing Services, Inc. ("LPS") entered into a Supplemental Indenture (the "Supplemental Indenture") with FNF, BKLS and the Trustee, to the Indenture dated as of October 12, 2012, among LPS, the subsidiary guarantors party thereto and the Trustee,Note 15 — Leases for additional information related to the Senior Notes. Pursuant to the terms of the Supplemental Indenture, (i) FNF became a guarantor of LPS' obligations under the Senior Notes and agreed to fully and unconditionally guarantee the Senior Notes, on a joint and several basis with the guarantors named in the Indenture and (ii) BKLS became a "co-issuer" of the Senior Notes and agreed to become a co-obligor of LPS' obligations under the Indenture and the Senior Notes, on the same terms and subject to the same conditions as LPS, on a joint and several basis. As a result of FNF's guarantee of the Senior Notes, the Senior Notes were rated as investment grade, which resulted in the suspension of certain restrictive covenants in the Indenture. From May 26, 2015 through April 25, 2017, we paid to FNF a guarantee fee of 1.0% of the outstanding principal of the Senior Notes in exchange for the guarantee by FNF of the Senior Notes.
As a result of the Acquisition, the Senior Notes were adjusted to fair value, resulting in our recording a premium on the Senior Notes of approximately $23.3 million. The premium was amortized over the remaining term of the Senior Notes using the effective interest method. During the years ended December 31, 2017 and 2016, we recognized $0.5 million and $1.5 million of amortization, respectively, which is included as a component of Interest expense, net.finance leases.
Fair Value of Long-Term Debt
The fair value of the Facilities approximates their carrying value at December 31, 2018 as they are variable rate instruments with short reset periods (either monthly or quarterly), which reflect current market rates.2020. The fair value of our Senior Notes as of December 31, 2020 was $1,026.3 million compared to its carrying value of $988.1 million, net of original issue discount and debt issuance costs. The fair value of our Facilities and Senior Notes is based upon established market prices for the securities using Level 2 inputs.
Interest Rate Swaps
We have enteredenter into interest rate swap agreements to hedge forecasted monthly interest rate payments on our floating rate debt. On April 11, 2018, we entered into a new interest rate swap agreement with a start date of April 30, 2018. On May 29, 2018, we entered into an interest rate swap agreement with a forward starting date on January 31, 2019. As of December 31, 2018,2020, we havehad the following interest rate swap agreements (collectively, the "Swap Agreements") (in millions):

Effective datesNotional amountFixed rates
March 31, 2017 through March 31, 2022$200.0 2.08%
September 29, 2017 through September 30, 2021$200.0 1.69%
April 30, 2018 through April 30, 2023$250.0 2.61%
January 31, 2019 through January 31, 2023$300.0 2.65%
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Effective dates Notional amount Fixed rates
February 1, 2016 through January 31, 2019 $200.0
 1.01%
February 1, 2016 through January 31, 2019 $200.0
 1.01%
March 31, 2017 through March 31, 2022 $200.0
 2.08%
September 29, 2017 through September 30, 2021 $200.0
 1.69%
April 30, 2018 through April 30, 2023 $250.0
 2.61%
January 31, 2019 through January 31, 2023 $300.0
 2.65%
Under the terms of the Swap Agreements, we receive payments based on the 1-month LIBOR rate (approximately 2.52%0.15% as of December 31, 2018)2020). During the year ended December 31, 2019, the following interest rate swap agreements expired (in millions):
Effective datesNotional amountFixed rates
February 1, 2016 through January 31, 2019$200.0 1.01%
February 1, 2016 through January 31, 2019$200.0 1.01%
We entered into the Swap Agreements to convert a portion of the interest rate exposure on our floating rate debt from variable to fixed. We designated these Swap Agreements as cash flow hedges. A portion of the amount included in Accumulated other comprehensive earnings (loss)loss will be reclassified into Interest expense, net as a yield adjustment as interest payments are madeis either paid or received on the hedged debt. The fair value of our Swap Agreements is based upon Level 2 inputs. We have considered our own credit risk and the credit risk of the counterparties when determining the fair value of our Swap Agreements.
The estimated fair value of our Swap Agreements in the Consolidated Balance Sheets is as follows (in millions):
  December 31,
Balance Sheet Account 2018 2017
Prepaid expenses and other current assets $0.5
 $
Other non-current assets $6.2
 $6.7
Other non-current liabilities $4.5
 $
As of December 31, 2018, a cumulative gain of $2.2 million ($1.6 million net of tax) is reflected in Accumulated other comprehensive earnings. As of December 31, 2017, a cumulative gain of $6.7 million ($3.9 million net of tax) is reflected in Accumulated other comprehensive earnings. Below is a summary of the effect of derivative instruments on amounts recognized in Other comprehensive earnings (loss) ("OCE") on the accompanying Consolidated Statements of Earnings and Comprehensive Earnings (in millions):
 Year ended December 31, 2018 Year ended December 31, 2017
 Amount of loss recognized
in OCE
 Amount of gain reclassified from Accumulated OCE
into Net earnings
 Amount of gain
recognized
in OCE
 Amount of loss reclassified from Accumulated OCE
into Net earnings
Swap agreements       
Attributable to noncontrolling interests$
 $
 $1.7
 $0.5
Attributable to Black Knight0.7
 2.7
 3.7
 0.4
Total$0.7
 $2.7
 $5.4
 $0.9
Approximately $2.7 million ($2.0 million net of tax) of the balance in Accumulated other comprehensive earnings (loss) as of December 31, 2018 is expected to be reclassified into Interest expense, net over the next 12 months.
It is our policy to execute derivative financialsuch instruments with credit-worthycreditworthy banks and not to enter into suchderivative financial instruments for speculative purposes. As of December 31, 2018, weWe believe our interest rate swap counterparties will be able to fulfill their obligations under our agreements, and we believe we will have debt outstanding through the various expiration dates of the swaps such that the occurrence of future cash flow hedges remains probable.
The estimated fair values of our Swap Agreements are as follows (in millions):
(12)
December 31,
Balance sheet accounts20202019
Other current liabilities$2.4 $
Other non-current liabilities$35.2 $21.9 
A cumulative loss of $37.6 million ($28.1 million net of tax) and $21.9 million ($16.4 million net of tax) is reflected in Accumulated other comprehensive loss as of December 31, 2020 and December 31, 2019, respectively. Below is a summary of the effect of derivative instruments on amounts recognized in Other comprehensive loss ("OCE") on the accompanying Consolidated Statements of Earnings and Comprehensive Earnings (in millions):
Year ended December 31, 2020Year ended December 31, 2019Year ended December 31, 2018
Amount of loss recognized
in OCE
Amount of loss reclassified from Accumulated OCE
into Net earnings
Amount of loss recognized
in OCE
Amount of gain reclassified from Accumulated OCE
into Net earnings
Amount of loss recognized
in OCE
Amount of gain reclassified from Accumulated OCE
into Net earnings
Swap agreements(23.9)12.2 (18.0)(0.7)(2.7)
Approximately $20.3 million ($15.2 million net of tax) of the balance in Accumulated other comprehensive loss as of December 31, 2020 is expected to be reclassified into Interest expense, net over the next 12 months.
(13)    Fair Value Measurements
Fair Value
Fair Value of Financial Assets and Liabilities
Fair value represents the amount that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair values of financial assets and liabilities are determined using the following fair value hierarchy:

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Level 1 inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that we have the ability to access.
Level 2 inputs to the valuation methodology include:
quoted prices for similar assets or liabilities in active markets;
quoted prices for identical or similar assets or liabilities in inactive markets;
inputs other than quoted prices that are observable for the asset or liability; and
inputs that are derived principally from or corroborated by observable market data by correlation or other means.
quoted prices for similar assets or liabilities in active markets;
quoted prices for identical or similar assets or liabilities in inactive markets;
inputs other than quoted prices that are observable for the asset or liability; and
inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.
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Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. We believe our valuation methods are appropriate and consistent with other market participants. The use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
Fair Value of Assets Acquired and Liabilities Assumed
The following table presents our fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (in millions):
December 31, 2020December 31, 2019
Carrying amountFair valueCarrying amountFair value
Level 1Level 2Level 3Level 1Level 2Level 3
Assets:
Cash and cash equivalents (Note 2)$34.7 $34.7 $$$15.4 $15.4 $$
Liabilities:
Interest rate swaps (Note 12)37.6 37.6 21.9 21.9 
Contingent consideration (Note 3)3.1 3.1 9.0 9.0 
Redeemable noncontrolling interests578.0 578.0 
 December 31, 2018 December 31, 2017
 Carrying amount Fair value Carrying amountFair value
  Level 1 Level 2 Level 3 Level 1 Level 2 Level 3
Assets:              
Cash and cash equivalents (Note 2)$20.3
 $20.3
 $
 $
 $16.2
$16.2
 $
 $
Interest rate swaps (Note 11)6.7
 
 6.7
 
 6.7

 6.7
 
               
Liabilities:
 
 
 
 

 
 
Interest rate swaps (Note 11)4.5
 
 4.5
 
 

 
 
The fair value of contingent consideration was primarily determined using a third-party valuation based on significant estimates and assumptions, including Level 3 inputs. The estimates and assumptions include the projected timing and amount of future cash flows and discount rates reflecting the rate inherent in the future cash flows.
During the year ended December 31, 2020, an agreement related to the Compass Analytics contingent consideration payout was amended to a set contractual amount. As result, the related contingent consideration amount was transferred out of Level 3.
The following table presents a summary of the change in fair value of our Level 3 fair value measurements (in millions):
(13)Beginning balance, December 31, 2019Commitments and Contingencies$9.0 
Adjustments related to prior year acquisition(9.0)
Adjustments related to current year acquisitions3.1 
Ending balance, December 31, 2020$3.1 
As of December 31, 2020, the fair value of redeemable noncontrolling interests approximates its carrying amount due to the close proximity to the reporting date of the contributions received from Cannae and THL for their share of equity interests in Optimal Blue Holdco. Refer to Note 2 — Significant Accounting Policies and Note 3 — Business Acquisitions.
(14)    Commitments and Contingencies
Legal and Regulatory Matters
In the ordinary course of business, we are involved in various pending and threatened litigation and regulatory matters related to our operations, some of which include claims for punitive or exemplary damages. Our ordinary course litigation may include class action lawsuits, which make allegations related to various aspects of our business. From time to time, we also receive requests for information from various state and federal regulatory authorities, some of which take the form of civil investigative demands or subpoenas. Some of these regulatory inquiries may result in the assessment of fines for violations of regulations or settlements with such authorities requiring a variety of remedies. We believe that none of these actions depart from customary litigation or regulatory inquiries incidental to our business.
We review lawsuits and other legal and regulatory matters (collectively "legal proceedings") on an ongoing basis when making accrual and disclosure decisions. When assessing reasonably possible and probable outcomes, management bases its decision on its assessment of the ultimate outcome assuming all appeals have been exhausted. For legal proceedings where it has been determined that a loss is both probable and reasonably estimable, a liability based on known facts and which represents our best estimate has been recorded. Actual losses may materially differ from the amounts recorded and the ultimate outcome of our pending cases is generally not yet determinable. While some of these matters could be material to our operating
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results or cash flows for any particular period if an unfavorable outcome results, at present we do not believe that the ultimate resolution of currently pending legal proceedings, either individually or in the aggregate, will have a material adverse effect on our resultsfinancial condition.
PennyMac Litigation
On November 5, 2019, Black Knight Servicing Technologies, LLC (“BKST”), an indirect, wholly-owned indirect subsidiary of Black Knight, filed a Complaint and Demand for Jury Trial (the “Black Knight Complaint”) against PennyMac Loan Services, LLC (“PennyMac”) in the Circuit Court for the Fourth Judicial Circuit in and for Duval County, Florida. The Black Knight Complaint includes causes of action for breach of contract and misappropriation of MSP® System trade secrets in order to develop an imitation mortgage processing system intended to replace the MSP® System. The Black Knight Complaint seeks damages for breach of contract and misappropriation of trade secrets, injunctive relief under the Florida Uniform Trade Secrets Act and declaratory judgment that BKST owns all intellectual property and software developed by or financial condition.on behalf of PennyMac as a result of its wrongful use of and access to the MSP® System and related trade secret and confidential information. PennyMac filed a motion to compel arbitration of the action, and the court granted the motion on April 6, 2020. After the court denied BKST's motion for reconsideration of the court’s order compelling arbitration, BKST filed a notice of appeal with the Florida First District Court of Appeal on May 6, 2020. On January 6, 2021, the appellate court affirmed the trial court's ruling.
Black Knight has requested that PennyMac preserve evidence concerning PennyMac’s use of Black Knight’s LendingSpace® software. Black Knight has also requested that PennyMac permit Black Knight to exercise its contractual right to audit PennyMac’s database and use of the LendingSpace® software. On October 21, 2020, PennyMac submitted the dispute regarding Black Knight Origination Technologies, LLC LendingSpace® software audit request to the American Arbitration Association ("AAA") for arbitration. Black Knight moved to consolidate the LendingSpace® arbitration with the existing trade secret/antitrust arbitrations and, on December 21, 2020, the arbitrator granted Black Knight’s motion to consolidate the arbitrations. On December 8, 2020, Black Knight and PennyMac filed motions for summary judgment concerning the LendingSpace® audit, and responses to the competing motions for summary judgment were filed by both parties on January 7, 2021. On February 16, 2021, the arbitrator granted Black Knight’s motion for summary judgment and ordered that Black Knight may conduct an audit of PennyMac’s use of Black Knight’s LendingSpace® software.
Shortly after the filing of the Black Knight Complaint, on November 6, 2019, PennyMac filed an Antitrust Complaint (the “PennyMac Complaint”) against Black Knight in the United States District Court for the Central District of California. The PennyMac Complaint included causes of action for alleged monopolization and attempted monopolization under Section 2 of the Sherman Antitrust Act, violation of California’s Cartwright Act, violation of California’s Unfair Competition Law and common law unfair competition under California law. The PennyMac Complaint sought equitable remedies, damages and other monetary relief, including treble and punitive damages. Generally, PennyMac alleged that Black Knight relies on various anticompetitive, unfair, and discriminatory practices to maintain and to enhance its dominance in the mortgage servicing platform market and in an attempt to monopolize the platform software applications market. Black Knight moved to dismiss the PennyMac Complaint or have the action transferred to Florida based upon a forum selection clause in the agreement with BKST. On February 13, 2020, the judge granted Black Knight's motion to transfer the case to Florida and denied as moot the motion to dismiss. On April 17, 2020, PennyMac filed a notice of dismissal of this action without prejudice and indicated that they intended to bring the claims raised in the dismissed PennyMac Complaint as defenses, third party claims and/or counterclaims in arbitration. On April 23, 2020, the court entered an order dismissing the action without prejudice and directing that the clerk close the case. On April 28, 2020, PennyMac submitted this matter to the AAA for arbitration. On May 27, 2020, Black Knight filed its answering statement with the AAA. The arbitrator was confirmed by the AAA on July 21, 2020.
The arbitrator set Black Knight's trade secret case for a 10-day final hearing beginning on October 24, 2022, and set PennyMac's antitrust case for a 5-day final hearing beginning on November 14, 2022.
On June 26, 2020, Black Knight filed a complaint against PennyMac in the United States District Court for the Middle District of Florida seeking a declaratory judgment that PennyMac waived its right to arbitrate federal antitrust and related state law claims against Black Knight because PennyMac previously filed and litigated those claims in a court of law (the “BKI Declaratory Action”). On July 22, 2020, PennyMac moved to dismiss the complaint in the BKI Declaratory Action, which Black Knight opposed. In response to a request from the court in the BKI Declaratory Action, on August 20, 2020, BKI filed a memorandum of law in support of the federal court's subject matter jurisdiction. Black Knight filed its motion for summary judgment on September 28, 2020, and PennyMac filed its opposition to the motion on October 27, 2020. On March 1, 2021, the court will conduct a telephonic hearing on PennyMac's motion to dismiss and BKI's motion for summary judgment.
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As these cases continue to evolve, it is not possible to reasonably estimate the probability that we will ultimately prevail on our lawsuit or be held liable for the violations alleged in the PennyMac Complaint, nor is it possible to reasonably estimate the ultimate gain or loss, if any, or range of gain or loss that could result from these cases.
Other Legal Matter
During the year ended December 31, 2020, we recognized a one-time gain of $18.5 million related to the resolution of a legacy legal matter of Lender Processing Services, Inc. ("LPS") in Other income (expense), net in our Consolidated Statements of Earnings and Comprehensive Earnings.
Indemnifications and Warranties
We often agree to indemnify our clients against damages and costs resulting from claims of patent, copyright, trademark infringement or breaches of confidentiality associated with use of our software through software licensing agreements. Historically, we have not made any payments under such indemnifications, but continue to monitor the conditions that are subject to the indemnifications to identify whether a loss has occurred that is both probable and estimable that would require recognition. In addition, we warrant to clients that our software operates substantially in accordance with the software specifications. Historically,

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

no costs have been incurred related to software warranties and none are expected in the future, and as such, no accruals for warranty costs have been made.
Indemnification Agreement
We are party to a cross-indemnity agreement dated December 22, 2014 with ServiceLink Holdings, LLC ("ServiceLink"). Pursuant to this agreement, ServiceLink indemnifies us from liabilities relating to, arising out of or resulting from the conduct of ServiceLink's business or any action, suit or proceeding in which we or any of our subsidiaries are named by reason of being a successor to the business of LPS and the cause of such action, suit or proceeding relates to the business of ServiceLink. In return, we indemnify ServiceLink for liabilities relating to, arising out of, or resulting from the conduct of our business.
Operating Leases
We lease certain of our property under leases which expire at various dates. Several of these agreements include escalation clauses and provide for renewal options for periods ranging from one to five years.
As of December 31, 2018, future minimum operating lease payments for leases with initial or remaining terms greater than one year are as follows (in millions):
2019$11.1
202010.3
20215.2
20222.5
20231.2
Thereafter0.7
Total$31.0
Rent expense incurred under operating leases during the years ended December 31, 2018, 2017 and 2016 was $10.9 million, $9.4 million and $11.0 million, respectively.
Capital Lease
We entered into a one-year capital lease agreement commencing January 1, 2017 with a bargain purchase option for certain computer equipment. The computer equipment has a useful life of five years and is depreciated on a straight-line basis over this period. The computer equipment was valued based on the net present value of the minimum lease payments, which was $8.4 million (net of imputed interest of $0.1 million).
There is no remaining capital lease obligation as of December 31, 2018 or 2017.
Data Processing and Maintenance Services Agreements
We have various data processing and maintenance services agreements with vendors, which expireare in effect through 2021,2025, for portions of our computer data processing operations and related functions.
As of December 31, 2018, payments2020, payment obligations for data processing and maintenance services agreements with initial or remaining terms greater than one year are as follows (in millions):
2021$47.3 
202226.0 
202317.4 
20240.2 
20250.2 
Total$91.1 
2019$66.3
202055.4
202129.9
Total$151.6
TheseActual amounts could be more or less depending on various factors such as the introduction of significant new technologies or changes in our data processing needs.
Off-Balance Sheet Arrangements
We do not have any material off-balance sheet arrangements other than operating leases and interest rate swaps.

(15)    Leases
Operating Leases
We have operating leases for corporate offices, data centers and certain equipment. Our leases have remaining lease terms of up to eight years, some of which include escalation clauses, renewal options for up to five years or termination options within one year.

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Operating lease liabilities are included in the Consolidated Balance Sheets as follows (in millions):
December 31,
20202019
Operating lease liabilities:
Trade accounts payable and other accrued liabilities$13.5 $12.3 
Other non-current liabilities29.7 13.8 
Total lease liabilities$43.2 $26.1 

As of December 31, 2020, maturities of lease liabilities were as follows (in millions):
2021$13.6 
20228.8 
20237.0 
20246.0 
20252.9 
Thereafter7.3 
Total45.6 
Less: imputed interest(2.4)
Total$43.2 

Supplemental information related to leases is as follows (in millions, except lease term and discount rate):
Year ended December 31,
20202019
Operating lease cost (1)
$18.1 $15.7 
Operating cash outflows related to lease liabilities12.4 12.5 
Non-cash additions for right-of-use assets, net of modifications21.5 9.1 
December 31,
20202019
Weighted average remaining lease term (in years)5.32.9
Weighted average discount rate3.30 %3.81 %

(1) Operating lease cost includes right-of-use asset amortization as well as short-term and variable lease costs. Accelerated right-of-use asset amortization included in operating lease cost was $2.8 million and $0.4 million for the years ended December 31, 2020 and 2019, respectively.

Rent expense incurred under operating leases for the year ended December 31, 2018 was $10.9 million.

Finance Leases
On December 31, 2019, we entered into one-year finance lease agreements with a stated rate of 0.0% and an imputed interest rate of 3.3% and bargain purchase options for certain computer equipment. The leased equipment has a useful life of five years and is depreciated on a straight-line basis. The leased equipment was valued based on the net present value of the minimum lease payments, which was $13.7 million (net of prepaid maintenance and imputed interest of $0.3 million) and is included in Property and equipment, net on our Consolidated Balance Sheets. Refer to Note 7 — Property and Equipment.
Finance lease cost for the year ended December 31, 2020 included amortization of right-of-use asset of $2.1 million and interest on lease liability of $0.3 million. Refer to Note 12 — Long-term Debt for additional information related to our finance leases.
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(14)(16)     Revenues
Disaggregation of Revenues
The following tables summarize revenues from contracts with clients (in millions):
Year ended December 31, 2020
Servicing
Software
Origination
Software
Software SolutionsData and AnalyticsCorporate and OtherTotal
Software and hosting solutions$700.1 $202.6 $902.7 $34.1 $$936.8 
Professional services77.6 45.8 123.4 0.7 (0.4)(1)123.7 
Data solutions1.2 1.2 161.4 162.6 
Other12.9 12.9 2.5 15.4 
     Revenues$777.7 $262.5 $1,040.2 $198.7 $(0.4)$1,238.5 
Year ended December 31, 2018Year ended December 31, 2019
Servicing
Software
 
Origination
Software
 Software Solutions Data and Analytics Corporate and Other Total
Servicing
Software
Origination
Software
Software SolutionsData and AnalyticsCorporate and OtherTotal
Software and hosting solutions$716.3
 $108.8
 $825.1
 $29.8
 $
 $854.9
Software and hosting solutions$726.1 $137.0 $863.1 $32.2 $$895.3 
Professional services82.2
 44.5
 126.7
 2.1
 (2.5)(1)126.3
Professional services84.3 46.4 130.7 1.2 (0.5)(1)131.4 
Data solutions
 
 
 119.7
 
 119.7
Data solutions129.4 129.4 
Other0.5
 9.7
 10.2
 2.9
 
 13.1
Other5.1 13.4 18.5 2.6 21.1 
Revenues$799.0
 $163.0
 $962.0
 $154.5
 $(2.5) $1,114.0
Revenues$815.5 $196.8 $1,012.3 $165.4 $(0.5)$1,177.2 

Year ended December 31, 2018
Servicing
Software
Origination
Software
Software SolutionsData and AnalyticsCorporate and OtherTotal
Software and hosting solutions$716.3 $108.8 $825.1 $29.8 $$854.9 
Professional services82.2 44.5 126.7 2.1 (2.5)(1)126.3 
Data solutions119.7 119.7 
Other0.5 9.7 10.2 2.9 13.1 
     Revenues$799.0 $163.0 $962.0 $154.5 $(2.5)$1,114.0 

(1)Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.

(1)    Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.

Our Software Solutions segment offers leading software and hosting solutions that facilitate and automate many of the mission criticalmission-critical business processes across the homeownership lifecycle. These solutions primarily consist of processing and workflow management software applications. Our servicing software solutions primarily include our core servicing software solution that automates loan servicing, including loan setup and ongoing processing, customer service, accounting, reporting to the secondary mortgage market and investors and web-based workflow information systems. Our origination software solutions primarily include our solutions that automate and facilitate the origination of mortgage loans, offer product, pricing and eligibility capabilities, and provide an interconnected network allowing the various parties and systems associated with lending transactions to exchange data quickly and efficiently. Professional services consists of pre-implementation and post-implementation support and services and are primarily billed on a time and materials basis. Professional services may also include dedicated teams provided as part of agreements with software and hosting solutions clients.
Our Data and Analytics segment offers data and analytics solutions to the mortgage, real estate and capital markets verticals. These solutions include property ownership data, lien data, servicing data, automated valuation models, collateral risk scores, behavioral models, a multiple listing service software solution and other data solutions.
Effect of Adopting ASC 606
The primary effect of adopting ASC 606 relates to the timing differences attributable to the effect of straight-line revenue recognition due to escalating billings related to contractual minimums, certain distinct license arrangements and timing of revenue recognition for professional services. Certain agreements within our origination software solutions with distinct services that are substantially the same and provided ratably over the agreement term resulted in straight-line revenue recognition due to escalating billings related to contractual minimums. Further, we identified timing differences related to recognizing the license portion of certain distinct license arrangements within our origination software solutions and Data and Analytics segment upon delivery rather than ratably over the license term. Finally, we identified timing differences related to revenue recognition for certain distinct professional services for certain solutions within our servicing and origination software solutions, which are recognized in the period the professional services are performed compared to deferred and recognized over the remaining contract term under the previous standard. Moreover, fees for certain post-implementation professional services related to minor customization of hosted software solutions that are not distinct from the hosted software solutions are deferred and recognized over the remaining hosted software contract term rather than over the period the professional services are performed as required under the previous standard.
In addition, based on our analysis of contract acquisition and fulfillment costs, we did not identify a material change to our current practice for capitalizing such costs; however, we amortize certain capitalized contract costs over a longer time period for certain contracts. Based on the requirements of the new standard, we consider the explicit term of the contract with the client, expected renewals and the rate of change related to our solutions in determining the amortization period of our deferred contract costs.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Opening Balance Sheet Adjustment on January 1, 2018
As a result of applying the modified retrospective method to adopt ASC 606, the following amounts on our Consolidated Balance Sheet were adjusted as of January 1, 2018 to reflect the cumulative effect adjustment to the opening balance of Retained earnings (in millions):
 
As reported
December 31, 2017
 
Adjustments for
ASC 606 adoption
 
Adjusted
January 1, 2018
Trade receivables, net$201.8
 $(6.2) $195.6
Prepaid expenses and other current assets44.6
 11.8
 56.4
Receivables from related parties18.1
 (3.7) 14.4
Computer software, net416.8
 1.8
 418.6
Other non-current assets240.1
 16.6
 256.7
Total assets3,655.9
 20.3
 3,676.2
      
Deferred revenues (current)59.6
 (1.9) 57.7
Deferred revenues (non-current)100.7
 6.8
 107.5
Deferred income taxes224.6
 4.2
 228.8
Total liabilities1,947.1
 9.1
 1,956.2
Retained earnings201.4
 11.2
 212.6
Total equity1,708.8
 11.2
 1,720.0
Total liabilities and equity3,655.9
 20.3
 3,676.2
Effect of ASC 606 as of December 31, 2018 and for the Year Ended December 31, 2018
The following table summarizes the effect of adopting ASC 606 on our Consolidated Balance Sheet (in millions):
 
As reported
December 31, 2018
 
Effect of
ASC 606 adoption
 
Amounts without adoption of ASC 606
December 31, 2018
Trade receivables, net$172.3
 $6.9
 $179.2
Prepaid expenses and other current assets67.3
 (14.4) 52.9
Receivables from related parties6.2
 4.8
 11.0
Computer software, net405.6
 (3.7) 401.9
Other non-current assets286.9
 (24.2) 262.7
Total assets3,653.4
 (30.6) 3,622.8
      
Deferred revenues (current)52.9
 4.1
 57.0
Deferred revenues (non-current)106.8
 (4.3) 102.5
Deferred income taxes220.9
 (8.1) 212.8
Total liabilities1,866.9
 (8.3) 1,858.6
Retained earnings381.1
 (22.3) 358.8
Total equity1,786.5
 (22.3) 1,764.2
Total liabilities and equity3,653.4
 (30.6) 3,622.8

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The following tables summarize the effect of adopting ASC 606 on our Consolidated Statement of Earnings and Comprehensive Earnings (in millions):
 Year ended December 31, 2018
 As reported 
Effect of
ASC 606 adoption
 Amounts without adoption of ASC 606
Revenues$1,114.0
 $(11.6) $1,102.4
 
 
 
Operating expenses625.4
 4.5
 629.9
Depreciation and amortization217.0
 (1.1) 215.9
Income tax expense37.7
 (3.9) 33.8
Net earnings168.5
 (11.1) 157.4
 
 
 
Earnings per share:
 
 
Basic$1.14
 $(0.07) $1.07
Diluted$1.14
 $(0.08) $1.06
The following table summarizes the effect of adopting ASC 606 on our Consolidated Statement of Cash Flow (in millions):
 Year ended December 31, 2018
 As reported 
Effect of
ASC 606 adoption
 Amounts without adoption of ASC 606
Cash flows from operating activities:     
Net earnings$168.5
 $(11.1) $157.4
Certain adjustments to reconcile net earnings to net cash provided by operating activities:     
Depreciation and amortization217.0
 (1.1) 215.9
Deferred income taxes, net(7.5) (3.9) (11.4)
Changes in assets and liabilities:     
Trade and other receivables, including receivables from related parties44.5
 (1.8) 42.7
Prepaid expenses and other assets(41.5) 6.3
 (35.2)
Deferred contract costs(44.8) 4.5
 (40.3)
Deferred revenues(6.4) 4.7
 (1.7)
Net cash provided by operating activities$435.5
 $(2.4) $433.1
Cash flows from investing activities:     
Additions to computer software$(73.1) $2.4
 $(70.7)
Net cash used in investing activities$(144.1) $2.4
 $(141.7)
Transaction Price Allocated to Future Performance ObligationObligations
ASC 606 allows for the use of certain practical expedients, which we elected and applied to measure our future performance obligations as of December 31, 2018. As a result, ourOur disclosure of transaction price allocated to these future performance obligations excludes the following:
Volume-based fees in excess of contractual minimums and other usage-based fees to the extent they are part of a single performance obligation and meet thecertain variable allocation criteria in ASC 606;criteria;
Performance obligations that are part of a contract with an original expected duration of one year or less; and
Transactional fees based on a fixed fee per transaction when we have the right to invoice once we have completed the performance obligation.
As of December 31, 2018,2020, the aggregate amount of the transaction price that is allocated to our future performance obligations was approximately $2.1$2.4 billion and is expected to be recognized as follows: 24% by December 31, 2019, 64%25% by December 31, 2021, 88%66% by December 31, 2023, 90% by December 31, 2025 and the rest thereafter.

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(17)    Equity
Share Repurchase Program
TableOn January 31, 2017, our Board of Contents
BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(15)Equity-Based Compensation
Profits Interests Plan
Under theDirectors approved a three-year share repurchase program, effective February 3, 2017, authorizing us to repurchase up to 10.0 million shares of Black Knight Financial Services, LLC 2013 Management Incentive Plan (the "Incentive Plan"Inc. ("BKFS"), we were authorized Class A common stock through February 2, 2020, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and other restrictions. In connection with the Distribution, our Board of Directors approved a share repurchase program authorizing the repurchase of shares of BKI common stock consistent with the previous share repurchase program.
A summary of share repurchases under our share repurchase program is as follows (in millions, except per share amounts):
YearTotal number of shares repurchasedAggregate purchase priceAverage price paid per shareShares remaining under repurchase authorization as of December 31,
20183.0 $141.5 $47.15 3.8 
20190.2 11.9 $57.94 3.6 
Total3.2 $153.4 $47.84 
Refer to issueNote 6 Related Party Transactions for additional information related to the repurchase of shares of BKI common stock in 2018.
On February 12, 2020, our Board of Directors approved a three-year share repurchase program authorizing us to repurchase up to 11.110.0 million Class B unitsshares of BKFS LLC ("BKFS LLC profits interests") to eligible members of managementour outstanding common stock through February 12, 2023, through open market purchases, negotiated transactions or other means, in accordance with applicable securities laws and the Board of Managers. Duringother restrictions. We did not repurchase any shares under this program during the year ended December 31, 2014,2020.
Common Stock Offering
On June 19, 2020, we issued BKFS LLC profits interestsand sold 7,130,000 shares of our common stock in an underwritten public offering pursuant to certain membersa registration statement filed with the SEC. We received net proceeds of BKFS LLC management,approximately $484.6 million after deducting the BKFS LLC Boardunderwriters' discount of Managers and certain employees$16.3 million. We also incurred costs directly related to the offering of FNF and ServiceLink, which vested over three years, with 50% vesting after the second year and 50% vesting after the third year.$0.4 million.
Omnibus Incentive Plan
In 2015, we established theThe Black Knight Financial Services, Inc. 2015 Omnibus Incentive Plan (the "BKFS Omnibus Plan") authorizing the issuance of up to 11.0 million shares of BKFS Class A common stock, subject to the terms of the BKFS Omnibus Plan. During 2017, the shares available for future awards was increased by 7.5 million shares. The BKFS Omnibus Plan has been renamed the “Black Knight, Inc. Amended and Restated 2015 Omnibus Incentive Plan”Plan (the "Black Knight Omnibus Plan"). The BKFS board of directors adopted the Black Knight Omnibus Plan as of September 29, 2017, and the Black Knight Omnibus Plan was assumed by Black Knight, Inc. on September 29, 2017. The Black Knight Omnibus Plan provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units, other cash and stock-based awards and dividend equivalents. The Black Knight Omnibus Plan is authorized to issue up to 18.5 million shares. As of December 31, 2020, 7.0 million shares were available for future issuance. Awards granted are approved by the Compensation Committee of the Board of Directors.
In connection with our initial public offering, we converted the 10.7 million outstanding BKFS LLC profits interests units into 8.0 million restricted shares of BKFS Class A common stock. We accelerated the vesting of 4.4 million restricted shares of BKFS Class A common stock held by our directors and the remaining 3.6 million unvested restricted shares continued to vest on the same schedule as the former BKFS LLC profits interests.
A summary of restricted shares granted is as follows:
79
Date 
Number of shares
granted
 
Grant date fair
value per share
 
Vesting period
(in years)
 Vesting criteria
December 21, 2015 318,000
 $32.37
 3.0 Service and Performance
February 3, 2016 247,437
 $28.29
 3.0 Service and Performance
February 3, 2016 552,311
 $28.29
 4.0 Service and Performance
Various other 2016 dates 44,898
 $ 32.74 - $34.84
 4.0 Service
February 3, 2017 203,160
 $37.90
 3.0 Service and Performance
February 3, 2017 681,410
 $37.90
 4.0 Service and Performance
Various other 2017 dates 98,194
 $ 41.90 - $42.25
 2.0 Service
February 9, 2018 772,642
 $45.85
 3.0 Service and Performance
April 2, 2018 159,915
 $46.90
 3.0 Service and Performance
April 2, 2018 200,427
 $46.90
 2.3 Service
Various other 2018 dates 13,602
 $ 50.15 - $53.70
 3.0 Service and Performance

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

A summary of restricted shares granted is as follows:
DateNumber of shares
granted
Grant date fair
value per share
Vesting period
(in years)
Vesting criteria
February 9, 2018772,642 $45.85 3.0Service and Performance
April 2, 2018159,915 $46.90 3.0Service and Performance
April 2, 2018200,427 $46.90 2.3Service
Various other 2018 dates13,602 $50.15 - $53.703.0Service and Performance
February 15, 2019793,863 $52.38 3.0Service and Performance
February 28, 20195,744 $52.25 2.0Service
April 8, 20191,110 $54.14 3.0Service and Performance
December 1, 2019122,203 $63.01 3.0Service and Performance
Various other 2019 dates14,202 $56.66 - $62.503.0Service
February 18, 202016,689 $74.91 1.0Service
February 18, 2020(1)
487,096 $74.91 3.0Service and Performance
March 11, 202011,865 $63.26 3.0Service
March 18, 20203,366 $59.45 2.0Service
May 6, 2020(1)
3,101 $72.57 3.0Service and Performance
August 11, 20201,902 $78.88 3.0Service
August 11, 2020761 $78.88 1.0Service
August 24, 20201,533 $81.54 1.0Service
November 10, 20201,365 $91.64 1.0Service

(1)    This award is subject to an independent performance target for each of 3 consecutive 12-month measurement periods. Vesting of each tranche is
independent of the satisfaction of the annual performance target for other tranches.
Restricted stock transactions under the Black Knight Omnibus plan for the periods presented are as follows:
SharesWeighted average grant date fair value
Balance December 31, 20171,581,711 $34.48 
Granted1,146,586 $46.27 
Forfeited(22,515)$42.71 
Vested(628,517)$34.90 
Balance, December 31, 20182,077,265 $40.77 
Granted937,122 $53.84 
Forfeited(90,880)$46.94 
Vested(908,524)$39.83 
Balance, December 31, 20192,014,983 $46.99 
Granted527,678 $74.62 
Forfeited(11,811)$63.12 
Vested(981,752)$44.50 
Balance, December 31, 20201,549,098 $57.86 
 Shares Weighted average grant date fair value
Balance December 31, 20153,914,344
 *
Granted844,646
 $28.56
Forfeited(57,484) *
Vested(1,793,132) *
Balance December 31, 20162,908,374
 *
Granted982,764
 $38.31
Forfeited(127,801) $34.23
Vested(2,181,626) *
Balance, December 31, 20171,581,711
 $34.48
Granted1,146,586
 $46.27
Forfeited(22,515) $42.71
Vested(628,517) $34.90
Balance, December 31, 20182,077,265
 $40.77
_______________
*The converted shares were originally BKFS LLC profits interests units with a weighted average grant date fair value of $2.10 per unit. The fair value of the restricted shares at the date of conversion, May 20, 2015, was $24.50 per share. The original grant date fair value of the forfeited and vested restricted shares, which were originally granted as profits interests units, ranges from $2.01 to $3.77 per unit.
On February 15, 2019, we granted 793,863 restricted shares of our common stock with a grant date fair value of $52.38 per share, which was based on the closing price of our common stock on the date of grant. These restricted shares vest over a three-year period; vesting is also based on certain operating performance criteria.
Equity-based compensation expense related to restricted shares of Black Knight was $50.9$38.5 million, $18.9$50.8 million and $12.4$50.9 million for the years ended December 31, 2018, 20172020, 2019 and 2016,2018, respectively. Equity-based compensation includes accelerated recognition of $6.9$0.5 million, $2.9 million and $1.3$6.9 million for the years ended December 31, 20182020, 2019 and 2017,2018, respectively. These expenses are included in Operating expenses in the Consolidated Statements of Earnings and Comprehensive EarningsEarnings.
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
As of December 31, 2018,2020, the total unrecognized compensation cost related to non-vested restricted shares of our common stock is $40.9$36.5 million, which is expected to be recognized over a weighted average period of approximately 1.61.9 years.
Profits Interests Units
(16)Employee Stock Purchase Plan and 401(k) Plan
On November 24, 2020, there were 6,292 OB PIUs granted to certain members of management, directors, and certain employees, which vest over 3 years, with 100% cliff vesting after the third year. The terms of the OB PIUs provide for the grantees to participate in the excess of Optimal Blue Holdco's fair value over the initial hurdle amount, which was the fair value of the Optimal Blue Holdco's Class A members' initial contributions.
Holders of the OB PIUs have an option to put their profit interests to us if no public offering has been consummated as of the date that is 60 days prior to the fourth and each subsequent anniversary of the acquisition date of Optimal Blue. The units may be settled in cash or Black Knight common stock or a combination of both at our election and will be settled at the current fair value at the time we receive notice of the put election. As the OB PIUs provide for redemption features not solely within our control, we classify the redemption value outside of permanent equity in redeemable noncontrolling interests. The redemption value is equal to the difference in the per unit fair value of the underlying member units and the hurdle amount, based upon the proportionate required service period rendered to date.
The hurdle rate as of the grant date was used to determine the per unit strike price for the calculation. The risk free interest rates used in the calculation of the fair value of the OB PIUs are the rates that correspond to the weighted average expected life of the OB PIUs. The volatility was estimated based on the historical volatility of the comparable public companies' stock prices over a term equal to the weighted average expected life of the OB PIUs. We used a weighted average risk free interest rate of 0.31%, a volatility assumption of 37.0% and an expected life of 4 years, resulting in a grant date fair value of $4,233 per profits interests unit. The grant date fair value of the OB PIUs was $26.6 million.
Equity-based compensation expense related to the OB PIUs was $0.9 million for the year ended December 31, 2020. As of December 31, 2020, the total unrecognized compensation cost related to non-vested OB PIUs is $25.7 million, which is expected to be recognized over a weighted average period of approximately 2.9 years.

(18)    Employee Stock Purchase Plan and 401(k) Plan
Employee Stock Purchase Plan ("ESPP")
Effective July 20, 2015, we adopted theThe Black Knight, Financial Services, Inc. Employee Stock Purchase Plan (the "BKFS ESPP ") that"Black Knight ESPP"), which was amended and restated as of December 5, 2019, allows our eligible employees to voluntarily make after-tax contributions ranging from 3% to 15% of eligible earnings. We contribute varying matching amounts as specified in the BKFS ESPP document. On September 29, 2017, our Board of Directors approved, and BKI assumed the BKFS ESPP and renamed itBlack Knight ESSP. Effective January 1, 2020, a one-year holding period was implemented for contributions to the Black Knight Inc. Employee Stock Purchase Plan (the "Black Knight ESPP"), which was amended and restated as of January 1, 2019. The terms ofESPP. During the Black Knightholding period, ESPP as amended,purchased shares are substantially similar to the terms of the BKFS ESPP.not eligible for sale or broker transfer.
We recorded expense of $7.8$7.1 million, $6.0$8.0 million and $5.8$7.8 million for the years ended December 31, 2018, 20172020, 2019 and 2016,2018, respectively, relating to the participation of our employees in the Black Knight ESPP and BKFS ESPP.
401(k) Profit Sharing Plan
Prior toOur employees participate in the Distribution, our employees participated inBlack Knight 401(k) Profit Sharing Plan (the “Black Knight 401(k) Plan”), a qualified 401(k) plan sponsored by FNF.our indirect subsidiary BKIS. Under the terms of the plan, and subsequent amendments,as amended, eligible employees may contribute up to 40% of their pretax annual compensation, up to the amount allowed pursuant to the Internal Revenue Code ("IRC"). We generally match 37.5% of each dollar of employee contribution up to 6% of the employee's total eligible compensation. As a result
We recorded expense of $7.2 million, $6.5 million and $6.3 million for the Distribution,years ended December 31, 2020, 2019 and 2018, respectively, relating to the participation of our employees no longer participate in this plan sponsored by FNF. Our indirect subsidiary, BKIS, adopted and established the Black Knight 401(k) Profit Sharing Plan (the “Black Knight 401(k) Plan”), effective September 29, 2017. The terms of the Black Knight 401(k) Plan are consistent with the terms of the 401(k) plan sponsored by FNF.

plans.
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

We recorded expense of $6.3 million, $5.8 million and $5.5 million for the years ended December 31, 2018, 2017 and 2016, respectively, relating to the participation of our employees in the 401(k) plans.

(17)(19)        Income Taxes
Income tax expense (benefit) consists of the following (in millions):
 Year ended December 31,
 2018 2017 2016
Current:     
     Federal$35.0
 $10.4
 $15.3
     State9.4
 5.3
 6.0
     Foreign0.8
 0.9
 1.0
          Total current45.2
 16.6
 22.3
      
Deferred:     
     Federal(2.3) (87.5) 5.0
     State(5.2) 9.1
 (1.1)
     Foreign
 
 (0.4)
         Total deferred(7.5) (78.4) 3.5
Total income tax expense (benefit)$37.7
 $(61.8) $25.8
On December 22, 2017, the Tax Reform Act was signed into law. Among other provisions, the Tax Reform Act reduced the federal statutory corporate income tax rate from 35% to 21%. During the fourth quarter of 2017, we recorded a one-time, non-cash net tax benefit of $110.9 million related to the revaluation of our deferred income tax assets and liabilities as a result of the Tax Reform Act.
Year ended December 31,
202020192018
Current:
     Federal$41.5 $39.5 $35.0 
     State11.6 9.7 9.4 
     Foreign1.0 0.9 0.8 
          Total current54.1 50.1 45.2 
Deferred:
     Federal(10.6)(0.2)(2.3)
     State(1.9)(8.0)(5.2)
         Total deferred(12.5)(8.2)(7.5)
Total income tax expense$41.6 $41.9 $37.7 
A reconciliation of our federal statutory income tax rate to our effective income tax rate is as follows:
Year ended December 31,Year ended December 31,
2018 2017 2016202020192018
Federal statutory rate21.0 % 35.0 % 35.0 %Federal statutory rate21.0 %21.0 %21.0 %
State income taxes, net of federal benefit5.0
 2.9
 2.0
State income taxes, net of federal benefit4.2 4.1 5.0 
Noncontrolling interests
 (13.7) (19.2)
Redeemable noncontrolling interestsRedeemable noncontrolling interests1.3 
Tax credits(1.8) (0.6) (0.6)Tax credits(4.6)(2.3)(1.8)
Transaction costs
 1.4
 
Domestic production activities deduction
 (0.5) (1.1)
Effect of Tax Reform Act
 (57.6) 
Restricted share vesting(1.0) (0.5) 
Restricted share vesting(2.6)(1.1)(1.0)
Effect of deferred revaluation related to lower blended state tax rate(2.0) 
 
Effect of deferred revaluation related to lower blended state tax rate(3.3)(2.0)
Prior year return to provision adjustments(2.8) 
 
Prior year return to provision adjustments(5.0)(0.9)(2.8)
Effect of Optimal Blue acquisition and related transactionsEffect of Optimal Blue acquisition and related transactions1.4 
Non-deductible executive compensationNon-deductible executive compensation1.2 
Unrecognized tax benefitUnrecognized tax benefit1.9 (0.2)0.1 
Other(0.1) 1.5
 0.1
Other0.1 1.3 (0.2)
Effective tax rate18.3 % (32.1)% 16.2 %Effective tax rate18.9 %18.6 %18.3 %
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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Prior to the Distribution and THL Interest Exchange, BKFS was treated as a corporation and our net deferred tax liability was primarily related to our investment in BKFS LLC. Following the Distribution, we no longer have any noncontrolling interests, and indirectly own 100% of BKFS LLC. To reflect the 100% indirect ownership, we recorded a non-cash transaction resulting in an increase of $292.5 million to Deferred income taxes with an offset to Additional paid-in capital on the Consolidated Balance Sheets to reflect the difference in the tax and financial reporting basis of our assets and liabilities. Deferred tax assets and liabilities are recognized for temporary differences between the financial reporting basis and the tax basis of the corporate subsidiaries' assets and liabilities and expected benefits of utilizing net operating loss carryforwards.
As of December 31, 2018 and 2017, the components of deferred tax assets primarily relate to deferred revenues, equity-based compensation, employee benefits accruals and deferred compensation. As of December 31, 2018 and 2017, the components of deferred tax liabilities primarily relate to depreciation and amortization of intangible assets, property and equipment and deferred contract costs.
The significant components of deferred tax assets and liabilities consist of the following (in millions):
December 31,
20202019
Deferred tax assets:
Equity method investments$5.2 $25.7 
Equity-based compensation9.7 12.6 
Deferred revenues22.6 6.2 
Interest rate swaps9.5 5.6 
Other24.1 13.0 
Total deferred tax assets71.1 63.1 
Deferred tax liabilities:
Goodwill and other intangible assets(170.0)(168.7)
Deferred contract costs(42.1)(40.3)
Property, equipment and computer software(32.7)(34.3)
Partnership basis(105.4)
Other(4.9)(5.1)
Total deferred tax liabilities(355.1)(248.4)
Net deferred tax liability$(284.0)$(185.3)
 December 31,
 2018 2017
Deferred tax assets:   
Deferred revenues$14.8
 $26.7
Net operating loss carryovers0.7
 1.3
Equity-based compensation9.2
 3.9
Other10.7
 8.9
Total deferred tax assets35.4
 40.8
Deferred tax liabilities:   
Goodwill and other intangibles(178.9) (193.8)
Deferred contract costs(41.9) (36.2)
Property, equipment and computer software(28.0) (26.1)
Other(7.5) (9.3)
Total deferred tax liabilities(256.3) (265.4)
Net deferred tax liability$(220.9) $(224.6)
As a result ofDuring the Distribution, we have a remaining net operating loss carryover of $0.7 million from BKHI. Although the loss is limited under IRC Section 382, we expect it to be fully utilized before it expires in 2033.
ASC Topic 740-10, Accounting for Uncertain Tax Positions, requiresyear ended December 31, 2020, management determined that a reserve for uncertain tax position be recognized or derecognized based on a more likely than not threshold. This applies to positions taken or expected to be taken on a tax return. In 2017,was warranted as a result of certain items claimed on amended income tax returns filed for certain prior periods. The methodology used in determining the Distribution,claimed amounts in the amendment of prior periods is also utilized for the current year and may result in additional reserves. We do not expect the reserve to reverse within the following year. If we recorded an $8.3 million contingent tax liability for anwere to prevail on our uncertain tax position that was previously recorded at BKHI. As partpositions, the reversal of the Distribution, we entered intothis reserve would also be a tax matters agreement with FNF (the "Tax Matters Agreement"). The agreement outlines requirements for items such as the filing of pre and post-spin tax returns, payment of tax liabilities, entitlements of refunds and certain other tax matters. Under the Tax Matters Agreement with FNF, we had an indemnification receivable for the full amount of the contingent tax liability included in Receivables from related parties on the Consolidated Balance Sheets as of December 31, 2017. In 2018, we received notification from the state of Florida that resulted in no changebenefit to our incomeeffective tax liabilities. As a result, the $8.3 million contingent tax liability was resolved, and we no longer have a related indemnification receivable as of December 31, 2018.
rate. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
 December 31,
 2018 2017
Balance, January 1$8.3
 $
Additions based on tax positions of prior years0.4
 8.3
Decreases based on tax positions of prior years(8.3) 
Balance, December 31$0.4
 $8.3

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

December 31,
20202019
Balance, January 1$$0.4 
Additions based on tax positions of prior years2.8 
Additions based on tax positions of current year1.3 
Decreases based on tax positions of prior years(0.4)
Balance, December 31$4.1 $
We are currently under audit by the Internal Revenue Service ("IRS") for the 2014 and 20152017 tax years.year. Our open tax years also include 2016, 20172018, 2019 and 2018.2020 for federal income tax purposes. We are currently under audit with the state of FloridaMaine for the 2015, 20162017, 2018 and 20172019 tax years. Other than the previously mentioned audits, we are not currently under auditWe have open tax years for any other state jurisdiction or for India as of year end. We record interest and penalties related to income taxes, if any, as a component of Income tax (benefit) expense on the Consolidated Statements of Earnings and Comprehensive Earnings.
Tax Matters Agreement
Pursuant to the Tax Matters Agreement with FNF, we are obligated to indemnify FNF for (i) any action by Black Knight, or the failure to take any action within our control that negates the tax-free status of the transactions; or (ii) direct or indirect changes in ownership of Black Knight equity interests that cause the Distribution to be a taxable event to FNF as a result of the application of Section 355(e) of the Internal Revenue Code (“IRC”) or to be a taxable event as a result of a failure to satisfy the “continuity of interest” or “device” requirements for tax-free treatment under Section 355 of the IRC. No such events have occurred.
Tax Distributions
Prior to the Distribution, the taxable income of BKFS LLC was allocated to its members, including BKFS, and the members were required to reflect on their own income tax returns the items of income, gain, deduction and loss and other tax items of BKFS LLC that were allocatedpurposes for up to them. BKFS LLC made tax distributions to its members for their allocable share of BKFS LLC's taxable income. Tax distributions are calculatedsix years based on allocationseach state's laws.
(20)    Concentrations of income to a member for a particular taxable year without taking into account any losses allocated to the member in a prior taxable year. This practice is consistent with IRS regulations. Subject to certain reductions, tax distributions are generally made based on an assumed tax rate equal to the highest combined marginal federal, state and local income tax rate applicable to a U.S. corporation. BKFS LLC made tax distributions of $75.3 million and $48.6 million during the years ended December 31, 2017 and 2016, respectively. The 2017 tax distributions were for the 2016 tax year and 2017 tax year relating to the period before the Distribution. During 2018, the 2017 tax distribution amount was finalized, and we received a refund of $1.8 million from a former member of BKFS LLC.Risk
(18)Concentrations of Risk
We generate a significant amount of revenues from large customers, including a customer thatclients. For the year ended December 31, 2020, no client accounted for more than 10% of our consolidated revenues. A large client accounted for 10% and 12% of total revenues for the years ended December 31, 2019 and 2018, 2017 and 2016.respectively.
Financial instruments that potentially subject us to concentrations of credit risk consist primarily of trade receivables and interest rate swaps.

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(19)Segment Information
BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
(21)    Segment Information
ASC Topic 280, Segment Reporting ("ASC 280"),establishes standards for reporting information about segments and requires that a public business enterprise reports financial and descriptive information about its segments. Segments are components of an enterprise for which separate financial information is available and are evaluated regularly by the chief operating decision maker ("CODM") in deciding how to allocate resources and in assessing performance. Our chief executive officer is identified as the CODM as defined by ASC 280. To align with the internal management of our business operations based on service offerings, our business is organized into two2 segments. Refer to Note 1416—Revenues for a description of our Software Solutions and Data and Analytics segments.
Separate discrete financial information is available for these two2 segments and the operating results of each segment are regularly evaluated by the CODM in order to assess performance and allocate resources. We use EBITDA as the primary profitability measure for making decisions regarding ongoing operations. EBITDA is earnings before Interest expense, net, Income tax expense (benefit) and Depreciation and amortization. It also excludes Equity in earnings (losses) of unconsolidated affiliates. We do not allocate Interest expense, Other expense,income, net, Income tax expense, (benefit), equity-based compensation and certain other items, such as purchase accounting adjustments and acquisition-related costs to the segments, since these items are not considered in evaluating the segments' overall operating performance.
On January 1, 2018,Segment asset information is not included below because we realigned the composition of our two reportable segments. Certain enterprise business intelligence offerings in our Data and Analytics segment were moveddo not use it to our Software Solutions segment. This change aligns with our go-to-market strategy and with the internal management of our business operations, including the allocation of resources and assessment of performance. Prior period results have been reclassified to conform to the current segment presentation.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

evaluate performance or allocate resources. Summarized financial information concerning our segments is shown in the tables below (in millions):
Year ended December 31, 2020
Software SolutionsData and AnalyticsCorporate and OtherTotal
Revenues$1,040.2 $198.7 $(0.4)(1)$1,238.5 
Expenses:
Operating expenses435.6 133.9 100.1 (2)669.6 
Transition and integration costs31.4 (3)31.4 
EBITDA604.6 64.8 (131.9)537.5 
Depreciation and amortization120.9 15.1 134.7 (4)270.7 
Operating income (loss)483.7 49.7 (266.6)266.8 
Interest expense, net(62.9)
Other income, net16.4 
Earnings before income taxes and equity in earnings of unconsolidated affiliates220.3 
Income tax expense41.6 
Earnings before equity in earnings of unconsolidated affiliates178.7 
Equity in earnings of unconsolidated affiliates, net of tax67.1 
Net earnings245.8 
Net losses attributable to redeemable noncontrolling interests18.3 
Net earnings attributable to Black Knight$264.1 
 Year ended December 31, 2018
 Software Solutions Data and Analytics Corporate and Other Total
Revenues$962.0
 $154.5
 $(2.5)(1)$1,114.0
Expenses:       
Operating expenses394.8
 115.0
 115.6
 625.4
Transition and integration costs
 
 6.6
 6.6
EBITDA567.2
 39.5
 (124.7) 482.0
Depreciation and amortization112.9
 14.1
 90.0
(2)217.0
Operating income (loss)454.3
 25.4
 (214.7) 265.0
Interest expense, net      (51.7)
Other expense, net      (7.1)
Earnings before income taxes      206.2
Income tax expense      37.7
Net earnings      $168.5
        
Balance sheet data:       
Total assets$3,227.8
 $310.2
 $115.4
(3)$3,653.4
Goodwill$2,157.6
 $172.1
 $
 $2,329.7

(1)Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.
(2)Depreciation and amortization for Corporate and Other primarily represents net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in accordance with GAAP.
(3)Receivables from related parties are included in Corporate and Other.
 Year ended December 31, 2017
 Software Solutions Data and Analytics Corporate and Other Total
Revenues$904.5
 $151.6
 $(4.5)(1)$1,051.6
Expenses:       
Operating expenses388.0
 113.2
 68.3
 569.5
Transition and integration costs
 
 13.1
 13.1
EBITDA516.5
 38.4
 (85.9) 469.0
Depreciation and amortization101.2
 12.8
 92.5
(2)206.5
Operating income (loss)415.3
 25.6
 (178.4) 262.5
Interest expense, net      (57.5)
Other expense, net      (12.6)
Earnings before income taxes      192.4
Income tax benefit      (61.8)
Net earnings      $254.2
        
Balance sheet data:       
Total assets$3,223.5
 $304.7
 $127.7
(3)$3,655.9
Goodwill$2,134.7
 $172.1
 $
 $2,306.8

(1)Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.
(2)Depreciation and amortization for Corporate and Other primarily represents net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in accordance with GAAP.
(3)Receivables from related parties are included in Corporate and Other.

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BLACK KNIGHT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Year ended December 31, 2019
Software SolutionsData and AnalyticsCorporate and OtherTotal
Revenues$1,012.3 $165.4 $(0.5)(1)$1,177.2 
Expenses:
Operating expenses412.7 123.4 109.9 (2)646.0 
Transition and integration costs5.4 (3)5.4 
EBITDA599.6 42.0 (115.8)525.8 
Depreciation and amortization123.9 15.9 96.4 (4)236.2 
Operating income (loss)475.7 26.1 (212.2)289.6 
Interest expense, net(63.5)
Other expense, net(1.4)
Earnings before income taxes and equity in losses of unconsolidated affiliates224.7 
Income tax expense41.9 
Earnings before equity in losses of unconsolidated affiliates182.8 
Equity in losses of unconsolidated affiliates, net of tax(74.0)
Net earnings$108.8 

 Year ended December 31, 2016
 Software Solutions Data and Analytics Corporate and Other Total
Revenues$860.7
 $172.6
 $(7.3)(1)$1,026.0
Expenses:       
Operating expenses374.6
 144.4
 63.6
 582.6
Transition and integration costs
 
 2.3
 2.3
EBITDA486.1
 28.2
 (73.2) 441.1
Depreciation and amortization107.0
 8.0
 93.3
(2)208.3
Operating income (loss)379.1
 20.2
 (166.5) 232.8
Interest expense, net      (67.6)
Other expense, net      (6.4)
Earnings before income taxes      158.8
Income tax expense      25.8
Net earnings      $133.0
        
Balance sheet data:       
Total assets$3,242.0
 $310.3
 $209.7
(3)$3,762.0
Goodwill$2,131.7
 $172.1
 $
 $2,303.8


Year ended December 31, 2018
Software SolutionsData and AnalyticsCorporate and OtherTotal
Revenues$962.0 $154.5 $(2.5)(1)$1,114.0 
Expenses:
Operating expenses394.8 115.0 115.6 (2)625.4 
Transition and integration costs6.6 (5)6.6 
EBITDA567.2 39.5 (124.7)482.0 
Depreciation and amortization112.9 14.1 90.0 (4)217.0 
Operating income (loss)454.3 25.4 (214.7)265.0 
Interest expense, net(51.7)
Other expense, net(7.1)
Earnings before income taxes206.2 
Income tax expense37.7 
Net earnings$168.5 

(1)Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.
(2)Depreciation and amortization for Corporate and Other primarily represents net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in accordance with GAAP.
(3)Receivables from related parties are included in Corporate and Other.
(1)    Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.
(2)    Operating expenses for Corporate and Other includes equity-based compensation, including certain related payroll taxes, of $40.6 million, $51.7 million and $51.4 million for the years ended December 31, 2020, 2019 and 2018, respectively.
(3)    Transition and integration costs primarily consists of costs associated with acquisitions and expense reduction initiatives.
(4)    Depreciation and amortization for Corporate and Other primarily represents net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in accordance with GAAP.
(5)    Transition and integration costs primarily consists of costs associated with executive transition, transition-related costs as we transferred certain corporate functions from FNF and acquisitions.

Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A.Controls and Procedures
Item 9A.    Controls and Procedures
As of the end of the year covered by this report, we carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer ("CEO") and Executive Vice President and Chief Financial Officer ("CFO"), of the effectiveness of the design and operation of our disclosure controls and procedures as such term is defined in Rule 13a-15(e) or 15d-15(e) under the Exchange Act. Based on this evaluation, our CEO and CFO concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that we file or submit under the Act is: (a) recorded, processed, summarized and reported, within the time periods specified in the Commission's rules
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and forms; and (b) accumulated and communicated to management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.
There were no changes inour internal control over financial reporting that occurred during the quarter endedDecember 31, 20182020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Management's Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f) or 15d-15(f). Under the supervision and with the participation of our management, including our CEO and CFO, we conducted an evaluation of the effectiveness of our internal control over financial reporting. Management has adopted the framework in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)("COSO"). Based on our evaluation under this framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2018.2020. Management has excluded HeavyWater and Ernst, (the "Excluded Businesses")Optimal Blue from its assessment of our internal control over financial reporting as of December 31, 2018,2020, because the Excluded Businesses wereit was acquired during 2018. The2020. Optimal Blue represents approximately 1.0% of total assets, including goodwill and identifiableexcluding computer software, other intangible assets and goodwill related to Optimal Blue, and 3.0% of total revenues in the consolidated financial statements amounts of the Excluded Businesses represent approximately 1.4% and 0.1%, respectively, of the related consolidated financial statement amountsCompany as of and for the year ended December 31, 2018.2020.
The effectiveness of our internal control over financial reporting as of December 31, 20182020 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report which is included herein.

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Item 9B.Other Information
Item 9B.    Other Information
None.
Part III
Items 10-14.
Within 120 days after the close of our fiscal year, we intend to file with the Securities and Exchange CommissionSEC a definitive proxy statement pursuant to Regulation 14A of the Securities Exchange Act, of 1934, as amended, which will include the matters required by these items.

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PART IV
Item 15.Exhibits and Financial Statement Schedules
Item 15.    Exhibits and Financial Statement Schedules
(a) (1) Financial Statements. The following is a list of the consolidated financial statements of Black Knight, Inc. and its subsidiaries included in Item 8 of Part II:
Page

Number
(a) (2) Financial Statement Schedules.All financial statement schedules have been omitted because they are not applicable or the required information is presented in the consolidated financial statements or the notes thereto.
(a) (3) Exhibits. Exhibits required to be filed by Item 601 of601of Regulation S-K, and by Item 15(b) are included below:

















89
88




Exhibit Number
Description
2.1
3.12.2*
3.1
3.2
4.1
10.1
10.2
10.34.2
10.44.3
10.1
10.510.2
10.6
10.7
10.810.3
10.910.4
10.1010.5
10.1110.6
10.12

90



10.1310.7
10.14
10.15
10.1610.8
10.1710.9
10.10
89


10.1810.11
10.1910.12
10.2010.13
10.2110.14
10.2210.15
10.2310.16
10.2410.17
10.2510.18
10.2610.19
10.2710.20
10.28
10.2910.21
10.3010.22

91



10.3110.23
10.3210.24
10.3310.25
21.110.26
10.27
90


10.28
10.29*
10.30
10.31
10.32
21.1
23.1
31.123.2
23.3
23.4
31.1
31.2
32.1
32.2
101Interactive Data Files
(1)99.1
99.2
101.INSInline XBRL Instance Document**
101.SCHInline XBRL Taxonomy Extension Schema Document
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document
101.LABInline XBRL Taxonomy Extension Label Linkbase Document
104Cover Page Interactive Data File formatted in Inline XBRL and contained in Exhibit 101


(1)A management or compensatory plan or arrangement required to be filed as an exhibit to this report pursuant to Item 15(b) of Form 10-K.
* Certain schedules have been omitted pursuant to Item 601(a)(5) of Registration S-K. A copy of any omitted schedule will be furnished to the Securities and Exchange Commission upon request.
** The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.


Item 16.    Form 10-K Summary
None.

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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Black Knight, Inc.
By: /s/ Anthony M. Jabbour
Anthony M. Jabbour
Chief Executive Officer


 
 
Date: February 22, 2019

26, 2021
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
SignatureTitleDate
/s/  Anthony M. JabbourChief Executive Officer and DirectorFebruary 22, 201926, 2021
Anthony M. Jabbour(Principal Executive Officer)
/s/  Kirk T. LarsenExecutive Vice President and Chief Financial Officer February 22, 201926, 2021
Kirk T. Larsen(Principal Financial Officer)
/s/  Michele M. MeyersChief Accounting Officer and TreasurerFebruary 22, 201926, 2021
Michele M. Meyers(Principal Accounting Officer)
/s/  William P. Foley, IIExecutive Chairman of the BoardFebruary 22, 201926, 2021
William P. Foley, II
/s/  Catherine L. BurkeDirectorFebruary 26, 2021
Catherine L. Burke
/s/  Thomas M. HagertyDirectorFebruary 22, 201926, 2021
Thomas M. Hagerty
/s/  David K. HuntDirectorFebruary 22, 201926, 2021
David K. Hunt
/s/  Richard N. MasseyJoseph M. OttingDirectorFebruary 22, 201926, 2021
Richard N. MasseyJoseph M. Otting
/s/  Ganesh B. RaoDirectorFebruary 22, 201926, 2021
Ganesh B. Rao
/s/  John D. RoodDirectorFebruary 22, 201926, 2021
John D. Rood
/s/  Nancy L. ShanikDirectorFebruary 26, 2021
Nancy L. Shanik



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