Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 01, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Upland Software, Inc. | |
Entity Central Index Key | 1,505,155 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 21,589,400 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 16,089 | $ 22,326 |
Accounts receivable (net of allowance of $1,269 and $1,069 at September 30, 2018 and December 31, 2017, respectively) | 26,440 | 26,504 |
Deferred commissions, current | 2,374 | 0 |
Prepaid and other | 3,890 | 2,856 |
Total current assets | 48,793 | 51,686 |
Canadian tax credits receivable | 1,637 | 1,196 |
Property and equipment, net | 2,206 | 2,927 |
Intangible assets, net | 112,156 | 70,043 |
Goodwill | 157,078 | 154,607 |
Deferred commissions, noncurrent | 5,470 | 0 |
Other assets | 153 | 800 |
Total assets | 327,493 | 281,259 |
Current liabilities: | ||
Accounts payable | 4,139 | 3,887 |
Accrued compensation | 3,048 | 5,157 |
Accrued expenses and other | 10,168 | 12,148 |
Deferred revenue | 43,575 | 43,807 |
Due to sellers | 10,655 | 7,839 |
Current maturities of notes payable (includes unamortized discount of $826 and $699 at September 30, 2018 and December 31, 2017, respectively) | 4,330 | 2,301 |
Total current liabilities | 75,915 | 75,139 |
Notes payable, less current maturities (includes unamortized discount of $1,852 and $1,969 at September 30, 2018 and December 31, 2017, respectively) | 153,898 | 108,843 |
Deferred revenue, noncurrent | 901 | 1,570 |
Noncurrent deferred tax liability, net | 6,808 | 3,262 |
Other long-term liabilities | 736 | 1,030 |
Total liabilities | 238,258 | 189,844 |
Stockholders’ equity: | ||
Common stock, $0.0001 par value; 50,000,000 shares authorized: 21,589,400 and 20,768,401 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively) | 2 | 2 |
Additional paid-in capital | 181,540 | 174,944 |
Accumulated other comprehensive loss | (4,830) | (2,403) |
Accumulated deficit | (87,477) | (81,128) |
Total stockholders’ equity | 89,235 | 91,415 |
Total liabilities and stockholders’ equity | $ 327,493 | $ 281,259 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 1,269 | $ 1,069 |
Unamortized discount, current | 826 | 699 |
Unamortized discount, noncurrent | $ 1,852 | $ 1,969 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 21,589,400 | 20,768,401 |
Common stock, shares outstanding (in shares) | 21,589,400 | 20,768,401 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue: | ||||
Total revenue | $ 37,144 | $ 26,072 | $ 104,705 | $ 70,105 |
Cost of revenue: | ||||
Total cost of revenue | 12,083 | 9,113 | 33,577 | 24,144 |
Gross profit | 25,061 | 16,959 | 71,128 | 45,961 |
Operating expenses: | ||||
Sales and marketing | 5,299 | 4,258 | 14,955 | 11,516 |
Research and development | 5,400 | 4,092 | 15,577 | 11,572 |
Refundable Canadian tax credits | (99) | (195) | (404) | (424) |
General and administrative | 8,011 | 5,084 | 23,475 | 17,564 |
Depreciation and amortization | 3,606 | 1,648 | 9,589 | 4,111 |
Acquisition-related expenses | 2,497 | 4,399 | 8,739 | 10,368 |
Total operating expenses | 24,714 | 19,286 | 71,931 | 54,707 |
Gain (loss) from operations | 347 | (2,327) | (803) | (8,746) |
Other expense: | ||||
Interest expense, net | (3,118) | (2,277) | (8,755) | (4,372) |
Loss on debt extinguishment | 0 | 1,634 | 0 | 0 |
Other income (expense), net | (744) | (130) | (965) | (260) |
Total other expense | (3,862) | (773) | (9,720) | (4,632) |
Loss before provision for income taxes | (3,515) | (3,100) | (10,523) | (13,378) |
Provision for income taxes | (735) | (406) | (2,118) | (1,553) |
Net loss | $ (4,250) | $ (3,506) | $ (12,641) | $ (14,931) |
Net loss per common share: | ||||
Net loss per common share, basic and diluted (in dollars per share) | $ (0.21) | $ (0.18) | $ (0.63) | $ (0.83) |
Weighted-average common shares outstanding, basic and diluted (in shares) | 20,089,919 | 19,380,519 | 19,916,907 | 18,043,365 |
Product [Member] | ||||
Revenue: | ||||
Total revenue | $ 34,834 | $ 24,025 | $ 98,026 | $ 64,007 |
Subscription And Support [Member] | ||||
Revenue: | ||||
Total revenue | 33,919 | 23,169 | 94,802 | 60,711 |
Cost of revenue: | ||||
Total cost of revenue | 10,566 | 7,737 | 29,395 | 20,306 |
Perpetual License [Member] | ||||
Revenue: | ||||
Total revenue | 915 | 856 | 3,224 | 3,296 |
Professional Services [Member] | ||||
Revenue: | ||||
Total revenue | 2,310 | 2,047 | 6,679 | 6,098 |
Cost of revenue: | ||||
Total cost of revenue | $ 1,517 | $ 1,376 | $ 4,182 | $ 3,838 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (4,250) | $ (3,506) | $ (12,641) | $ (14,931) |
Foreign currency translation adjustment | 253 | 508 | (2,427) | 841 |
Comprehensive loss | $ (3,997) | $ (2,998) | $ (15,068) | $ (14,090) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Operating activities | ||
Net loss | $ (12,641) | $ (14,931) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 14,604 | 8,112 |
Deferred income taxes | 421 | 698 |
Amortization of deferred commissions | 1,709 | 0 |
Foreign currency re-measurement (gain) loss | 105 | (422) |
Non-cash interest and other expense | 616 | 416 |
Non-cash stock compensation expense | 10,380 | 7,804 |
Non-cash loss on retirement of fixed assets | 0 | (18) |
Changes in operating assets and liabilities, net of purchase business combinations: | ||
Accounts receivable | 3,173 | 753 |
Prepaids and other | (3,115) | 1,664 |
Accounts payable | (679) | 1,736 |
Accrued expenses and other liabilities | (7,097) | 789 |
Deferred revenue | (2,679) | (793) |
Net cash provided by operating activities | 4,797 | 5,808 |
Investing activities | ||
Purchase of property and equipment | (643) | (443) |
Purchase business combinations, net of cash acquired | (47,850) | (61,163) |
Net cash used in investing activities | (48,493) | (61,606) |
Financing activities | ||
Payments on capital leases | (893) | (1,098) |
Proceeds from notes payable, net of issuance costs | 49,375 | 54,683 |
Payments on notes payable | (2,907) | (11,319) |
Taxes paid related to net share settlement of equity awards | (4,642) | (628) |
Issuance of common stock, net of issuance costs | 858 | 43,257 |
Additional consideration paid to sellers of businesses | (4,294) | (5,361) |
Net cash provided by financing activities | 37,497 | 79,534 |
Effect of exchange rate fluctuations on cash | (38) | 482 |
Change in cash and cash equivalents | (6,237) | 24,218 |
Cash and cash equivalents, beginning of period | 22,326 | 28,758 |
Cash and cash equivalents, end of period | 16,089 | 52,976 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 8,170 | 3,966 |
Cash paid for taxes | 2,480 | 1,463 |
Noncash investing and financing activities: | ||
Equipment acquired pursuant to capital lease obligations | $ 0 | $ 121 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies Basis of Presentation These condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States ("GAAP"). The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for interim financial reporting. In the opinion of management of the Company, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments of a normal recurring nature necessary for a fair presentation. The results of operations for the three months ended September 30, 2018 are not necessarily indicative of the results to be expected for the year ending December 31, 2018 or for any other period. The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2017 Annual Report on Form 10-K filed with the SEC on March 9, 2018 . Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses. Significant items subject to such estimates include allowance for doubtful accounts, stock-based compensation, contingent consideration, acquired intangible assets, the useful lives of intangible assets and property and equipment, and income taxes. In accordance with GAAP, management bases its estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances. Management regularly evaluates its estimates and assumptions using historical experience and other factors; however, actual results could differ from those estimates. Concentrations of Credit Risk and Significant Customers Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents and accounts receivable. The Company’s cash and cash equivalents are placed with high-quality financial institutions, which, at times, may exceed federally insured limits. The Company has not experienced any losses in these accounts, and the Company does not believe it is exposed to any significant credit risk related to cash and cash equivalents. The Company provides credit, in the normal course of business, to a number of its customers. The Company performs periodic credit evaluations of its customers and generally does not require collateral. No individual customer represented more than 10% of total revenues in the three months ended September 30, 2018 or for the year ended December 31, 2017 , or more than 10% of accounts receivable as of September 30, 2018 or December 31, 2017 . Fair Value of Financial Instruments The Company’s financial instruments consist principally of cash and cash equivalents, accounts receivable, and accounts payable, and long–term debt. The carrying value of cash and cash equivalents, accounts receivable, and accounts payable approximate fair value, primarily due to short maturities. The carrying values of the Company’s debt instruments approximated their fair value based on rates currently available to the Company. Recent Accounting Pronouncements Recently issued accounting pronouncements not yet adopted In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (ASC 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which requires hosting arrangements that are service contracts to follow the guidance for internal-use software to determine which implementation costs can be capitalized. ASU 2018-15 is effective either prospectively or retrospectively for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating how to apply the new guidance. 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, to eliminate, add and modify certain disclosure requirements for fair value measurements. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The guidance is effective for annual and interim periods beginning after December 15, 2019, but entities are permitted to early adopt either the entire standard or only the provisions that eliminate or modify the requirements. The Company is currently evaluating how to apply the new guidance. In January 2018, the FASB issued ASU 2018-02 Income Statement - Reporting Comprehensive Income (ASC 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (AOCI) , which gives entities the option to reclassify to retained earnings the tax effects resulting from the Tax Act related to items in Additional Other Comprehensive Income (AOCI) that the FASB refers to as having been “stranded” in AOCI. The guidance is effective for annual and interim periods beginning after December 15, 2018, and is applicable to the Company in fiscal year 2019; however, early adoption is permitted. The Company is currently evaluating the effect that the adoption of ASU 2018-02 will have on its financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . The new standard supersedes the present U.S. GAAP standard on leases and requires substantially all leases to be reported on the balance sheet as right-of-use assets and lease obligations. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within those annual reporting periods. Early adoption is permitted and in the original guidance the modified retrospective application was required, however, in July 2018 the FASB issued ASU 2018-11 which permits entities with another transition method in which the effective date would be the date of initial application of transition. Under this optional transition method, we would recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We expect to elect the optional transition method. We plan to adopt the new standard on its effective date of January 1, 2019. We anticipate adoption of the standard will not significantly impact results. We are evaluating the election of the practical expedients upon transition that would retain the lease classification and initial direct costs for any leases that exist prior to adoption of the standard. We are in the process of cataloging our existing lease contracts and implementing changes to our systems. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments , which changes the impairment model for most financial assets. The new model uses a forward-looking expected loss method, which will generally result in earlier recognition of allowances for losses. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019 and early adoption is permitted for annual and interim periods beginning after December 15, 2018. The Company is currently evaluating the effect that the adoption of ASU 2016-13 will have on its financial statements. Recently adopted accounting pronouncements In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2018-07 Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting which simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees, with certain exceptions. For public business entities, the guidance is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods, however, early adoption is permitted. Although nonemployee directors do not satisfy the definition of employee, under FASB guidance, the Company's nonemployee directors acting in their role as members of a board of directors are treated as employees as those directors were elected by the Company's shareholders. Therefore, awards granted to these nonemployee directors for their services as directors already were accounted for as employee awards. We adopted ASU 2018-07 during the second quarter of 2018 with no impact on our financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , to replace existing revenue recognition rules with a single comprehensive model to use in accounting for revenue arising from contracts with customers. Under this ASU and the associated subsequent amendments (collectively, “ASC 606”), revenue is recognized when a customer obtains control of promised goods or services for an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. In addition, ASC 606 requires expanded disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted ASC 606 on January 1, 2018 for all contracts using the modified retrospective method. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of accumulated deficit. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. We expect the impact of the adoption of the new revenue standard to be immaterial to our net income on an ongoing basis. A majority of our sales revenue continues to be recognized ratably over the applicable term of the respective subscription or maintenance contracts. For most sales commissions formerly expensed as incurred, other than for perpetual license commissions which will continue to be expensed as incurred, we are now amortizing these costs to the consolidated statements of income over the shorter of 1) the expected life of our customer relationships, which we have determined to be approximately 6 years, or 2) the life of the related technology. For further discussion about changes to Significant Accounting Policies impacted by the adoption of 2014-09 (Topic 606), see Note 10. Revenue . The cumulative effect of the changes made to our consolidated January 1, 2018 balance sheet for the adoption of ASC 606 were as follows (in thousands): Balance Sheet Balance at December 31, 2017 Adjustments Due to ASC 606 Balance at January 1, 2018 Assets Deferred commissions, current $ — $ 2,070 $ 2,070 Deferred commissions, noncurrent — 4,447 4,447 Liabilities Deferred revenue (current) 43,807 225 44,032 Equity Accumulated deficit $ (81,128 ) $ 6,292 $ (74,836 ) In accordance with the new revenue standard requirements, the disclosure of the impact of adoption on our consolidated income statement and balance sheet for the periods ended September 30, 2018 was as follows (in thousands): Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Income statement As Reported Balances Without Adoption of ASC 606 Effect of Change As Reported Balances Without Adoption of ASC 606 Effect of Change Revenues Perpetual license 915 971 (56 ) 3,224 3,015 209 Operating expenses Sales & marketing 5,299 5,915 (616 ) 14,955 16,154 (1,199 ) During the three months ended September 30, 2018 and the nine months ended September 30, 2018 , the effect on earnings per share of the adoption of ASC 606 was an increase in earnings per share of $0.03 and $0.07 , respectively. As of September 30, 2018 Balance Sheet As Reported Balances Without Adoption of ASC 606 Effect of Change Assets Deferred commissions, current $ 2,374 $ — $ 2,374 Deferred commissions, noncurrent 5,470 — 5,470 Liabilities Deferred revenue (current) 43,575 43,368 (207 ) Equity Accumulated deficit $ (87,477 ) $ (92,361 ) $ (4,884 ) In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business , which revises the definition of a business and assists in the evaluation of when a set of transferred assets and activities is a business. ASU 2017-01 is effective for interim and annual reporting periods beginning after December 15, 2017, and should be applied prospectively. Early adoption is permitted under certain circumstances. The Company adopted ASU 2017-01 during the first quarter of 2018. No impact on the financial statements was recorded as a result of the adoption of ASU 2017-01. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment . ASU 2017-04 eliminates step two of the goodwill impairment test and specifies that goodwill impairment should be measured by comparing the fair value of a reporting unit with its carrying amount. Additionally, the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount of net assets should be disclosed. ASU 2017-04 is effective for annual or interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019; early adoption is permitted. The Company adopted ASU 2017-04 during the first quarter of 2018. No impact on the financial statements was recorded as a result of the adoption of ASU 2017-04. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 is intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows and to eliminate the diversity in practice related to such classifications. The guidance in ASU 2016-15 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. The Company adopted ASU 2016-15 during the first quarter of 2017. No additional disclosure was deemed necessary upon the adoption of ASU 2016-15. No impact on the financial statements was recorded as a result of the adoption of ASU 2016-15. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | 2. Acquisitions We perform quantitative and qualitative analysis to determine the significance. of each acquisition, to the financial statements the Company. The following acquisitions were deemed to be insignificant, except for Qvidian Corporation, a Delaware corporation (“Qvidian”). Refer to the pro formas disclosed below. 2018 Acquisitions On March 21, 2018, the Company’s wholly owned subsidiary, PowerSteering Software Limited, a limited liability company organized and existing under the laws of England and Wales (“PowerSteering UK”), completed its purchase of the shares comprising the entire issued share capital of Interfax Communications Limited ("Interfax"), an Irish-based software company providing secured cloud-based messaging solutions, including enterprise cloud fax and secure document distribution. In connection with this acquisition, the Company also acquired certain assets related to Interfax’s business from a United States based reseller of Interfax’s products. The purchase price consideration paid for Interfax was $33.6 million in cash at closing, net of cash acquired of $1.4 million , and a $5.0 million cash holdback payable over 18 months (subject to reduction for indemnification claims). In conjunction with the acquisition of Interfax, certain assets and customer relationships of their U.S. reseller ("Marketech") were purchased for $2.0 million , and excludes any potential earnout payments tied to performance-based goals. Revenues recorded since the acquisition date through September 30, 2018 were approximately $8.1 million . On June 28, 2018, the Company completed its purchase of RO Innovation, Inc. ("RO Innovation"), a cloud-based customer reference solution for creating, deploying, managing, and measuring customer reference and sales enablement content. The purchase price consideration paid was approximately $12.3 million in cash payable at closing, net of cash acquired of $0.2 million and a $1.8 million cash holdback payable in one year (subject to reduction for indemnification claims) and excludes potential future earn-out payments tied to additional performance-based goals. Revenues recorded since the acquisition date through September 30, 2018 were approximately $1.2 million . See Note 13. Subsequent Events in Notes to Unaudited Condensed Consolidated Financial Statements for more information regarding an additional acquisition. 2017 Acquisitions On January 10, 2017, the Company completed its purchase of Omtool, Ltd ("Omtool"), a document capture, fax and workflow solution company. The purchase price consideration paid was approximately $19.3 million in cash payable at closing (net of $3.0 million of cash acquired). On April 21, 2017, the Company acquired RightAnswers, Inc. ("RightAnswers"), a cloud-based knowledge management system. The purchase price was $17.4 million , in cash at closing (net of $0.1 million cash acquired) and a $2.5 million cash holdback payable in one year (subject to reduction for indemnification claims) and excludes potential future earn-out payments tied to additional performance-based goals. On July 12, 2017, the Company acquired Waterfall International Inc. (“Waterfall”), a cloud-based mobile messaging platform. The purchase price consideration paid was approximately $24.4 million in cash at closing (net of $0.4 million of cash acquired) and a $1.5 million cash holdback payable in 18 months (subject to reduction for indemnification claims). The foregoing excludes additional potential $3.0 million in earnout payments tied to performance-based conditions. On November 16, 2017, the Company completed its acquisition of Qvidian, a Massachusetts-based provider of cloud-based RFP and sales-proposal automation software. The purchase price consideration paid by the Company was $50 million in cash. The pro forma statements of operations data for three and nine months ended September 30, 2018 and September 30, 2017 shown in table below, give effect to the Qvidian acquisition, described above, as if it had occurred at January 1, 2016. These amounts have been calculated after applying our accounting policies and adjusting the results of Qvidian to reflect: the costs of debt financing incurred to acquire Qvidian, the additional intangible amortization and the adjustments to acquired deferred revenue that would have been occurred assuming the fair value adjustments had been applied and incurred since January 1, 2016. This pro forma data is presented for informational purposes only and does not purport to be indicative of our future results of operations. The table below shows the Pro forma statements of operations data for the three and nine months ended September 30, 2018 and September 30, 2017 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Revenue $ 37,144 $ 31,262 $ 104,705 $ 84,524 Loss from continuing operations (1) $ (4,250 ) $ (2,412 ) $ (12,641 ) $ (10,435 ) (1) While some recurring adjustments impact the pro forma figures presented, the decrease in pro forma loss from continuing operations compared to our loss from continuing operations presented on the consolidated statements of operations for the three and nine months ended September 30, 2018 and September 30, 2017 includes nonrecurring adjustments removing acquisition costs from 2017 and reflects these costs in the year ended 2016, the year the acquisition was assumed to be completed for pro forma purposes. The following condensed table presents the preliminary and finalized acquisition-date fair value of the assets acquired and liabilities assumed for the acquisitions in 2017 and through the nine months ended September 30, 2018 , as well as assets and liabilities (in thousands): Preliminary Finalized RO Innovation Interfax Qvidian Waterfall RightAnswers Omtool Year Acquired 2018 2018 2017 2017 2017 2017 Cash $ 197 $ 1,396 $ 468 $ 100 $ 139 $ 2,957 Accounts receivable 1,564 1,706 1,907 1,477 2,164 784 Other current assets 1,299 1,000 334 608 246 464 Property and equipment 15 286 108 23 408 58 Customer relationships 8,596 22,577 30,160 6,400 10,500 4,400 Trade name 65 649 227 110 180 170 Technology 1,636 5,236 5,739 2,800 2,300 3,180 Goodwill 4,535 14,070 21,229 18,575 15,680 14,081 Other assets — 14 8 — — 33 Total assets acquired 17,907 46,934 60,180 30,093 31,617 26,127 Accounts payable (231 ) (737 ) (388 ) (605 ) (139 ) (219 ) Accrued expense and other (1,921 ) (2,832 ) (403 ) (1,136 ) (2,108 ) (915 ) Deferred tax liabilities — (3,365 ) — — — — Deferred revenue (1,505 ) — (9,389 ) (1,220 ) (5,479 ) (2,779 ) Total liabilities assumed (3,657 ) (6,934 ) (10,180 ) (2,961 ) (7,726 ) (3,913 ) Total consideration $ 14,250 $ 40,000 $ 50,000 $ 27,132 $ 23,891 $ 22,214 Tangible assets were valued at their respective carrying amounts, which approximates their estimated fair value. The valuation of identifiable intangible assets reflects management’s estimates based on, among other factors, use of established valuation methods. Customer relationships were valued using an income approach, which estimates fair value based on the earnings and cash flow capacity of the subject asset. The value of the marketing-related intangibles was determined using a relief-from-royalty method, which estimates fair value based on the value the owner of the asset receives from not having to pay a royalty to use the asset. Developed technology was valued using a cost-to-recreate approach. The Company recorded the purchase of the acquisitions described above using the acquisition method of accounting and, accordingly, recognized the assets acquired and liabilities assumed at their fair values as of the date of the acquisition. The purchase price allocations for the 2017 acquisitions of Omtool, RightAnswers, and Waterfall are final, and Qvidian, Interfax, and RO Innovation are preliminary as the Company has not obtained and evaluated all of the detailed information necessary to finalize the opening balance sheet amounts in all respects. Management has recorded the purchase price allocations based upon acquired company information that is currently available. Management expects to complete its purchase price allocations for Qvidian in the fourth quarter of 2018 and for Interfax and RO Innovation in the first half of 2019. There were immaterial changes in the preliminary acquisition-date fair value of assets and liabilities for Qvidian during the three months ended September 30, 2018 . The change in the preliminary acquisition-date fair value of assets and liabilities for Interfax during the three months ended September 30, 2018 was $2.3 million increase in intangibles (customer relationships, trade name and technology) due to a change in estimates. The change in the preliminary acquisition-date fair value of assets and liabilities for RO Innovation during the three months ended September 30, 2018 was $1.4 million , including a $0.2 million reduction Accounts receivable and a $1.2 million increase in Other liabilities. The goodwill of $88.2 million for the above acquisitions is primarily attributable to the synergies expected to arise after the acquisition. Goodwill deductible for tax purposes is $3.7 million for Waterfall, $2.4 million (at the time of the acquisition) for Interfax, and $2.7 million for RO Innovation. There was no Goodwill deductible for tax purposes for our Omtool, RightAnswers, and Qvidian acquisitions. M easurement period expenses recorded to other income (expense), net, related to acquisitions that took place within a prior period for the three months ended September 30, 2018 and the three months ended September 30, 2017 were net expense of $0.6 million and none , respectively, and for the nine months ended September 30, 2018 and the nine months ended September 30, 2017 , were net income of $0.8 million and $0.1 million , respectively. Total one-time transaction costs, excluding one-time restructuring costs, incurred with respect to acquisition activity in the three months ended September 30, 2018 and the three months ended September 30, 2017 were $0.2 million and $1.1 million and for the nine months ended September 30, 2018 and the nine months ended September 30, 2017 were $2.8 million and $4.3 million , respectively. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. GAAP sets forth a three–tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The three tiers are Level 1, defined as observable inputs, such as quoted market prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, which therefore requires an entity to develop its own assumptions. Changes to the fair value of earnout liabilities are recorded to other expense, net. Liabilities measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements at December 31, 2017 Level 1 Level 2 Level 3 Total Earnout consideration liability $ — $ — $ 3,576 $ 3,576 Fair Value Measurements at September 30, 2018 (unaudited) Level 1 Level 2 Level 3 Total Earnout consideration liability $ — $ — $ 2,537 $ 2,537 As of September 30, 2018 , the Level 3 earnout consideration liability consists of amounts associated with the acquisitions of Waterfall in July 2017, Marketech in March 2018, and RO Innovation in June 2018. The Level 3 earnout consideration liability associated with RightAnswers of $2.0 million was settled in February 2018. In addition, the increase in cash earnouts from December 31, 2017 to September 30, 2018 is related to current year acquisitions. The following table presents additional information about liabilities measured at fair value on a recurring basis and for which we have utilized significant unobservable (Level 3) inputs to determine fair value (in thousands): Ending balance at December 31, 2017 $ 3,576 Additions - cash earnouts 939 Settlements - cash earnouts (1,978 ) Ending balance at September 30, 2018 $ 2,537 The fair value of the cash earnout consideration was determined using the Binary Option model based on the present value of the probability-weighted earnout consideration. Debt The Company believes the carrying value of its long-term debt at September 30, 2018 approximates its fair value based on the variable interest rate feature or based upon interest rates currently available to the Company. The estimated fair value and carrying value of the Company's debt, before debt discount, at September 30, 2018 and December 31, 2017 are $160.9 million and $113.8 million , respectively, based on valuation methodologies using interest rates currently available to the Company, which are Level 2 inputs. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 4. Goodwill and Other Intangible Assets Changes in the Company’s goodwill balance for the nine months ended September 30, 2018 are summarized in the table below (in thousands): Balance at December 31, 2017 $ 154,607 Acquired in business combinations 11,800 Adjustment related to prior year business combinations (15,022 ) Adjustment related to finalization of current year business combinations 6,056 Foreign currency translation adjustment (363 ) Balance at September 30, 2018 $ 157,078 Net intangible assets include the estimated acquisition-date fair values of customer relationships, marketing-related assets, and developed technology that the Company recorded as part of its business acquisitions. The $15.0 million adjustment to Goodwill during the six months ended September 30, 2018 primarily related to changes in the ASC 805 valuation of customer relationships in the prior year business combination of Qvidian. The following is a summary of the Company’s intangible assets, net (in thousands): Estimated Useful Gross Accumulated Net Carrying September 30, 2018: Customer relationships 1-10 $ 116,733 $ 26,784 $ 89,949 Trade name 1.5-7 4,009 3,224 785 Developed technology 4-7 35,923 14,501 21,422 Total intangible assets $ 156,665 $ 44,509 $ 112,156 Estimated Useful Life (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount December 31, 2017: Customer relationships 5-10 $ 69,061 $ 18,040 $ 51,021 Trade name 1.5 3,431 2,900 531 Developed technology 4-7 29,308 10,817 18,491 Total intangible assets $ 101,800 $ 31,757 $ 70,043 The following table summarizes the Company's weighted-average amortization period, in total and by major finite-lived intangible asset class (in years): September 30, 2018 December 31, 2017 Customer relationships 9.3 9.0 Trade name 1.7 1.5 Developed technology 6.6 6.4 Total weighted-average amortization period 8.5 8.2 The Company periodically reviews the estimated useful lives of its identifiable intangible assets, taking into consideration any events or circumstances that might result in either a diminished fair value or revised useful life. There have been no indicators of impairment or change in the useful life during the three and nine months ended September 30, 2018 and September 30, 2017 , respectively. Total amortization expense during the three months ended September 30, 2018 and September 30, 2017 was $4.8 million and $2.5 million , respectively, and for the nine months ended September 30, 2018 and September 30, 2017 was $12.9 million and $6.3 million , respectively. Estimated annual amortization expense for the next five years and thereafter is as follows (in thousands): Amortization Year ending December 31: Remainder of 2018 $ 4,766 2019 18,125 2020 16,163 2021 15,462 2022 13,325 2023 and thereafter 44,315 Total $ 112,156 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 5. Income Taxes The Company’s income tax provision for the three and nine months ended September 30, 2018 and September 30, 2017 reflects its estimate of the effective tax rates expected to be applicable for the full years, adjusted for any discrete events that are recorded in the period in which they occur. The estimates are re-evaluated each quarter based on the estimated tax expense for the full year. The tax provision for the three and nine months ended September 30, 2018 and September 30, 2017 is primarily related to foreign income taxes associated with our Canadian, Irish, and Israeli operations, changes in deferred tax liabilities associated with amortization of United States tax deductible goodwill and state taxes in certain states in which the Company does not file on a consolidated basis or have net operating loss carryforwards. The Company has historically incurred operating losses in the United States and, given its cumulative losses and limited history of profits, has recorded a valuation allowance against its United States net deferred tax assets, exclusive of tax deductible goodwill, at September 30, 2018 and September 30, 2017 , respectively. The Company has reflected any uncertain tax positions primarily within its long-term taxes payable and a portion within deferred taxes. Federal, state, and foreign income tax returns have been filed in jurisdictions with varying statutes of limitations. Varying among the separate companies, tax years 1998 through 2017 remain subject to examination by federal and most state tax authorities due to our net operating loss carryforwards. In foreign jurisdictions, tax years 2008 through 2017 remain subject to examination. The Tax Act enacted in December 2017 introduced significant changes to U.S. income tax law. Effective 2018, the Tax Act reduced the U.S. statutory tax rate from 35% to 21% and created new taxes on certain foreign-sourced earnings and certain intercompany payments. The Company is applying the guidance in SEC Staff Accounting Bulletin No. 118 when accounting for the enactment-date effects of the Tax Act. Due to the timing of the enactment and the complexity involved in applying the provisions of the Tax Act, we made reasonable estimates of the effects and recorded provisional amounts in our financial statements as of December 31, 2017. As we collect and prepare necessary data, and interpret the Tax Act and any additional guidance issued by the U.S. Treasury Department, the Internal Revenue Service (IRS), and other standard-setting bodies, we may make adjustments to the provisional amounts. Those adjustments may materially affect our provision for income taxes and effective tax rate in the period in which the adjustments are made. During the nine months ended September 30, 2018 , the Company did not recognize any adjustments to the provisional amounts recorded at December 31, 2017. The accounting for the tax effects of the Tax Act will be completed later in 2018. Under a provision commonly known as global intangible low taxes income (“GILTI”), the Tax Act subjects a U.S. shareholder to current tax on certain earnings of foreign subsidiaries. Under US GAAP, an accounting policy election can be made to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years, or to provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. Given the complexity of the GILTI provisions, the Company is still evaluating the effects of the GILTI provisions and has not yet made an accounting policy election. At September 30, 2018 , because the Company is still evaluating the GILTI provisions, it has included GILTI related to current-year operations only in our estimated annual effective tax rate and has not provided additional GILTI on deferred items. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | 6. Deb t Long-term debt consisted of the following at September 30, 2018 and December 31, 2017 (in thousands): September 30, 2018 December 31, 2017 Senior secured loans (includes unamortized discount of $2,678 and $2,668 based on an imputed interest rate of 7.1% and 7.7%, at September 30, 2018 and December 31, 2017, respectively) $ 158,228 $ 111,144 Less current maturities (4,330 ) (2,301 ) Total long-term debt $ 153,898 $ 108,843 Loan and Security Agreements Eighth Amendment to Credit Facility See Note 13. Subsequent Events in Notes to Unaudited Condensed Consolidated Financial Statements for more information regarding amendments to this facility. Seventh Amendment to Credit Facility On July 31, 2018, the Company entered into a seventh amendment to the Credit Facility, with a Consent and Seventh Amendment to Credit Agreement (the “Seventh Amendment”). The purpose of the Seventh Amendment was (i) to obtain the consent of the Required Lenders (as such term is defined in the Credit Facility) for the waiver of the requirement that Interfax Communications Limited, Data Guard Limited and Return Fax 2000 Limited become Canadian Guarantors and join the Canadian Guarantee and Security Agreement as Grantors and (ii) to clarify certain definitions included in the Credit Facility. Sixth Amendment to Credit Facility On March 21, 2018, the Company entered into a sixth amendment to its Credit Agreement dated May 14, 2015, as amended, among, inter alia , the Company, certain of its subsidiaries, and each of the lenders named in the Credit Agreement (the “Credit Facility”) with Wells Fargo Capital Finance and CIT Bank, N.A. as joint lead arrangers, and including Goldman Sachs Bank USA, Regions Bank, and Citizens Bank, N.A. (collectively, the "Lenders"), with a Consent and Sixth Amendment to Credit Agreement (the “Sixth Amendment”). Loans The Sixth Amendment to the Credit Facility provided for a $258.7 million credit facility, including (i) a $163.7 million term loan facility, (ii) a $30.0 million delayed draw term loan commitment (the "DDTL"), (iii) a $10.0 million revolving loan commitment, and (iv) a $55.0 million uncommitted accordion. Specifically, the Credit Facility provided for $163.7 million of term debt comprised of (i) a fully drawn U.S. term loan facility in an aggregate principal amount of $158.4 million (the “U.S. Term Loan”), and (ii) a fully drawn Canadian term loan facility in an aggregate principal amount of $5.3 million (the “Canadian Term Loan” together with the U.S. and Canadian Term Loans, the “Term Loans”). The Credit Facility provides that any principal repayments under the Term Loans shall reduce the amount available under the term loan facilities. In addition, the Credit Facility also provides for revolvers of $10.0 million , comprised of (i) a U.S. revolving credit facility in an aggregate principal amount of up to $9.0 million (the “U.S. Revolver”), and (ii) a Canadian revolving credit facility in an aggregate principal amount of up to $1.0 million (the “Canadian Revolver” and, together with the U.S. Revolver, the “Revolver”). As of September 30, 2018 , there were no amounts drawn on the Revolver, and there was $160.9 million outstanding on the Term Loans comprised of (i) $155.7 million in the U.S. Term Loans outstanding under the Credit Facility; and (ii) $5.2 million in the Canadian Term Loans outstanding under the Credit Facility. Terms of Term Loans Under the terms of the Sixth Amendment, the Term Loans are repayable, on a quarterly basis by an amount equal to 2.5% per annum on or before June 30, 2019, after which the remaining balance is payable on a straight-line basis by an amount equal to 5.0% per annum thereafter until the facility’s maturity date of August 2, 2022. The Sixth Amendment also provides for other improvements including, among other things, (i) a favorable adjustment to decrease the overall applicable interest rate for accounts outstanding under the Credit Agreement by 50 to 150 basis points resulting in an effective interest rate at the time of the Sixth Amendment of approximately 6.15% down from the previous effective interest rate of approximately 7.1% ; (ii) a favorable adjustment to the leverage ratio to increase the amount of funded indebtedness to EBITDA (as defined in the Amendment) to 4.25 to 1.00 as of March 31, 2018, along with additional leverage ratio improvements throughout the remainder of the loan term; and (iii) a favorable increase to the recurring revenue ratio future draw condition to the delayed draw term loan facility from 1.25 :1.0 to 1.50 :1.0. Also, the maximum amount of purchase consideration payable in respect of an individual permitted acquisition is $25.0 million and in respect of all permitted acquisitions is $175.0 million . In addition, the amount of permitted indebtedness to sellers of businesses increased is $20.0 million . Terms of Delay Draw Term Loan Pursuant to the terms of the Credit Facility, the undrawn $30.0 million DDTL is to be used to finance acquisitions. The DDTL, if all or a portion is drawn, is repayable, on a quarterly basis, by an amount equal to 2.5% per annum on or before June 30, 2019, after which the remaining balance is payable on a straight-line basis by an amount equal to 5.0% per annum thereafter until the facility’s maturity date of August 2, 2022. Terms of Revolver Loans under the Revolver are available up to the lesser of (i) $10.0 million (the “Maximum Revolver Amount”) or (ii) the maximum facility amount of $203.7 million less the sum of any amount of Revolver usage plus the outstanding balance of the Term Loans and other uses of the capacity made under the Credit Facility (such amount, the “Credit Amount”). The Revolver provides a subfacility whereby the Company may request letters of credit (the “Letters of Credit”) in an aggregate amount not to exceed, at any one time outstanding, $0.5 million and $0.25 million , from the U.S and Canadian facilities, respectively. The aggregate amount of outstanding Letters of Credit is reserved against the credit availability under the Maximum Revolver Amount and the Credit Amount. Loans under the Revolver may be borrowed, repaid and reborrowed until August 2, 2022 (the “Maturity Date”), at which time all amounts borrowed under the Credit Facility must be repaid. Other Terms of Credit Facility At the option of the Company, U.S. loans accrue interest at a per annum rate based on (i) the U.S. base rate plus a margin ranging from 3.00% to 4.00% depending on the leverage ratio or (ii) the U.S. LIBOR rate determined in accordance with the Credit Facility (based on 1, 2, 3 or 6-month interest periods) plus a margin ranging from 4.00% to 5.00% depending on the leverage ratio. The U.S. base rate is a rate equal to the highest of (i) the federal funds rate plus a margin equal to 0.5% , (ii) the U.S. LIBOR rate for a 1-month interest period plus 1.0% , or (iii) Wells Fargo Capital Finance’s prime rate. At the option of the Company, the Canadian loans accrue interest at a per annum rate based on (i) the Canadian prime rate or the U.S. base rate plus a margin ranging from 3.00% to 4.00% depending on the leverage ratio or (ii) the U.S. LIBOR rate determined in accordance with the Credit Facility (based on 1, 2, 3 or 6-month interest periods) (or the Canadian Bankers' Acceptance ("Canadian BA") rate determined in accordance with the Credit Facility for obligations in Canadian dollars) plus a margin ranging from 4.00% to 5.00% depending on the leverage ratio. Accrued interest on the loans will be paid monthly, or, with respect to loans that are accruing interest based on the U.S. LIBOR rate or Canadian BA rate, at the end of the applicable U.S. LIBOR or Canadian BA interest rate period. Lenders are entitled to a premium (the “Prepayment Premium”) in the event of certain prepayments as follows: (i) from August 2, 2017 to August 1, 2018, 2.0% times the sum of (a) the Maximum Revolver Amount plus (b) the outstanding principal amount of the Term Loans and DDTL on the date immediately prior to the date of the prepayment (such sum, the “Prepayment Amount”) and (ii) from August 2, 2018 to August 1, 2019, 1.0% times the Prepayment Amount. The Company may also be subject to prepayment fees in the case of commitment reductions of the Revolver and also may be obligated to prepay loans upon the occurrence of certain events. The Company is also obligated to pay other customary servicing fees, letter of credit fees and unused credit facility fees. The Credit Facility contains customary affirmative and negative covenants. The negative covenants limit the ability of the Company and its subsidiaries to, among other things (in each case subject to customary exceptions for a credit facility of this size and type): • Incur additional indebtedness or guarantee indebtedness of others; • Create liens on their assets; • Make investments, including certain acquisitions; • Enter into mergers or consolidations; • Dispose of assets; • Pay dividends and make other distributions on the Company’s capital stock, and redeem and repurchase the Company’s capital stock; • Enter into transactions with affiliates; and • Prepay indebtedness or make changes to certain agreements. There are certain financial covenants that will become more restrictive starting March 31, 2019. If an event of default occurs, at the election of the Lenders, a default interest rate shall apply on all obligations during an event of default, at a rate per annum equal to 2.00% above the applicable interest rate. The Credit Facility permits the Company to buyback up to $10.0 million of its capital stock, subject to restrictions including a minimum liquidity requirement of $25.0 million before and after any such buyback. Interest Rate and Debt Discount Cash interest costs averaged 6.7% and 6.3% under the Credit Facility for the nine months ended September 30, 2018 and for the year ended December 31, 2017 , respectively. In addition, the Company has $2.7 million and $2.7 million of unamortized debt discount associated with the Credit Facility as of September 30, 2018 and December 31, 2017 , respectively. These debt discount costs will be amortized to non-cash interest expense over the term of the Credit Facility. Debt Maturities Under the terms of the Sixth Amendment, future debt maturities of long-term debt (excluding financing costs) at September 30, 2018 are as follows (in thousands): Remaining 2018 $ 1,031 2019 6,188 2020 8,250 2021 8,250 2022 137,187 Thereafter — Total debt maturities 160,906 Less current maturities (4,330 ) Less unamortized debt discount (2,678 ) Notes Payable, less current maturities and unamortized debt discount $ 153,898 |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 7. Net Loss Per Share The following table sets forth the computations of loss per share (in thousands, except share and per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Numerator: Net Loss $ (4,250 ) $ (3,506 ) $ (12,641 ) $ (14,931 ) Denominator: Weighted–average common shares outstanding, basic and diluted 20,089,919 19,380,519 19,916,907 18,043,365 Net loss per common share, basic and diluted $ (0.21 ) $ (0.18 ) $ (0.63 ) $ (0.83 ) Due to the net losses for the three and nine months ended September 30, 2018 and September 30, 2017 , respectively, basic and diluted loss per share were the same, as the effect of all potentially dilutive securities would have been anti–dilutive. The following table sets forth the anti–dilutive common share equivalents as of September 30, 2018 and September 30, 2017 : September 30, 2018 2017 Stock options 410,506 692,097 Restricted stock 1,473,898 1,274,088 Total anti–dilutive common share equivalents 1,884,404 1,966,185 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 8. Commitments and Contingencies Purchase Commitments The Company purchased software development services pursuant to a technology services agreement with DevFactory FZ-LLC for the three months ended September 30, 2018 and September 30, 2017 totaling $0.8 million and $0.6 million , respectively, and for the nine months ended September 30, 2018 and September 30, 2017 , totaling $2.4 million and $1.6 million , respectively. The remaining purchase obligation after September 30, 2018 through December 31, 2018 is $0.8 million . See Note 12 — Related Party Transactions for more information regarding our purchase commitment to this related party. Litigation In the normal course of business, the Company may become involved in various lawsuits and legal proceedings. At this time, the Company is not involved in any current or pending legal proceedings, and does not anticipate any legal proceedings, that may have a material adverse affect on the consolidated financial position or results of operations of the Company. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Stockholders' Equity | 9. Stockholders' Equity On May 12, 2017, the Company filed a registration statement on Form S-3 (File No. 333-217977) (the "S-3"), to register Upland securities in an aggregate amount of up to $75.0 million for offerings from time to time. The S-3 was amended on May 22, 2017 and declared effective on May 26, 2017. On June 6, 2017, the Company completed a registered underwritten public offering pursuant to the S-3. The net proceeds of the offering were approximately $42.7 million , net of issuance costs, in exchange for 2,139,534 shares of common stock. Restricted Stock Awards Restricted share activity during the nine months ended September 30, 2018 was as follows: Number of Weighted-Average Grant Date Fair Value Unvested balances at December 31, 2017 1,047,480 $ 13.35 Awards granted 825,741 28.97 Awards vested (398,323 ) 16.63 Awards forfeited (1,000 ) 23.60 Unvested balances at September 30, 2018 1,473,898 $ 21.21 Stock Option Activity Stock option activity during the nine months ended September 30, 2018 was as follows: Number of Weighted– Outstanding at December 31, 2017 549,907 $ 7.36 Options granted 4,378 33.39 Options exercised (143,706 ) 6.12 Options expired (73 ) 1.79 Outstanding at September 30, 2018 410,506 $ 8.08 Share-based Compensation The Company recognized share-based compensation expense from all awards in the following expense categories (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Cost of revenue $ 195 $ 147 $ 464 $ 277 Research and development 383 219 871 560 Sales and marketing 169 73 368 149 General and administrative 3,034 1,445 8,677 6,818 Total $ 3,781 $ 1,884 $ 10,380 $ 7,804 |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 10. Revenue Revenues are recognized when control of the promised goods or services is transferred to the Company's customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services over the term of the agreement, generally when made available to the customers. We enter into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Revenues are recognized net of sales credits and allowances. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. Revenue-generating activities consist of subscription and support, perpetual licenses, and professional services revenues within a single operating segment. Subscription and Support Revenues The Company's software solutions are available for use as hosted application arrangements under subscription fee agreements without licensing perpetual rights to the software. Subscription fees from these applications are recognized over time on a ratable basis over the customer agreement term beginning on the date the Company's solution is made available to the customer. Our subscription contracts are generally one to three years in length. Amounts that have been invoiced are recorded in accounts receivable and deferred revenues or revenues, depending on whether the revenue recognition criteria have been met. Additional fees for monthly usage above the levels included in the standard subscription fee are recognized as revenue at the end of each month and is invoiced concurrently. Perpetual License Revenues The Company also records revenue from the sales of proprietary software products under perpetual licenses. Revenue from distinct on-premises licenses is recognized upfront at the point in time when the software is made available to the customer. The Company’s products do not require significant customization. Professional Services Revenue Professional services provided with subscription and support licenses and perpetual licenses consist of implementation fees, data extraction, configuration, and training. The Company’s implementation and configuration services do not involve significant customization of the software and are not considered essential to the functionality. Revenues from professional services are recognized over time as such services are performed. Significant Judgments Performance Obligations and Standalone Selling Price A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of accounting. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. The Company has contracts with customers that often include multiple performance obligations, usually including perpetual licenses, multiple subscriptions and professional services. For these contracts, the Company accounts for individual performance obligations separately if they are distinct by allocating the contract's total transaction price to each performance obligation in an amount based on the relative standalone selling price, or SSP, of each distinct good or service in the contract. Judgment is required to determine the SSP for each distinct performance obligation. A residual approach would only be applied when a particular performance obligation has highly variable and uncertain SSP and such is bundled with other performance obligations that have observable SSP. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, historical standalone sales, customer demographics, geographic locations, and the number and types of users within our contracts. Other Considerations The Company evaluates whether it is the principal (i.e., report revenues on a gross basis) or agent (i.e., report revenues on a net basis) for vendor reseller agreements. Generally, the Company reports revenues from these types of contracts on a gross basis, meaning the amounts billed to customers are recorded as revenues, and expenses incurred are recorded as cost of revenues. Where the Company is the principal, it first obtains control of the inputs to the specific good or service and directs their use to create the combined output. The Company's control is evidenced by its involvement in the integration of the good or service on its platform before it is transferred to its customers, and is further supported by the Company being primarily responsible to its customers and having a level of discretion in establishing pricing. Revenues provided from agreements in which the Company is an agent are immaterial. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers or to provide customers with financing. Example includes invoicing at the beginning of a subscription term with revenue recognized ratably over the contract period. Unearned revenue is mainly unearned revenue related to subscription services. During the nine months ended September 30, 2018 , we recognized $53.7 million of subscription services revenue that was included in the unearned revenue balances at the beginning of the period. Professional services revenue recognized in the same period from unearned revenue balances at the beginning of the period was not material. Remaining Performance Obligations As of September 30, 2018 , approximately $94 million of revenue is expected to be recognized from remaining performance obligations for subscription contracts. We expect to recognize revenue on approximately 76% of these remaining performance obligations over the next 15 months , with the balance recognized thereafter. Revenue from remaining performance obligations for professional services contracts as of September 30, 2018 was no t material. Deferred Commissions The Company capitalizes sales commissions related to its customer agreements. The Company capitalizes commissions and bonuses for those involved in the sale, as these are incremental to the sale. The Company begins amortizing deferred solution and other costs for a particular customer agreement once the revenue recognition criteria are met and amortizes those deferred costs over the expected life of the customer relationships, which has been determined to be approximately 6 years. The portion of capitalized costs expected to be amortized during the succeeding twelve-month period is recorded in current assets as deferred commissions, current, and the remainder is recorded in long-term assets as deferred commissions, net of current portion. Amortization expense is included in sales and marketing expenses in the accompanying condensed consolidated statements of operations. |
Domestic and Foreign Operations
Domestic and Foreign Operations | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Domestic and Foreign Operations | 11. Domestic and Foreign Operations Revenue by geography is based on the ship-to address of the customer, which is intended to approximate where the customer’s users are located. The ship-to country is generally the same as the billing country. The Company has operations in the U.S., Canada and Europe. Information about these operations is presented below (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Revenues: U.S. $ 30,681 $ 21,468 $ 83,640 $ 57,093 Canada 1,525 1,186 4,781 3,265 Other International 4,938 3,418 16,284 9,747 Total Revenues $ 37,144 $ 26,072 $ 104,705 $ 70,105 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 12. Related Party Transactions We are a party to two agreements with companies controlled by a non-management investor in the Company: • On March 28, 2017, the Company entered into an amendment to the Amended and Restated Technology Services Agreement with DevFactory FZ LLC ("DevFactory") to extend the initial term end date from December 31, 2017 to December 31, 2021. Additionally, the Company amended the option for either party to renew annually for one additional year. The effective date of the amendment is January 1, 2017. DevFactory is an affiliate of ESW Capital LLC, which holds more than 5% of the Company's capital stock. The Company has an outstanding purchase commitment in 2018 for software development services pursuant to this agreement in the amount of $3.2 million . For years after 2018 , the purchase commitment amount for software development services will be equal to the prior year purchase commitment increased (decreased) by the percentage change in total revenue for the prior year as compared to the preceding year. For example, if 2018 total revenues increase by 10% as compared to 2017 total revenues, then the 2019 purchase commitment will increase by approximately $0.4 million from the 2018 purchase commitment amount to approximately $3.6 million . The Company purchased software development services pursuant to this agreement with DevFactory during the three months ended September 30, 2018 and September 30, 2017 totaling $0.8 million and $0.6 million , respectively, and during the nine months ended September 30, 2018 and September 30, 2017 , in the amount of $2.4 million and $1.6 million , respectively. • The Company purchased services from Crossover, Inc. ("Crossover"), a company controlled by ESW Capital, LLC (a non-management investor) during the three months ended September 30, 2018 and September 30, 2017 of approximately $0.8 million and $0.7 million , respectively, and during nine months ended September 30, 2018 and September 30, 2017 approximately $2.4 million and $2.2 million , respectively. Crossover provides a proprietary technology system to help the Company identify, screen, select, assign, and connect with necessary resources from time to time to perform technology software development and other services throughout the Company, and track productivity of such resources. While there are no purchase commitments with Crossover, the Company continues to use its services in 2018 . The Company has an arrangement with a former subsidiary, Visionael Corporation ("Visionael"), to provide management, human resource, payroll and administrative services. John T. McDonald, the Company's Chief Executive Officer and Chairman of the Board, beneficially holds an approximate 26.18% interest in Visionael. The Company received fees from this arrangement during the three months ended September 30, 2018 and September 30, 2017 totaling $15,000 and $90,000 , respectively and during the nine months ended September 30, 2018 and September 30, 2017 totaling $45,000 and $270,000 , resp ectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events On October 3, 2018, the Company’s wholly owned subsidiary, PowerSteering UK, completed its purchase of the shares comprising the entire issued share capital of Rapide Communication LTD, a private company limited by shares organized and existing under the laws of England and Wales doing business as Rant & Rave (“Rant & Rave”), a leading provider of cloud-based customer engagement solutions. The purchase price paid for Rant & Rave was $58.5 million in cash at closing, net of cash acquired, and a $6.5 million cash holdback payable in 12 months (subject to indemnification claims). The required disclosures have not been provided as the Company is currently in the process of completing the accounting for this transaction due to the timing of the acquisition. The Company expects to complete the preliminary allocation of the purchase consideration to the assets acquired and liabilities assumed and the pro forma impact of this acquisition by the end of its fourth quarter of fiscal 2018. In connection with the acquisition of Rant & Rave, Upland amended and expanded its credit facility from $258.7 million to $358.9 million . Specifically, $63.0 million of new term debt was drawn, taking Upland’s gross debt outstanding from $160.9 million to $223.9 million with debt, net of cash on hand, now at approximately $209 million at a new lower maximum interest rate of LIBOR + 400 basis points (currently at approximately 6.3% ). Further details regarding the transaction can be obtained in the Form 8-K filed on October 3, 2018. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation These condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States ("GAAP"). The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for interim financial reporting. In the opinion of management of the Company, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments of a normal recurring nature necessary for a fair presentation. The results of operations for the three months ended September 30, 2018 are not necessarily indicative of the results to be expected for the year ending December 31, 2018 or for any other period. The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2017 Annual Report on Form 10-K filed with the SEC on March 9, 2018 . |
Use of Estimates | Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses. Significant items subject to such estimates include allowance for doubtful accounts, stock-based compensation, contingent consideration, acquired intangible assets, the useful lives of intangible assets and property and equipment, and income taxes. In accordance with GAAP, management bases its estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances. Management regularly evaluates its estimates and assumptions using historical experience and other factors; however, actual results could differ from those estimates. |
Concentrations of Credit Risk and Significant Customers | Concentrations of Credit Risk and Significant Customers Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents and accounts receivable. The Company’s cash and cash equivalents are placed with high-quality financial institutions, which, at times, may exceed federally insured limits. The Company has not experienced any losses in these accounts, and the Company does not believe it is exposed to any significant credit risk related to cash and cash equivalents. The Company provides credit, in the normal course of business, to a number of its customers. The Company performs periodic credit evaluations of its customers and generally does not require collateral. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist principally of cash and cash equivalents, accounts receivable, and accounts payable, and long–term debt. The carrying value of cash and cash equivalents, accounts receivable, and accounts payable approximate fair value, primarily due to short maturities. The carrying values of the Company’s debt instruments approximated their fair value based on rates currently available to the Company. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently issued accounting pronouncements not yet adopted In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (ASC 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which requires hosting arrangements that are service contracts to follow the guidance for internal-use software to determine which implementation costs can be capitalized. ASU 2018-15 is effective either prospectively or retrospectively for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating how to apply the new guidance. 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, to eliminate, add and modify certain disclosure requirements for fair value measurements. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The guidance is effective for annual and interim periods beginning after December 15, 2019, but entities are permitted to early adopt either the entire standard or only the provisions that eliminate or modify the requirements. The Company is currently evaluating how to apply the new guidance. In January 2018, the FASB issued ASU 2018-02 Income Statement - Reporting Comprehensive Income (ASC 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (AOCI) , which gives entities the option to reclassify to retained earnings the tax effects resulting from the Tax Act related to items in Additional Other Comprehensive Income (AOCI) that the FASB refers to as having been “stranded” in AOCI. The guidance is effective for annual and interim periods beginning after December 15, 2018, and is applicable to the Company in fiscal year 2019; however, early adoption is permitted. The Company is currently evaluating the effect that the adoption of ASU 2018-02 will have on its financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . The new standard supersedes the present U.S. GAAP standard on leases and requires substantially all leases to be reported on the balance sheet as right-of-use assets and lease obligations. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within those annual reporting periods. Early adoption is permitted and in the original guidance the modified retrospective application was required, however, in July 2018 the FASB issued ASU 2018-11 which permits entities with another transition method in which the effective date would be the date of initial application of transition. Under this optional transition method, we would recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We expect to elect the optional transition method. We plan to adopt the new standard on its effective date of January 1, 2019. We anticipate adoption of the standard will not significantly impact results. We are evaluating the election of the practical expedients upon transition that would retain the lease classification and initial direct costs for any leases that exist prior to adoption of the standard. We are in the process of cataloging our existing lease contracts and implementing changes to our systems. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments , which changes the impairment model for most financial assets. The new model uses a forward-looking expected loss method, which will generally result in earlier recognition of allowances for losses. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019 and early adoption is permitted for annual and interim periods beginning after December 15, 2018. The Company is currently evaluating the effect that the adoption of ASU 2016-13 will have on its financial statements. Recently adopted accounting pronouncements In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2018-07 Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting which simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees, with certain exceptions. For public business entities, the guidance is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods, however, early adoption is permitted. Although nonemployee directors do not satisfy the definition of employee, under FASB guidance, the Company's nonemployee directors acting in their role as members of a board of directors are treated as employees as those directors were elected by the Company's shareholders. Therefore, awards granted to these nonemployee directors for their services as directors already were accounted for as employee awards. We adopted ASU 2018-07 during the second quarter of 2018 with no impact on our financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , to replace existing revenue recognition rules with a single comprehensive model to use in accounting for revenue arising from contracts with customers. Under this ASU and the associated subsequent amendments (collectively, “ASC 606”), revenue is recognized when a customer obtains control of promised goods or services for an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. In addition, ASC 606 requires expanded disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted ASC 606 on January 1, 2018 for all contracts using the modified retrospective method. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of accumulated deficit. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. We expect the impact of the adoption of the new revenue standard to be immaterial to our net income on an ongoing basis. A majority of our sales revenue continues to be recognized ratably over the applicable term of the respective subscription or maintenance contracts. For most sales commissions formerly expensed as incurred, other than for perpetual license commissions which will continue to be expensed as incurred, we are now amortizing these costs to the consolidated statements of income over the shorter of 1) the expected life of our customer relationships, which we have determined to be approximately 6 years, or 2) the life of the related technology. For further discussion about changes to Significant Accounting Policies impacted by the adoption of 2014-09 (Topic 606), see Note 10. Revenue . The cumulative effect of the changes made to our consolidated January 1, 2018 balance sheet for the adoption of ASC 606 were as follows (in thousands): Balance Sheet Balance at December 31, 2017 Adjustments Due to ASC 606 Balance at January 1, 2018 Assets Deferred commissions, current $ — $ 2,070 $ 2,070 Deferred commissions, noncurrent — 4,447 4,447 Liabilities Deferred revenue (current) 43,807 225 44,032 Equity Accumulated deficit $ (81,128 ) $ 6,292 $ (74,836 ) In accordance with the new revenue standard requirements, the disclosure of the impact of adoption on our consolidated income statement and balance sheet for the periods ended September 30, 2018 was as follows (in thousands): Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Income statement As Reported Balances Without Adoption of ASC 606 Effect of Change As Reported Balances Without Adoption of ASC 606 Effect of Change Revenues Perpetual license 915 971 (56 ) 3,224 3,015 209 Operating expenses Sales & marketing 5,299 5,915 (616 ) 14,955 16,154 (1,199 ) During the three months ended September 30, 2018 and the nine months ended September 30, 2018 , the effect on earnings per share of the adoption of ASC 606 was an increase in earnings per share of $0.03 and $0.07 , respectively. As of September 30, 2018 Balance Sheet As Reported Balances Without Adoption of ASC 606 Effect of Change Assets Deferred commissions, current $ 2,374 $ — $ 2,374 Deferred commissions, noncurrent 5,470 — 5,470 Liabilities Deferred revenue (current) 43,575 43,368 (207 ) Equity Accumulated deficit $ (87,477 ) $ (92,361 ) $ (4,884 ) In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business , which revises the definition of a business and assists in the evaluation of when a set of transferred assets and activities is a business. ASU 2017-01 is effective for interim and annual reporting periods beginning after December 15, 2017, and should be applied prospectively. Early adoption is permitted under certain circumstances. The Company adopted ASU 2017-01 during the first quarter of 2018. No impact on the financial statements was recorded as a result of the adoption of ASU 2017-01. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment . ASU 2017-04 eliminates step two of the goodwill impairment test and specifies that goodwill impairment should be measured by comparing the fair value of a reporting unit with its carrying amount. Additionally, the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount of net assets should be disclosed. ASU 2017-04 is effective for annual or interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019; early adoption is permitted. The Company adopted ASU 2017-04 during the first quarter of 2018. No impact on the financial statements was recorded as a result of the adoption of ASU 2017-04. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 is intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows and to eliminate the diversity in practice related to such classifications. The guidance in ASU 2016-15 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. The Company adopted ASU 2016-15 during the first quarter of 2017. No additional disclosure was deemed necessary upon the adoption of ASU 2016-15. No impact on the financial statements was recorded as a result of the adoption of ASU 2016-15. |
Revenue Recognition | Deferred Commissions The Company capitalizes sales commissions related to its customer agreements. The Company capitalizes commissions and bonuses for those involved in the sale, as these are incremental to the sale. The Company begins amortizing deferred solution and other costs for a particular customer agreement once the revenue recognition criteria are met and amortizes those deferred costs over the expected life of the customer relationships, which has been determined to be approximately 6 years. The portion of capitalized costs expected to be amortized during the succeeding twelve-month period is recorded in current assets as deferred commissions, current, and the remainder is recorded in long-term assets as deferred commissions, net of current portion. Amortization expense is included in sales and marketing expenses in the accompanying condensed consolidated statements of operations. Revenues are recognized when control of the promised goods or services is transferred to the Company's customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services over the term of the agreement, generally when made available to the customers. We enter into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Revenues are recognized net of sales credits and allowances. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. Revenue-generating activities consist of subscription and support, perpetual licenses, and professional services revenues within a single operating segment. Subscription and Support Revenues The Company's software solutions are available for use as hosted application arrangements under subscription fee agreements without licensing perpetual rights to the software. Subscription fees from these applications are recognized over time on a ratable basis over the customer agreement term beginning on the date the Company's solution is made available to the customer. Our subscription contracts are generally one to three years in length. Amounts that have been invoiced are recorded in accounts receivable and deferred revenues or revenues, depending on whether the revenue recognition criteria have been met. Additional fees for monthly usage above the levels included in the standard subscription fee are recognized as revenue at the end of each month and is invoiced concurrently. Perpetual License Revenues The Company also records revenue from the sales of proprietary software products under perpetual licenses. Revenue from distinct on-premises licenses is recognized upfront at the point in time when the software is made available to the customer. The Company’s products do not require significant customization. Professional Services Revenue Professional services provided with subscription and support licenses and perpetual licenses consist of implementation fees, data extraction, configuration, and training. The Company’s implementation and configuration services do not involve significant customization of the software and are not considered essential to the functionality. Revenues from professional services are recognized over time as such services are performed. Significant Judgments Performance Obligations and Standalone Selling Price A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of accounting. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. The Company has contracts with customers that often include multiple performance obligations, usually including perpetual licenses, multiple subscriptions and professional services. For these contracts, the Company accounts for individual performance obligations separately if they are distinct by allocating the contract's total transaction price to each performance obligation in an amount based on the relative standalone selling price, or SSP, of each distinct good or service in the contract. Judgment is required to determine the SSP for each distinct performance obligation. A residual approach would only be applied when a particular performance obligation has highly variable and uncertain SSP and such is bundled with other performance obligations that have observable SSP. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, historical standalone sales, customer demographics, geographic locations, and the number and types of users within our contracts. Other Considerations The Company evaluates whether it is the principal (i.e., report revenues on a gross basis) or agent (i.e., report revenues on a net basis) for vendor reseller agreements. Generally, the Company reports revenues from these types of contracts on a gross basis, meaning the amounts billed to customers are recorded as revenues, and expenses incurred are recorded as cost of revenues. Where the Company is the principal, it first obtains control of the inputs to the specific good or service and directs their use to create the combined output. The Company's control is evidenced by its involvement in the integration of the good or service on its platform before it is transferred to its customers, and is further supported by the Company being primarily responsible to its customers and having a level of discretion in establishing pricing. Revenues provided from agreements in which the Company is an agent are immaterial. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers or to provide customers with financing. Example includes invoicing at the beginning of a subscription term with revenue recognized ratably over the contract period. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The cumulative effect of the changes made to our consolidated January 1, 2018 balance sheet for the adoption of ASC 606 were as follows (in thousands): Balance Sheet Balance at December 31, 2017 Adjustments Due to ASC 606 Balance at January 1, 2018 Assets Deferred commissions, current $ — $ 2,070 $ 2,070 Deferred commissions, noncurrent — 4,447 4,447 Liabilities Deferred revenue (current) 43,807 225 44,032 Equity Accumulated deficit $ (81,128 ) $ 6,292 $ (74,836 ) In accordance with the new revenue standard requirements, the disclosure of the impact of adoption on our consolidated income statement and balance sheet for the periods ended September 30, 2018 was as follows (in thousands): Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Income statement As Reported Balances Without Adoption of ASC 606 Effect of Change As Reported Balances Without Adoption of ASC 606 Effect of Change Revenues Perpetual license 915 971 (56 ) 3,224 3,015 209 Operating expenses Sales & marketing 5,299 5,915 (616 ) 14,955 16,154 (1,199 ) During the three months ended September 30, 2018 and the nine months ended September 30, 2018 , the effect on earnings per share of the adoption of ASC 606 was an increase in earnings per share of $0.03 and $0.07 , respectively. As of September 30, 2018 Balance Sheet As Reported Balances Without Adoption of ASC 606 Effect of Change Assets Deferred commissions, current $ 2,374 $ — $ 2,374 Deferred commissions, noncurrent 5,470 — 5,470 Liabilities Deferred revenue (current) 43,575 43,368 (207 ) Equity Accumulated deficit $ (87,477 ) $ (92,361 ) $ (4,884 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Summary of Pro Forma Statements of Operations | The table below shows the Pro forma statements of operations data for the three and nine months ended September 30, 2018 and September 30, 2017 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Revenue $ 37,144 $ 31,262 $ 104,705 $ 84,524 Loss from continuing operations (1) $ (4,250 ) $ (2,412 ) $ (12,641 ) $ (10,435 ) (1) While some recurring adjustments impact the pro forma figures presented, the decrease in pro forma loss from continuing operations compared to our loss from continuing operations presented on the consolidated statements of operations for the three and nine months ended September 30, 2018 and September 30, 2017 includes nonrecurring adjustments removing acquisition costs from 2017 and reflects these costs in the year ended 2016, the year the acquisition was assumed to be completed for pro forma purposes. |
Schedule of Assets and Liabilities Assumed Through Acquisition | The following condensed table presents the preliminary and finalized acquisition-date fair value of the assets acquired and liabilities assumed for the acquisitions in 2017 and through the nine months ended September 30, 2018 , as well as assets and liabilities (in thousands): Preliminary Finalized RO Innovation Interfax Qvidian Waterfall RightAnswers Omtool Year Acquired 2018 2018 2017 2017 2017 2017 Cash $ 197 $ 1,396 $ 468 $ 100 $ 139 $ 2,957 Accounts receivable 1,564 1,706 1,907 1,477 2,164 784 Other current assets 1,299 1,000 334 608 246 464 Property and equipment 15 286 108 23 408 58 Customer relationships 8,596 22,577 30,160 6,400 10,500 4,400 Trade name 65 649 227 110 180 170 Technology 1,636 5,236 5,739 2,800 2,300 3,180 Goodwill 4,535 14,070 21,229 18,575 15,680 14,081 Other assets — 14 8 — — 33 Total assets acquired 17,907 46,934 60,180 30,093 31,617 26,127 Accounts payable (231 ) (737 ) (388 ) (605 ) (139 ) (219 ) Accrued expense and other (1,921 ) (2,832 ) (403 ) (1,136 ) (2,108 ) (915 ) Deferred tax liabilities — (3,365 ) — — — — Deferred revenue (1,505 ) — (9,389 ) (1,220 ) (5,479 ) (2,779 ) Total liabilities assumed (3,657 ) (6,934 ) (10,180 ) (2,961 ) (7,726 ) (3,913 ) Total consideration $ 14,250 $ 40,000 $ 50,000 $ 27,132 $ 23,891 $ 22,214 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Liabilities Measured at Fair Value on a Recurring Basis | Liabilities measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements at December 31, 2017 Level 1 Level 2 Level 3 Total Earnout consideration liability $ — $ — $ 3,576 $ 3,576 Fair Value Measurements at September 30, 2018 (unaudited) Level 1 Level 2 Level 3 Total Earnout consideration liability $ — $ — $ 2,537 $ 2,537 |
Schedule of Liabilities Measured at Fair Value on a Recurring Basis which Unobservable Inputs are Utilized | The following table presents additional information about liabilities measured at fair value on a recurring basis and for which we have utilized significant unobservable (Level 3) inputs to determine fair value (in thousands): Ending balance at December 31, 2017 $ 3,576 Additions - cash earnouts 939 Settlements - cash earnouts (1,978 ) Ending balance at September 30, 2018 $ 2,537 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | Changes in the Company’s goodwill balance for the nine months ended September 30, 2018 are summarized in the table below (in thousands): Balance at December 31, 2017 $ 154,607 Acquired in business combinations 11,800 Adjustment related to prior year business combinations (15,022 ) Adjustment related to finalization of current year business combinations 6,056 Foreign currency translation adjustment (363 ) Balance at September 30, 2018 $ 157,078 |
Summary of intangible assets, net | The following is a summary of the Company’s intangible assets, net (in thousands): Estimated Useful Gross Accumulated Net Carrying September 30, 2018: Customer relationships 1-10 $ 116,733 $ 26,784 $ 89,949 Trade name 1.5-7 4,009 3,224 785 Developed technology 4-7 35,923 14,501 21,422 Total intangible assets $ 156,665 $ 44,509 $ 112,156 Estimated Useful Life (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount December 31, 2017: Customer relationships 5-10 $ 69,061 $ 18,040 $ 51,021 Trade name 1.5 3,431 2,900 531 Developed technology 4-7 29,308 10,817 18,491 Total intangible assets $ 101,800 $ 31,757 $ 70,043 |
Schedule of weighted-average amortization period | The following table summarizes the Company's weighted-average amortization period, in total and by major finite-lived intangible asset class (in years): September 30, 2018 December 31, 2017 Customer relationships 9.3 9.0 Trade name 1.7 1.5 Developed technology 6.6 6.4 Total weighted-average amortization period 8.5 8.2 |
Estimated annual amortization expense | Estimated annual amortization expense for the next five years and thereafter is as follows (in thousands): Amortization Year ending December 31: Remainder of 2018 $ 4,766 2019 18,125 2020 16,163 2021 15,462 2022 13,325 2023 and thereafter 44,315 Total $ 112,156 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Long-term debt consisted of the following at September 30, 2018 and December 31, 2017 (in thousands): September 30, 2018 December 31, 2017 Senior secured loans (includes unamortized discount of $2,678 and $2,668 based on an imputed interest rate of 7.1% and 7.7%, at September 30, 2018 and December 31, 2017, respectively) $ 158,228 $ 111,144 Less current maturities (4,330 ) (2,301 ) Total long-term debt $ 153,898 $ 108,843 |
Schedule of future debt maturities of long-term debt (excluding financing costs) | Under the terms of the Sixth Amendment, future debt maturities of long-term debt (excluding financing costs) at September 30, 2018 are as follows (in thousands): Remaining 2018 $ 1,031 2019 6,188 2020 8,250 2021 8,250 2022 137,187 Thereafter — Total debt maturities 160,906 Less current maturities (4,330 ) Less unamortized debt discount (2,678 ) Notes Payable, less current maturities and unamortized debt discount $ 153,898 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Computations of loss per share | The following table sets forth the computations of loss per share (in thousands, except share and per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Numerator: Net Loss $ (4,250 ) $ (3,506 ) $ (12,641 ) $ (14,931 ) Denominator: Weighted–average common shares outstanding, basic and diluted 20,089,919 19,380,519 19,916,907 18,043,365 Net loss per common share, basic and diluted $ (0.21 ) $ (0.18 ) $ (0.63 ) $ (0.83 ) |
Schedule of anti–dilutive common share equivalents | The following table sets forth the anti–dilutive common share equivalents as of September 30, 2018 and September 30, 2017 : September 30, 2018 2017 Stock options 410,506 692,097 Restricted stock 1,473,898 1,274,088 Total anti–dilutive common share equivalents 1,884,404 1,966,185 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Schedule of restricted stock activity | Restricted share activity during the nine months ended September 30, 2018 was as follows: Number of Weighted-Average Grant Date Fair Value Unvested balances at December 31, 2017 1,047,480 $ 13.35 Awards granted 825,741 28.97 Awards vested (398,323 ) 16.63 Awards forfeited (1,000 ) 23.60 Unvested balances at September 30, 2018 1,473,898 $ 21.21 |
Schedule of stock option activity | Stock option activity during the nine months ended September 30, 2018 was as follows: Number of Weighted– Outstanding at December 31, 2017 549,907 $ 7.36 Options granted 4,378 33.39 Options exercised (143,706 ) 6.12 Options expired (73 ) 1.79 Outstanding at September 30, 2018 410,506 $ 8.08 |
Schedule of allocated share-based compensation expense | The Company recognized share-based compensation expense from all awards in the following expense categories (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Cost of revenue $ 195 $ 147 $ 464 $ 277 Research and development 383 219 871 560 Sales and marketing 169 73 368 149 General and administrative 3,034 1,445 8,677 6,818 Total $ 3,781 $ 1,884 $ 10,380 $ 7,804 |
Domestic and Foreign Operatio_2
Domestic and Foreign Operations (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of revenues by geographical area | The Company has operations in the U.S., Canada and Europe. Information about these operations is presented below (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Revenues: U.S. $ 30,681 $ 21,468 $ 83,640 $ 57,093 Canada 1,525 1,186 4,781 3,265 Other International 4,938 3,418 16,284 9,747 Total Revenues $ 37,144 $ 26,072 $ 104,705 $ 70,105 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Schedule of Cumulative Effect of ASU 2014-09 Adoption on Balance Sheet) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Assets | |||
Deferred commissions, current | $ 2,374 | $ 2,070 | $ 0 |
Deferred commissions, noncurrent | 5,470 | 4,447 | 0 |
Liabilities | |||
Deferred revenue (current) | 43,575 | 44,032 | 43,807 |
Equity | |||
Accumulated deficit | (87,477) | (74,836) | (81,128) |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||
Assets | |||
Deferred commissions, current | 0 | 0 | |
Deferred commissions, noncurrent | 0 | 0 | |
Liabilities | |||
Deferred revenue (current) | 43,368 | 43,807 | |
Equity | |||
Accumulated deficit | (92,361) | $ (81,128) | |
Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||
Assets | |||
Deferred commissions, current | 2,374 | 2,070 | |
Deferred commissions, noncurrent | 5,470 | 4,447 | |
Liabilities | |||
Deferred revenue (current) | (207) | 225 | |
Equity | |||
Accumulated deficit | $ (4,884) | $ 6,292 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Schedule of Effect of New Accounting Pronouncements) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | |
Revenue: | ||||||
Total revenue | $ 37,144 | $ 26,072 | $ 104,705 | $ 70,105 | ||
Operating expenses: | ||||||
Sales and marketing | 5,299 | 4,258 | 14,955 | 11,516 | ||
Assets | ||||||
Deferred commissions, current | 2,374 | 2,374 | $ 2,070 | $ 0 | ||
Deferred commissions, noncurrent | 5,470 | 5,470 | 4,447 | 0 | ||
Liabilities | ||||||
Deferred revenue (current) | 43,575 | 43,575 | 44,032 | 43,807 | ||
Equity | ||||||
Accumulated deficit | (87,477) | (87,477) | (74,836) | (81,128) | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||||
Operating expenses: | ||||||
Sales and marketing | 5,915 | 16,154 | ||||
Assets | ||||||
Deferred commissions, current | 0 | 0 | 0 | |||
Deferred commissions, noncurrent | 0 | 0 | 0 | |||
Liabilities | ||||||
Deferred revenue (current) | 43,368 | 43,368 | 43,807 | |||
Equity | ||||||
Accumulated deficit | (92,361) | (92,361) | $ (81,128) | |||
Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | ||||||
Operating expenses: | ||||||
Sales and marketing | (616) | (1,199) | ||||
Assets | ||||||
Deferred commissions, current | 2,374 | 2,374 | 2,070 | |||
Deferred commissions, noncurrent | 5,470 | 5,470 | 4,447 | |||
Liabilities | ||||||
Deferred revenue (current) | (207) | (207) | 225 | |||
Equity | ||||||
Accumulated deficit | (4,884) | (4,884) | $ 6,292 | |||
Perpetual License [Member] | ||||||
Revenue: | ||||||
Total revenue | 915 | $ 856 | 3,224 | $ 3,296 | ||
Perpetual License [Member] | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||||
Revenue: | ||||||
Total revenue | 971 | 3,015 | ||||
Perpetual License [Member] | Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | ||||||
Revenue: | ||||||
Total revenue | $ (56) | $ 209 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Narrative) (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Effect of earning per share of adoption of ASC 606 (in dollars per share) | $ (0.21) | $ (0.18) | $ (0.63) | $ (0.83) |
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Effect of earning per share of adoption of ASC 606 (in dollars per share) | $ 0.03 | $ 0.07 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) - USD ($) | Jun. 28, 2018 | Mar. 21, 2018 | Nov. 16, 2017 | Jul. 12, 2017 | Apr. 21, 2017 | Jan. 10, 2017 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||||||||||||
Payments to acquire business, net of cash acquired | $ 47,850,000 | $ 61,163,000 | |||||||||||
Adjustment to intangibles | (15,000,000) | ||||||||||||
Goodwill | $ 157,078,000 | $ 157,078,000 | $ 157,078,000 | 157,078,000 | $ 154,607,000 | ||||||||
Measurement period expenses | 600,000 | $ 44,160 | 800,000 | 100,000 | |||||||||
Transaction costs | 2,497,000 | 4,399,000 | 8,739,000 | 10,368,000 | |||||||||
Interfax Communications Limited [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Cash consideration transferred | $ 33,600,000 | ||||||||||||
Contingent consideration, fair value | $ 5,000,000 | ||||||||||||
Cash holdback payable, payment period | 18 months | ||||||||||||
Recorded revenue | 8,100,000 | ||||||||||||
Cash acquired | $ 1,400,000 | ||||||||||||
Adjustment to intangibles | 2,300,000 | ||||||||||||
Goodwill | 14,070,000 | ||||||||||||
Goodwill expected to be tax deductible | 2,400,000 | ||||||||||||
RO Innovation, Inc. [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Cash holdback payable, payment period | 1 year | ||||||||||||
Recorded revenue | 1,200,000 | ||||||||||||
Payments to acquire business, net of cash acquired | $ 12,300,000 | ||||||||||||
Cash holdback payable | 1,800,000 | ||||||||||||
Cash acquired | 200,000 | ||||||||||||
Adjustments to consideration | 1,400,000 | ||||||||||||
Adjustments to accounts receivable | (200,000) | ||||||||||||
Adjustments to other liabilities | 1,200,000 | ||||||||||||
Goodwill | 4,535,000 | ||||||||||||
Goodwill expected to be tax deductible | $ 2,700,000 | ||||||||||||
Omtool, Ltd [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Payments to acquire business, net of cash acquired | $ 19,300,000 | ||||||||||||
Cash acquired | 3,000,000 | ||||||||||||
Goodwill | $ 14,081,000 | ||||||||||||
RightAnswers, Inc. [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Cash holdback payable, payment period | 1 year | ||||||||||||
Payments to acquire business, net of cash acquired | $ 17,400,000 | ||||||||||||
Cash holdback payable | 2,500,000 | ||||||||||||
Cash acquired | 100,000 | ||||||||||||
Goodwill | $ 15,680,000 | ||||||||||||
Waterfall International Inc. [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Cash holdback payable, payment period | 18 months | ||||||||||||
Payments to acquire business, net of cash acquired | $ 24,400,000 | ||||||||||||
Cash holdback payable | 1,500,000 | ||||||||||||
Cash acquired | 400,000 | ||||||||||||
Earnout consideration liability | 3,000,000 | ||||||||||||
Goodwill | 18,575,000 | ||||||||||||
Goodwill expected to be tax deductible | $ 3,700,000 | ||||||||||||
Qvidian Corporation [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Payments to acquire business, net of cash acquired | $ 50,000,000 | ||||||||||||
Goodwill | $ 21,229,000 | ||||||||||||
LeadLander, HipCricket, Omtool and RightAnswers [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Goodwill | 88,200,000 | 88,200,000 | 88,200,000 | 88,200,000 | |||||||||
Omtool Ltd., RightAnswers Inc., and Qvidian Corporation [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Goodwill expected to be tax deductible | 0 | $ 0 | $ 0 | 0 | |||||||||
Series of Business Acquisitions [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Transaction costs | $ 200,000 | $ 1,100,000 | $ 2,800,000 | $ 4,300,000 | |||||||||
Marketech [Member] | Interfax Communications Limited [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Payments to acquire certain assets and intangible assets | $ 2,000,000 |
Acquisitions (Schedule of Pro F
Acquisitions (Schedule of Pro Forma Statements of Operations) (Details) - Qvidian Corporation [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma revenue | $ 37,144 | $ 31,262 | $ 104,705 | $ 84,524 |
Pro forma loss from continuing operations | $ (4,250) | $ (2,412) | $ (12,641) | $ (10,435) |
Acquisitions (Assets Acquired a
Acquisitions (Assets Acquired and Liabilities Assumed and Divested) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Jun. 28, 2018 | Mar. 21, 2018 | Dec. 31, 2017 | Nov. 16, 2017 | Jul. 12, 2017 | Apr. 21, 2017 | Jan. 10, 2017 |
Assets Acquired | ||||||||
Goodwill | $ 157,078 | $ 154,607 | ||||||
RO Innovation, Inc. [Member] | ||||||||
Assets Acquired | ||||||||
Cash | $ 197 | |||||||
Accounts receivable | 1,564 | |||||||
Other current assets | 1,299 | |||||||
Property and equipment | 15 | |||||||
Goodwill | 4,535 | |||||||
Other assets | 0 | |||||||
Total assets acquired | 17,907 | |||||||
Liabilities Assumed | ||||||||
Accounts payable | (231) | |||||||
Accrued expense and other | (1,921) | |||||||
Deferred tax liabilities | 0 | |||||||
Deferred revenue | (1,505) | |||||||
Total liabilities assumed | (3,657) | |||||||
Total consideration | 14,250 | |||||||
RO Innovation, Inc. [Member] | Customer Relationships [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 8,596 | |||||||
RO Innovation, Inc. [Member] | Trade Name [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 65 | |||||||
RO Innovation, Inc. [Member] | Technology [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | $ 1,636 | |||||||
Interfax Communications Limited [Member] | ||||||||
Assets Acquired | ||||||||
Cash | $ 1,396 | |||||||
Accounts receivable | 1,706 | |||||||
Other current assets | 1,000 | |||||||
Property and equipment | 286 | |||||||
Goodwill | 14,070 | |||||||
Other assets | 14 | |||||||
Total assets acquired | 46,934 | |||||||
Liabilities Assumed | ||||||||
Accounts payable | (737) | |||||||
Accrued expense and other | (2,832) | |||||||
Deferred tax liabilities | (3,365) | |||||||
Deferred revenue | 0 | |||||||
Total liabilities assumed | (6,934) | |||||||
Total consideration | 40,000 | |||||||
Interfax Communications Limited [Member] | Customer Relationships [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 22,577 | |||||||
Interfax Communications Limited [Member] | Trade Name [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 649 | |||||||
Interfax Communications Limited [Member] | Technology [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | $ 5,236 | |||||||
Qvidian Corporation [Member] | ||||||||
Assets Acquired | ||||||||
Cash | $ 468 | |||||||
Accounts receivable | 1,907 | |||||||
Other current assets | 334 | |||||||
Property and equipment | 108 | |||||||
Goodwill | 21,229 | |||||||
Other assets | 8 | |||||||
Total assets acquired | 60,180 | |||||||
Liabilities Assumed | ||||||||
Accounts payable | (388) | |||||||
Accrued expense and other | (403) | |||||||
Deferred tax liabilities | 0 | |||||||
Deferred revenue | (9,389) | |||||||
Total liabilities assumed | (10,180) | |||||||
Total consideration | 50,000 | |||||||
Qvidian Corporation [Member] | Customer Relationships [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 30,160 | |||||||
Qvidian Corporation [Member] | Trade Name [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 227 | |||||||
Qvidian Corporation [Member] | Technology [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | $ 5,739 | |||||||
Waterfall International Inc. [Member] | ||||||||
Assets Acquired | ||||||||
Cash | $ 100 | |||||||
Accounts receivable | 1,477 | |||||||
Other current assets | 608 | |||||||
Property and equipment | 23 | |||||||
Goodwill | 18,575 | |||||||
Other assets | 0 | |||||||
Total assets acquired | 30,093 | |||||||
Liabilities Assumed | ||||||||
Accounts payable | (605) | |||||||
Accrued expense and other | (1,136) | |||||||
Deferred tax liabilities | 0 | |||||||
Deferred revenue | (1,220) | |||||||
Total liabilities assumed | (2,961) | |||||||
Total consideration | 27,132 | |||||||
Waterfall International Inc. [Member] | Customer Relationships [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 6,400 | |||||||
Waterfall International Inc. [Member] | Trade Name [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 110 | |||||||
Waterfall International Inc. [Member] | Technology [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | $ 2,800 | |||||||
RightAnswers, Inc. [Member] | ||||||||
Assets Acquired | ||||||||
Cash | $ 139 | |||||||
Accounts receivable | 2,164 | |||||||
Other current assets | 246 | |||||||
Property and equipment | 408 | |||||||
Goodwill | 15,680 | |||||||
Other assets | 0 | |||||||
Total assets acquired | 31,617 | |||||||
Liabilities Assumed | ||||||||
Accounts payable | (139) | |||||||
Accrued expense and other | (2,108) | |||||||
Deferred tax liabilities | 0 | |||||||
Deferred revenue | (5,479) | |||||||
Total liabilities assumed | (7,726) | |||||||
Total consideration | 23,891 | |||||||
RightAnswers, Inc. [Member] | Customer Relationships [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 10,500 | |||||||
RightAnswers, Inc. [Member] | Trade Name [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 180 | |||||||
RightAnswers, Inc. [Member] | Technology [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | $ 2,300 | |||||||
Omtool, Ltd [Member] | ||||||||
Assets Acquired | ||||||||
Cash | $ 2,957 | |||||||
Accounts receivable | 784 | |||||||
Other current assets | 464 | |||||||
Property and equipment | 58 | |||||||
Goodwill | 14,081 | |||||||
Other assets | 33 | |||||||
Total assets acquired | 26,127 | |||||||
Liabilities Assumed | ||||||||
Accounts payable | (219) | |||||||
Accrued expense and other | (915) | |||||||
Deferred tax liabilities | 0 | |||||||
Deferred revenue | (2,779) | |||||||
Total liabilities assumed | (3,913) | |||||||
Total consideration | 22,214 | |||||||
Omtool, Ltd [Member] | Customer Relationships [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 4,400 | |||||||
Omtool, Ltd [Member] | Trade Name [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | 170 | |||||||
Omtool, Ltd [Member] | Technology [Member] | ||||||||
Assets Acquired | ||||||||
Intangible assets | $ 3,180 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Level 2 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value of debt | $ 160,900 | $ 113,800 |
Recurring Measurement Basis [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Earnout consideration liability | 2,537 | 3,576 |
Recurring Measurement Basis [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Earnout consideration liability | 0 | 0 |
Recurring Measurement Basis [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Earnout consideration liability | 0 | 0 |
Recurring Measurement Basis [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Earnout consideration liability | 2,537 | 3,576 |
Recurring Measurement Basis [Member] | Level 3 [Member] | Earnout Consideration [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | 3,576 | |
Additions - cash earnouts | 939 | |
Settlements - cash earnouts | (1,978) | |
Ending balance | $ 2,537 | |
Recurring Measurement Basis [Member] | RightAnswers, Inc. [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration, fair value | $ 2,000 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Schedule of Goodwill) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 154,607 |
Acquired in business combinations | 11,800 |
Adjustment related to prior year business combinations | (15,022) |
Adjustment related to finalization of current year business combinations | 6,056 |
Foreign currency translation adjustment | (363) |
Ending balance | $ 157,078 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Adjustment related to prior year business combinations | $ (15) | |||
Amortization charge of intangible assets | $ 4.8 | $ 2.5 | $ 12.9 | $ 6.3 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets (Intangible Assets, Net) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 156,665 | $ 101,800 |
Accumulated Amortization | 44,509 | 31,757 |
Net Carrying Amount | 112,156 | 70,043 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 116,733 | 69,061 |
Accumulated Amortization | 26,784 | 18,040 |
Net Carrying Amount | $ 89,949 | $ 51,021 |
Customer Relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 1 year | 5 years |
Customer Relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 10 years | 10 years |
Trade Name [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 1 year 6 months | |
Gross Carrying Amount | $ 4,009 | $ 3,431 |
Accumulated Amortization | 3,224 | 2,900 |
Net Carrying Amount | $ 785 | 531 |
Trade Name [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 1 year 6 months | |
Trade Name [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 7 years | |
Developed Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 35,923 | 29,308 |
Accumulated Amortization | 14,501 | 10,817 |
Net Carrying Amount | $ 21,422 | $ 18,491 |
Developed Technology [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 4 years | 4 years |
Developed Technology [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 7 years | 7 years |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets (Weighted-Average Amortization Period) (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 8 years 6 months | 8 years 2 months |
Customer Relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 9 years 3 months 18 days | 9 years |
Trade Name [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 1 year 8 months 12 days | 1 year 6 months |
Developed Technology [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 6 years 7 months 6 days | 6 years 5 months |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets (Estimated Annual Amortization Expense) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
Remainder of 2018 | $ 4,766 | |
2,019 | 18,125 | |
2,020 | 16,163 | |
2,021 | 15,462 | |
2,022 | 13,325 | |
2023 and thereafter | 44,315 | |
Net Carrying Amount | $ 112,156 | $ 70,043 |
Debt (Long-term Debt) (Details)
Debt (Long-term Debt) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Notes Payable, less current maturities and unamortized debt discount | $ 153,898 | |
Less current maturities | (4,330) | $ (2,301) |
Total long-term debt | 153,898 | 108,843 |
Unamortized debt discount | 2,678 | 2,700 |
Senior Secured Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, less current maturities and unamortized debt discount | 158,228 | 111,144 |
Unamortized debt discount | $ 2,678 | $ 2,668 |
Implied interest rate | 7.10% | 7.70% |
Debt (Loans) (Details)
Debt (Loans) (Details) - USD ($) | Sep. 30, 2018 | Mar. 21, 2018 |
Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 203,700,000 | |
Revolving Credit Facility [Member] | Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Amounts drawn on loans | 0 | |
Credit Facility [Member] | Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 258,700,000 | |
Credit Facility [Member] | Medium-term Notes [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 163,700,000 | |
Amounts drawn on loans | 160,900,000 | |
Credit Facility [Member] | Medium-term Notes [Member] | Domestic Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 158,400,000 | |
Amounts drawn on loans | 155,700,000 | |
Credit Facility [Member] | Medium-term Notes [Member] | Foreign Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 5,300,000 | |
Amounts drawn on loans | $ 5,200,000 | |
Credit Facility [Member] | Delayed Draw Term Loan [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 30,000,000 | |
Credit Facility [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 10,000,000 | |
Credit Facility [Member] | Revolving Credit Facility [Member] | Domestic Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 9,000,000 | |
Credit Facility [Member] | Revolving Credit Facility [Member] | Foreign Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 1,000,000 | |
Credit Facility [Member] | Uncommitted Accordion Debt [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 55,000,000 |
Debt (Terms of Term Loans) (Det
Debt (Terms of Term Loans) (Details) | Mar. 31, 2018 | Mar. 21, 2018USD ($) | Mar. 20, 2018 |
Line of Credit Facility [Line Items] | |||
Decrease in basis points percentage | 0.50% | ||
Basis points, percentage | 1.50% | ||
Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Effective interest rate percentage | 7.10% | ||
Leverage ratio | 4.25 | ||
Revenue ratio | 1.50 | 1.25 | |
Line of Credit [Member] | Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Interest rate percentage | 2.50% | ||
Maximum purchase consideration payable | $ 25,000,000 | ||
Permitted acquisition | 175,000,000 | ||
Indebtedness to sellers of businesses | $ 20,000,000 | ||
Medium-term Notes [Member] | Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Effective interest rate percentage | 6.15% | ||
Through Maturity Of August 2, 2022 [Member] | Line of Credit [Member] | Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Interest rate percentage | 5.00% |
Debt (Terms of Delay Draw Term
Debt (Terms of Delay Draw Term Loan) (Details) - Delayed Draw Term Loan [Member] - Credit Facility [Member] | Mar. 21, 2018USD ($) |
Line of Credit Facility [Line Items] | |
Delay draw term loan | $ 30,000,000 |
Interest rate percentage | 2.50% |
Through Maturity Of August 2, 2022 [Member] | |
Line of Credit Facility [Line Items] | |
Interest rate percentage | 5.00% |
Debt (Terms of Revolver) (Detai
Debt (Terms of Revolver) (Details) - USD ($) | Sep. 30, 2018 | Mar. 21, 2018 |
Revolving Credit Facility [Member] | Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Delay draw term loan | $ 10,000,000 | |
Revolving Credit Facility [Member] | Credit Facility [Member] | Domestic Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Delay draw term loan | 9,000,000 | |
Revolving Credit Facility [Member] | Credit Facility [Member] | Foreign Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Delay draw term loan | 1,000,000 | |
Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Delay draw term loan | $ 203,700,000 | |
Line of Credit [Member] | Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Delay draw term loan | $ 258,700,000 | |
Letter of Credit [Member] | Credit Facility [Member] | Domestic Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Delay draw term loan | 500,000 | |
Letter of Credit [Member] | Credit Facility [Member] | Foreign Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Delay draw term loan | $ 250,000 |
Debt (Other Terms of Credit Fac
Debt (Other Terms of Credit Facility) (Details) - USD ($) | Mar. 21, 2018 | Sep. 30, 2018 |
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate | 1.50% | |
Capital stock buyback limit | $ 10,000,000 | |
Line of Credit [Member] | Loan Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Increase in interest rate upon default | 2.00% | |
Covenant, minimum liquidity to buyback stock | $ 25,000,000 | |
Line of Credit [Member] | Loan Facility [Member] | From August 1, 2017 to August 1, 2018 [Member] | ||
Line of Credit Facility [Line Items] | ||
Prepayment premium, percent | 2.00% | |
Line of Credit [Member] | Loan Facility [Member] | From August 2, 2018 to August 1, 2019 [Member] | ||
Line of Credit Facility [Line Items] | ||
Prepayment premium, percent | 1.00% | |
Line of Credit [Member] | U.S. [Member] | Federal Funds Rate [Member] | ||
Line of Credit Facility [Line Items] | ||
Variable rate, spread over reference rate | 0.50% | |
Line of Credit [Member] | U.S. [Member] | Prime Rate [Member] | ||
Line of Credit Facility [Line Items] | ||
Variable rate, spread over reference rate | 1.00% | |
Line of Credit [Member] | U.S. [Member] | Minimum [Member] | Base Rate [Member] | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate | 3.00% | |
Line of Credit [Member] | U.S. [Member] | Minimum [Member] | LIBOR [Member] | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate | 4.00% | |
Line of Credit [Member] | U.S. [Member] | Maximum [Member] | Base Rate [Member] | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate | 4.00% | |
Line of Credit [Member] | U.S. [Member] | Maximum [Member] | LIBOR [Member] | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate | 5.00% |
Debt (Interest Rate and Debt Di
Debt (Interest Rate and Debt Discount) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Line of Credit Facility [Line Items] | ||
Unamortized debt discount | $ 2,678 | $ 2,700 |
Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Cash interest costs | 6.70% | 6.30% |
Debt (Future Debt Maturities of
Debt (Future Debt Maturities of Long-term Debt) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure [Abstract] | ||
Remaining 2,018 | $ 1,031 | |
2,019 | 6,188 | |
2,020 | 8,250 | |
2,021 | 8,250 | |
2,022 | 137,187 | |
Thereafter | 0 | |
Long-term debt | 160,906 | |
Less current maturities | (4,330) | $ (2,301) |
Less unamortized debt discount | (2,678) | $ (2,700) |
Notes Payable, less current maturities and unamortized debt discount | $ 153,898 |
Net Loss Per Share (Computation
Net Loss Per Share (Computation of Loss Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Numerator: | ||||
Net loss | $ (4,250) | $ (3,506) | $ (12,641) | $ (14,931) |
Denominator: | ||||
Weighted-average common shares outstanding, basic and diluted (in shares) | 20,089,919 | 19,380,519 | 19,916,907 | 18,043,365 |
Net loss per common share, basic and diluted (in dollars per share) | $ (0.21) | $ (0.18) | $ (0.63) | $ (0.83) |
Net Loss Per Share (Anti_Diluti
Net Loss Per Share (Anti–Dilutive Common Share Equivalents) (Details) - shares | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti–dilutive common share equivalents (in shares) | 1,884,404 | 1,966,185 |
Employee Stock Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti–dilutive common share equivalents (in shares) | 410,506 | 692,097 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti–dilutive common share equivalents (in shares) | 1,473,898 | 1,274,088 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Investor [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Long-term Purchase Commitment [Line Items] | ||||
Amount of related party transaction | $ 0.8 | $ 0.6 | $ 2.4 | $ 1.6 |
Purchase Obligation [Member] | ||||
Long-term Purchase Commitment [Line Items] | ||||
Remaining purchase obligations | $ 0.8 | $ 0.8 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | Jun. 06, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | May 12, 2017 |
Class of Stock [Line Items] | ||||
Net proceeds of public offering | $ 42,700,000 | $ 858,000 | $ 43,257,000 | |
Public Offering [Member] | ||||
Class of Stock [Line Items] | ||||
Additional registration of shares of aggregate amount (up to) | $ 75,000,000 | |||
Shares issued for public offering (in shares) | 2,139,534 |
Stockholders' Equity (Restricte
Stockholders' Equity (Restricted Stock Activity) (Details) - Restricted Stock [Member] | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Number of Restricted Shares Outstanding | |
Unvested balances at beginning of period (in shares) | shares | 1,047,480 |
Awards granted (in shares) | shares | 825,741 |
Awards vested (in shares) | shares | (398,323) |
Awards forfeited (in shares) | shares | (1,000) |
Unvested balances at end of period (in shares) | shares | 1,473,898 |
Weighted-Average Grant Date Fair Value | |
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 13.35 |
Weighted average grant date fair value, awards granted (in dollars per share) | $ / shares | 28.97 |
Weighted average grant date fair value, awards vested (in dollars per share) | $ / shares | 16.63 |
Weighted average grant date fair value, awards forfeited (in dollars per share) | $ / shares | 23.60 |
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 21.21 |
Stockholders' Equity (Stock Opt
Stockholders' Equity (Stock Option Activity) (Details) | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Number of Options Outstanding | |
Options expired (in shares) | shares | (73) |
Weighted– Average Exercise Price | |
Options expired (in dollars per share) | $ / shares | $ 1.79 |
Employee Stock Option [Member] | |
Number of Options Outstanding | |
Outstanding at beginning of period (in shares) | shares | 549,907 |
Options granted (in shares) | shares | 4,378 |
Options exercised (in shares) | shares | (143,706) |
Outstanding at end of period (in shares) | shares | 410,506 |
Weighted– Average Exercise Price | |
Outstanding at beginning of period (in dollars per share) | $ / shares | $ 7.36 |
Options granted (in dollars per share) | $ / shares | 33.39 |
Options exercised (in dollars per share) | $ / shares | 6.12 |
Outstanding at end of period (in dollars per share) | $ / shares | $ 8.08 |
Stockholders' Equity (Shared Ba
Stockholders' Equity (Shared Based Compensation) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | $ 3,781 | $ 1,884 | $ 10,380 | $ 7,804 |
Cost of revenue [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | 195 | 147 | 464 | 277 |
Research and development [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | 383 | 219 | 871 | 560 |
Sales and marketing [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | 169 | 73 | 368 | 149 |
General and administrative [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | $ 3,034 | $ 1,445 | $ 8,677 | $ 6,818 |
Revenue (Details)
Revenue (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Performance obligation, description of timing | one to three years |
Revenue recognized, previously in unearned revenue | $ 53.7 |
Revenue (Remaining Performance
Revenue (Remaining Performance Obligation) (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01 $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, percentage | 76.00% |
Expected satisfaction period of performance obligations, in months | 15 months |
Subscription Contracts [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue expected to be recognized from performance obligations | $ 94 |
Professional Service Contracts [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue expected to be recognized from performance obligations | $ 0 |
Domestic and Foreign Operatio_3
Domestic and Foreign Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenues | $ 37,144 | $ 26,072 | $ 104,705 | $ 70,105 |
U.S. [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenues | 30,681 | 21,468 | 83,640 | 57,093 |
Canada [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenues | 1,525 | 1,186 | 4,781 | 3,265 |
Other International [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenues | $ 4,938 | $ 3,418 | $ 16,284 | $ 9,747 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Thousands | Mar. 28, 2017 | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)agreement | Sep. 30, 2017USD ($) |
Related Party Transaction [Line Items] | |||||
Agreements | agreement | 2 | ||||
Purchase obligation increase in amount, if a 10% increase in revenue | $ 400 | ||||
Visionael Corporation [Member] | Chief Executive Officer And Board Of Directors Chairman [Member] | |||||
Related Party Transaction [Line Items] | |||||
Percentage of ownership | 26.18% | ||||
Pro Forma [Member] | |||||
Related Party Transaction [Line Items] | |||||
Purchase commitment, amount | $ 3,600 | ||||
Investor [Member] | |||||
Related Party Transaction [Line Items] | |||||
Ownership percentage, minimum | 5.00% | 5.00% | |||
Amount of related party transaction | $ 800 | $ 600 | $ 2,400 | $ 1,600 | |
Software Development Services [Member] | Investor [Member] | |||||
Related Party Transaction [Line Items] | |||||
Option to renew purchase commitment, term (in years) | 1 year | ||||
Purchase obligation outstanding | 3,200 | 3,200 | |||
Services [Member] | Investor [Member] | |||||
Related Party Transaction [Line Items] | |||||
Amount of related party transaction | 800 | 700 | 2,400 | 2,200 | |
Management, HR/Payroll and Administrative Services [Member] | Former Subsidiary [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related party | $ 15 | $ 90 | $ 45 | $ 270 |
Subsequent Events Narrative (De
Subsequent Events Narrative (Details) - USD ($) $ in Thousands | Oct. 03, 2018 | Mar. 21, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Subsequent Event [Line Items] | ||||
Payments to acquire business, net of cash acquired | $ 47,850 | $ 61,163 | ||
Basis points, percentage | 1.50% | |||
Line of Credit [Member] | ||||
Subsequent Event [Line Items] | ||||
Maximum borrowing capacity | 203,700 | |||
Line of Credit [Member] | Credit Facility [Member] | ||||
Subsequent Event [Line Items] | ||||
Maximum borrowing capacity | $ 258,700 | |||
Line of Credit [Member] | Credit Facility [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Maximum borrowing capacity | $ 358,900 | |||
Medium-term Notes [Member] | Credit Facility [Member] | ||||
Subsequent Event [Line Items] | ||||
Maximum borrowing capacity | $ 163,700 | |||
Amounts drawn on loans | $ 160,900 | |||
Medium-term Notes [Member] | Credit Facility [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Amounts drawn on loans | 223,900 | |||
Long-term line of credit, net of cash on hand | $ 209,000 | |||
Interest rate | 6.30% | |||
Line of Credit [Member] | Medium-term Notes [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Proceeds from secured debt | $ 63,000 | |||
LIBOR [Member] | Medium-term Notes [Member] | Credit Facility [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Basis points, percentage | 4.00% | |||
PowerSteering UK [Member] | Rant & Rave [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Payments to acquire business, net of cash acquired | $ 58,500 | |||
Cash holdback payable | $ 6,500 | |||
Cash holdback payable, payment period | 12 months |