þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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11-2617163
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Large accelerated filer þ
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Accelerated filer
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¨
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Non-accelerated filer ¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Securities Registered Pursuant to Section 12(b) of the Act:
|
||
Title of Each Class
|
Trading Symbol(s)
|
Name of Each Exchange on which Registered
|
Common Stock, $0.001 Par Value
|
BLKB
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The Nasdaq Stock Market LLC
(Nasdaq Global Select Market)
|
|
|
|
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First Quarter 2019 Form 10-Q
|
|
1
|
|
|
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
|
2
|
|
First Quarter 2019 Form 10-Q
|
|
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PART I. FINANCIAL INFORMATION
|
First Quarter 2019 Form 10-Q
|
|
3
|
4
|
|
First Quarter 2019 Form 10-Q
|
Blackbaud, Inc.
Consolidated statements of cash flows
(Unaudited)
|
||||||
|
Three months ended
March 31, |
|
||||
(dollars in thousands)
|
2019
|
|
2018
|
|
||
Cash flows from operating activities
|
|
|
||||
Net (loss) income
|
$
|
(1,122
|
)
|
$
|
17,751
|
|
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
|
|
|
||||
Depreciation and amortization
|
21,724
|
|
19,820
|
|
||
Provision for doubtful accounts and sales returns
|
2,032
|
|
1,774
|
|
||
Stock-based compensation expense
|
13,726
|
|
11,092
|
|
||
Deferred taxes
|
(1,155
|
)
|
902
|
|
||
Amortization of deferred financing costs and discount
|
188
|
|
188
|
|
||
Other non-cash adjustments
|
1,820
|
|
(197
|
)
|
||
Changes in operating assets and liabilities, net of acquisition and disposal of businesses:
|
|
|
||||
Accounts receivable
|
(1,797
|
)
|
5,088
|
|
||
Prepaid expenses and other assets
|
(12,107
|
)
|
(10,052
|
)
|
||
Trade accounts payable
|
(3,624
|
)
|
(1,655
|
)
|
||
Accrued expenses and other liabilities
|
(11,690
|
)
|
(14,092
|
)
|
||
Deferred revenue
|
(18,006
|
)
|
(18,866
|
)
|
||
Net cash (used in) provided by operating activities
|
(10,011
|
)
|
11,753
|
|
||
Cash flows from investing activities
|
|
|
||||
Purchase of property and equipment
|
(1,152
|
)
|
(5,771
|
)
|
||
Capitalized software development costs
|
(11,319
|
)
|
(7,103
|
)
|
||
Purchase of net assets of acquired companies, net of cash and restricted cash acquired
|
(109,386
|
)
|
(5,036
|
)
|
||
Net cash used in investing activities
|
(121,857
|
)
|
(17,910
|
)
|
||
Cash flows from financing activities
|
|
|
||||
Proceeds from issuance of debt
|
271,500
|
|
81,700
|
|
||
Payments on debt
|
(75,175
|
)
|
(52,875
|
)
|
||
Employee taxes paid for withheld shares upon equity award settlement
|
(18,400
|
)
|
(22,511
|
)
|
||
Proceeds from exercise of stock options
|
3
|
|
9
|
|
||
Change in due to customers
|
(242,885
|
)
|
(434,640
|
)
|
||
Change in customer funds receivable
|
(3,573
|
)
|
(4,783
|
)
|
||
Dividend payments to stockholders
|
(5,901
|
)
|
(5,825
|
)
|
||
Net cash used in financing activities
|
(74,431
|
)
|
(438,925
|
)
|
||
Effect of exchange rate on cash, cash equivalents, and restricted cash
|
1,036
|
|
713
|
|
||
Net decrease in cash, cash equivalents, and restricted cash
|
(205,263
|
)
|
(444,369
|
)
|
||
Cash, cash equivalents, and restricted cash, beginning of period
|
449,846
|
|
640,174
|
|
||
Cash, cash equivalents, and restricted cash, end of period
|
$
|
244,583
|
|
$
|
195,805
|
|
First Quarter 2019 Form 10-Q
|
|
5
|
(dollars in thousands)
|
Common stock
|
|
Additional
paid-in
capital
|
|
Treasury
stock
|
|
Accumulated
other
comprehensive
Income (loss)
|
|
Retained
earnings
|
|
Total stockholders' equity
|
|
||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||
Balance at December 31, 2018
|
59,327,633
|
|
$
|
59
|
|
$
|
399,241
|
|
$
|
(266,884
|
)
|
$
|
(5,110
|
)
|
$
|
246,477
|
|
$
|
373,783
|
|
Net loss
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,122
|
)
|
(1,122
|
)
|
||||||
Payment of dividends ($0.12 per share)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5,901
|
)
|
(5,901
|
)
|
||||||
Exercise of stock options and stock appreciation rights and vesting of restricted stock units
|
234,453
|
|
—
|
|
3
|
|
—
|
|
—
|
|
—
|
|
3
|
|
||||||
Employee taxes paid for 239,311 withheld shares upon equity award settlement
|
—
|
|
—
|
|
—
|
|
(18,400
|
)
|
—
|
|
—
|
|
(18,400
|
)
|
||||||
Stock-based compensation
|
—
|
|
—
|
|
13,693
|
|
—
|
|
—
|
|
33
|
|
13,726
|
|
||||||
Restricted stock grants
|
663,906
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1
|
|
||||||
Restricted stock cancellations
|
(43,314
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||
Other comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
3,658
|
|
—
|
|
3,658
|
|
||||||
Balance at March 31, 2019
|
60,182,678
|
|
$
|
60
|
|
$
|
412,937
|
|
$
|
(285,284
|
)
|
$
|
(1,452
|
)
|
$
|
239,487
|
|
$
|
365,748
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
(dollars in thousands)
|
Common stock
|
|
Additional
paid-in
capital
|
|
Treasury
stock
|
|
Accumulated
other
comprehensive
Income (loss)
|
|
Retained
earnings
|
|
Total stockholders' equity
|
|
||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||
Balance at December 31, 2017
|
58,551,761
|
|
$
|
59
|
|
$
|
351,042
|
|
$
|
(239,199
|
)
|
$
|
(642
|
)
|
$
|
225,029
|
|
$
|
336,289
|
|
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
17,751
|
|
17,751
|
|
||||||
Payment of dividends ($0.12 per share)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5,825
|
)
|
(5,825
|
)
|
||||||
Exercise of stock options and stock appreciation rights and vesting of restricted stock units
|
279,422
|
|
—
|
|
9
|
|
—
|
|
—
|
|
—
|
|
9
|
|
||||||
Employee taxes paid for 234,454 withheld shares upon equity award settlement
|
—
|
|
—
|
|
—
|
|
(22,511
|
)
|
—
|
|
—
|
|
(22,511
|
)
|
||||||
Stock-based compensation
|
—
|
|
—
|
|
11,062
|
|
—
|
|
—
|
|
30
|
|
11,092
|
|
||||||
Restricted stock grants
|
437,878
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||
Restricted stock cancellations
|
(35,218
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||
Other comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
7,516
|
|
—
|
|
7,516
|
|
||||||
Reclassification upon early adoption of ASU 2018-02
|
|
|
|
|
167
|
|
(167
|
)
|
—
|
|
||||||||||
Balance at March 31, 2018
|
59,233,843
|
|
$
|
59
|
|
$
|
362,113
|
|
$
|
(261,710
|
)
|
$
|
7,041
|
|
$
|
236,818
|
|
$
|
344,321
|
|
|
|
|
|
|
|
|
|
|||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
|
6
|
|
First Quarter 2019 Form 10-Q
|
1. Organization
|
2. Basis of Presentation
|
First Quarter 2019 Form 10-Q
|
|
7
|
3. Business Combinations
|
8
|
|
First Quarter 2019 Form 10-Q
|
(in thousands)
|
Purchase price allocation
|
|
|
Net working capital, excluding deferred revenue
|
$
|
3,332
|
|
Other long-term assets
|
2,574
|
|
|
Identifiable intangible assets
|
74,690
|
|
|
Deferred tax liability
|
(4,615
|
)
|
|
Deferred revenue
|
(4,300
|
)
|
|
Other long-term liabilities
|
(1,650
|
)
|
|
Goodwill
|
87,717
|
|
|
Total purchase price
|
$
|
157,748
|
|
|
Intangible assets acquired
|
|
Weighted average amortization period
|
|
YourCause
|
(in thousands)
|
|
(in years)
|
|
Acquired technology
|
$
|
47,800
|
|
12
|
Customer relationships
|
25,900
|
|
15
|
|
Marketing assets
|
830
|
|
2
|
|
Non-compete agreements
|
160
|
|
0
|
|
Total intangible assets
|
$
|
74,690
|
|
13
|
First Quarter 2019 Form 10-Q
|
|
9
|
4. Goodwill and Other Intangible Assets
|
(dollars in thousands)
|
Total
|
||
Balance at December 31, 2018
|
$
|
545,213
|
|
Additions related to current year business combinations
|
87,717
|
|
|
Effect of foreign currency translation
|
1,915
|
|
|
Balance at March 31, 2019
|
$
|
634,845
|
|
5. (Loss) Earnings Per Share
|
|
Three months ended
March 31, |
|
||||
(dollars in thousands, except per share amounts)
|
2019
|
|
2018
|
|
||
Numerator:
|
|
|
||||
Net (loss) income
|
$
|
(1,122
|
)
|
$
|
17,751
|
|
Denominator:
|
|
|
||||
Weighted average common shares
|
47,516,912
|
|
47,019,603
|
|
||
Add effect of dilutive securities:
|
|
|
||||
Stock-based awards
|
—
|
|
989,792
|
|
||
Weighted average common shares assuming dilution
|
47,516,912
|
|
48,009,395
|
|
||
(Loss) earnings per share:
|
|
|
||||
Basic
|
$
|
(0.02
|
)
|
$
|
0.38
|
|
Diluted
|
$
|
(0.02
|
)
|
$
|
0.37
|
|
|
|
|
||||
Anti-dilutive shares excluded from calculations of diluted (loss) earnings per share
|
740,119
|
|
24
|
|
10
|
|
First Quarter 2019 Form 10-Q
|
6. Fair Value Measurements
|
•
|
Level 1 - Quoted prices for identical assets or liabilities in active markets;
|
•
|
Level 2 - Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
|
•
|
Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are unobservable.
|
|
Fair value measurement using
|
|
|
||||||||||||
(dollars in thousands)
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
||||
Fair value as of March 31, 2019
|
|
|
|
|
|
|
|
||||||||
Financial assets:
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
—
|
|
|
$
|
1,239
|
|
|
$
|
—
|
|
|
$
|
1,239
|
|
Total financial assets
|
$
|
—
|
|
|
$
|
1,239
|
|
|
$
|
—
|
|
|
$
|
1,239
|
|
|
|
|
|
|
|
|
|
||||||||
Fair value as of March 31, 2019
|
|
|
|
|
|
|
|
||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
—
|
|
|
$
|
433
|
|
|
$
|
—
|
|
|
$
|
433
|
|
Total financial liabilities
|
$
|
—
|
|
|
$
|
433
|
|
|
$
|
—
|
|
|
$
|
433
|
|
|
|
|
|
|
|
|
|
||||||||
Fair value as of December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Financial assets:
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
—
|
|
|
$
|
2,260
|
|
|
$
|
—
|
|
|
$
|
2,260
|
|
Total financial assets
|
$
|
—
|
|
|
$
|
2,260
|
|
|
$
|
—
|
|
|
$
|
2,260
|
|
|
|
|
|
|
|
|
|
||||||||
Fair value as of December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
—
|
|
|
$
|
186
|
|
|
$
|
—
|
|
|
$
|
186
|
|
Total financial liabilities
|
$
|
—
|
|
|
$
|
186
|
|
|
$
|
—
|
|
|
$
|
186
|
|
First Quarter 2019 Form 10-Q
|
|
11
|
7. Consolidated Financial Statement Details
|
(dollars in thousands)
|
March 31,
2019 |
|
December 31,
2018 |
|
||
Costs of obtaining contracts(1)(2)
|
$
|
88,812
|
|
$
|
85,590
|
|
Prepaid software maintenance and subscriptions
|
27,598
|
|
21,134
|
|
||
Unbilled accounts receivable
|
6,043
|
|
4,161
|
|
||
Taxes, prepaid and receivable
|
3,954
|
|
2,055
|
|
||
Derivative instruments
|
1,239
|
|
2,260
|
|
||
Security deposits
|
1,228
|
|
1,020
|
|
||
Other assets
|
11,686
|
|
8,931
|
|
||
Total prepaid expenses and other assets
|
140,560
|
|
125,151
|
|
||
Less: Long-term portion
|
67,461
|
|
65,363
|
|
||
Prepaid expenses and other current assets
|
$
|
73,099
|
|
$
|
59,788
|
|
(1)
|
Amortization expense from costs of obtaining contracts was $9.6 million for the three months ended March 31, 2019.
|
(2)
|
The current portion of costs of obtaining contracts as of March 31, 2019 and December 31, 2018 was $32.1 million and $31.7 million, respectively.
|
12
|
|
First Quarter 2019 Form 10-Q
|
(dollars in thousands)
|
March 31,
2019 |
|
December 31,
2018 |
|
||
Operating lease liabilities, current portion
|
$
|
16,755
|
|
$
|
—
|
|
Accrued bonuses
|
8,586
|
|
14,868
|
|
||
Accrued commissions and salaries
|
8,546
|
|
9,934
|
|
||
Taxes payable
|
4,843
|
|
6,204
|
|
||
Customer credit balances
|
4,027
|
|
4,076
|
|
||
Unrecognized tax benefit
|
3,609
|
|
2,719
|
|
||
Accrued vacation costs
|
2,101
|
|
2,352
|
|
||
Accrued health care costs
|
1,841
|
|
1,497
|
|
||
Other liabilities
|
8,977
|
|
14,631
|
|
||
Total accrued expenses and other liabilities
|
59,285
|
|
56,281
|
|
||
Less: Long-term portion
|
4,302
|
|
9,388
|
|
||
Accrued expenses and other current liabilities
|
$
|
54,983
|
|
$
|
46,893
|
|
8. Debt
|
|
Debt balance at
|
|
|
Weighted average
effective interest rate at
|
|
||||||
(dollars in thousands)
|
March 31,
2019 |
|
December 31,
2018 |
|
|
March 31,
2019 |
|
December 31,
2018 |
|
||
Credit facility:
|
|
|
|
|
|
||||||
Revolving credit loans
|
$
|
298,200
|
|
$
|
100,000
|
|
|
3.90
|
%
|
4.13
|
%
|
Term loans
|
286,875
|
|
288,750
|
|
|
3.43
|
%
|
3.44
|
%
|
||
Total debt
|
585,075
|
|
388,750
|
|
|
3.67
|
%
|
3.61
|
%
|
||
Less: Unamortized discount and debt issuance costs
|
1,507
|
|
1,626
|
|
|
|
|
||||
Less: Debt, current portion
|
7,500
|
|
7,500
|
|
|
3.75
|
%
|
3.77
|
%
|
||
Debt, net of current portion
|
$
|
576,068
|
|
$
|
379,624
|
|
|
3.67
|
%
|
3.61
|
%
|
Years ending December 31,
(dollars in thousands)
|
Annual maturities
|
|
|
2019 - remaining
|
$
|
5,625
|
|
2020
|
7,500
|
|
|
2021
|
7,500
|
|
|
2022
|
564,450
|
|
|
2023
|
—
|
|
|
Thereafter
|
—
|
|
|
Total required maturities
|
$
|
585,075
|
|
First Quarter 2019 Form 10-Q
|
|
13
|
9. Derivative Instruments
|
|
|
Asset Derivatives
|
|
|
Liability Derivatives
|
||||||||||
(dollars in thousands)
|
Balance sheet location
|
March 31,
2019 |
|
December 31,
2018 |
|
|
Balance sheet location
|
March 31,
2019 |
|
December 31,
2018 |
|
||||
Derivative instruments designated as hedging instruments:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps, long-term portion
|
Other assets
|
1,239
|
|
2,260
|
|
|
Other liabilities
|
433
|
|
186
|
|
||||
Total derivative instruments designated as hedging instruments
|
|
$
|
1,239
|
|
$
|
2,260
|
|
|
|
$
|
433
|
|
$
|
186
|
|
|
Gain (loss) recognized
in accumulated other
comprehensive
loss as of
|
|
Location
of gain (loss)
reclassified from
accumulated other
comprehensive
loss into income
|
Gain (loss) reclassified from accumulated
other comprehensive loss into income
|
|
||
(dollars in thousands)
|
March 31,
2019 |
|
Three months ended
March 31, 2019 |
|
|||
Interest rate swaps
|
$
|
806
|
|
Interest expense
|
$
|
229
|
|
|
|
|
|
||||
|
March 31,
2018 |
|
|
Three months ended
March 31, 2018 |
|
||
Interest rate swaps
|
$
|
2,748
|
|
Interest expense
|
$
|
20
|
|
14
|
|
First Quarter 2019 Form 10-Q
|
10. Commitments and Contingencies
|
|
Three months ended
March 31, |
|
|
(dollars in thousands)
|
2019
|
|
|
Operating lease cost(1)
|
$
|
6,001
|
|
Variable lease cost(2)
|
991
|
|
|
Sublease income
|
(705
|
)
|
|
Net lease cost
|
$
|
6,287
|
|
(1)
|
Includes short-term lease costs, which are immaterial.
|
(2)
|
Includes costs for operating lease ROU assets that vary due to changes in facts or circumstances occurring after the commencement date, other than the passage of time. For example, the base rent of our Customer Operations Center (discussed above) escalates annually at a rate equal to the change in the consumer price index, as defined in the agreement, but not to exceed 5.5% in any year. Accordingly, variable lease costs for this lease are determined as the difference between the actual rent payment for a period and the rent payment expected for that period as of our adoption of ASU 2016-02 on January 1, 2019.
|
First Quarter 2019 Form 10-Q
|
|
15
|
Years ending December 31,
(dollars in thousands) |
Operating leases(1)
|
|
|
2019 – remaining
|
$
|
17,590
|
|
2020
|
21,616
|
|
|
2021
|
18,155
|
|
|
2022
|
16,405
|
|
|
2023
|
14,613
|
|
|
Thereafter
|
81,958
|
|
|
Total lease payments
|
170,337
|
|
|
Less: Amount representing interest
|
50,702
|
|
|
Present value of future payments
|
$
|
119,635
|
|
(1)
|
Our maturities of our operating lease liabilities do not include payments related to Phase Two of our New Headquarters Facility, as that option had not been exercised as of March 31, 2019.
|
Years ending December 31,
(dollars in thousands)
|
Operating leases
|
|
|
2019
|
$
|
20,808
|
|
2020
|
20,274
|
|
|
2021
|
16,924
|
|
|
2022
|
14,391
|
|
|
2023
|
12,923
|
|
|
Thereafter
|
81,755
|
|
|
Total minimum lease payments
|
$
|
167,075
|
|
(dollars in thousands)
|
March 31,
2019 |
|
|
Operating leases
|
|
||
Operating lease right-of-use assets
|
$
|
110,485
|
|
|
|
||
Accrued expenses and other current liabilities
|
$
|
16,755
|
|
Operating lease liabilities, net of current portion
|
102,880
|
|
|
Total operating lease liabilities
|
$
|
119,635
|
|
(dollars in thousands)
|
March 31,
2019 |
|
Operating leases
|
|
|
Weighted average remaining lease term (years)
|
13.0
|
|
Weighted average discount rate
|
5.96
|
%
|
16
|
|
First Quarter 2019 Form 10-Q
|
|
Three months ended
March 31, |
|
|
(dollars in thousands)
|
2019
|
|
|
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash flows from operating leases
|
$
|
5,914
|
|
Right-of-use assets obtained in exchange for lease obligations (non-cash):
|
|
||
Operating leases
|
108,330
|
|
First Quarter 2019 Form 10-Q
|
|
17
|
11. Income Taxes
|
|
Three months ended
March 31, |
|
||||
(dollars in thousands)
|
2019
|
|
2018
|
|
||
Income tax benefit
|
$
|
(1,834
|
)
|
$
|
(3,527
|
)
|
Effective income tax rate
|
62.0
|
%
|
(24.8
|
)%
|
12. Stock-based Compensation
|
|
Three months ended
March 31, |
|
||||
(dollars in thousands)
|
2019
|
|
2018
|
|
||
Included in cost of revenue:
|
|
|
||||
Cost of recurring
|
$
|
512
|
|
$
|
452
|
|
Cost of one-time services and other
|
462
|
|
643
|
|
||
Total included in cost of revenue
|
974
|
|
1,095
|
|
||
Included in operating expenses:
|
|
|
||||
Sales, marketing and customer success
|
2,911
|
|
1,825
|
|
||
Research and development
|
2,674
|
|
2,136
|
|
||
General and administrative
|
7,167
|
|
6,036
|
|
||
Total included in operating expenses
|
12,752
|
|
9,997
|
|
||
Total stock-based compensation expense
|
$
|
13,726
|
|
$
|
11,092
|
|
18
|
|
First Quarter 2019 Form 10-Q
|
13. Stockholders' Equity
|
Declaration Date
|
Dividend
per Share
|
|
Record Date
|
|
Payable Date
|
|
February 6, 2019
|
$
|
0.12
|
|
February 27
|
|
March 15
|
|
Three months ended
March 31, |
|
||||
(dollars in thousands)
|
2019
|
|
2018
|
|
||
Accumulated other comprehensive loss, beginning of period
|
$
|
(5,110
|
)
|
$
|
(642
|
)
|
By component:
|
|
|
||||
Gains and losses on cash flow hedges:
|
|
|
||||
Accumulated other comprehensive income balance, beginning of period
|
$
|
1,498
|
|
$
|
748
|
|
Other comprehensive (loss) income before reclassifications, net of tax effects of $276 and $(392)
|
(763
|
)
|
1,094
|
|
||
Amounts reclassified from accumulated other comprehensive loss to interest expense
|
(229
|
)
|
(20
|
)
|
||
Tax benefit included in provision for income taxes
|
60
|
|
5
|
|
||
Total amounts reclassified from accumulated other comprehensive loss
|
(169
|
)
|
(15
|
)
|
||
Net current-period other comprehensive (loss) income
|
(932
|
)
|
1,079
|
|
||
Reclassification upon early adoption of ASU 2018-02
|
—
|
|
167
|
|
||
Accumulated other comprehensive income balance, end of period
|
$
|
566
|
|
$
|
1,994
|
|
Foreign currency translation adjustment:
|
|
|
||||
Accumulated other comprehensive loss balance, beginning of period
|
$
|
(6,608
|
)
|
$
|
(1,390
|
)
|
Translation adjustments
|
4,590
|
|
6,437
|
|
||
Accumulated other comprehensive (loss) income balance, end of period
|
(2,018
|
)
|
5,047
|
|
||
Accumulated other comprehensive (loss) income, end of period
|
$
|
(1,452
|
)
|
$
|
7,041
|
|
First Quarter 2019 Form 10-Q
|
|
19
|
14. Revenue Recognition
|
(in thousands)
|
March 31,
2019 |
|
December 31,
2018 |
|
Total deferred revenue
|
285,372
|
|
298,555
|
|
|
Three months ended
March 31, |
|
||||
(dollars in thousands)
|
2019
|
|
2018
|
|
||
United States
|
$
|
188,126
|
|
$
|
175,923
|
|
Other countries
|
27,704
|
|
28,261
|
|
||
Total revenue
|
$
|
215,830
|
|
$
|
204,184
|
|
•
|
The GMG focuses on sales primarily to all K-12 private schools, faith-based and arts and cultural organizations, as well as emerging and mid-sized prospects in the U.S.;
|
•
|
The EMG focuses on sales primarily to all healthcare and higher education institutions, corporations and foundations, as well as large and/or strategic prospects in the U.S.; and
|
•
|
The IMG focuses on sales primarily to all prospects and customers outside of the U.S.
|
20
|
|
First Quarter 2019 Form 10-Q
|
|
Three months ended
March 31, |
|
||||
(dollars in thousands)
|
2019
|
|
2018(1)
|
|
||
GMG
|
$
|
92,515
|
|
$
|
88,268
|
|
EMG
|
95,165
|
|
86,851
|
|
||
IMG
|
28,122
|
|
28,999
|
|
||
Other
|
28
|
|
66
|
|
||
Total revenue
|
$
|
215,830
|
|
$
|
204,184
|
|
(1)
|
Beginning in the first quarter of 2019, all of our Canadian operations are included in IMG. We have recast our revenue by market group for the three months ended March 31, 2018, to present them on a consistent basis with the current year.
|
15. Restructuring
|
|
Cumulative costs incurred as of
|
|
|
Costs incurred during the three months ended(1)
|
|
|
Cumulative costs incurred as of
|
|
|||
(in thousands)
|
December 31, 2018
|
|
|
March 31, 2019
|
|
||||||
By component:
|
|
|
|
|
|
||||||
Contract termination costs
|
$
|
4,176
|
|
|
$
|
1,392
|
|
|
$
|
5,568
|
|
Other costs
|
1,208
|
|
|
561
|
|
|
1,769
|
|
|||
Total
|
$
|
5,384
|
|
|
$
|
1,953
|
|
|
$
|
7,337
|
|
(1)
|
Includes $1.3 million of operating lease ROU asset impairment costs.
|
First Quarter 2019 Form 10-Q
|
|
21
|
|
Accrued at
|
|
|
Increases for incurred costs(1)
|
|
|
Written off
upon adoption
of ASU 2016-02(2)
|
|
|
Costs paid
|
|
|
Accrued at
|
|
|||||
(in thousands)
|
December 31, 2018
|
|
|
|
|
|
March 31, 2019
|
|
|||||||||||
By component:
|
|
|
|
|
|
|
|
|
|
||||||||||
Contract termination costs
|
$
|
1,865
|
|
|
$
|
1,392
|
|
|
$
|
(1,656
|
)
|
|
$
|
(1,536
|
)
|
|
$
|
65
|
|
Other costs
|
50
|
|
|
561
|
|
|
—
|
|
|
(611
|
)
|
|
—
|
|
|||||
Total
|
$
|
1,915
|
|
|
$
|
1,953
|
|
|
$
|
(1,656
|
)
|
|
$
|
(2,147
|
)
|
|
$
|
65
|
|
(1)
|
Includes $1.3 million of operating lease ROU asset impairment costs.
|
(2)
|
Upon adoption of ASU 2016-02 at January 1, 2019, we reduced our operating lease ROU assets recognized at transition by the carrying amounts of the restructuring liabilities for certain leased office spaces that we ceased using prior to December 31, 2018.
|
22
|
|
First Quarter 2019 Form 10-Q
|
Executive Summary
|
1.
|
Deliver Integrated and Open Solutions in the Cloud
|
First Quarter 2019 Form 10-Q
|
|
23
|
2.
|
Drive Sales Effectiveness
|
3.
|
Expand TAM into Near Adjacencies through Acquisitions and Product Investments
|
4.
|
Improve Operating Efficiency
|
Total revenue
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
Total revenue
|
$
|
215.8
|
|
$
|
204.2
|
|
5.7
|
%
|
24
|
|
First Quarter 2019 Form 10-Q
|
Income from operations
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
Income from operations
|
$
|
2.2
|
|
$
|
17.6
|
|
(87.6
|
)%
|
First Quarter 2019 Form 10-Q
|
|
25
|
Results of Operations
|
Recurring
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
Recurring revenue
|
$
|
198.1
|
|
$
|
180.8
|
|
9.5
|
%
|
Cost of recurring
|
84.7
|
|
69.1
|
|
22.6
|
%
|
||
Recurring gross profit(1)
|
$
|
113.4
|
|
$
|
111.8
|
|
1.4
|
%
|
Recurring gross margin
|
57.2
|
%
|
61.8
|
%
|
|
(1)
|
The individual amounts for each year may not sum to recurring gross profit due to rounding.
|
26
|
|
First Quarter 2019 Form 10-Q
|
One-time services and other
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
One-time services and other revenue
|
$
|
17.7
|
|
$
|
23.3
|
|
(24.0
|
)%
|
Cost of one-time services and other
|
14.6
|
|
19.0
|
|
(23.1
|
)%
|
||
One-time services and other gross profit(1)
|
$
|
3.2
|
|
$
|
4.4
|
|
(27.8
|
)%
|
One-time services and other gross margin
|
17.8
|
%
|
18.8
|
%
|
|
(1)
|
The individual amounts for each year may not sum to one-time services and other gross profit due to rounding.
|
First Quarter 2019 Form 10-Q
|
|
27
|
Sales, marketing and customer success
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
Sales, marketing and customer success expense
|
$
|
55.5
|
|
$
|
45.5
|
|
21.9
|
%
|
% of total revenue
|
25.7
|
%
|
22.3
|
%
|
|
Research and development
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019(1)
|
|
2018(1)
|
|
Change
|
|
||
Research and development expense
|
$
|
28.5
|
|
$
|
26.0
|
|
9.6
|
%
|
% of total revenue
|
13.2
|
%
|
12.7
|
%
|
|
(1)
|
Not included in research and development expense for the three months ended March 31, 2019 and 2018 were $11.1 million and $6.9 million, respectively, of qualifying costs associated with development activities that are required to be capitalized under the internal-use software accounting guidance such as those related to development of our next generation cloud-based solutions. Qualifying capitalized software development costs associated with our cloud-based solutions are subsequently amortized to cost of subscriptions revenue over the related asset's estimated useful life, which generally range from three to seven years.
|
28
|
|
First Quarter 2019 Form 10-Q
|
General and administrative
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
General and administrative expense
|
$
|
27.1
|
|
$
|
25.1
|
|
8.2
|
%
|
% of total revenue
|
12.6
|
%
|
12.3
|
%
|
|
|
Cumulative costs incurred as of
|
|
|
Costs incurred during the three months ended(1)
|
|
|
Cumulative costs incurred as of
|
|
|||
(in thousands)
|
December 31, 2018
|
|
|
March 31, 2019
|
|
||||||
By component:
|
|
|
|
|
|
||||||
Contract termination costs
|
$
|
4,176
|
|
|
$
|
1,392
|
|
|
$
|
5,568
|
|
Other costs
|
1,208
|
|
|
561
|
|
|
1,769
|
|
|||
Total
|
$
|
5,384
|
|
|
$
|
1,953
|
|
|
$
|
7,337
|
|
(1)
|
Includes $1.3 million of operating lease ROU asset impairment costs.
|
First Quarter 2019 Form 10-Q
|
|
29
|
|
Accrued at
|
|
|
Increases for incurred costs(1)
|
|
|
Written off
upon adoption
of ASU 2016-02(2)
|
|
|
Costs paid
|
|
|
Accrued at
|
|
|||||
(in thousands)
|
December 31, 2018
|
|
|
|
|
|
March 31, 2019
|
|
|||||||||||
By component:
|
|
|
|
|
|
|
|
|
|
||||||||||
Contract termination costs
|
$
|
1,865
|
|
|
$
|
1,392
|
|
|
$
|
(1,656
|
)
|
|
$
|
(1,536
|
)
|
|
$
|
65
|
|
Other costs
|
50
|
|
|
561
|
|
|
—
|
|
|
(611
|
)
|
|
—
|
|
|||||
Total
|
$
|
1,915
|
|
|
$
|
1,953
|
|
|
$
|
(1,656
|
)
|
|
$
|
(2,147
|
)
|
|
$
|
65
|
|
(1)
|
Includes $1.3 million of operating lease ROU asset impairment costs.
|
(2)
|
Upon adoption of ASU 2016-02 at January 1, 2019, we reduced our operating lease ROU assets recognized at transition by the carrying amounts of the restructuring liabilities for certain leased office spaces that we ceased using prior to December 31, 2018.
|
Interest expense
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
Interest expense
|
$
|
5.3
|
|
$
|
3.5
|
|
51.4
|
%
|
% of total revenue
|
2.5
|
%
|
1.7
|
%
|
|
(dollars in millions)
|
Timing of recognition
|
March 31,
2019 |
|
Change
|
|
|
December 31,
2018 |
|
||
Recurring
|
Over the period billed in advance, generally one year
|
$
|
272.7
|
|
(5.0
|
)%
|
|
$
|
287.0
|
|
One-time services and other
|
As services are delivered
|
12.7
|
|
9.2
|
%
|
|
11.6
|
|
||
Total deferred revenue(1)
|
|
285.4
|
|
(4.4
|
)%
|
|
298.6
|
|
||
Less: Long-term portion
|
|
4.3
|
|
67.3
|
%
|
|
2.6
|
|
||
Current portion(1)
|
|
$
|
281.1
|
|
(5.0
|
)%
|
|
$
|
296.0
|
|
(1)
|
The individual amounts for each year may not sum to total deferred revenue or current portion of deferred revenue due to rounding.
|
30
|
|
First Quarter 2019 Form 10-Q
|
Income tax benefit
|
|
|
|
|||||
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
Income tax benefit
|
$
|
(1.8
|
)
|
$
|
(3.5
|
)
|
(48.0
|
)%
|
Effective income tax rate
|
62.0
|
%
|
(24.8
|
)%
|
|
First Quarter 2019 Form 10-Q
|
|
31
|
|
Three months ended
March 31, |
|
||||||
(dollars in millions)
|
2019
|
|
2018
|
|
Change
|
|
||
GAAP Revenue
|
$
|
215.8
|
|
$
|
204.2
|
|
5.7
|
%
|
Non-GAAP adjustments:
|
|
|
|
|||||
Add: Acquisition-related deferred revenue write-down
|
0.7
|
|
0.3
|
|
105.7
|
%
|
||
Non-GAAP revenue(1)
|
$
|
216.5
|
|
$
|
204.5
|
|
5.9
|
%
|
|
|
|
|
|||||
GAAP gross profit
|
$
|
116.5
|
|
$
|
116.1
|
|
0.3
|
%
|
GAAP gross margin
|
54.0
|
%
|
56.9
|
%
|
|
|||
Non-GAAP adjustments:
|
|
|
|
|||||
Add: Acquisition-related deferred revenue write-down
|
0.7
|
|
0.3
|
|
105.7
|
%
|
||
Add: Stock-based compensation expense
|
1.0
|
|
1.1
|
|
(11.1
|
)%
|
||
Add: Amortization of intangibles from business combinations
|
11.4
|
|
10.4
|
|
9.9
|
%
|
||
Add: Employee severance
|
1.1
|
|
0.6
|
|
94.6
|
%
|
||
Subtotal(1)
|
14.2
|
|
12.4
|
|
14.7
|
%
|
||
Non-GAAP gross profit(1)
|
$
|
130.8
|
|
$
|
128.6
|
|
1.7
|
%
|
Non-GAAP gross margin
|
60.4
|
%
|
62.9
|
%
|
|
(1)
|
The individual amounts for each year may not sum to non-GAAP revenue, subtotal or non-GAAP gross profit due to rounding.
|
32
|
|
First Quarter 2019 Form 10-Q
|
|
Three months ended
March 31, |
|
||||||
(dollars in millions, except per share amounts)
|
2019
|
|
2018
|
|
Change
|
|
||
GAAP income from operations
|
$
|
2.2
|
|
$
|
17.6
|
|
(87.6
|
)%
|
GAAP operating margin
|
1.0
|
%
|
8.6
|
%
|
|
|||
Non-GAAP adjustments:
|
|
|
|
|||||
Add: Acquisition-related deferred revenue write-down
|
0.7
|
|
0.3
|
|
105.7
|
%
|
||
Add: Stock-based compensation expense
|
13.7
|
|
11.1
|
|
23.7
|
%
|
||
Add: Amortization of intangibles from business combinations
|
12.8
|
|
11.7
|
|
9.8
|
%
|
||
Add: Employee severance
|
3.4
|
|
0.9
|
|
267.5
|
%
|
||
Add: Acquisition-related integration costs
|
0.7
|
|
0.4
|
|
65.8
|
%
|
||
Add: Acquisition-related expenses
|
0.4
|
|
0.4
|
|
12.9
|
%
|
||
Add: Restructuring costs
|
2.0
|
|
0.8
|
|
140.8
|
%
|
||
Subtotal(1)
|
33.8
|
|
25.7
|
|
31.6
|
%
|
||
Non-GAAP income from operations(1)
|
$
|
36.0
|
|
$
|
43.2
|
|
(16.9
|
)%
|
Non-GAAP operating margin
|
16.6
|
%
|
21.1
|
%
|
|
|||
|
|
|
|
|||||
GAAP (loss) income before provision for income taxes
|
$
|
(3.0
|
)
|
$
|
14.2
|
|
(120.8
|
)%
|
GAAP net (loss) income
|
$
|
(1.1
|
)
|
$
|
17.8
|
|
(106.3
|
)%
|
Shares used in computing GAAP diluted (loss) earnings per share
|
47,516,912
|
|
48,009,395
|
|
(1.0
|
)%
|
||
GAAP diluted (loss) earnings per share
|
$
|
(0.02
|
)
|
$
|
0.37
|
|
(105.4
|
)%
|
Non-GAAP adjustments:
|
|
|
|
|||||
Less: GAAP income tax benefit
|
(1.8
|
)
|
(3.5
|
)
|
(48.0
|
)%
|
||
Add: Total non-GAAP adjustments affecting income from operations
|
33.8
|
|
25.7
|
|
31.6
|
%
|
||
Non-GAAP income before provision for income taxes
|
30.8
|
|
39.9
|
|
(22.7
|
)%
|
||
Assumed non-GAAP income tax provision(2)
|
6.2
|
|
8.0
|
|
(22.8
|
)%
|
||
Non-GAAP net income(1)
|
$
|
24.7
|
|
$
|
31.9
|
|
(22.7
|
)%
|
|
|
|
|
|||||
Shares used in computing non-GAAP diluted earnings per share
|
48,051,289
|
|
48,009,395
|
|
0.1
|
%
|
||
Non-GAAP diluted earnings per share
|
$
|
0.51
|
|
$
|
0.66
|
|
(22.7
|
)%
|
(1)
|
The individual amounts for each year may not sum to subtotal, non-GAAP income from operations or non-GAAP net income due to rounding.
|
(2)
|
We apply a non-GAAP effective tax rate of 20.0% in our determination of non-GAAP net income, which represents the GAAP effective tax rate, excluding the discrete tax effect of stock-based compensation.
|
|
Three months ended March 31,
|
|
|||||||
(dollars in millions)
|
2019
|
|
Change
|
|
|
2018
|
|
||
GAAP net cash provided by operating activities
|
$
|
(10.0
|
)
|
(185.2
|
)%
|
|
$
|
11.8
|
|
Less: purchase of property and equipment
|
(1.2
|
)
|
(80.0
|
)%
|
|
(5.8
|
)
|
||
Less: capitalized software development costs
|
(11.3
|
)
|
59.4
|
%
|
|
(7.1
|
)
|
||
Non-GAAP free cash flow
|
(22.5
|
)
|
1,905.5
|
%
|
|
(1.1
|
)
|
First Quarter 2019 Form 10-Q
|
|
33
|
(dollars in millions)
|
Three months ended
March 31, |
|
||||
2019
|
|
2018
|
|
|||
GAAP revenue
|
$
|
215.8
|
|
$
|
204.2
|
|
GAAP revenue growth
|
5.7
|
%
|
|
|||
(Less) Add: Non-GAAP acquisition-related revenue (1)
|
(4.4
|
)
|
2.7
|
|
||
Non-GAAP organic revenue
|
$
|
211.4
|
|
$
|
206.9
|
|
Non-GAAP organic revenue growth
|
2.2
|
%
|
|
|||
|
|
|
||||
Non-GAAP organic revenue (2)
|
$
|
211.4
|
|
$
|
206.9
|
|
Foreign currency impact on Non-GAAP organic revenue (3)
|
1.8
|
|
—
|
|
||
Non-GAAP organic revenue on constant currency basis (3)
|
$
|
213.2
|
|
$
|
206.9
|
|
Non-GAAP organic revenue growth on constant currency basis
|
3.1
|
%
|
|
|||
|
|
|
||||
GAAP recurring revenue
|
198.1
|
|
180.8
|
|
||
GAAP recurring revenue growth
|
9.5
|
%
|
|
|||
(Less) Add: Non-GAAP acquisition-related revenue (1)
|
(4.2
|
)
|
2.6
|
|
||
Non-GAAP organic recurring revenue
|
$
|
193.9
|
|
$
|
183.4
|
|
Non-GAAP organic recurring revenue growth
|
5.7
|
%
|
|
(1)
|
Non-GAAP acquisition-related revenue excludes incremental acquisition-related revenue calculated in accordance with GAAP that is attributable to companies acquired in the current fiscal year. For companies, if any, acquired in the immediately preceding fiscal year, non-GAAP acquisition-related revenue reflects presentation of full-year incremental non-GAAP revenue derived from such companies, as if they were combined throughout the prior period, and it includes the non-GAAP revenue from the acquisition-related deferred revenue write-down attributable to those companies.
|
(2)
|
Non-GAAP organic revenue for the prior year periods presented herein will not agree to non-GAAP organic revenue presented in the respective prior period quarterly financial information solely due to the manner in which non-GAAP organic revenue growth is calculated.
|
(3)
|
To determine non-GAAP organic revenue growth on a constant currency basis, revenues from entities reporting in foreign currencies were translated to U.S. Dollars using the comparable prior period's quarterly weighted average foreign currency exchange rates. The primary foreign currencies creating the impact are the Canadian Dollar, EURO, British Pound and Australian Dollar.
|
34
|
|
First Quarter 2019 Form 10-Q
|
Liquidity and Capital Resources
|
(dollars in millions)
|
March 31,
2019 |
|
Change
|
|
|
December 31,
2018 |
|
||
Cash and cash equivalents
|
$
|
25.2
|
|
(18.4
|
)%
|
|
$
|
30.9
|
|
Property and equipment, net
|
38.8
|
|
(3.2
|
)%
|
|
40.0
|
|
||
Software development costs, net
|
81.2
|
|
8.2
|
%
|
|
75.1
|
|
||
Total carrying value of debt
|
583.6
|
|
50.7
|
%
|
|
387.1
|
|
||
Working capital
|
(187.2
|
)
|
9.9
|
%
|
|
(207.7
|
)
|
|
Three months ended March 31,
|
|
|||||||
(dollars in millions)
|
2019
|
|
Change
|
|
|
2018
|
|
||
Net cash (used in) provided by operating activities
|
$
|
(10.0
|
)
|
(185.2
|
)%
|
|
$
|
11.8
|
|
Net cash used in investing activities
|
(121.9
|
)
|
580.4
|
%
|
|
(17.9
|
)
|
||
Net cash used in financing activities
|
(74.4
|
)
|
(83.0
|
)%
|
|
(438.9
|
)
|
First Quarter 2019 Form 10-Q
|
|
35
|
36
|
|
First Quarter 2019 Form 10-Q
|
Financial Covenant
|
Requirement
|
Ratio as of March 31, 2019
|
Net Leverage Ratio
|
≤ 3.50 to 1.00
|
2.98 to 1.00
|
Interest Coverage Ratio
|
≥ 2.50 to 1.00
|
10.53 to 1.00
|
|
Payments due by period
|
||||||||||||||
(in millions)
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than 5 years
|
|
|||||
Recorded contractual obligations:
|
|
|
|
|
|
||||||||||
Debt(1)
|
$
|
585.1
|
|
$
|
7.5
|
|
$
|
15.0
|
|
$
|
562.6
|
|
$
|
—
|
|
Operating leases(2)
|
170.3
|
|
23.3
|
|
38.2
|
|
29.1
|
|
79.8
|
|
|||||
|
|
|
|
|
|
||||||||||
Unrecorded contractual obligations:
|
|
|
|
|
|
||||||||||
Interest payments on debt(3)
|
68.1
|
|
21.6
|
|
42.8
|
|
3.8
|
|
—
|
|
|||||
Purchase obligations(4)
|
111.4
|
|
41.8
|
|
67.9
|
|
1.7
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
935.0
|
|
$
|
94.2
|
|
$
|
163.8
|
|
$
|
597.2
|
|
$
|
79.8
|
|
(1)
|
Represents principal payments only, under the following assumptions: (i) that the amounts outstanding under the 2017 Credit Facility and our other debt at March 31, 2019 will remain outstanding until maturity, with minimum payments occurring as currently scheduled, and (ii) that there are no assumed future borrowings on the 2017 Credit Facility for the purposes of determining minimum commitment amounts.
|
(2)
|
Our commitments related to operating leases have not been reduced by sublease income, incentive payments and reimbursement of leasehold improvements.
|
(3)
|
The actual interest expense recognized in our consolidated statements of comprehensive income will depend on the amount of debt, the length of time the debt is outstanding and the interest rate, which could be different from our assumptions described in (1) above.
|
(4)
|
We have contractual obligations for third-party technology used in our solutions and for other services we purchase as part of our normal operations. In certain cases, these arrangements require a minimum annual purchase commitment by us.
|
First Quarter 2019 Form 10-Q
|
|
37
|
Off-Balance Sheet Arrangements
|
Foreign Currency Exchange Rates
|
Critical Accounting Policies and Estimates
|
38
|
|
First Quarter 2019 Form 10-Q
|
Recently Issued Accounting Pronouncements
|
Interest Rate Risk
|
Foreign Currency Risk
|
Evaluation of Disclosure Controls and Procedures
|
Changes in Internal Control Over Financial Reporting
|
First Quarter 2019 Form 10-Q
|
|
39
|
|
|
PART II. OTHER INFORMATION
|
Issuer Purchases of Equity Securities
|
Period
|
Total
number
of shares
purchased
|
|
|
Average
price
paid
per
share
|
|
|
Total number
of shares
purchased as
part of
publicly
announced
plans or
programs(1)
|
|
|
Approximate
dollar value
of shares
that may yet
be purchased
under the
plans or programs
(in thousands)
|
|
||
Beginning balance, January 1, 2019
|
|
|
|
|
|
|
$
|
50,000
|
|
||||
January 1, 2019 through January 31, 2019
|
5,404
|
|
|
$
|
65.88
|
|
|
—
|
|
|
50,000
|
|
|
February 1, 2019 through February 28, 2019
|
233,407
|
|
|
77.14
|
|
|
—
|
|
|
50,000
|
|
||
March 1, 2019 through March 31, 2019
|
500
|
|
|
80.00
|
|
|
—
|
|
|
50,000
|
|
||
Total
|
239,311
|
|
|
$
|
76.89
|
|
|
—
|
|
|
$
|
50,000
|
|
(1)
|
In August 2010, our Board of Directors approved a stock repurchase program that authorized us to purchase up to $50.0 million of our outstanding shares of common stock. We have not made any repurchases under the program to date, and the program does not have an expiration date.
|
40
|
|
First Quarter 2019 Form 10-Q
|
|
|
|
|
Filed In
|
||||||
Exhibit Number
|
|
Description of Document
|
|
Filed Herewith
|
|
Form
|
|
Exhibit Number
|
|
Filing Date
|
|
|
X
|
|
|
|
|
|
|
||
|
|
X
|
|
|
|
|
|
|
||
|
|
|
|
10-Q
|
|
10.92
|
|
8/4/2017
|
||
|
|
X
|
|
|
|
|
|
|
||
|
|
X
|
|
|
|
|
|
|
||
|
|
X
|
|
|
|
|
|
|
||
|
|
X
|
|
|
|
|
|
|
||
101.INS*
|
|
XBRL Instance Document.
|
|
X
|
|
|
|
|
|
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document.
|
|
X
|
|
|
|
|
|
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
X
|
|
|
|
|
|
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
X
|
|
|
|
|
|
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
X
|
|
|
|
|
|
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
X
|
|
|
|
|
|
|
First Quarter 2019 Form 10-Q
|
|
41
|
|
|
SIGNATURES
|
|
|
BLACKBAUD, INC.
|
|
|
|
|
|
Date:
|
May 3, 2019
|
By:
|
/s/ Michael P. Gianoni
|
|
|
|
Michael P. Gianoni
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
Date:
|
May 3, 2019
|
By:
|
/s/ Anthony W. Boor
|
|
|
|
Anthony W. Boor
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial and Accounting Officer)
|
42
|
|
First Quarter 2019 Form 10-Q
|
•
|
You will receive a base salary of $425,000 annually, to be paid on a semi-monthly basis.
|
•
|
You are eligible to participate in the 2018 Corporate Incentive Plan with a target bonus opportunity of 65% of your earned salary. Upon your arrival specifics of the bonus plan will be communicated to you.
|
•
|
You will also receive a LTIP grant in the amount of $2,500,000.00 granted in the next open window following your start date. The grant will consist of 50% restricted shares that will vest equally over 4 years and 50% performance based RSUs, while if earned will vest over 3 years. Details on the performance based RSUs will be provided to you along with the grant notice. The amount of the shares and RSUs will be determined by dividing the amount the $2,500,000.00 by the 30-day average price of Blackbaud stock. A copy of the Blackbaud Equity Plan will also be provided to you.
|
•
|
If within the first two (2) years of your employment with Blackbaud, Inc., you are terminated for any reason other than cause, you will be provided with 12 months’ severance (consisting of base pay) and will receive 12-month acceleration on any unvested restricted shares. (Does not include PRSUs)
|
•
|
You will receive a sign-on bonus in the amount of $33,000.00. This bonus, which will be paid on your first paycheck, is subject to all normal payroll taxes and will require that you sign the enclosed repayment agreement in the event you leave Blackbaud within the first year. This bonus is a combination relocation settlement and commutation allowance.
|
•
|
You will be eligible for the full range of benefits offered to all Blackbaud employees, including medical, dental, life, and 401(k) beginning on your start date. A complete explanation of our benefits program will be provided to you during New Employee Orientation.
|
•
|
Blackbaud will cover the cost of the move of household goods, through our selected vendor, from your New Jersey home to Charleston, South Carolina, up to $20,000.00. It is important to note that your relocation benefits will expire one (1) year from your date of hire. We require that you sign the repayment agreement in the event you leave Blackbaud within the first year. Please contact Blackbaud’s Talent Acquisition Coordinator, Charles Stephens, to begin the process of scheduling your move by calling (843) 654-2271 or emailing him at Charles.Stephens@blackbaud.com.
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◦
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Additionally, Blackbaud will cover the costs of one (1) moving trip for you and your spouse to relocate to the Charleston, South Carolina area. This coverage includes reasonable transportation, hotel expenses and other relevant expenses. A portion of this moving trip will be subject to appropriate taxation in accordance with the Blackbaud Relocation Policy.
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Blackbaud will reimburse you for the costs of one (1) hunting trip for you and your spouse from New Jersey, to Charleston, SC in accordance with Blackbaud’s Travel Policy. This includes economy class airfare, local transportation, hotel expenses, and normal and reasonable meal expenses. Please be aware that Blackbaud is required to reflect this payment in your semi-monthly pay and it will subject to all normal payroll taxes.
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Additionally, we will provide up to six (6) months of temporary housing, with a maximum of $3,500 per month. Please be aware that housing allowances of any kind are now considered taxable income by the IRS. Blackbaud is required to reflect this payment in your semi-monthly pay and it will subject to all normal payroll taxes.
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2/16/2018
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/s/ Kevin P. Gregoire
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Date
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Kevin Gregoire
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1.
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Nature of the Business. For purposes of this Agreement, the “Business” means (A) (i) the design, development, marketing, licensing, leasing, rental or sale of products and/or services in respect of software, software applications, internet applications, mobile applications, donor research and management, prospective donor analysis, business performance analytics, payment processing, e-commerce solutions, tuition payment portal or financial aid, scholarship management solutions, peer-to-peer fundraising, donation-based crowd funding or, in each case, services and/or consulting with respect thereto, (ii) to consumers, non-profit organizations, associations, foundations, corporations, government agencies, donors, advisors, education institutions, financial institutions or faith-based organizations, and (iii) in connection with fundraising, e-commerce, accounting and financial management activities, donor management, corporate social responsibility program management, volunteer management, charitable event management, charitable mission / case / outcomes management or grant (or other charitable currency) management (including investing, managing and awarding such currency), tuition management or scholarship management or church management systems, member management, congregant engagement, child check-in, worship planning and associated production, including live-stream, and (B) design, development, marketing, licensing, leasing, rental or sale of software, software applications, internet applications, mobile applications, and analytics, in each case targeted to nonprofit organizations and charities and designed: (A) to provide performance management, activity tracking, prospect research, analytics, insights, reporting, direct marketing, benchmarking and recommended actions to gift officers and their management; or (B) to enable fundraising campaigns, provide fundraising data collection, analysis and processing for nonprofit organizations and charities, or provide best practice tools and recommendations; and (ii) consulting and/or performance of installation, training, support and other services related to any of the foregoing.
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2.
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Consideration. In return for the restrictions, promises and other terms contained herein, it is stipulated and agreed that this Agreement is being entered into in consideration of the Company’s employment of Employee and allowing Employee access to valuable, confidential, privileged, and proprietary information and trade secrets relating to the Company’s business, customers, processes, vendors, and relationships.
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3.
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Covenants Not to Use or Disclose Confidential Information.
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(a)
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Employee will hold all Confidential Information in strict confidence and will not use, publish, divulge or otherwise reveal or allow to be revealed any portion thereof to any third person, company or other entity, except to or with the prior written consent of the Company;
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(b)
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Employee will use his/her best efforts to assure that all Confidential Information is properly protected and kept from unauthorized persons or entities, and will immediately report to the Company any misuse of Confidential Information by another person or entity that Employee may encounter or of which Employee may become aware;
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(c)
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Employee will make no use of any Confidential Information except such use as is required in the performance of Employee’s services for the Company; and
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(d)
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Upon termination of Employee’s employment with the Company for any reason, or upon the Company’s request, Employee will immediately deliver to the Company all documents, software, hardware, written materials and other items of any kind, and any copies thereof that contain Confidential Information.
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4.
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Covenant Not to Compete or Solicit Customers.
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(a)
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During Employee’s employment and for one (1) year following the termination of his/her employment, regardless of whether voluntary or involuntary (the “Restricted Period”), Employee will not, either directly or indirectly, for himself/herself or on behalf of any other person, business, enterprise or entity, compete with Company by providing services similar to the Business of the Company to any other person, business, enterprise or entity that competes with the Company, in the same or substantially similar capacity in which Employee was employed by the Company.
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(b)
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Notwithstanding the foregoing, if a court or arbitrator determines that the Restricted Territory is overbroad, the parties agree that the Restricted Territory will be (i) all States where the Company has or had operations during the two (2) years preceding Employee’s last day of employment with the Company; and (ii) all States where the Employee regularly transacted business on behalf of the Company during the two (2) years preceding Employee’s last day of employment with the Company.
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(c)
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In addition to, but not in limitation of the restrictions set forth above, the Employee further promises and agrees that unless the Company has given its prior written consent, which can be withheld in its sole discretion, he/she will not advertise or market services as a Company employee or former Company employee or as an expert in any Company products or services or any similar designation in connection with the foregoing. During Employee’s employment and for one (1) year following termination of his/her employment, regardless of whether voluntary or involuntary, Employee will not, directly or indirectly, either on behalf of himself/herself or any other person, business, enterprise or entity, (i) solicit any of the Company’s Customers for any business purpose in competition with or in conflict with the Business of the Company or (ii) request or advise any of the Company’s Customers to withdraw, curtail, or cancel their business with the Company. For purposes of this Agreement “Customers” shall mean any current customer or prospective customer of the Company (1) with whom Employee had contact directly or indirectly in connection with Employee’s employment with the Company during the two (2) years prior to the termination of Employee’s employment with the Company; or (ii) about whom Employee had access to proprietary, confidential, or commercially advantageous information through Employee’s employment by the Company during the two (2) year period prior to the termination of Employee’s employment with the Company.
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5.
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Covenant Not to Solicit Employees. During Employee’s employment and for one (1) year after separation of employment from the Company Employee will not, directly or indirectly, either on behalf of himself/herself or any other person, business, enterprise or entity, solicit for employment, employ, hire, contract with, or otherwise engage any Applicable Personnel. For purposes of this Section, “Applicable Personnel” means any person that was employed or engaged as an employee or independent contractor of the Company at any time during the six (6) month period prior to termination of Employee’s employment with the Company of whom Employee developed knowledge or information regarding skills and abilities while employed.
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6.
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Exclusive Employment. Employee shall not without the express prior written consent of the Company, directly or indirectly, during Employee’s employment with the Company, render professional services to any person or firm for compensation or engage in any activity competitive with and/or adverse to the Company’s purposes, mission or interests, whether alone, as a partner or member, or as an officer, director, employee or shareholder of any other corporation or entity or as a trustee, fiduciary or other representative of any other activity or entity, except with the express written approval of the Company, which the Company may revoke at any time in its sole discretion.
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7.
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Ownership and Assignment of Inventions. Employee understands and agrees that Employee is performing work for hire for the Company and that any Inventions (as defined below) developed or conceived by Employee during Employee’s employment with the Company are the sole property of the Company. “Inventions” shall include any inventions, improvements, developments, discoveries, programs, designs, products, processes, information systems and software, as well as any other concepts, works and ideas, whether patentable or not, relating to any present or prospective activities or Business of the Company. Employee agrees to make the Company aware of all such Inventions. To the maximum extent permitted by applicable law, Employee further agrees to assign and does hereby assign to the Company all rights, title and interest in and to all such Inventions hereafter made by Employee. This Section does not apply to any Invention for which Employee affirmatively proves that: (a) no equipment, supplies, facility, trade secrets, or Confidential Information of the Company was
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8.
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Remedies. It is stipulated and agreed that a breach by Employee of any of the covenants contained in Sections 3, 4, 5, 6 or 7 of this Agreement would cause irreparable damage to the Company. The Company, in addition to any other rights or remedies that the Company may have, shall be entitled to an injunction restraining Employee from violating or continuing any violation of such covenants without posting of bond (to the extent permitted by applicable law). Such right to obtain injunctive relief may be exercised at the option of the Company, concurrently with, prior to, after, or in lieu of the exercise of any other rights or remedies that the Company may have as a result of any such breach or threatened breach of this Agreement. Employee agrees that upon breach of any of the covenants contained in Sections 3, 4, 5, 6 or 7 of this Agreement, the Company shall be entitled to an accounting and repayment of all profits, royalties, compensation, and/or other benefits that Employee directly or indirectly has realized or may realize as a result of, or in connection with, any such breach. Employee further agrees that Employee will be liable for any expenses the Company may incur, including attorneys’ fees, to enforce the terms of this Agreement. This provision is in addition to and not in lieu of any rights and remedies available to the Company for any breach of this Agreement.
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9.
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No Effect on Trade Secret Laws. Subject to Section 11 below, nothing in this Agreement is intended to alter, limit (temporally, geographically, or otherwise), or have any effect whatsoever on Employee’s obligation to refrain from disclosing the Company’s trade secrets. Nothing in this Agreement shall limit or otherwise affect the Company’s remedies for any violation of applicable trade secrets laws, all of which shall be cumulative to any remedies available to the Company for a breach of this Agreement.
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10.
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Defend Trade Secrets Act. Under the federal Defend Trade Secrets Act of 2016, Employee shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (a) is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made to Employee’s attorney in relation to a lawsuit for retaliation against Employee for reporting a suspected violation of law; or (c) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
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11.
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Other Agreements/Warranties. Employee warrants that Employee is not bound by the terms of a confidentiality agreement or non-competition agreement or any other agreement with a former employer or other third party that would preclude Employee from accepting employment with the Company or that would preclude Employee from effectively performing Employee’s duties for the Company. Employee further warrants that Employee has the right to make all disclosures that Employee will make to the Company during the course of Employee’s employment with the Company. Employee agrees that Employee shall not disclose to the Company, or seek to induce the Company to use, any confidential information in the nature of trade secrets or other proprietary information belonging to others and that in the event that the Company directs Employee to perform tasks that would result in the disclosure or use of any such confidential information, that Employee shall notify the Company in advance of any such disclosure. Employee agrees to defend, indemnify, and hold harmless the Company for any losses that it incurs as a result of the Employee’s violation of any non-competition, non-solicitation, non-disclosure, or trade secret obligations that Employee may have to any other party during employment with the Company. Employee also agrees that any violation by Employee of any non-competition, non-solicitation, non-disclosure, or trade secret obligations that Employee may have to any other party during employment with the Company shall be grounds for immediate discharge.
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12.
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Acknowledgment of Reasonableness. Employee has carefully read and considered the provisions of this Agreement, has had the opportunity to consult with an attorney of Employee’s choice, and agrees that the restrictions and remedies set forth herein are fair and reasonably required for the protection of the Company. In the event that any provision relating to the scope of the restrictions shall be declared by a court of competent jurisdiction to exceed the maximum scope that such court deems reasonable and enforceable under applicable law, the Company and Employee agree that the scope of the restriction held reasonable and enforceable by the court shall thereafter be the scope of this Agreement.
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13.
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Severability; Survival; Modification. The covenants described herein and all provisions and sub-provisions of this Agreement are intended to be severable. If any term, covenant, provision, sub-provision, or portion thereof is held to be invalid, void or unenforceable by a court of competent jurisdiction or arbitrator for any reason whatsoever, such ruling shall not affect the remainder of this Agreement, which shall remain in full
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14.
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Applicable Law. This Agreement and any dispute or controversy arising out of or relating to this Agreement shall, in all respects, be governed by and construed according to the laws of the State of South Carolina, without regard to its conflict of law principles.
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15.
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Dispute Resolution. Employee and Blackbaud agree that all disputes (unless excluded below), arising out of or related to this Agreement or the employment relationship, which Blackbaud may have against Employee or the Employee may have against Blackbaud (including its affiliates, subsidiaries, divisions, successors, assigns and their current and former employees, officers, directors, and agents), involving legally or equitably protected rights, shall be resolved only through formal, mandatory arbitration before a neutral arbitrator. This includes, without limitation, disputes or claims about the application for employment, terms and conditions of employment, wages and pay, leaves of absence, reasonable accommodation, or termination of employment. For example, such claims include, but are not limited to, those under the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, the Fair Labor Standards Act, the Family and Medical Leave Act, the Americans with Disabilities Act of 1990, Sections 1981 through 1988 of Title 42 of the United States Code, any state or local anti-discrimination (such as, for example, the Massachusetts Fair Employment Practices Act), harassment, or wage laws, or under any federal, state, or local law, ordinance or regulation, or based on any public policy, contract, tort, equitable theory, or common law. The arbitration must be pursued on an individual basis only and, to the maximum extent permitted by law, Employee and Blackbaud waive the right to commence, be a party to, participate in, receive money or any other relief from, or amend any existing lawsuit to include, any representative, collective or class proceeding or claims or to bring jointly any claim covered by this Agreement. No party may bring a claim on behalf of other individuals and an arbitrator may not (a) combine more than one individual’s claim or claims into a single case; (b) order, require, participate in or facilitate production of class-wide contact information or notification to others of potential claims; or (c) arbitrate any form of a class, collective, or representative proceeding. Only a court of competent jurisdiction may interpret the enforceability of this class/collective action waiver. If the class/collective action waiver is determined to be unenforceable by a court of competent jurisdiction then the case will proceed as a putative class/collective action in court.
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16.
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Waiver. Any waiver of a breach of any provision of this Agreement must be in writing and signed by the waiving party. Any waiver of a breach of any provision of this Agreement shall not operate or be construed as a waiver of, or estoppel with respect to, any subsequent breach of such provision or any other provision of this Agreement. The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not deprive that party of its right thereafter to insist upon strict adherence to that term or any other term of this Agreement.
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17.
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Employment At-Will. Nothing in this Agreement shall be interpreted to create a contract of employment for any specific time. Employee is and shall remain an employee at-will, and either party may terminate the employment relationship at any time for any reason or no reason at all.
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18.
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Entire Agreement. This Agreement constitutes the entire agreement between the parties as of the date hereof with respect to the subject matter hereof and supersedes any previous understandings, representations, statements and agreements, whether oral or written, between or among the parties with respect to the subject matter hereof. This Agreement may be modified only by written agreement, signed by all of the parties and expressly purporting to modify this Agreement.
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19.
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No Assignment / Binding Effect. Employee may not assign this Agreement to any other person or entity without the Company’s express written consent, which may be withheld for any reason or no reason at all. This Agreement shall be binding on Employee’s heirs, successors, and permitted assigns. This Agreement shall be assignable by the Company to its successors and assigns.
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20.
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Tolling. The Restricted Period shall be tolled for any period(s) of violation, including period(s) of time required for litigation to enforce the covenants of this Agreement.
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21.
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Execution. This Agreement may be executed by one or more parties in the form of an electronic signature, which will constitute an original and binding signature of a party. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement.
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EMPLOYEE:
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Date:
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2/16/2018
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/s/ Kevin P. Gregoire
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BLACKBAUD, INC.:
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/s/ Peggy Anderson
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By:
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1.
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I have reviewed this quarterly report on Form 10-Q of Blackbaud, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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May 3, 2019
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By:
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/s/ Michael P. Gianoni
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Michael P. Gianoni
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President and Chief Executive Officer
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(Principal Executive Officer)
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1.
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I have reviewed this quarterly report on Form 10-Q of Blackbaud, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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May 3, 2019
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By:
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/s/ Anthony W. Boor
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Anthony W. Boor
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Executive Vice President and Chief Financial Officer
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(Principal Financial and Accounting Officer)
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1.
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date:
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May 3, 2019
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By:
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/s/ Michael P. Gianoni
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Michael P. Gianoni
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President and Chief Executive Officer
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(Principal Executive Officer)
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1.
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date:
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May 3, 2019
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By:
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/s/ Anthony W. Boor
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Anthony W. Boor
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Executive Vice President and Chief Financial Officer
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(Principal Financial and Accounting Officer)
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