Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 05, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ZIXI | |
Entity Registrant Name | ZIX CORP | |
Entity Central Index Key | 0000855612 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 56,790,468 | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Security Exchange Name | NASDAQ | |
Entity File Number | 0-17995 | |
Entity Tax Identification Number | 75-2216818 | |
Entity Address, Address Line One | 2711 North Haskell Avenue | |
Entity Address, Address Line Two | Suite 2300, LB 36 | |
Entity Address, City or Town | Dallas | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75204-2960 | |
City Area Code | 214 | |
Local Phone Number | 370-2000 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Entity Incorporation, State or Country Code | TX | |
Document Quarterly Report | true | |
Document Transition Report | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 38,973 | $ 21,362 |
Receivables, net | 19,317 | 16,831 |
Prepaid and other current assets | 4,394 | 5,430 |
Total current assets | 62,684 | 43,623 |
Property and equipment, net | 5,530 | 7,345 |
Operating lease assets | 10,994 | 14,259 |
Intangible assets, net | 129,959 | 144,163 |
Goodwill | 195,687 | 195,013 |
Deferred tax assets | 33,691 | 32,554 |
Deferred costs and other assets | 12,378 | 12,767 |
Total assets | 450,923 | 449,724 |
Current liabilities: | ||
Accounts payable | 21,445 | 20,018 |
Accrued expenses | 11,424 | 10,364 |
Deferred revenue | 41,902 | 40,447 |
Current portion of long-term debt | 2,205 | 2,205 |
Operating lease liabilities, current | 5,802 | 5,156 |
Finance lease liabilities, current | 174 | 602 |
Total current liabilities | 82,952 | 78,792 |
Long-term liabilities: | ||
Deferred revenue | 593 | 1,079 |
Noncurrent operating lease liabilities | 6,292 | 10,094 |
Noncurrent finance lease liabilities | 14 | 114 |
Long-term debt | 208,939 | 209,658 |
Total long-term liabilities | 215,838 | 220,945 |
Total liabilities | 298,790 | 299,737 |
Commitments and contingencies (see Note 11) | ||
Preferred stock: | ||
Convertible preferred stock | 122,722 | 115,552 |
Stockholders’ equity: | ||
Preferred stock, $1 par value, 10,000,000 shares authorized; none issued and outstanding | ||
Common stock, $0.01 par value, 175,000,000 shares authorized; 85,273,243 issued and 56,790,468 outstanding in 2021 and 85,382,484 issued and 57,246,521 outstanding in 2020 | 782 | 782 |
Additional paid-in capital | 413,848 | 401,646 |
Treasury stock, at cost; 28,482,775 common shares in 2021 and 28,135,963 common shares in 2020 | (115,530) | (113,031) |
Accumulated deficit | (271,515) | (256,548) |
Accumulated other comprehensive income | 1,826 | 1,586 |
Total stockholders’ equity | 29,411 | 34,435 |
Total liabilities, preferred stock and stockholders’ equity | 450,923 | 449,724 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock: | ||
Convertible preferred stock | $ 122,722 | $ 115,552 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value | $ 1 | $ 1 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 85,273,243 | 85,382,484 |
Common stock, shares outstanding | 56,790,468 | 57,246,521 |
Treasury stock, shares | 28,482,775 | 28,135,963 |
Series A Convertible Preferred Stock [Member] | ||
Convertible Preferred stock, par value | $ 1 | $ 1 |
Convertible Preferred stock, shares designated | 100,206 | 100,206 |
Convertible Preferred stock, shares issued | 100,206 | 100,206 |
Convertible Preferred stock, shares outstanding | 100,206 | 100,206 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenue | $ 64,850 | $ 54,840 | $ 187,694 | $ 160,611 |
Cost of revenue | 36,219 | 27,928 | 103,961 | 82,265 |
Gross margin | 28,631 | 26,912 | 83,733 | 78,346 |
Operating expenses: | ||||
Research and development | 6,429 | 5,720 | 19,371 | 16,926 |
Selling, general and administrative | 22,468 | 18,813 | 66,156 | 58,058 |
Total operating expenses | 28,897 | 24,533 | 85,527 | 74,984 |
Operating income (loss) | (266) | 2,379 | (1,794) | 3,362 |
Other income (expense): | ||||
Investment and other income (expense) | (53) | 127 | (58) | 104 |
Interest expense | (2,200) | (2,035) | (6,513) | (7,190) |
Total other (expense) income | (2,253) | (1,908) | (6,571) | (7,086) |
Loss before income taxes | (2,519) | 471 | (8,365) | (3,724) |
Income tax benefit (expense) | 113 | (1,196) | 568 | 244 |
Net loss | (2,406) | (725) | (7,797) | (3,480) |
Deemed and accrued dividends on preferred stock | 2,448 | 2,267 | 7,170 | 6,714 |
Net loss attributable to common stockholders | $ (4,854) | $ (2,992) | $ (14,967) | $ (10,194) |
Basic loss per share attributable to common stockholders | $ (0.09) | $ (0.05) | $ (0.27) | $ (0.19) |
Diluted loss per common share attributable to common stockholders | $ (0.09) | $ (0.05) | $ (0.27) | $ (0.19) |
Basic weighted average common shares outstanding | 55,179,775 | 54,999,114 | 54,932,530 | 53,933,721 |
Diluted weighted average common shares outstanding | 55,179,775 | 54,999,114 | 54,932,530 | 53,933,721 |
Other comprehensive loss, net of tax | ||||
Foreign currency translation adjustments | $ 39 | $ 493 | $ 240 | $ (118) |
Comprehensive loss | $ (2,367) | $ (232) | $ (7,557) | $ (3,598) |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Preferred Stock and Stockholders' Equity (Unaudited) - USD ($) | Total | Cumulative Effect, Period of Adoption, Adjustment [Member] | Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | Series A Convertible Preferred Stock [Member] | Preferred Stock [Member] | Preferred Stock [Member]Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | Preferred Stock [Member]Series A Convertible Preferred Stock [Member] | Common Stock [Member] | Common Stock [Member]Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | Additional Paid-In Capital [Member] | Additional Paid-In Capital [Member]Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | Treasury Stock [Member] | Treasury Stock [Member]Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | Accumulated Deficit [Member] | Accumulated Deficit [Member]Cumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated Deficit [Member]Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | Accumulated Deficit [Member]Series A Convertible Preferred Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Other Comprehensive Income (Loss) [Member]Cumulative Effect, Period of Adoption, Adjusted Balance [Member] |
Beginning balances at Dec. 31, 2019 | $ 41,291,000 | $ (103,000) | $ 41,188,000 | $ 780,000 | $ 780,000 | $ 391,605,000 | $ 391,605,000 | $ (110,298,000) | $ (110,298,000) | $ (240,995,000) | $ (103,000) | $ (241,098,000) | $ 199,000 | $ 199,000 | |||||
Beginning balances, shares at Dec. 31, 2019 | 100,206 | ||||||||||||||||||
Beginning balances at Dec. 31, 2019 | $ 106,527,000 | $ 106,527,000 | |||||||||||||||||
Beginning balances, shares at Dec. 31, 2019 | 83,393,514 | ||||||||||||||||||
Accretion of beneficial conversion feature of preferred shares (participating) | $ (48,000) | $ 48,000 | $ (48,000) | ||||||||||||||||
Accrued dividend on preferred stock | (2,181,000) | 2,181,000 | (2,181,000) | ||||||||||||||||
Net issuance of common stock upon exercise of stock options | 117,000 | $ 1,000 | 116,000 | ||||||||||||||||
Net issuance of common stock upon exercise of stock options, shares | 46,875 | ||||||||||||||||||
Net Issuance of common stock upon vesting of restricted stock units, net, shares | 30,084 | ||||||||||||||||||
Net Issuance of common stock upon vesting of performance stock units, net, shares | 16,062 | ||||||||||||||||||
Net Issuance of restricted common stock, net, shares | 1,062,683 | ||||||||||||||||||
Net Issuance of restricted performance common stock, net, shares | 404,746 | ||||||||||||||||||
Employee stock-based compensation costs | 204,000 | 1,989,000 | (1,785,000) | ||||||||||||||||
Adjustment from foreign currency translation | (905,000) | (905,000) | |||||||||||||||||
Net loss | (853,000) | (853,000) | |||||||||||||||||
Ending balances at Mar. 31, 2020 | 37,522,000 | $ 781,000 | 393,710,000 | (112,083,000) | (244,180,000) | (706,000) | |||||||||||||
Ending balances, shares at Mar. 31, 2020 | 100,206 | ||||||||||||||||||
Ending balances at Mar. 31, 2020 | $ 108,756,000 | ||||||||||||||||||
Ending balances, shares at Mar. 31, 2020 | 84,953,964 | ||||||||||||||||||
Beginning balances at Dec. 31, 2019 | 41,291,000 | $ (103,000) | $ 41,188,000 | $ 780,000 | $ 780,000 | 391,605,000 | $ 391,605,000 | (110,298,000) | $ (110,298,000) | (240,995,000) | $ (103,000) | $ (241,098,000) | 199,000 | $ 199,000 | |||||
Beginning balances, shares at Dec. 31, 2019 | 100,206 | ||||||||||||||||||
Beginning balances at Dec. 31, 2019 | $ 106,527,000 | $ 106,527,000 | |||||||||||||||||
Beginning balances, shares at Dec. 31, 2019 | 83,393,514 | ||||||||||||||||||
Adjustment from foreign currency translation | (118,000) | ||||||||||||||||||
Net loss | (3,480,000) | ||||||||||||||||||
Ending balances at Sep. 30, 2020 | 35,842,000 | $ 782,000 | 399,285,000 | (113,015,000) | (251,291,000) | 81,000 | |||||||||||||
Ending balances, shares at Sep. 30, 2020 | 100,206 | ||||||||||||||||||
Ending balances at Sep. 30, 2020 | $ 113,241,000 | ||||||||||||||||||
Ending balances, shares at Sep. 30, 2020 | 85,127,484 | ||||||||||||||||||
Beginning balances at Mar. 31, 2020 | 37,522,000 | $ 781,000 | 393,710,000 | (112,083,000) | (244,180,000) | (706,000) | |||||||||||||
Beginning balances, shares at Mar. 31, 2020 | 100,206 | ||||||||||||||||||
Beginning balances at Mar. 31, 2020 | $ 108,756,000 | ||||||||||||||||||
Beginning balances, shares at Mar. 31, 2020 | 84,953,964 | ||||||||||||||||||
Accretion of beneficial conversion feature of preferred shares (participating) | (47,000) | 47,000 | (47,000) | ||||||||||||||||
Accrued dividend on preferred stock | (2,171,000) | 2,171,000 | (2,171,000) | ||||||||||||||||
Net issuance of common stock upon exercise of stock options | 217,000 | $ 1,000 | 216,000 | ||||||||||||||||
Net issuance of common stock upon exercise of stock options, shares | 67,500 | ||||||||||||||||||
Net Issuance of common stock upon vesting of restricted stock units, net, shares | 75,631 | ||||||||||||||||||
Net Issuance of common stock upon vesting of performance stock units, net, shares | 32,848 | ||||||||||||||||||
Net Issuance of restricted common stock, net, shares | 6,590 | ||||||||||||||||||
Net Issuance of restricted performance common stock, net, shares | (26,666) | ||||||||||||||||||
Employee stock-based compensation costs | 2,454,000 | 3,251,000 | (797,000) | ||||||||||||||||
Adjustment from foreign currency translation | 294,000 | 294,000 | |||||||||||||||||
Net loss | (1,902,000) | (1,902,000) | |||||||||||||||||
Ending balances at Jun. 30, 2020 | 36,368,000 | $ 782,000 | 397,177,000 | (112,880,000) | (248,299,000) | (412,000) | |||||||||||||
Ending balances, shares at Jun. 30, 2020 | 100,206 | ||||||||||||||||||
Ending balances at Jun. 30, 2020 | $ 110,974,000 | ||||||||||||||||||
Ending balances, shares at Jun. 30, 2020 | 85,109,867 | ||||||||||||||||||
Accretion of beneficial conversion feature of preferred shares (participating) | (48,000) | 48,000 | (48,000) | ||||||||||||||||
Accrued dividend on preferred stock | $ (2,219,000) | 2,219,000 | (2,219,000) | ||||||||||||||||
Net Issuance of common stock upon vesting of restricted stock units, net, shares | 7,084 | ||||||||||||||||||
Net Issuance of restricted common stock, net, shares | 10,533 | ||||||||||||||||||
Employee stock-based compensation costs | 1,973,000 | 2,108,000 | (135,000) | ||||||||||||||||
Adjustment from foreign currency translation | 493,000 | 493,000 | |||||||||||||||||
Net loss | (725,000) | (725,000) | |||||||||||||||||
Ending balances at Sep. 30, 2020 | 35,842,000 | $ 782,000 | 399,285,000 | (113,015,000) | (251,291,000) | 81,000 | |||||||||||||
Ending balances, shares at Sep. 30, 2020 | 100,206 | ||||||||||||||||||
Ending balances at Sep. 30, 2020 | $ 113,241,000 | ||||||||||||||||||
Ending balances, shares at Sep. 30, 2020 | 85,127,484 | ||||||||||||||||||
Beginning balances at Dec. 31, 2020 | 34,435,000 | $ 782,000 | 401,646,000 | (113,031,000) | (256,548,000) | 1,586,000 | |||||||||||||
Beginning balances, shares at Dec. 31, 2020 | 100,206 | 100,206 | |||||||||||||||||
Beginning balances at Dec. 31, 2020 | 115,552,000 | $ 115,552,000 | $ 115,552,000 | ||||||||||||||||
Beginning balances, shares at Dec. 31, 2020 | 85,382,484 | ||||||||||||||||||
Accretion of beneficial conversion feature of preferred shares (participating) | (50,000) | 50,000 | (50,000) | ||||||||||||||||
Accrued dividend on preferred stock | $ (2,273,000) | 2,273,000 | (2,273,000) | ||||||||||||||||
Net issuance of common stock upon exercise of stock options | 251,000 | 251,000 | |||||||||||||||||
Net issuance of common stock upon exercise of stock options, shares | 65,000 | ||||||||||||||||||
Net Issuance of common stock upon vesting of restricted stock units, net, shares | 17,397 | ||||||||||||||||||
Net Issuance of common stock upon vesting of performance stock units, net, shares | 11,763 | ||||||||||||||||||
Net Issuance of restricted common stock, net, shares | 39,745 | ||||||||||||||||||
Net Issuance of restricted performance common stock, net, shares | (113,628) | ||||||||||||||||||
Employee stock-based compensation costs | 1,372,000 | 3,477,000 | (2,105,000) | ||||||||||||||||
Adjustment from foreign currency translation | (1,262,000) | (1,262,000) | |||||||||||||||||
Net loss | (2,460,000) | (2,460,000) | |||||||||||||||||
Ending balances at Mar. 31, 2021 | 30,013,000 | $ 782,000 | 405,374,000 | (115,136,000) | (261,331,000) | 324,000 | |||||||||||||
Ending balances, shares at Mar. 31, 2021 | 100,206 | ||||||||||||||||||
Ending balances at Mar. 31, 2021 | $ 117,875,000 | ||||||||||||||||||
Ending balances, shares at Mar. 31, 2021 | 85,402,761 | ||||||||||||||||||
Beginning balances at Dec. 31, 2020 | 34,435,000 | $ 782,000 | 401,646,000 | (113,031,000) | (256,548,000) | 1,586,000 | |||||||||||||
Beginning balances, shares at Dec. 31, 2020 | 100,206 | 100,206 | |||||||||||||||||
Beginning balances at Dec. 31, 2020 | 115,552,000 | $ 115,552,000 | $ 115,552,000 | ||||||||||||||||
Beginning balances, shares at Dec. 31, 2020 | 85,382,484 | ||||||||||||||||||
Adjustment from foreign currency translation | 240,000 | ||||||||||||||||||
Net loss | (7,797,000) | ||||||||||||||||||
Ending balances at Sep. 30, 2021 | 29,411,000 | $ 782,000 | 413,848,000 | (115,530,000) | (271,515,000) | 1,826,000 | |||||||||||||
Ending balances, shares at Sep. 30, 2021 | 100,206 | 100,206 | |||||||||||||||||
Ending balances at Sep. 30, 2021 | 122,722,000 | $ 122,722,000 | $ 122,722,000 | ||||||||||||||||
Ending balances, shares at Sep. 30, 2021 | 85,273,243 | ||||||||||||||||||
Beginning balances at Mar. 31, 2021 | 30,013,000 | $ 782,000 | 405,374,000 | (115,136,000) | (261,331,000) | 324,000 | |||||||||||||
Beginning balances, shares at Mar. 31, 2021 | 100,206 | ||||||||||||||||||
Beginning balances at Mar. 31, 2021 | $ 117,875,000 | ||||||||||||||||||
Beginning balances, shares at Mar. 31, 2021 | 85,402,761 | ||||||||||||||||||
Accretion of beneficial conversion feature of preferred shares (participating) | (51,000) | 51,000 | (51,000) | ||||||||||||||||
Accrued dividend on preferred stock | (2,348,000) | 2,348,000 | (2,348,000) | ||||||||||||||||
Net Issuance of common stock upon vesting of restricted stock units, net, shares | 25,580 | ||||||||||||||||||
Net Issuance of restricted common stock, net, shares | (35,969) | ||||||||||||||||||
Employee stock-based compensation costs | 4,105,000 | 4,423,000 | (318,000) | ||||||||||||||||
Adjustment from foreign currency translation | 1,463,000 | 1,463,000 | |||||||||||||||||
Net loss | (2,931,000) | (2,931,000) | |||||||||||||||||
Ending balances at Jun. 30, 2021 | $ 30,251,000 | $ 782,000 | 409,797,000 | (115,454,000) | (266,661,000) | 1,787,000 | |||||||||||||
Ending balances, shares at Jun. 30, 2021 | 100,206 | ||||||||||||||||||
Ending balances at Jun. 30, 2021 | $ 120,274,000 | ||||||||||||||||||
Ending balances, shares at Jun. 30, 2021 | 85,392,372 | ||||||||||||||||||
Accretion of beneficial conversion feature of preferred shares (participating) | (52,000) | 52,000 | (52,000) | ||||||||||||||||
Accrued dividend on preferred stock | $ (2,396,000) | $ 2,396,000 | $ (2,396,000) | ||||||||||||||||
Net issuance of common stock upon exercise of stock options, shares | 0 | ||||||||||||||||||
Net Issuance of common stock upon vesting of restricted stock units, net, shares | 4,583 | ||||||||||||||||||
Net Issuance of restricted common stock, net, shares | (89,702) | ||||||||||||||||||
Net Issuance of restricted performance common stock, net, shares | (34,010) | ||||||||||||||||||
Employee stock-based compensation costs | $ 3,975,000 | 4,051,000 | (76,000) | ||||||||||||||||
Adjustment from foreign currency translation | 39,000 | 39,000 | |||||||||||||||||
Net loss | (2,406,000) | (2,406,000) | |||||||||||||||||
Ending balances at Sep. 30, 2021 | 29,411,000 | $ 782,000 | $ 413,848,000 | $ (115,530,000) | $ (271,515,000) | $ 1,826,000 | |||||||||||||
Ending balances, shares at Sep. 30, 2021 | 100,206 | 100,206 | |||||||||||||||||
Ending balances at Sep. 30, 2021 | $ 122,722,000 | $ 122,722,000 | $ 122,722,000 | ||||||||||||||||
Ending balances, shares at Sep. 30, 2021 | 85,273,243 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Operating activities: | ||
Net loss | $ (7,797) | $ (3,480) |
Non-cash items in net loss: | ||
Depreciation and amortization | 28,326 | 23,604 |
Amortization of debt issuance costs | 979 | 970 |
Employee stock-based compensation costs | 11,954 | 7,349 |
Noncash lease costs | 4,027 | 2,189 |
Changes in deferred taxes | (1,131) | (154) |
Changes in operating assets and liabilities: | ||
Receivables | (2,456) | (5,239) |
Prepaid and other current assets | 985 | 1,014 |
Deferred costs and other assets | 403 | (681) |
Accounts payable | 1,967 | 3,321 |
Deferred revenue | 887 | (922) |
Earn-out payment | (400) | |
Accrued and other liabilities | (2,265) | (3,726) |
Net cash provided by operating activities | 35,479 | 24,245 |
Investing activities: | ||
Purchases of property, equipment and internal-use software | (12,832) | (13,992) |
Acquisition of business, net of cash acquired | (339) | |
Net cash used in investing activities | (13,171) | (13,992) |
Financing activities: | ||
Proceeds of long-term debt | 6,000 | |
Proceeds from exercise of stock options | 251 | 334 |
Repayment of long-term debt | (1,654) | (1,388) |
Repayment of finance lease liabilities | (528) | (1,086) |
Purchase of treasury shares | (2,499) | (2,717) |
Payment of acquisition related contingent consideration | (1,125) | |
Net cash (used in) provided by financing activities | (4,430) | 18 |
Effect of exchange rate on cash | (267) | 42 |
Increase in cash and cash equivalents | 17,611 | 10,313 |
Cash and cash equivalents, beginning of period | 21,362 | 13,349 |
Cash and cash equivalents, end of period | $ 38,973 | $ 23,662 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The accompanying condensed consolidated financial statements of Zix Corporation (“Zix” the “Company,” “we,” “our” or “us”) should be read in conjunction with the audited consolidated financial statements included in the Company’s 2020 Annual Report on Form 10-K. These financial statements are unaudited, but have been prepared in the ordinary course of business for the purpose of providing information with respect to the covered interim periods. Management of the Company believes that all adjustments necessary for a fair presentation for such periods have been included and are of a normal recurring nature. Our interim period operating results are not necessarily indicative of the results to be expected for any future periods or for the full fiscal year. The preparation of financial statements and related disclosures in accordance with accounting principles generally accepted in the United States of America requires the Company’s management to make estimates and assumptions that affect reported amounts and disclosures. These estimates and assumptions take into account historical and forward-looking factors that the Company believes are reasonable, including but not limited to the potential impacts arising from the recent coronavirus (COVID-19), and variants thereof, and public and private sector policies and initiatives aimed at reducing its transmission. As the extent and duration of the impacts of COVID-19 and its variants remain unclear, the Company’s estimates and assumptions may evolve as conditions change. Actual results could differ significantly from those estimates. |
Recent Accounting Standards and
Recent Accounting Standards and Pronouncements | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Changes And Error Corrections [Abstract] | |
Recent Accounting Standards and Pronouncements | 2. Recent Accounting Standards and Pronouncements Income Taxes On January 1, 2021, we adopted Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes by eliminating certain exceptions related to the approach for intraperiod tax allocation, the tax basis of goodwill after a business combination, and the recognition of deferred tax liabilities for outside basis differences. The adoption of this standard did not have a material impact on our condensed consolidated financial statements. |
Stock- Based Awards and Stock-B
Stock- Based Awards and Stock-Based Employee Compensation Expense | 9 Months Ended |
Sep. 30, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock- Based Awards and Stock-Based Employee Compensation Expense | 3. Stock-Based Awards and Stock-Based Employee Compensation Expense Our stock-based awards include (i) stock options, (ii) restricted stock awards, some of which are subject to time-based vesting (“Restricted Stock”) and some of which are subject to performance-based vesting (“Performance Stock”), and (iii) restricted stock units, some of which are subject to time-based vesting (“RSUs”) and some of which are subject to performance-based vesting (“Performance RSUs”). As of September 30, 2021, the Company had 777,010 stock options outstanding, 1,077,562 non-vested Restricted Stock awards; 519,267 non-vested Performance Stock awards; 1,903,992 non-vested RSUs; and 796,582 non-vested Performance RSUs. On June 9, 2021, the Zix Corporation 2021 Omnibus Incentive Plan (the “2021 Plan”) received the requisite shareholder approval and became effective immediately. The 2021 Plan replaced the Zix Corporation Amended and Restated 2018 Incentive Plan (the “Prior Incentive Plan”). The 2021 Plan has 5,650,000 of shares of common stock reserved for issuance which includes a reserve for the incremental shares that would be required if performance awards issued from the Prior Incentive Plan achieve maximum target performance. As of September 30, 2021, there were 4,279,814 shares of common stock available for grant. Stock Option Activity The following is a summary of all stock option transactions during the three months ended September 30, 2021: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Yrs) Outstanding at June 30, 2021 777,010 $ 4.45 5.03 Granted at market price — — Cancelled or expired — — Exercised — — Outstanding at September 30, 2021 777,010 $ 4.45 4.78 Options exercisable at September 30, 2021 633,260 $ 3.81 3.86 At September 30, 2021, 677,010 stock options outstanding and 595,760 stock options exercisable had an exercise price lower than the market price of the Company’s common stock on that date. The aggregate intrinsic value of these stock options was $2.1 million and $2.1 million, respectively. Restricted Stock Activity The following is a summary of Restricted Stock activity during the three months ended September 30, 2021: Restricted Shares Weighted Average Fair Value Non-vested restricted stock at June 30, 2021 1,215,243 $ 7.61 Granted at market price — — Vested (47,979 ) 8.23 Cancelled (89,702 ) 8.03 Non-vested restricted stock at September 30, 2021 1,077,562 $ 7.54 Restricted Stock Unit Activity The following is a summary of all RSU activity during the three months ended September 30, 2021: Restricted Stock Units Weighted Average Fair Value Non-vested restricted stock units at June 30, 2021 1,845,868 $ 7.35 Granted at market price 177,261 6.87 Vested (12,535 ) 7.95 Cancelled (106,602 ) 7.14 Non-vested restricted stock units at September 30, 2021 1,903,992 $ 7.31 Performance RSU Activity The following is a summary of all Performance RSU activity during the three months ended September 30, 2021: Performance RSUs Weighted Average Fair Value Non-vested performance RSUs at June 30, 2021 820,740 $ 7.39 Granted at market price — — Vested — — Forfeited (24,158 ) 7.13 Non-vested performance RSUs at September 30, 2021 796,582 $ 7.39 Performance Stock Activity The following is a summary of all Performance Stock activity during the three months ended September 30, 2021: Performance Stock Weighted Average Fair Value Non-vested performance stock at June 30, 2021 553,277 $ 7.50 Granted at market price — — Vested — — Forfeited (34,010 ) 7.31 Non-vested performance stock at September 30, 2021 519,267 $ 7.51 The weighted average grant-date fair value of awards of Restricted Stock, RSUs, Performance RSUs and Performance Stock is based on the quoted market price of the Company’s common stock on the date of grant. Stock-Based Compensation Expense For the nine month period ended September 30, 2021, the total stock-based employee compensation expense (excluding $373 thousand payroll tax expense resulting from the vesting of employees’ equity awards) resulting from stock options, Restricted Stock, RSUs, Performance RSUs and Performance Stock was recorded to the following line items of the Company’s condensed consolidated statement of comprehensive loss: (In thousands) Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Cost of revenues $ 134 $ 503 Research and development 513 1,986 Selling, general and administrative 3,404 9,465 Stock-based compensation expense $ 4,051 $ 11,954 A deferred tax asset totaling $2.4 million and $1.4 million, resulting from stock-based compensation expense associated with awards relating to the Company’s U.S. operations, was recorded for the nine month periods ended September 30, 2021 and 2020, respectively. As of September 30, 2021, there was $23.6 million of total unrecognized stock-based compensation expense related to non-vested stock-based compensation awards granted. This expense is expected to be recognized over a weighted average period of 1.97 years. For additional information regarding the Company’s Equity Awards and Stock-based Employee Compensation, see Note 3, Stock Options and Stock-Based Employee Compensation |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Sep. 30, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | 4. Supplemental Cash Flow Information Supplemental cash flow information relating to taxes, interest and non-cash activities: Nine Months Ended September 30, (In thousands) 2021 2020 Interest payments $ 5,028 5,812 Income tax payments 373 217 Non-cash investing and financing activities: Accrued and deemed dividends on Series A preferred stock 7,170 6,714 |
Receivables, Net
Receivables, Net | 9 Months Ended |
Sep. 30, 2021 | |
Receivables [Abstract] | |
Receivables, Net | 5. Receivables, net (In thousands) September 30, 2021 December 31, 2020 Gross accounts receivables $ 32,679 $ 30,188 Allowance for credit losses (469 ) (478 ) Unpaid portion of deferred revenue (12,893 ) (12,879 ) Note receivable 458 458 Allowance for note receivable (458 ) (458 ) Receivables, net $ 19,317 $ 16,831 Accounts receivable are recorded at cost less an allowance for credit losses. We estimate losses on receivables at the reporting date based on expected losses resulting from the inability of our customers to make required payments, including our historical experience of actual losses and the aging of such receivables. These receivables have been pooled by shared risk characteristics. Based on known information we may also establish specific reserves for customers in an adverse financial condition or adjust our expectations of changes in conditions that may impact the collectability of outstanding receivables. As of September 30, 2021, based on available information to date, the Company assessed no material impact related to potential losses caused by COVID-19. The reduction for the unpaid portion of deferred revenue represents future customer service or maintenance obligations that have been billed to customers, but remain unpaid as of the respective balance sheet dates. Deferred revenue on our consolidated balance sheets represents future customer service or maintenance obligations that have been billed and collected as of the respective balance sheet dates. The note receivable represents the remaining outstanding balance of an original note related to the sale of a product line in 2005 in the amount of $540 thousand. This was fully reserved at the time of the sale, as the note’s collectability was not assured. The note receivable is fully reserved at September 30, 2021. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Leases | 6. Leases The Company determines if a contract is or contains a lease at inception. The Company has operating leases for office spaces and data centers and finance leases for equipment. The Company has entered into lease contracts ranging from 1 to 12 years with the majority of leases having terms one to seven years, many of which include options to extend in various increments. Variable lease costs consist primarily of variable common area maintenance, taxes, insurance, parking and utilities. The Company’s leases do not have any residual value guarantees or restrictive covenants. As the implicit rate is not readily determinable for most of the Company’s lease agreements, the Company uses an estimated incremental borrowing rate to determine the initial present value of lease payments. These discount rates for leases are calculated using the Company's weighted average interest rate of the term loan and delayed draw term loan. The components of lease costs are as follows: Three Months ended September 30, Nine Months ended September 30, (In thousands) 2021 2020 2021 2020 Finance lease costs: Amortization of right-of-use assets $ 157 $ 261 $ 565 $ 949 Interest on lease liabilities 4 18 21 71 Operating lease costs 1,483 785 4,461 2,658 Short-term lease costs 485 493 1,417 1,490 Variable lease costs 508 165 1,017 649 Total lease costs $ 2,637 $ 1,722 $ 7,481 $ 5,817 Supplemental cash flow information related to leases are as follows: Three Months ended September 30, Nine Months ended September 30, (In thousands) 2021 2020 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 1,450 $ 961 $ 4,309 $ 2,897 Operating cash flows related to finance leases 4 18 21 71 Financing cash flows related to finance leases 165 340 528 1,086 Right-of-use assets obtained in exchange for lease obligations: Operating leases 415 (333 ) 748 523 Finance leases — — — — Supplemental balance sheet information related to leases are as follows: September 30, December 31, (In thousands) Balance Sheet Classification 2021 2020 Operating Leases Operating lease right-of- use assets Operating lease assets $ 10,994 $ 14,259 Total operating lease assets $ 10,994 $ 14,259 September 30, December 31, (In thousands) Balance Sheet Classification 2021 2020 Finance Leases Finance lease right-of-use assets $ 3,362 $ 3,362 Accumulated depreciation - finance leases (3,047 ) (2,490 ) Finance lease right-of-use assets, net Property and equipment, net $ 315 $ 872 Weighted average remaining lease term and weighted average discount rate are as follows: Weighted Average Remaining Lease Term (Years) 2021 2020 Operating leases 2.83 4.06 Finance leases 0.88 1.53 Weighted Average Discount Rate Operating leases 4.31 % 4.95 % Finance leases 6.10 % 6.14 % Maturities of lease liabilities are as follows: Payments Due by Period - Year Ending December 31, 2021 (In thousands) Total Year 1 (1) Years 2 & 3 Years 4 & 5 Beyond 5 Years Operating leases $ 12,774 $ 1,534 $ 8,924 $ 2,234 $ 82 Less imputed interest (680 ) Total $ 12,094 Finance leases $ 193 $ 77 $ 116 $ — $ — Less imputed interest (5 ) Total $ 188 (1) |
Long-term Debt
Long-term Debt | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Long-term Debt | 7. Long-term Debt On February 20, 2019, the Company entered into a credit agreement (the “Credit Agreement”) with a syndicate of lenders and SunTrust Bank as administrative agent, which (1) provided for borrowing in the form of a senior secured term loan facility in an aggregate principal amount of $175 million (the “Term Loan”), (2) provided for a senior secured delayed draw term loan facility in an aggregate principal amount of $10 million (the “Delayed Draw Term Loan Facility”), and (3) provided for a senior secured revolving credit facility in an aggregate principal amount of $25 million, up to $5 million of which is available for letters of credit (the “Revolving Facility” and, together with the Term Loan and the Delayed Draw Term Loan Facility, the “Credit Facilities”). On February 20, 2019, the Term Loan was borrowed in full to pay a portion of the purchase price in connection with the AppRiver acquisition including certain fees, costs and expenses related thereto. On May 2, 2019, the Delayed Draw Term Loan Facility was borrowed in full to pay a portion of the purchase price in connection with the DeliverySlip acquisition , including certain fees, costs and expenses related thereto. On November 5, 2020, the Company amended its Credit Agreement to, among other things, borrow an incremental $35.0 million term loan (the “Incremental Term Loan”). The Incremental Term Loan has the same interest rate, maturity date, amortization schedule, collateral and other terms as the existing Term Loan and Delayed Draw Term Loan. The Company used the proceeds of the Incremental Term Loan to fund the acquisition of CloudAlly (described below in Note 16 “Acquisitions”) and to repay all existing borrowing under the Revolving Facility. As of September 3 0 , 202 1 , the Company had no outstanding debt attributable to the Revolving Facility. The Credit Facilities are secured by substantially all the assets of Zix and its wholly owned domestic subsidiaries and guaranteed by substantially all of Zix’s wholly owned domestic subsidiaries. Borrowings under the Credit Agreement bear interest, at the Company’s option, at either (1) the adjusted LIBOR rate (as defined in the Credit Agreement) plus a margin ranging from 2.50% to 3.50% or (2) the alternate base rate (as defined in the Credit Agreement) plus a margin ranging from 1.50% to 2.50%. The applicable margin varies depending on the Company’s total net leverage ratio. One-week and 2-month U.S dollar LIBOR and all remaining U.S dollar LIBOR settings are set to be phased out at December 31, 2021 and June 30, 2023, respectively. We are currently reviewing how the LIBOR rate phase out will affect us, but we do not expect the impact to be material. The Credit Facilities are scheduled to mature on February 20, 2024, unless extended in accordance with the terms of the Credit Agreement. The Credit Agreement includes procedures for additional financial institutions to become lenders, or for any existing lender to increase its commitments thereunder, subject to the limits and conditions set forth in the Credit Agreement. Optional prepayments of borrowings under the Credit Facilities are permitted at any time and do not require any prepayment premium (other than reimbursement of the lenders’ breakage and redeployment costs in the case of a prepayment of LIBOR borrowings). The Credit Agreement contains various financial, operational, and legal covenants. The financial covenant is tested on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter. The financial covenant requires the Company to maintain a maximum total net leverage ratio of: • 4.50:1.00 for the fiscal quarters ending June 30, 2021 through December 31, 2021; and • 4.25:1.00 for the fiscal quarter ending March 31, 2022 and each fiscal quarter thereafter. The non-financial covenants restrict the Company’s ability and the ability of the Company’s restricted subsidiaries to, among other things, incur indebtedness, incur liens, merge with or acquire other entities, make investments, dispose of assets, enter into sale and leaseback transactions, make dividends, distributions or stock repurchases, prepay junior indebtedness, enter into transactions with affiliates, enter into restrictive agreements, and amend organizational documents or the terms of junior indebtedness. The Credit Agreement contains events of default that Zix believes are customary for a secured credit facility. If an event of default relating to bankruptcy or other insolvency events occurs, all obligations under the Credit Agreement will immediately become due and payable. If any other event of default exists under the Credit Agreement, the lenders may accelerate the maturity of the Credit Facilities and exercise other rights and remedies, including foreclosure or other actions against the collateral. If any default exists under the Credit Agreement, or if the Company is unable to make any of the representations and warranties in the Credit Agreement at the applicable time, Zix will be unable to borrow additional funds or have letters of credit issued under the Credit Agreement. Term Loan and Incremental Term Loan (“Combined Term Loan”) As of September 30, 2021, the Company had $205.3 million in principal outstanding under the Term Loan. The Term Loan was fully drawn on February 20, 2019 in the amount of $175 million, and requires quarterly payments of principal of $437 thousand beginning on June 30, 2019. The Incremental Loan was fully drawn on November 5, 2020 in the amount of $35.0 million, and requires quarterly payments of principal of $89 thousand beginning on December 31, 2020. In addition to other customary mandatory prepayment requirements, the Term Loan requires annual prepayments based on a percentage of Zix’s excess cash flow, which percentage will reduce if Zix’s total net leverage ratio decreases. Based on the calculation of excess cash flow and total net leverage ratio and for the year ended December 31, 2020, the Company is not required to make a prepayment in addition to the quarterly installment. At September 30, 2021, the Company had an outstanding debt balance of $201.4 million attributable to the Combined Term Loan based on the 4.21% and 4.12% interest rate in effect during the three- and nine-month period ended on September 30, 2021, respectively. Included in the balance at September 30, 2021 is $3.9 million of unamortized debt issuance costs. Future principal payments under the Combined Term Loan as of September 30, 2021 are as follows: (In thousands) Year Ending December 31, Amount 2021 $ 526 2022 2,105 2023 2,106 2024 200,533 $ 205,270 Delayed Draw Term Loan Facility At September 30, 2021, the Company had $9.8 million in principal outstanding under the Delayed Draw Term Loan Facility. The Delayed Draw Term Loan Facility was fully drawn on May 2, 2019 in the amount of $10 million to fund the DeliverySlip acquisition. The Delayed Draw Term Loan Facility requires 1.00% per annum amortization of the original principal amount borrowed, payable in equal quarterly installments of $25 thousand beginning on September 30, 2019. In addition to other customary mandatory prepayment requirements, the Delayed Draw Term Loan Facility requires annual prepayments based on a percentage of Zix’s excess cash flow, which percentage reduces if Zix’s total net leverage ratio decreases. Based on the calculation of excess cash flow and total net leverage ratio and for the year ended December 31, 2020, the Company is not required to make a prepayment in addition to the quarterly installment. At September 30, 2021, the Company had an outstanding debt balance of $9.7 million attributable to the Delayed Draw Term Loan Facility based on the 3.59% and 3.51% interest rate in effect during the three- and nine-month period ended September 30, 2021. Included in the balance at September 30, 2021 is $33 thousand of unamortized debt issuance costs. Future principal payments under the Delayed Draw Term Loan Facility as of September 30, 2021 are as follows: (In thousands) Year Ending December 31, Amount 2021 $ 25 2022 100 2023 100 2024 9,550 $ 9,775 Revolving Facility The Company also has a Revolving Facility with the lenders, pursuant to which the lenders agreed to make a Revolving Facility available to the Company in an aggregate amount of up to $25 million. Proceeds from the Revolving Facility may be used for working capital and general business purposes, including the financing of permitted acquisitions, investments and restricted payments, subject, in both cases, to the conditions contained in the Credit Agreement. Zix is charged a commitment fee ranging from 0.25% to 0.50% per year on the daily amount of the unused portions of the commitments under the Revolving Facility. As of September 30, 2021, the Company had no outstanding debt attributable to the Revolving Facility. The undrawn balance of $25 million is available to fund working capital and for other general corporate purposes, including the financing of permitted acquisitions, investments and restricted payments, subject to the conditions contained in the Credit Agreement. The Company incurred $24 and $71 thousand of commitment fees for the three- and nine-month period ended September 30, 2021. As of September 30, 2021, the estimated fair value of the Credit Facilities approximated their carrying value and the Company was in compliance with all covenants in the Credit Agreement. |
Preferred Stock
Preferred Stock | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Preferred Stock | 8. Preferred Stock On February 20, 2019, (the “Original Issuance Date” or “Closing Date”), Zix consummated a private placement pursuant to an investment agreement with an investment fund managed by True Wind Capital and issued an aggregate of $100 million of shares of convertible Preferred Stock (as defined below) at a price of $1,000 per share (the “Stated Value”). 64,914 shares of Series A Convertible Preferred Stock (the “Series A Preferred Stock”) were issued for proceeds of $62.7 million, net of issuance costs of $2.3 million , and 35,086 shares of Series B Convertible Preferred Stock (the “Series B Preferred Stock” and , together with the Series A Preferred Stock, the “Preferred Stock”) were issued for proceeds of $ million, net of issuance costs of $ million. The Preferred Stock is classified outside of stockholders’ equity in temporary equity because the shares contain certain redemption features which require redemption upon a change in control. The Series A Preferred Stock can be immediately converted to common stock . On June 5, 2019, Shareholders approved the conversion of the outstanding shares of Series B Preferred Stock into shares of Series A Preferred Stock. Each share of Series B Preferred Stock was converted into the number of shares of Series A Preferred Stock equal to the liquidation preference of such share of Series B Preferred Stock divided by the accreted value of a share of Series A Preferred Stock on the date of conversion plus cash in lieu of fractional shares. On June 6, 2019, all the outstanding shares of Series B Preferred Stock were converted into 35,292 shares of Series A Preferred Stock. As of September 30, 2021, no shares of Series B Preferred Stock are outstanding. The conversion option of the Series A Preferred Stock was determined to have a beneficial conversion feature valued at $2.5 million, excluding the additional beneficial conversion feature accrued for the deemed dividend, and was recorded to additional paid-in capital and as a discount to the Series A Preferred Stock. This resulting discount was immediately amortized as the Series A Preferred Stock has no set redemption date but is currently convertible. Dividends The Stated Value of the Series A Preferred Stock accretes at a fixed rate of 8% per annum, compounded quarterly (“Series A Preferred Dividend”). Apart from the Series A Preferred Dividend, the holders of Series A Preferred Stock are also entitled to receive any dividends paid on our common stock on an "as converted" basis. No dividend may be paid on our common stock until such dividend is paid on the Series A Preferred Stock. All calculations of the Accreted Value (as defined below) of Series A Preferred Stock will be computed on the basis of a 360-day year of twelve 30-day months. As of September 30, 2021, the accretion of the Stated Value of Series A Preferred Stock is valued at $22.0 million. Voting Rights Holders of Series A Preferred Stock are entitled to vote, together with the holders of common stock on all matters submitted to a vote of the holders of our common stock. Each holder of Series A Preferred Stock shall be entitled to the number of votes equal to the largest number of whole shares of common stock into which all shares of Series A Preferred Stock held by such holder could be converted. The vote or consent of the holders of at least a majority of the shares of Series A Preferred Stock outstanding will be necessary for effecting or validating any of the following actions: (i) any amendment, alteration or repeal of Zix’s Articles of Incorporation or Series A Certification of Designations that would adversely affect the rights, preferences, privileges or power of the Series A Preferred Stock; (ii) any amendment or alteration to Zix’s Articles of Incorporation or any other action to authorize or create, or increase the number of authorized or issued shares of capital stock of the Company convertible into shares of, or ranking senior to, or on a parity basis with, the Series A Preferred Stock as to dividend rights or liquidation rights; (iii) the issuance of shares of Series A Preferred Stock after the Original Issuance Date other than in connection with the conversion of Series B Preferred Stock that was issued on the Original Issuance Date; (iv) any action that would cause the Company to cease to be treated as a domestic corporation for U.S. federal income tax purposes; and (v) the incurrence of any indebtedness of the Company that would cause Zix to exceed a specified leverage ratio. Liquidation Preference The Series A Preferred Stock has a liquidation preference equal to the greater of (i) the Stated Value per share as it has accreted as of such date (the “Accreted Value”) and (ii) the amount such holder would have received if the Series A Preferred Stock had converted into common stock immediately prior to such liquidation. Conversion At any time, each Series A Preferred Stock holder may elect to convert each share of such holders’ then-outstanding Series A Preferred Stock into (i) the number of shares of common stock equal to the product of (a) the Accreted Value with respect to such share on the conversion date multiplied by (b) the conversion rate (currently 166.11) as of the applicable conversion date divided by (c) 1,000 plus (ii) cash in lieu of fractional shares. Optional Redemption by Zix At any time after the fourth anniversary of the Closing Date, Zix may redeem the Series A Preferred Stock for an amount per share of Series A Preferred Stock equal to the Accreted Value per share of the Series A Preferred Stock to be redeemed as of the applicable redemption date multiplied by 1.50. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 30, 2021 | |
Revenue From Contract With Customer [Abstract] | |
Revenue from Contracts with Customers | 9. Revenue from Contracts with Customers Accounting policies Our Company provides message security solutions as subscription services in which we recognize revenue as our services are rendered. Certain customers commit to contract terms ranging from one to three year. The Company typically invoices in either annual or monthly installments. Deferred revenue is recognized when payments are received in advance of revenue recognition from our subscription and other services. We exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by our Company from a customer (e.g., sales, use, value added, and some excise taxes). Disaggregation of Revenue In the nine months ended September 30, 2021, excluding our CloudAlly business, we recorded revenue for our services in the following core industry verticals: 20% healthcare, 16% financial services, 3% government sector, and 61% as other. In the first nine months of 2020, we categorized our revenue in the following core industry verticals: 21% healthcare, 17% financial services, 3% government sector, and 59% as other. We operate as a single Contract balances Our contract assets include our accounts receivables, discussed above in Footnote 5 “Receivables, net”, and the deferred cost associated with commissions earned by our sales team on securing new, add-on, and renewal contract orders. During the three and nine months ended September 30, 2021, we increased our noncurrent deferred contract asset by $1.1 million and $2.9 million, respectively, resulting from commissions earned by our sales team during the three and nine months ended September 30, 2021. We also amortized $1.1 million and $3.3 million of deferred cost as a selling and marketing expense in the same periods. Our deferred cost asset is assessed for impairment on a periodic basis. There were no impairment losses recognized on deferred contract cost assets for the three and nine months ended September 30, 2021. Our contract liabilities consist of deferred revenue representing future customer services which have been billed and collected. The $969 thousand increase to our net deferred revenue in the nine months ended September 30, 2021, is related to the timing of orders and payments. Performance obligations As of September 30, 2021, the aggregate amount of the transaction prices allocated to remaining service performance obligations, which represents the transaction price of firm orders less inception to date revenue, was $82.8 million. We expect to recognize approximately $27.8 million of revenue related to this backlog during the remainder of 2021, $40.2 million in 2022, and $14.8 million in periods thereafter. Approximately $27.7 million of our $64.9 million revenue recognized in the three months ended September 30, 2021, was included in our performance obligation balance at the beginning of the period. Approximately $54.6 million of our $187.7 million recognized in the nine months ended September 30, 2021, was included in our performance obligation balance at the beginning of the period. |
Earnings (Loss) Per Share and P
Earnings (Loss) Per Share and Potential Dilution | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share and Potential Dilution | 10. Earnings (Loss) Per Share and Potential Dilution Basic earnings (loss) per share are computed using the weighted average number of common shares outstanding for the applicable period under the Treasury Stock method. As applicable, the dilutive effect of potential common shares outstanding is included in diluted earnings (loss) per share. Basic and diluted net loss per common share was the same for all periods presented as the impact of all potentially dilutive securities outstanding was anti-dilutive. The following table presents the potentially dilutive common shares outstanding that were excluded from the computation of dilutive net loss per share of common stock for the periods presented because including them would have been anti-dilutive: September 30, September 30, 2021 2020 Stock options to purchase common stock 777,010 742,010 Restricted Stock 1,077,562 2,090,745 RSUs 1,903,992 153,099 Performance RSUs 796,582 44,349 Performance Stock 519,267 691,852 Preferred Stock 20,301,575 18,759,956 Potential dilutive common shares 25,375,988 22,482,011 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies We have not entered into any material, non-cancelable purchase commitments at September 30, 2021. Claims and Proceedings We are from time to time involved in legal claims, litigation, and other legal proceedings. Although we may incur significant expenses in those matters, we expect no material adverse effect on our operations or financial results from current or concluded legal proceedings. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 12. Fair Value Measurements FASB guidance regarding fair value measurement establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices for similar assets and liabilities in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. For certain of the Company’s financial instruments, including cash and cash equivalents, trade receivables, and accounts payable, the fair values approximate the carrying values due to the short-term maturities of these instruments. The carrying values of other current assets and accrued expenses are also not recorded at fair value, but approximate fair values primarily due to their short-term nature. |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill | 13. Goodwill The following is a summary of the changes in the carrying amount of goodwill for the nine month periods ended September 30, 2021 and 2020: Nine Months ended September 30, (In thousands) 2021 2020 Opening balance $ 195,013 $ 171,209 Acquisition adjustments 729 — Effect of currency translation adjustment (55 ) (279 ) Goodwill $ 195,687 $ 170,930 The increase to our goodwill in the nine months ended September 30, 2021 is due to fair value adjustment of our acquired intangible assets and deferred revenue liability as well as the final working capital adjustment of our CloudAlly acquisition completed on November 5, 2020. S . We evaluate goodwill for impairment annually in the fourth quarter, or when there is a reason to believe that the value has been diminished or impaired. There were no impairments to goodwill during the periods presented above. |
Other Comprehensive Loss
Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2021 | |
Other Comprehensive Income Loss Tax [Abstract] | |
Other Comprehensive Loss | 14. Other Comprehensive Loss The assets and liabilities of international subsidiaries are translated from the respective local currency to the U.S. dollar using exchange rates at the balance sheet date. Related translation adjustments are recorded as a component of the accumulated other comprehensive income (loss). Our Consolidated Statement of Comprehensive Loss of international subsidiaries are translated from the local currency to the U.S. dollar using average exchange rates for the period covered by the income statements. We are exposed to fluctuations in the foreign currency exchange rates as a result of our net investments and operations in Canada, United Kingdom, Switzerland, Germany, Spain and Israel. For the nine months ended September 30, 2021, movements in currency exchange rates and the related impact on the translation of the balance sheets of our foreign subsidiaries was the primary cause of our foreign currency translation gain of $240 thousand, net of $14 thousand in income tax benefit. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 15. Income Taxes The operating losses incurred by the Company’s U.S. operations in past years and the resulting net operating losses for U.S. Federal tax purposes are subject to a $22.9 million reserve. Any change to this $22.9 million valuation allowance is based on an assessment of future utilization following accounting guidance, which relies largely on historical and projected earnings. For this reason, the Company has recognized its first, second and third quarter 2021 federal deferred tax provision in full. If in prospective periods we conclude our future U.S. federal taxable estimate established at the end of the year will exceed the prior year estimate, the Company will offset its federal deferred tax provision by reducing its valuation allowance by an equal amount, thereby eliminating from its deferred tax provision federal taxes from the Company’s financial statements. The Company will continue to reevaluate the need for its valuation allowance each quarter, following the same assessment methodology described above. An increase or decrease to our valuation allowance could have a significant impact on operating results for each period that it becomes more likely than not that an additional portion of our deferred tax assets will or will not be realized. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
Acquisitions | 16. Acquisitions Acquisition of CloudAlly On November 5, 2020, Zix acquired 100% of the equity interest of CloudAlly Ltd. (“CloudAlly”) and its parent holding company for a total purchase price of $30.8 million, following a working capital adjustment. The purchase price included cash consideration of $30.4 million, net of cash acquired. The Company used a portion of the proceeds of the Incremental Term Loan (as defined in Note 7) to fund the acquisition of CloudAlly. Founded in 2011, CloudAlly, based in Israel, is a pioneer of enterprise-grade, software-as-a-service (SaaS) cloud backup and recovery solutions. The company offers a robust suite of award-winning, ISO 27001 certified and GDPR/HIPAA compliant solutions for Microsoft Office 365, Google Workspace (formerly G Suite), SharePoint, OneDrive, Salesforce, Box and Dropbox. CloudAlly is a channel-first provider, serving more than 5,000 customers, 500,000 users and supported by 300 Managed Service Provider (MSP) partners. The Company incurred $2.0 million in acquisition-related costs which included $1.8 million and $229 thousand recorded within the operating expenses during the twelve months ended December 31, 2020 and the nine months ended September 30, 2021, respectively. Revenue from CloudAlly was $2.1 and $7.0 million for the three and nine months ended September 30, 2021, and due to the continued integration of the combined business, it was impractical to determine earnings attributable to CloudAlly. We accounted for the acquisition as the purchase of a business and recorded the excess purchase price as goodwill. The majority of the goodwill balance is expected to be deductible for tax purposes. The intangible assets we acquired from CloudAlly are technology, customer relationships, and trademarks/names which we are each amortizing over a 4 year period. The results of operations and the provisional fair values of the acquired assets and liabilities have been included in the accompanying condensed consolidated financial statements since the CloudAlly acquisition closed on November 5, 2020. The following table summarizes the current estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 1,385 Property and equipment 116 Operating lease assets 5,080 Trademark/Names 200 Technology 6,300 Customer relationships 3,500 Goodwill 23,041 Total assets 39,622 Liabilities: Current liabilities $ 654 Deferred revenue 1,400 Operating lease liabilities 5,080 Deferred tax liability 1,646 Total liabilities 8,780 Net assets recorded $ 30,842 Pro Forma Financial Information (Unaudited) The following unaudited pro forma financial information presents the combined results of operations for the three and nine month periods ending September 30, 2021 and 2020, respectively, as though the CloudAlly acquisition that occurred during the reporting period had occurred as of the beginning of the period presented, with adjustments, such as amortization expense of intangible assets and acquisition-related transaction costs, to give effect to pro forma events that are directly attributable to the acquisitions. These unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the respective acquisitions had occurred at the beginning of the period presented, nor are they indicative of future results of operations: Three Months Ended September 30, Nine Months Ended September 30, (In thousands, except per share data) 2021 2020 2021 2020 Revenues $ 64,863 $ 56,787 $ 187,751 $ 166,453 Net income (2,336 ) (542 ) (7,559 ) (4,432 ) Basic income per share attributed to common shareholders $ (0.09 ) $ (0.05 ) $ (0.27 ) $ (0.21 ) Diluted income per share attributed to common shareholders $ (0.09 ) $ (0.05 ) $ (0.27 ) $ (0.21 ) |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events On November 7, 2021, the Company entered into a definitive merger agreement (the “Merger Agreement”) with Open Text Corporation (“OpenText”). Pursuant to the Merger Agreement, upon the terms and subject to the conditions thereof, Open Text will form a wholly owned subsidiary (“Merger Sub”), which will commence a tender offer (the “Offer”), no later than November 22, 2021, to acquire all of the outstanding shares of common stock of the Company (the “Shares”) for $8.50 per Share in cash. The obligation of Merger Sub to purchase Shares tendered in the Offer is subject to the satisfaction or waiver of a number of conditions set forth in the Merger Agreement, including the tender of at least one Share more than two-thirds of the Company’s outstanding Shares in the Offer, receipt of applicable regulatory approvals and other customary conditions set forth in the Merger Agreement. Subject to the closing of the Offer, the Merger Agreement also contemplates that OpenText will acquire any Shares that are not tendered into the Offer at the same price per Share through a second-step merger, which will be completed as soon as practicable following the closing of the Offer. On November 7, 2021, in connection with the execution of the Merger Agreement, OpenText and the Company entered into a Tender and Voting Agreement (the “Voting Agreement”) with Zephyr Holdco, LLC (the “Stockholder”), the holder of all of the outstanding shares of Series A Convertible Preferred Stock, par value $1.00 per share, of the Company (“Series A Shares”). Under the terms of the Voting Agreement, the Stockholder has agreed, among other things, to convert its Series A Shares into Shares (such converted Shares, together with any other Shares owned by Stockholder, the “Subject Shares”), to tender, pursuant to the Offer, its Subject Shares in the Offer, vote its Subject Shares in favor of the Merger (to the extent not purchased in the Offer) and, subject to certain exceptions, not to transfer any of its Subject Shares. The Voting Agreement will terminate upon termination of the Merger Agreement and other specified events. |
Recent Accounting Standards a_2
Recent Accounting Standards and Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Changes And Error Corrections [Abstract] | |
Income Taxes | On January 1, 2021, we adopted Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes by eliminating certain exceptions related to the approach for intraperiod tax allocation, the tax basis of goodwill after a business combination, and the recognition of deferred tax liabilities for outside basis differences. The adoption of this standard did not have a material impact on our condensed consolidated financial statements. |
Fair Value Measurements | FASB guidance regarding fair value measurement establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices for similar assets and liabilities in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. For certain of the Company’s financial instruments, including cash and cash equivalents, trade receivables, and accounts payable, the fair values approximate the carrying values due to the short-term maturities of these instruments. The carrying values of other current assets and accrued expenses are also not recorded at fair value, but approximate fair values primarily due to their short-term nature. |
Stock- Based Awards and Stock_2
Stock- Based Awards and Stock-Based Employee Compensation Expense (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of All Stock Option Transactions | The following is a summary of all stock option transactions during the three months ended September 30, 2021: Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Yrs) Outstanding at June 30, 2021 777,010 $ 4.45 5.03 Granted at market price — — Cancelled or expired — — Exercised — — Outstanding at September 30, 2021 777,010 $ 4.45 4.78 Options exercisable at September 30, 2021 633,260 $ 3.81 3.86 |
Summary of Restricted Stock Activity | The following is a summary of Restricted Stock activity during the three months ended September 30, 2021: Restricted Shares Weighted Average Fair Value Non-vested restricted stock at June 30, 2021 1,215,243 $ 7.61 Granted at market price — — Vested (47,979 ) 8.23 Cancelled (89,702 ) 8.03 Non-vested restricted stock at September 30, 2021 1,077,562 $ 7.54 |
Summary of All Restricted Stock Unit Activity | The following is a summary of all RSU activity during the three months ended September 30, 2021: Restricted Stock Units Weighted Average Fair Value Non-vested restricted stock units at June 30, 2021 1,845,868 $ 7.35 Granted at market price 177,261 6.87 Vested (12,535 ) 7.95 Cancelled (106,602 ) 7.14 Non-vested restricted stock units at September 30, 2021 1,903,992 $ 7.31 |
Summary of All Performance RSU Activity | The following is a summary of all Performance RSU activity during the three months ended September 30, 2021: Performance RSUs Weighted Average Fair Value Non-vested performance RSUs at June 30, 2021 820,740 $ 7.39 Granted at market price — — Vested — — Forfeited (24,158 ) 7.13 Non-vested performance RSUs at September 30, 2021 796,582 $ 7.39 |
Summary of All Performance Stock Activity | The following is a summary of all Performance Stock activity during the three months ended September 30, 2021: Performance Stock Weighted Average Fair Value Non-vested performance stock at June 30, 2021 553,277 $ 7.50 Granted at market price — — Vested — — Forfeited (34,010 ) 7.31 Non-vested performance stock at September 30, 2021 519,267 $ 7.51 |
Summary of Total Stock-based Employee Compensation Expense Resulting from Stock Options, Restricted Stock, RSUs, Performance RSUs, and Performance Stock | For the nine month period ended September 30, 2021, the total stock-based employee compensation expense (excluding $373 thousand payroll tax expense resulting from the vesting of employees’ equity awards) resulting from stock options, Restricted Stock, RSUs, Performance RSUs and Performance Stock was recorded to the following line items of the Company’s condensed consolidated statement of comprehensive loss: (In thousands) Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Cost of revenues $ 134 $ 503 Research and development 513 1,986 Selling, general and administrative 3,404 9,465 Stock-based compensation expense $ 4,051 $ 11,954 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information Relating to Taxes, Interest and Non-Cash Activities | Supplemental cash flow information relating to taxes, interest and non-cash activities: Nine Months Ended September 30, (In thousands) 2021 2020 Interest payments $ 5,028 5,812 Income tax payments 373 217 Non-cash investing and financing activities: Accrued and deemed dividends on Series A preferred stock 7,170 6,714 |
Receivables, Net (Tables)
Receivables, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Receivables [Abstract] | |
Summary of Net Receivables | (In thousands) September 30, 2021 December 31, 2020 Gross accounts receivables $ 32,679 $ 30,188 Allowance for credit losses (469 ) (478 ) Unpaid portion of deferred revenue (12,893 ) (12,879 ) Note receivable 458 458 Allowance for note receivable (458 ) (458 ) Receivables, net $ 19,317 $ 16,831 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Schedule of Components of Lease Costs | The components of lease costs are as follows: Three Months ended September 30, Nine Months ended September 30, (In thousands) 2021 2020 2021 2020 Finance lease costs: Amortization of right-of-use assets $ 157 $ 261 $ 565 $ 949 Interest on lease liabilities 4 18 21 71 Operating lease costs 1,483 785 4,461 2,658 Short-term lease costs 485 493 1,417 1,490 Variable lease costs 508 165 1,017 649 Total lease costs $ 2,637 $ 1,722 $ 7,481 $ 5,817 |
Schedule of Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases are as follows: Three Months ended September 30, Nine Months ended September 30, (In thousands) 2021 2020 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 1,450 $ 961 $ 4,309 $ 2,897 Operating cash flows related to finance leases 4 18 21 71 Financing cash flows related to finance leases 165 340 528 1,086 Right-of-use assets obtained in exchange for lease obligations: Operating leases 415 (333 ) 748 523 Finance leases — — — — |
Schedule of Supplemental Balance Sheet Information Related to Lease | Supplemental balance sheet information related to leases are as follows: September 30, December 31, (In thousands) Balance Sheet Classification 2021 2020 Operating Leases Operating lease right-of- use assets Operating lease assets $ 10,994 $ 14,259 Total operating lease assets $ 10,994 $ 14,259 September 30, December 31, (In thousands) Balance Sheet Classification 2021 2020 Finance Leases Finance lease right-of-use assets $ 3,362 $ 3,362 Accumulated depreciation - finance leases (3,047 ) (2,490 ) Finance lease right-of-use assets, net Property and equipment, net $ 315 $ 872 |
Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate | Weighted average remaining lease term and weighted average discount rate are as follows: Weighted Average Remaining Lease Term (Years) 2021 2020 Operating leases 2.83 4.06 Finance leases 0.88 1.53 Weighted Average Discount Rate Operating leases 4.31 % 4.95 % Finance leases 6.10 % 6.14 % |
Schedule of Maturities of Lease Liabilities | Maturities of lease liabilities are as follows: Payments Due by Period - Year Ending December 31, 2021 (In thousands) Total Year 1 (1) Years 2 & 3 Years 4 & 5 Beyond 5 Years Operating leases $ 12,774 $ 1,534 $ 8,924 $ 2,234 $ 82 Less imputed interest (680 ) Total $ 12,094 Finance leases $ 193 $ 77 $ 116 $ — $ — Less imputed interest (5 ) Total $ 188 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Term Loan [Member] | |
Schedule of Future Scheduled Principal Payments | Future principal payments under the Combined Term Loan as of September 30, 2021 are as follows: (In thousands) Year Ending December 31, Amount 2021 $ 526 2022 2,105 2023 2,106 2024 200,533 $ 205,270 |
Senior Secured Delayed Draw Term Loan Facility [Member] | |
Schedule of Future Scheduled Principal Payments | Future principal payments under the Delayed Draw Term Loan Facility as of September 30, 2021 are as follows: (In thousands) Year Ending December 31, Amount 2021 $ 25 2022 100 2023 100 2024 9,550 $ 9,775 |
Earnings (Loss) Per Share and_2
Earnings (Loss) Per Share and Potential Dilution (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table presents the potentially dilutive common shares outstanding that were excluded from the computation of dilutive net loss per share of common stock for the periods presented because including them would have been anti-dilutive: September 30, September 30, 2021 2020 Stock options to purchase common stock 777,010 742,010 Restricted Stock 1,077,562 2,090,745 RSUs 1,903,992 153,099 Performance RSUs 796,582 44,349 Performance Stock 519,267 691,852 Preferred Stock 20,301,575 18,759,956 Potential dilutive common shares 25,375,988 22,482,011 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The following is a summary of the changes in the carrying amount of goodwill for the nine month periods ended September 30, 2021 and 2020: Nine Months ended September 30, (In thousands) 2021 2020 Opening balance $ 195,013 $ 171,209 Acquisition adjustments 729 — Effect of currency translation adjustment (55 ) (279 ) Goodwill $ 195,687 $ 170,930 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Unaudited Pro Forma Financial Information | The following unaudited pro forma financial information presents the combined results of operations for the three and nine month periods ending September 30, 2021 and 2020, respectively, as though the CloudAlly acquisition that occurred during the reporting period had occurred as of the beginning of the period presented, with adjustments, such as amortization expense of intangible assets and acquisition-related transaction costs, to give effect to pro forma events that are directly attributable to the acquisitions. These unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the respective acquisitions had occurred at the beginning of the period presented, nor are they indicative of future results of operations: Three Months Ended September 30, Nine Months Ended September 30, (In thousands, except per share data) 2021 2020 2021 2020 Revenues $ 64,863 $ 56,787 $ 187,751 $ 166,453 Net income (2,336 ) (542 ) (7,559 ) (4,432 ) Basic income per share attributed to common shareholders $ (0.09 ) $ (0.05 ) $ (0.27 ) $ (0.21 ) Diluted income per share attributed to common shareholders $ (0.09 ) $ (0.05 ) $ (0.27 ) $ (0.21 ) |
CloudAlly Ltd [Member] | |
Summary of Estimated Fair Value of Acquired Assets and Liabilities | The following table summarizes the current estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 1,385 Property and equipment 116 Operating lease assets 5,080 Trademark/Names 200 Technology 6,300 Customer relationships 3,500 Goodwill 23,041 Total assets 39,622 Liabilities: Current liabilities $ 654 Deferred revenue 1,400 Operating lease liabilities 5,080 Deferred tax liability 1,646 Total liabilities 8,780 Net assets recorded $ 30,842 |
Stock- Based Awards and Stock_3
Stock- Based Awards and Stock-Based Employee Compensation Expense - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Options outstanding | 777,010 | 777,010 | 777,010 | |
Shares of common stock available for grant | 4,279,814 | 4,279,814 | ||
Options, options exercisable | 633,260 | 633,260 | ||
Stock-based compensation expense | $ 4,051 | $ 11,954 | ||
Deferred tax assets, tax deferred expense compensation and benefits employee compensation | 2,400 | 2,400 | $ 1,400 | |
Total unrecognized stock-based compensation related to non-vested stock-based compensation awards | $ 23,600 | $ 23,600 | ||
The number of years over which expense is expected to be recognized | 1 year 11 months 19 days | |||
Payroll Tax Expense [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 373 | |||
2021 Omnibus Incentive Plan [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Shares available for issuance | 5,650,000 | 5,650,000 | ||
Restricted Stock [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Non-vested stock | 1,077,562 | 1,077,562 | 1,215,243 | |
Restricted Stock Units (RSUs) [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Non-vested stock | 1,903,992 | 1,903,992 | 1,845,868 | |
Non-vested Performance Stock Awards [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Non-vested stock | 519,267 | 519,267 | 553,277 | |
Non-vested Performance RSUs [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Non-vested stock | 796,582 | 796,582 | 820,740 | |
Employee and Director Stock Options [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Options outstanding | 677,010 | 677,010 | ||
Options, options exercisable | 595,760 | 595,760 | ||
Aggregate intrinsic value of options outstanding | $ 2,100 | $ 2,100 | ||
Aggregate intrinsic value of options exercisable | $ 2,100 | $ 2,100 |
Stock- Based Awards and Stock_4
Stock- Based Awards and Stock-Based Employee Compensation Expense - Summary of All Stock Option Transactions (Detail) - $ / shares | 3 Months Ended | |
Sep. 30, 2021 | Jun. 30, 2021 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward | ||
Options, Outstanding, Beginning Balance | 777,010 | |
Options, Granted at market price | 0 | |
Options, Cancelled or expired | 0 | |
Options, Exercised | 0 | |
Options, Outstanding Ending Balance | 777,010 | 777,010 |
Options, Options Exercisable | 633,260 | |
Weighted Average Exercise Price, Outstanding, Beginning Balance | $ 4.45 | |
Weighted Average Exercise Price, Granted at market price | 0 | |
Weighted Average Exercise Price, Cancelled or expired | 0 | |
Weighted Average Exercise Price, Exercised | 0 | |
Weighted Average Exercise Price, Outstanding, Ending Balance | 4.45 | $ 4.45 |
Weighted Average Exercise Price, Options Exercisable | $ 3.81 | |
Weighted Average Remaining Contractual Term, Outstanding | 4 years 9 months 10 days | 5 years 10 days |
Weighted Average Remaining Contractual Term, Options exercisable | 3 years 10 months 9 days |
Stock- Based Awards and Stock_5
Stock- Based Awards and Stock-Based Employee Compensation Expense - Summary of Restricted Stock Activity (Detail) - Restricted Stock [Member] | 3 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares, Non-vested, Beginning balance | shares | 1,215,243 |
Shares, Granted at market price | shares | 0 |
Shares, Vested | shares | (47,979) |
Shares, Cancelled | shares | (89,702) |
Shares, Non-vested, Ending balance | shares | 1,077,562 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ / shares | $ 7.61 |
Weighted Average Fair Value, Granted at market price | $ / shares | 0 |
Weighted Average Fair Value, Vested | $ / shares | 8.23 |
Weighted Average Fair Value, Cancelled | $ / shares | 8.03 |
Weighted Average Fair Value, Non-vested, Ending balance | $ / shares | $ 7.54 |
Stock- Based Awards and Stock_6
Stock- Based Awards and Stock-Based Employee Compensation Expense - Summary of All Restricted Stock Unit Activity (Detail) - Restricted Stock Units (RSUs) [Member] | 3 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares, Non-vested, Beginning balance | shares | 1,845,868 |
Shares, Granted at market price | shares | 177,261 |
Shares, Vested | shares | (12,535) |
Shares, Cancelled | shares | (106,602) |
Shares, Non-vested, Ending balance | shares | 1,903,992 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ / shares | $ 7.35 |
Weighted Average Fair Value, Granted at market price | $ / shares | 6.87 |
Weighted Average Fair Value, Vested | $ / shares | 7.95 |
Weighted Average Fair Value, Cancelled | $ / shares | 7.14 |
Weighted Average Fair Value, Non-vested, Ending balance | $ / shares | $ 7.31 |
Stock- Based Awards and Stock_7
Stock- Based Awards and Stock-Based Employee Compensation Expense - Summary of All Performance RSU Activity (Detail) - Non-vested Performance RSUs [Member] | 3 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares, Non-vested, Beginning balance | shares | 820,740 |
Shares, Granted at market price | shares | 0 |
Shares, Vested | shares | 0 |
Shares, Cancelled | shares | (24,158) |
Shares, Non-vested, Ending balance | shares | 796,582 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ / shares | $ 7.39 |
Weighted Average Fair Value, Granted at market price | $ / shares | 0 |
Weighted Average Fair Value, Vested | $ / shares | 0 |
Weighted Average Fair Value, Cancelled | $ / shares | 7.13 |
Weighted Average Fair Value, Non-vested, Ending balance | $ / shares | $ 7.39 |
Stock- Based Awards and Stock_8
Stock- Based Awards and Stock-Based Employee Compensation Expense - Summary of All Performance Stock Activity (Detail) - Performance Stock [Member] | 3 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares, Non-vested, Beginning balance | shares | 553,277 |
Shares, Granted at market price | shares | 0 |
Shares, Vested | shares | 0 |
Shares, Cancelled | shares | (34,010) |
Shares, Non-vested, Ending balance | shares | 519,267 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ / shares | $ 7.50 |
Weighted Average Fair Value, Granted at market price | $ / shares | 0 |
Weighted Average Fair Value, Vested | $ / shares | 0 |
Weighted Average Fair Value, Cancelled | $ / shares | 7.31 |
Weighted Average Fair Value, Non-vested, Ending balance | $ / shares | $ 7.51 |
Stock- Based Awards and Stock_9
Stock- Based Awards and Stock-Based Employee Compensation Expense - Summary of Total Stock-based Employee Compensation Expense Resulting from Stock Options, Restricted Stock, RSUs, Performance RSUs, and Performance Stock (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 4,051 | $ 11,954 |
Cost of Revenues [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | 134 | 503 |
Research and Development [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | 513 | 1,986 |
Selling, General and Administrative [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 3,404 | $ 9,465 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information - Supplemental Cash Flow Information Relating to Taxes, Interest and Non-Cash Activities (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Supplemental Cash Flow [Line Items] | ||||
Interest payments | $ 5,028 | $ 5,812 | ||
Income tax payments | 373 | 217 | ||
Non-cash investing and financing activities: | ||||
Accrued and deemed dividends on preferred stock | $ (2,448) | $ (2,267) | (7,170) | (6,714) |
Series A Convertible Preferred Stock [Member] | ||||
Non-cash investing and financing activities: | ||||
Accrued and deemed dividends on preferred stock | $ 7,170 | $ 6,714 |
Receivables, Net - Summary of N
Receivables, Net - Summary of Net Receivables (Detail) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Accounts Notes And Loans Receivable Net Current [Abstract] | ||
Gross accounts receivables | $ 32,679 | $ 30,188 |
Allowance for credit losses | (469) | (478) |
Unpaid portion of deferred revenue | (12,893) | (12,879) |
Note receivable | 458 | 458 |
Allowance for note receivable | (458) | (458) |
Receivables, net | $ 19,317 | $ 16,831 |
Receivables, Net - Additional I
Receivables, Net - Additional Information (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Receivables [Abstract] | |
Note receivable on a product line | $ 540 |
Date of note receivable, reserved | Sep. 30, 2021 |
Leases - Additional Information
Leases - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2021 | |
Lessee Lease Description [Line Items] | |
Lessee, operating lease, variable lease payment, terms and conditions | Variable lease costs consist primarily of variable common area maintenance, taxes, insurance, parking and utilities. |
Lessee, operating lease, existence of option to extend | true |
Minimum [Member] | |
Lessee Lease Description [Line Items] | |
Lessee, operating lease, term of contract | 1 year |
Lessee, majority operating lease, term of contract | 1 year |
Maximum [Member] | |
Lessee Lease Description [Line Items] | |
Lessee, operating lease, term of contract | 12 years |
Lessee, majority operating lease, term of contract | 7 years |
Leases - Schedule of Components
Leases - Schedule of Components of Lease Costs (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Finance lease costs: | ||||
Amortization of right-of-use assets | $ 157 | $ 261 | $ 565 | $ 949 |
Interest on lease liabilities | 4 | 18 | 21 | 71 |
Operating lease costs | 1,483 | 785 | 4,461 | 2,658 |
Short-term lease costs | 485 | 493 | 1,417 | 1,490 |
Variable lease costs | 508 | 165 | 1,017 | 649 |
Total lease costs | $ 2,637 | $ 1,722 | $ 7,481 | $ 5,817 |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows used in operating leases | $ 1,450 | $ 961 | $ 4,309 | $ 2,897 |
Operating cash flows related to finance leases | 4 | 18 | 21 | 71 |
Financing cash flows related to finance leases | 165 | 340 | 528 | 1,086 |
Right-of-use assets obtained in exchange for lease obligations: | ||||
Operating leases | $ 415 | $ (333) | $ 748 | $ 523 |
Leases - Schedule of Suppleme_2
Leases - Schedule of Supplemental Balance Sheet Information Related to Leases (Detail) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Assets And Liabilities Lessee [Abstract] | ||
Operating lease right-of- use assets | $ 10,994 | $ 14,259 |
Operating lease assets | 10,994 | 14,259 |
Finance lease right-of-use assets | 3,362 | 3,362 |
Accumulated depreciation - finance leases | (3,047) | (2,490) |
Finance lease right-of-use assets, net | $ 315 | $ 872 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | us-gaap:OtherAssets |
Leases - Schedule of Weighted A
Leases - Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate (Detail) | Sep. 30, 2021 | Sep. 30, 2020 |
Lease Cost [Abstract] | ||
Operating leases, weighted average remaining lease term (years) | 2 years 9 months 29 days | 4 years 21 days |
Finance leases, weighted average remaining lease term (years) | 10 months 17 days | 1 year 6 months 10 days |
Operating leases, weighted average discount rate | 4.31% | 4.95% |
Finance leases, weighted average discount rate | 6.10% | 6.14% |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Lease Liabilities (Detail) $ in Thousands | Sep. 30, 2021USD ($) |
Operating Lease Liabilities Payments Due [Abstract] | |
Operating leases | $ 12,774 |
Less imputed interest | (680) |
Total | 12,094 |
Finance leases | 193 |
Less imputed interest | (5) |
Total | 188 |
Operating lease payments due, Year 1 | 1,534 |
Operating lease payments due, Years 2 & 3 | 8,924 |
Operating lease payments due, Years 4 & 5 | 2,234 |
Operating lease payments due, beyond 5 years | 82 |
Finance lease payments due, Year 1 | 77 |
Finance lease payments due, Years 2 & 3 | $ 116 |
Long-term Debt - Additional Inf
Long-term Debt - Additional Information (Detail) | Nov. 05, 2020USD ($) | May 02, 2019USD ($) | Feb. 20, 2019USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2021USD ($) | Dec. 31, 2020USD ($) |
Debt Instrument [Line Items] | ||||||
Term loan | $ 35,000,000 | |||||
Outstanding debt balance | $ 201,400,000 | $ 201,400,000 | ||||
Lines of credit, drawn amount | $ 35,000,000 | |||||
Debt instrument quarterly payment, principal amount | $ 89,000 | |||||
Interest rate | 4.21% | 4.12% | ||||
Unamortized debt issuance costs | $ 3,900,000 | $ 3,900,000 | ||||
Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Delayed draw term loan facility fully drawn date | May 2, 2019 | |||||
Outstanding debt balance | 9,700,000 | $ 9,700,000 | ||||
Principal outstanding | $ 9,775,000 | $ 9,775,000 | ||||
Lines of credit, drawn amount | $ 10,000,000 | |||||
Interest rate | 3.59% | 3.51% | ||||
Unamortized debt issuance costs | $ 33,000 | $ 33,000 | ||||
Term Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Principal outstanding | 205,270,000 | 205,270,000 | ||||
Lines of credit, drawn amount | $ 175,000,000 | |||||
Debt instrument quarterly payment, principal amount | 437,000 | |||||
Credit Agreement [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility maturity date | Feb. 20, 2024 | |||||
Credit Agreement [Member] | Revolving Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding debt balance | 0 | 0 | ||||
Undrawn balance | 25,000,000 | |||||
Commitment fees | 24,000 | $ 71,000 | ||||
Credit Agreement [Member] | Maximum [Member] | June 30, 2021 through December 31, 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum total net leverage ratio | 4.50 | |||||
Credit Agreement [Member] | Maximum [Member] | March 31, 2022 and Each Fiscal Quarter Thereafter [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum total net leverage ratio | 4.25 | |||||
Credit Agreement [Member] | Maximum [Member] | LIBOR Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 3.50% | |||||
Credit Agreement [Member] | Maximum [Member] | Alternate Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 2.50% | |||||
Credit Agreement [Member] | Maximum [Member] | Revolving Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of commitment fee unused portions | 0.50% | |||||
Credit Agreement [Member] | Minimum [Member] | LIBOR Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 2.50% | |||||
Credit Agreement [Member] | Minimum [Member] | Alternate Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 1.50% | |||||
Credit Agreement [Member] | Minimum [Member] | Revolving Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of commitment fee unused portions | 0.25% | |||||
Credit Agreement [Member] | Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument quarterly payment, principal amount | $ 25,000 | |||||
Amortization payments percentage of original aggregate principal amount | 1.00% | |||||
Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 25,000,000 | $ 25,000,000 | ||||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 175,000,000 | |||||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | 10,000,000 | |||||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | 25,000,000 | |||||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Letters of credit | $ 5,000,000 | |||||
Delivery Slip Acquisition [Member] | Credit Agreement [Member] | Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Delayed draw term loan facility fully drawn date | May 2, 2019 |
Long-term Debt - Schedule of Fu
Long-term Debt - Schedule of Future Scheduled Principal Payments Under Term Loan (Detail) $ in Thousands | Sep. 30, 2021USD ($) |
Term Loan [Member] | |
Debt Instrument [Line Items] | |
2021 | $ 526 |
2022 | 2,105 |
2023 | 2,106 |
2024 | 200,533 |
Total | 205,270 |
Senior Secured Delayed Draw Term Loan Facility [Member] | |
Debt Instrument [Line Items] | |
2021 | 25 |
2022 | 100 |
2023 | 100 |
2024 | 9,550 |
Total | $ 9,775 |
Preferred Stock - Additional In
Preferred Stock - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Feb. 20, 2019 | Sep. 30, 2021 | Dec. 31, 2020 | Jun. 06, 2019 |
Temporary Equity [Line Items] | ||||
Preferred stock, shares outstanding | 0 | 0 | ||
Beneficial conversion feature, valued | $ 2.5 | |||
Series A Convertible Preferred Stock [Member] | ||||
Temporary Equity [Line Items] | ||||
Convertible Preferred stock, par value | $ 1 | $ 1 | ||
Convertible Preferred stock, shares issued | 64,914 | 100,206 | 100,206 | |
Issuance of preferred stock in connection with private placement | $ 62.7 | |||
Preferred stock, net of issuance costs | $ 2.3 | |||
Preferred stock, number of shares converted | 35,292 | |||
Series B Convertible Preferred Stock [Member] | ||||
Temporary Equity [Line Items] | ||||
Convertible Preferred stock, shares issued | 35,086 | |||
Issuance of preferred stock in connection with private placement | $ 33.9 | |||
Preferred stock, net of issuance costs | 1.2 | |||
Preferred stock, shares outstanding | 0 | |||
Series A Preferred Stock [Member] | ||||
Temporary Equity [Line Items] | ||||
Preferred stock accretion percentage | 8.00% | |||
Accretion of stated value of preferred stock | $ 22 | |||
Preferred stock conversion description | At any time, each Series A Preferred Stock holder may elect to convert each share of such holders’ then-outstanding Series A Preferred Stock into (i) the number of shares of common stock equal to the product of (a) the Accreted Value with respect to such share on the conversion date multiplied by (b) the conversion rate (currently 166.11) as of the applicable conversion date divided by (c) 1,000 plus (ii) cash in lieu of fractional shares. | |||
True Wind Capital [Member] | ||||
Temporary Equity [Line Items] | ||||
Aggregate purchase price of preferred stock issued in private placement | $ 100 | |||
Convertible Preferred stock, par value | $ 1,000 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)Segment | Sep. 30, 2020USD ($) | |
Disaggregation Of Revenue [Line Items] | ||||
Number of operating segment | Segment | 1 | |||
Percentage of revenue generated from email protection services | 100.00% | 100.00% | ||
Increased noncurrent deferred contract asset | $ 1,100,000 | $ 2,900,000 | ||
Impairment losses recognized on deferred contract cost assets | 0 | 0 | ||
Amortization of deferred cost | 1,100,000 | 3,300,000 | ||
Increase (decrease) to net deferred revenue | 969,000 | |||
Revenue remaining service performance obligations | 82,800,000 | 82,800,000 | ||
Revenue recognized performance obligation | 27,700,000 | 54,600,000 | ||
Revenue recognized | $ 64,850,000 | $ 54,840,000 | $ 187,694,000 | $ 160,611,000 |
Healthcare [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue in percentage | 20.00% | 21.00% | ||
Financial Services [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue in percentage | 16.00% | 17.00% | ||
Government Sector [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue in percentage | 3.00% | 3.00% | ||
Other [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue in percentage | 61.00% | 59.00% | ||
Minimum [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Subscription services contracts period | 1 year | |||
Maximum [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Subscription services contracts period | 3 years |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Additional Information (Detail 1) $ in Millions | Sep. 30, 2021USD ($) |
Disaggregation Of Revenue [Line Items] | |
Revenue remaining service performance obligations | $ 82.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-10-01 | |
Disaggregation Of Revenue [Line Items] | |
Revenue, remaining performance obligation expected timing of satisfaction period | 3 months |
Revenue remaining service performance obligations | $ 27.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01 | |
Disaggregation Of Revenue [Line Items] | |
Revenue, remaining performance obligation expected timing of satisfaction period | 1 year |
Revenue remaining service performance obligations | $ 40.2 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01 | |
Disaggregation Of Revenue [Line Items] | |
Revenue, remaining performance obligation expected timing of satisfaction period | 0 years |
Revenue remaining service performance obligations | $ 14.8 |
Earnings Per Share and Potentia
Earnings Per Share and Potential Dilution - Computations of Basic and Diluted Earnings Per Share Excluded From Potentially Dilutive Common Shares Outstanding (Detail) - shares | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Weighted Average Number of Shares [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 25,375,988 | 22,482,011 |
Preferred Stock [Member] | ||
Weighted Average Number of Shares [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 20,301,575 | 18,759,956 |
Stock Options to Purchase Common Stock [Member] | ||
Weighted Average Number of Shares [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 777,010 | 742,010 |
Restricted Stock [Member] | ||
Weighted Average Number of Shares [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 1,077,562 | 2,090,745 |
Restricted Stock Units (RSUs) [Member] | ||
Weighted Average Number of Shares [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 1,903,992 | 153,099 |
Performance RSUs [Member] | ||
Weighted Average Number of Shares [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 796,582 | 44,349 |
Performance Stock [Member] | ||
Weighted Average Number of Shares [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 519,267 | 691,852 |
Goodwill - Schedule of Changes
Goodwill - Schedule of Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Goodwill Roll Forward | ||
Opening balance | $ 195,013 | $ 171,209 |
Acquisition adjustments | 729 | |
Effect of currency translation adjustment | (55) | (279) |
Goodwill | $ 195,687 | $ 170,930 |
Goodwill - Additional Informati
Goodwill - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Goodwill impairment | $ 0 | $ 0 |
Other Comprehensive Loss - Addi
Other Comprehensive Loss - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Foreign currency translation adjustments | $ 39 | $ 1,463 | $ (1,262) | $ 493 | $ 294 | $ (905) | $ 240 | $ (118) |
Canada [Member] | ||||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Foreign currency translation adjustments | 240 | |||||||
Foreign currency translation gain, tax amount | $ 14 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) $ in Millions | Sep. 30, 2021USD ($) |
Income Tax Disclosure [Abstract] | |
Operating loss carryforwards | $ 22.9 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) $ in Thousands | Nov. 05, 2020USD ($)CustomerUserServiceProvider | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) |
Business Acquisition [Line Items] | ||||||
Cash consideration | $ 339 | |||||
Operating Expenses | $ 28,897 | $ 24,533 | 85,527 | $ 74,984 | ||
CloudAlly Ltd [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of equity interest acquired | 100.00% | |||||
Total purchase price | $ 30,800 | |||||
Cash consideration | $ 30,400 | |||||
Number of customers | Customer | 5,000 | |||||
Number of users | User | 500,000 | |||||
Number of managed service providers | ServiceProvider | 300 | |||||
Acquisition related costs | 2,000 | |||||
Operating Expenses | 229 | $ 1,800 | ||||
Revenue from acquisition | $ 2,100 | $ 7,000 | ||||
CloudAlly Ltd [Member] | Technology [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, estimated useful live | 4 years |
Acquisitions - Summary of Estim
Acquisitions - Summary of Estimated Fair Value of Acquired Assets and Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Nov. 05, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Assets: | |||||
Goodwill | $ 195,687 | $ 195,013 | $ 170,930 | $ 171,209 | |
CloudAlly Ltd [Member] | |||||
Assets: | |||||
Current assets | $ 1,385 | ||||
Property and equipment | 116 | ||||
Operating lease assets | 5,080 | ||||
Goodwill | 23,041 | ||||
Total assets | 39,622 | ||||
Liabilities: | |||||
Current liabilities | 654 | ||||
Deferred revenue | 1,400 | ||||
Operating lease liabilities | 5,080 | ||||
Deferred tax liability | 1,646 | ||||
Total liabilities | 8,780 | ||||
Net assets recorded | 30,842 | ||||
Trademark/names [Member] | CloudAlly Ltd [Member] | |||||
Assets: | |||||
Intangible assets | 200 | ||||
Technology [Member] | CloudAlly Ltd [Member] | |||||
Assets: | |||||
Intangible assets | 6,300 | ||||
Customer Relationships [Member] | CloudAlly Ltd [Member] | |||||
Assets: | |||||
Intangible assets | $ 3,500 |
Acquisitions - Unaudited Pro Fo
Acquisitions - Unaudited Pro Forma Financial Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Business Acquisition Pro Forma Information [Abstract] | ||||
Revenues | $ 64,863 | $ 56,787 | $ 187,751 | $ 166,453 |
Net income | $ (2,336) | $ (542) | $ (7,559) | $ (4,432) |
Basic income per share attributed to common shareholders | $ (0.09) | $ (0.05) | $ (0.27) | $ (0.21) |
Diluted income per share attributed to common shareholders | $ (0.09) | $ (0.05) | $ (0.27) | $ (0.21) |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - $ / shares | Nov. 07, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Series A Convertible Preferred Stock [Member] | |||
Subsequent Event [Line Items] | |||
Convertible preferred stock, par value per share | $ 1 | $ 1 | |
Subsequent Event [Member] | Merger Agreement with Open Text Corporation [Member] | |||
Subsequent Event [Line Items] | |||
Merger agreement date | Nov. 7, 2021 | ||
Merger consideration paid in cash per share for all outstanding shares of common stock | $ 8.50 | ||
Subsequent Event [Member] | Tender and Voting Agreement with Zephyr Holdco, LLC [Member] | Series A Convertible Preferred Stock [Member] | |||
Subsequent Event [Line Items] | |||
Convertible preferred stock, par value per share | $ 1 | ||
Subsequent Event [Member] | Maximum [Member] | Merger Agreement with Open Text Corporation [Member] | |||
Subsequent Event [Line Items] | |||
Tender offer commencing date | Nov. 22, 2021 | ||
Subsequent Event [Member] | Minimum [Member] | Merger Agreement with Open Text Corporation [Member] | |||
Subsequent Event [Line Items] | |||
Number of excess shares tendered over two-thirds of outstanding shares. | 1 |