10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                      

Commission file number 0-27512

CSG SYSTEMS INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Delaware	47-0783182
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

6175 S. Willow Drive, 10^th Floor

Greenwood Village, Colorado 80111

(Address of principal executive offices, including zip code)

(303) 200-2000

(Registrant’s telephone number, including area code)

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, Par Value $0.01 Per Share	CSGS	NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes   ☒            No   ☐  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes   ☒            No   ☐  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of April 30, 2021, there were 32,889,346 shares of the registrant’s common stock outstanding.

CSG SYSTEMS INTERNATIONAL, INC.

FORM 10-Q for the Quarter Ended March 31, 2021

INDEX

		Page No.
Part I - FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020 (Unaudited)	3
	Condensed Consolidated Statements of Income for the Quarters ended March 31, 2021 and 2020 (Unaudited)	4
	Condensed Consolidated Statements of Comprehensive Income for the Quarters ended March 31, 2021 and 2020 (Unaudited)	5
	Condensed Consolidated Statements of Stockholders’ Equity for the Quarters ended March 31, 2021 and 2020 (Unaudited)	6
	Condensed Consolidated Statements of Cash Flows for the Quarters ended March 31, 2021 and 2020 (Unaudited)	7
	Notes to Condensed Consolidated Financial Statements (Unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 4.	Controls and Procedures	24
Part II - OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 6.	Exhibits	25
	Index to Exhibits	26
	Signatures	27

2

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED

(in thousands, except per share amounts)  

	March 31,			December 31,
	2021			2020
ASSETS
Current assets:
Cash and cash equivalents	$	150,609		$	188,699
Short-term investments		54,539			51,598
Total cash, cash equivalents and short-term investments		205,148			240,297
Settlement assets		108,578			149,785
Trade accounts receivable:
Billed, net of allowance of $3,718 and $3,628		247,025			226,623
Unbilled		40,789			37,785
Income taxes receivable		2,421			2,167
Other current assets		39,047			41,688
Total current assets		643,008			698,345
Non-current assets:
Property and equipment, net of depreciation of $110,797 and $105,073		81,944			81,759
Operating lease right-of-use assets		106,173			110,756
Software, net of amortization of $143,662 and $139,836		25,585			26,453
Goodwill		273,265			272,322
Acquired customer contracts, net of amortization of $107,846 and $105,778		46,273			48,012
Customer costs, net of amortization of $42,802 and $39,893		47,334			47,238
Deferred income taxes		9,892			10,205
Other assets		41,007			36,910
Total non-current assets		631,473			633,655
Total assets	$	1,274,481		$	1,332,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt, net of unamortized discounts of $3,119 and zero	$	241,881		$	14,063
Operating lease liabilities		23,309			22,651
Customer deposits		32,565			39,992
Trade accounts payable		32,949			29,834
Accrued employee compensation		71,120			86,289
Settlement liabilities		107,023			148,819
Deferred revenue		55,840			52,357
Income taxes payable		5,797			6,627
Other current liabilities		17,249			19,383
Total current liabilities		587,733			420,015
Non-current liabilities:
Long-term debt, net of unamortized discounts of $1,017 and $5,346		107,733			337,154
Operating lease liabilities		91,028			95,926
Deferred revenue		15,505			17,275
Income taxes payable		2,467			2,436
Deferred income taxes		11,569			5,109
Other non-current liabilities		30,731			31,690
Total non-current liabilities		259,033			489,590
Total liabilities		846,766			909,605
Stockholders' equity:
Preferred stock, par value $.01 per share; 10,000 shares authorized; zero shares issued and outstanding		-			-
Common stock, par value $.01 per share; 100,000 shares authorized; 32,963 and 32,713 shares outstanding		704			700
Additional paid-in capital		471,364			470,557
Treasury stock, at cost; 36,122 and 35,980 shares		(900,644	)		(894,126	)
Accumulated other comprehensive income (loss):
Unrealized gains on short-term investments, net of tax		7			13
Cumulative foreign currency translation adjustments		(31,506	)		(31,151	)
Accumulated earnings		887,790			876,402
Total stockholders' equity		427,715			422,395
Total liabilities and stockholders' equity	$	1,274,481		$	1,332,000

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

(in thousands, except per share amounts)

	Quarter Ended
	March 31, 2021			March 31, 2020
Revenue	$	253,119		$	245,617
Cost of revenue (exclusive of depreciation, shown separately below)		133,542			131,206
Other operating expenses:
Research and development		32,212			30,337
Selling, general and administrative		48,815			44,384
Depreciation		6,113			5,565
Restructuring and reorganization charges		1,060			966
Total operating expenses		221,742			212,458
Operating income		31,377			33,159
Other income (expense):
Interest expense		(3,592	)		(4,213	)
Amortization of original issue discount		(772	)		(730	)
Interest and investment income, net		124			529
Other, net		(555	)		(69	)
Total other		(4,795	)		(4,483	)
Income before income taxes		26,582			28,676
Income tax provision		(6,951	)		(7,162	)
Net income	$	19,631		$	21,514
Weighted-average shares outstanding:
Basic		31,844			31,994
Diluted		32,146			32,358
Earnings per common share:
Basic	$	0.62		$	0.67
Diluted		0.61			0.66

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - UNAUDITED

(in thousands)

	Quarter Ended
	March 31, 2021			March 31, 2020
Net income	$	19,631		$	21,514
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		(355	)		(15,084	)
Unrealized holding losses on short-term investments arising during period		(6	)		(24	)
Other comprehensive loss, net of tax		(361	)		(15,108	)
Total comprehensive income, net of tax	$	19,270		$	6,406

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - UNAUDITED

(in thousands)

	Shares of Common Stock Outstanding			Common Stock			Additional Paid-in Capital			Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Accumulated Earnings			Total Stockholders' Equity
For the Quarter Ended March 31, 2021:
BALANCE, January 1, 2021		32,713		$	700		$	470,557		$	(894,126	)	$	(31,138	)	$	876,402		$	422,395
Comprehensive income:
Net income		-			-			-			-			-			19,631
Unrealized gain on short-term investments, net of tax		-			-			-			-			(6	)		-
Foreign currency translation adjustments		-			-			-			-			(355	)		-
Total comprehensive income																				19,270
Repurchase of common stock		(252	)		(1	)		(5,202	)		(6,518	)		-			-			(11,721	)
Issuance of common stock pursuant to employee stock purchase plan		16			-			619			-			-			-			619
Issuance of restricted common stock pursuant to stock-based compensation plans		487			5			(5	)		-			-			-			-
Cancellation of restricted common stock issued pursuant to stock-based compensation plans		(1	)		-			-			-			-			-			-
Stock-based compensation expense		-			-			5,395			-			-			-			5,395
Dividends		-			-			-			-			-			(8,243	)		(8,243	)
BALANCE, March 31, 2021		32,963		$	704		$	471,364		$	(900,644	)	$	(31,499	)	$	887,790		$	427,715
	Shares of Common Stock Outstanding			Common Stock			Additional Paid-in Capital			Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Accumulated Earnings			Total Stockholders' Equity
For the Quarter Ended March 31, 2020:
BALANCE, January 1, 2020		32,891		$	696		$	454,663		$	(867,817	)	$	(39,503	)	$	848,623		$	396,662
Comprehensive income:
Net income		-			-			-			-			-			21,514
Unrealized gain on short-term investments, net of tax		-			-			-			-			(24	)		-
Foreign currency translation adjustments		-			-			-			-			(15,084	)		-
Total comprehensive income																				6,406
Repurchase of common stock		(299	)		(2	)		(7,555	)		(6,408	)		-			-			(13,965	)
Issuance of common stock pursuant to employee stock purchase plan		14			-			564			-			-			-			564
Issuance of restricted common stock pursuant to stock-based compensation plans		476			5			(5	)		-			-			-			-
Cancellation of restricted common stock issued pursuant to stock-based compensation plans		(7	)		-			-			-			-			-			-
Stock-based compensation expense		-			-			4,857			-			-			-			4,857
Dividends		-			-			-			-			-			(7,693	)		(7,693	)
BALANCE, March 31, 2020		33,075		$	699		$	452,524		$	(874,225	)	$	(54,611	)	$	862,444		$	386,831

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

(in thousands)

	Quarter Ended
	March 31, 2021			March 31, 2020
Cash flows from operating activities:
Net income	$	19,631		$	21,514
Adjustments to reconcile net income to net cash used in operating activities -
Depreciation		6,113			5,565
Amortization		10,737			10,788
Amortization of original issue discount		772			730
Asset impairment		102			259
(Gain)/loss on short-term investments		15			(85	)
Deferred income taxes		6,508			9,310
Stock-based compensation		5,395			4,857
Changes in operating assets and liabilities, net of acquired amounts:
Trade accounts receivable, net		(23,874	)		(23,304	)
Other current and non-current assets and liabilities		(999	)		(8,452	)
Income taxes payable/receivable		(1,022	)		(3,092	)
Trade accounts payable and accrued liabilities		(28,101	)		(32,455	)
Deferred revenue		1,914			7,152
Net cash used in operating activities		(2,809	)		(7,213	)
Cash flows from investing activities:
Purchases of software, property and equipment		(8,239	)		(4,822	)
Purchases of short-term investments		(32,304	)		(16,037	)
Proceeds from sale/maturity of short-term investments		29,340			18,670
Acquisition of and investments in business, net of cash acquired		(648	)		(9,991	)
Net cash used in investing activities		(11,851	)		(12,180	)
Cash flows from financing activities:
Proceeds from issuance of common stock		619			564
Payment of cash dividends		(8,635	)		(8,277	)
Repurchase of common stock		(11,738	)		(13,876	)
Payments on long-term debt		(2,813	)		(1,875	)
Net cash used in financing activities		(22,567	)		(23,464	)
Effect of exchange rate fluctuations on cash		(863	)		(5,947	)
Net decrease in cash and cash equivalents		(38,090	)		(48,804	)
Cash and cash equivalents, beginning of period		188,699			156,548
Cash and cash equivalents, end of period	$	150,609		$	107,744
Supplemental disclosures of cash flow information:
Cash paid during the period for -
Interest	$	5,661		$	6,194
Income taxes		1,468			857

The accompanying notes are an integral part of these condensed consolidated financial statements.

7

CSG SYSTEMS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.  GENERAL

We have prepared the accompanying unaudited condensed consolidated financial statements as of March 31, 2021 and December 31, 2020, and for the quarters ended March 31, 2021 and 2020, in accordance with accounting principles generally accepted in the United States of America (“U.S.”) (“GAAP”) for interim financial information, and pursuant to the instructions to Form 10-Q and the rules and regulations of the Securities and Exchange Commission (the “SEC”).  Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.  In the opinion of our management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position and operating results have been included.  The unaudited Condensed Consolidated Financial Statements (the “Financial Statements”) should be read in conjunction with the Consolidated Financial Statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), contained in our Annual Report on Form 10-K for the year ended December 31, 2020 (our “2020 10-K”), filed with the SEC.  The results of operations for the quarter ended March 31, 2021 are not necessarily indicative of the expected results for the entire year ending December 31, 2021.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates in Preparation of Financial Statements. The preparation of the accompanying Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of our Financial Statements, and the reported amounts of revenue and expenses during the reporting periods.  Actual results could differ from those estimates.  

Revenue.  The majority of our future revenue is related to our revenue management solution customer contracts that include variable consideration dependent upon a series of monthly volumes and/or daily usage of services and have contractual terms ending from 2021 through 2028.  Our customer contracts may include guaranteed minimums and fixed monthly or annual fees.  As of March 31, 2021, our aggregate amount of the transaction price allocated to the remaining performance obligations is approximately $900 million, which is made up of fixed fee consideration and guaranteed minimums expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied).  We expect to recognize approximately 80% of this amount by the end of 2023, with the remaining amount recognized by the end of 2028.  We have excluded from this amount variable consideration expected to be recognized in the future related to performance obligations that are unsatisfied.    

The nature, amount, timing, and uncertainty of our revenue and how revenue and cash flows are affected by economic factors is most appropriately depicted by revenue type, geographic region, and customer vertical.

Revenue by type for the first quarters of 2021 and 2020 was as follows (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Cloud and related solutions	$	227,019	$	222,220
Software and services		14,779		13,206
Maintenance		11,321		10,191
Total revenue	$	253,119	$	245,617

We use the location of the customer as the basis of attributing revenue to geographic regions.  Revenue by geographic region for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Americas (principally the U.S.)		86	%		88	%
Europe, Middle East, and Africa		10	%		9	%
Asia Pacific		4	%		3	%
Total revenue		100	%		100	%

8

We generate our revenue primarily from the global communications markets; however, we serve an expanding group of customers in markets including financial services, healthcare, media and entertainment companies, and government entities.  Revenue by customer vertical for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Broadband/Cable/Satellite		57	%		58	%
Telecommunications		18	%		17	%
Other		25	%		25	%
Total revenue		100	%		100	%

Deferred revenue recognized for the first quarters of 2021and 2020 was $20.1 million and $17.7 million, respectively.

Cash and Cash Equivalents. We consider all highly liquid investments with original maturities of three months or less at the date of the purchase to be cash equivalents.  As of March 31, 2021 and December 31, 2020, our cash equivalents consist primarily of institutional money market funds, commercial paper, and time deposits held at major banks.

As of March 31, 2021 and December 31, 2020, we had $1.9 million and $1.7 million, respectively, of restricted cash that serves to collateralize outstanding letters of credit.  This restricted cash is included in cash and cash equivalents in our Condensed Consolidated Balance Sheets (“Balance Sheets” or “Balance Sheet”).  For the cash and cash equivalents denominated in foreign currencies and/or located outside the U.S., we do not anticipate any material amounts being unavailable for use in running our business, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.

Short-term Investments and Other Financial Instruments.  Our financial instruments as of March 31, 2021 and December 31, 2020 include cash and cash equivalents, short-term investments, accounts receivable, accounts payable, and debt.  Due to their short maturities, the carrying amounts of cash equivalents, accounts receivable, and accounts payable approximate their fair value.

Our short-term investments and certain of our cash equivalents are considered “available-for-sale” and are reported at fair value in our Balance Sheets, with unrealized gains and losses, net of the related income tax effect, excluded from earnings and reported in a separate component of stockholders’ equity.  Realized and unrealized gains and losses were not material in any period presented.

Primarily all short-term investments held by us as of March 31, 2021 and December 31, 2020 have contractual maturities of less than two years from the time of acquisition.  Our short-term investments as of March 31, 2021 and December 31, 2020 consisted almost entirely of fixed income securities.  Proceeds from the sale/maturity of short-term investments for the first quarters of March 31, 2021 and 2020 were $29.3 million and $18.7 million, respectively.

Our short-term investments as of March 31, 2021 and December 31, 2020 were $54.5 million and $51.6 million, respectively.

The following table represents the fair value hierarchy based upon three levels of inputs, of which Levels 1 and 2 are considered observable and Level 3 is unobservable, for our financial assets measured at fair value (in thousands):

	March 31, 2021						December 31, 2020
	Level 1		Level 2		Total		Level 1		Level 2		Total
Cash equivalents:
Money market funds	$	33,546	$	—	$	33,546	$	33,535	$	—	$	33,535
Commercial paper		—		9,224		9,224		—		15,746		15,746
Corporate debt securities		—		—		—		—		1,351		1,351
Short-term investments:
Corporate debt securities		—		42,544		42,544		—		38,672		38,672
U.S. government agency bonds		—		4,628		4,628		—		4,642		4,642
Asset-backed securities		—		7,367		7,367		—		8,284		8,284
Total	$	33,546	$	63,763	$	97,309	$	33,535	$	68,695	$	102,230

Valuation inputs used to measure the fair values of our money market funds were derived from quoted market prices.  The fair values of all other financial instruments are based upon pricing provided by third-party pricing services.  These prices were derived from observable market inputs.

9

We have chosen not to record our debt at fair value, with changes recognized in earnings each reporting period.  The following table indicates the carrying value (par value for convertible debt) and estimated fair value of our debt as of the indicated periods (in thousands):

	March 31, 2021				December 31, 2020
	Carrying		Fair		Carrying		Fair
	Value		Value		Value		Value
2018 Credit Agreement (carrying value including current maturities)	$	123,750	$	123,750	$	126,563	$	126,563
2016 Convertible debt (par value)		230,000		243,513		230,000		244,663

The fair value for our credit agreement was estimated using a discounted cash flow methodology, while the fair value for our convertible debt was estimated based upon quoted market prices or recent sales activity, both of which are considered Level 2 inputs.

Equity Method Investment.  We held a 15% noncontrolling interest in a payment technology and services company with a carrying value of approximately $8 million as of March 31, 2021 and December 31, 2020, included in other non-current assets in our Balance Sheets.

Accounting Pronouncement Issued But Not Yet Effective.  In August 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. ASU 2020-06 also amends the related Earnings Per Share guidance. ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, and can be adopted on either a fully retrospective or modified retrospective basis. We are currently evaluating the timing, method of adoption, and overall impact of this standard on our Financial Statements.

3.  LONG-LIVED ASSETS

Goodwill. The changes in the carrying amount of goodwill for the first quarter of 2021 were as follows (in thousands):

January 1, 2021 balance	$	272,322
Goodwill acquired during period		168
Adjustments related to prior acquisitions		(15	)
Effects of changes in foreign currency exchange rates		790
March 31, 2021 balance	$	273,265

Other Intangible Assets.  Our other intangible assets subject to ongoing amortization consist primarily of acquired customer contracts and software.  As of March 31, 2021 and December 31, 2020, the carrying values of these assets were as follows (in thousands):

	March 31, 2021							December 31, 2020
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Acquired customer contracts	$	154,119	$	(107,846	)	$	46,273	$	153,790	$	(105,778	)	$	48,012
Software		169,247		(143,662	)		25,585		166,289		(139,836	)		26,453
Total intangible assets	$	323,366	$	(251,508	)	$	71,858	$	320,079	$	(245,614	)	$	74,465

The total amortization expense related to other intangible assets for the first quarters of 2021 and 2020 were $5.6 million and $6.3 million, respectively.  Based on the March 31, 2021 net carrying value of our other intangible assets, the estimated total amortization expense for each of the five succeeding fiscal years ending December 31 are: 2021 – $20.5 million; 2022 – $14.7 million; 2023 – $10.8 million; 2024 – $7.4 million; and 2025 – $6.5 million. 

10

Customer Contract Costs.  As of March 31, 2021 and December 31, 2020, the carrying values of our customer contract cost assets, related to those contracts with a contractual term greater than one year, were as follows (in thousands):

	March 31, 2021							December 31, 2020
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Customer contract costs	$	90,136	$	(42,802	)	$	47,334	$	87,131	$	(39,893	)	$	47,238

The total amortization expense related to customer contract costs for the first quarters of 2021 and 2020 were $4.7 million and $4.0 million, respectively. 

4.  DEBT

Our long-term debt, as of March 31, 2021 and December 31, 2020, was as follows (in thousands):

	March 31,			December 31,
	2021			2020
2018 Credit Agreement:
Term loan, due March 2023, interest at adjusted LIBOR plus 1.5% (combined rate of 1.70% at March 31, 2021 and 1.75% at December 31, 2020)	$	123,750		$	126,563
Less – deferred financing costs		(1,017	)		(1,155	)
2018 Term Loan, net of unamortized discounts		122,733			125,408
$200 million revolving loan facility, due March 2023, interest at adjusted LIBOR plus applicable margin	—			—
2016 Convertible Notes:
Convertible Notes – Senior convertible notes; due March 15, 2036; cash interest at 4.25%		230,000			230,000
Less – unamortized original issue discount		(2,249	)		(3,021	)
Less – deferred financing costs		(870	)		(1,170	)
2016 Convertible Notes, net of unamortized discounts		226,881			225,809
Total debt, net of unamortized discounts		349,614			351,217
Current portion of long-term debt, net of unamortized discounts		(241,881	)		(14,063	)
Long-term debt, net of unamortized discounts	$	107,733		$	337,154

2018 Credit Agreement.  During the quarter ended March 31, 2021, we made $2.8 million of principal repayments on our $150 million aggregate principal five-year term loan (the “2018 Term Loan”).  As of March 31, 2021, our interest rate on the 2018 Term Loan is 1.70% (adjusted LIBOR plus 1.50% per annum), effective through June 2021, and our commitment fee on the unused $200 million aggregate principal five-year revolving loan facility (the “2018 Revolver”) is 0.20%.  As of March 31, 2021, we had no borrowings outstanding on our 2018 Revolver and had the entire $200.0 million available to us.  

The interest rates under the 2018 Credit Agreement are based upon our choice of an adjusted LIBOR rate plus an applicable margin of 1.50% – 2.50%, or an alternate base rate plus an applicable margin of 0.50% – 1.50%, with the applicable margin, depending on our then-net secured total leverage ratio.  We will pay a commitment fee of 0.200% – 0.375% of the average daily unused amount of the 2018 Revolver, with the commitment fee rate also dependent upon our then-net secured total leverage ratio.  If the LIBOR rate is no longer available, then our interest rate under the Credit Agreement will be determined by the alternate base rate plus an applicable margin as discussed above.  

11

2016 Convertible Notes.  We will settle conversions of the 2016 Convertible Notes by paying or delivering, as the case may be, cash, shares of our common stock, or a combination thereof, at our election.  It is our current intent and policy to settle our conversion obligations as follows: (i) pay cash for 100% of the par value of the 2016 Convertible Notes that are converted; and (ii) to the extent the value of our conversion obligation exceeds the par value, we can satisfy the remaining conversion obligation in our common stock, cash, or a combination thereof.

The 2016 Convertible Notes will be convertible at the option of the note holders upon the satisfaction of specified conditions and during certain periods.  During the period from, and including, December 15, 2021 to the close of business on the business day immediately preceding March 15, 2022 and on or after December 15, 2035, holders may convert all or any portion of their 2016 Convertible Notes at the conversion rate then in effect at any time regardless of these conditions. For the 2016 Convertible Notes presented during this time frame, the settlement amount will be equal to the sum of the daily settlement amounts for each of the following 40 consecutive trading days during the related observation period.

As the 2016 Convertible Notes can be converted at the holder's option beginning December 15, 2021 and ending March 15, 2022, subject to an observation holding period of 40 days, the net carrying value of the 2016 Convertible Notes of $226.9 million has been classified as a current liability in our Balance Sheet as of March 31, 2021.

As a result of our quarterly dividend in March 2021 (see Note 7), the previous conversion rate for the 2016 Convertible Notes of 17.6656 shares of our common stock per $1,000 principal amount of the 2016 Convertible Notes, which is equivalent to an initial conversion price of $56.61 per share of our common stock, has been adjusted to 17.6898 shares of our common stock per $1,000 principal amount of the 2016 Convertible Notes, which is equivalent to an initial conversion price of $56.53 per share of our common stock.  Holders may require us to repurchase the 2016 Convertible Notes for cash on each of March 15, 2022, March 15, 2026, and March 15, 2031, or upon the occurrence of a fundamental change (as defined in the 2016 Convertible Notes Indenture) in each case at a purchase price equal to the principal amount thereof plus accrued and unpaid interest.

We may redeem for cash all or part of the 2016 Convertible Notes if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption.  On or after March 15, 2022, we may redeem for cash all or part of the 2016 Convertible Notes regardless of the sales price condition described in the preceding sentence.  In each case, the redemption price will equal the principal amount of the 2016 Convertible Notes to be redeemed, plus accrued and unpaid interest.

As of March 31, 2021, none of the conversion features have been achieved, and thus, the 2016 Convertible Notes are not convertible by the holders.

5.  COMMITMENTS, GUARANTEES AND CONTINGENCIES

Guarantees.  In the ordinary course of business, we may provide guarantees in the form of bid bonds, performance bonds, or standby letters of credit.  At March 31, 2021, we had $2.9 million of restricted assets used to collateralize these guarantees, with $1.9 million included in cash and cash equivalents and $1.0 million included in other non-current assets. We have bid bonds and performance guarantees in form of surety bonds issued through a third-party of $4.4 million that were not required to be recorded on our Balance Sheet.  We are ultimately liable for claims that may occur against these guarantees.  We have no history of material claims or are aware of circumstances that would require us to pay under any of these arrangements.  We also believe that the resolution of any claim that may arise in the future, either individually or in the aggregate, would not be material to our Financial Statements.

Additionally, we have money transmitter bonds issued through a third-party for the benefit of various states to comply with the states’ financial requirements and industry regulations for money transmitter licenses.  At March 31, 2021, we had total aggregate money transmitter bonds of approximately $15 million outstanding.

Warranties. We generally warrant that our solutions and related offerings will conform to published specifications, or to specifications provided in an individual customer arrangement, as applicable.  The typical warranty period is 90 days from the date of acceptance of the solution or offering.  For certain service offerings we provide a warranty for the duration of the services provided.  We generally warrant that services will be performed in a professional and workmanlike manner.  The typical remedy for breach of warranty is to correct or replace any defective deliverable, and if not possible or practical, we will accept the return of the defective deliverable and refund the amount paid under the customer arrangement that is allocable to the defective deliverable.  Our contracts also generally contain limitation of damages provisions in an effort to reduce our exposure to monetary damages arising from breach of warranty claims.  Historically, we have incurred minimal warranty costs, and as a result, do not maintain a warranty reserve.

Solution and Services Indemnifications. Our arrangements with our customers generally include an indemnification provision that will indemnify and defend a customer in actions brought against the customer that claim our products and/or services infringe upon a

12

copyright, trade secret, or valid patent.  Historically, we have not incurred any significant costs related to such indemnification claims, and as a result, do not maintain a reserve for such exposure.

Claims for Company Non-performance.  Our arrangements with our customers typically limit our liability for breach to a specified amount of the direct damages incurred by the customer resulting from the breach.  From time-to-time, these arrangements may also include provisions for possible liquidated damages or other financial remedies for our non-performance, or in the case of certain of our outsourced customer care and billing solutions, provisions for damages related to service level performance requirements.  The service level performance requirements typically relate to system availability and timeliness of service delivery.  As of March 31, 2021, we believe we have adequate reserves, based on our historical experience, to cover any reasonably anticipated exposure as a result of our nonperformance for any past or current arrangements with our customers.  

Indemnifications Related to Officers and the Board of Directors.  We have agreed to indemnify members of our Board of Directors (the “Board”) and certain of our officers if they are named or threatened to be named as a party to any proceeding by reason of the fact that they acted in such capacity.  We maintain directors’ and officers’ (D&O) insurance coverage to protect against such losses.  We have not historically incurred any losses related to these types of indemnifications, and are not aware of any pending or threatened actions or claims against any officer or member of our Board.  As a result, we have not recorded any liabilities related to such indemnifications as of March 31, 2021.  In addition, as a result of the insurance policy coverage, we believe these indemnification agreements are not significant to our results of operations.       

Legal Proceedings.  From time-to-time, we are involved in litigation relating to claims arising out of our operations in the normal course of business.  

6.  EARNINGS PER COMMON SHARE

Basic and diluted earnings per common share (“EPS”) amounts are presented on the face of the accompanying Income Statements.

No reconciliation of the basic and diluted EPS numerators is necessary as net income is used as the numerators for all periods presented. The reconciliation of the basic and diluted EPS denominators related to the common shares is included in the following table (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Basic weighted-average common shares		31,844		31,994
Dilutive effect of restricted common stock		302		364
Diluted weighted-average common shares		32,146		32,358

The Convertible Notes have a dilutive effect only in those quarterly periods in which our average stock price exceeds the current effective conversion price (see Note 4).

The stock warrants have a dilutive effect only in those quarterly periods in which our average stock price exceeds the exercise price of $26.68 per warrant (under the treasury stock method), and are not subject to performance vesting conditions (see Note 7).  Potentially dilutive common shares related to non-participating unvested restricted stock excluded from the computation of diluted EPS, as the effect was antidilutive, were not material in any period presented.

7.  STOCKHOLDERS’ EQUITY AND EQUITY COMPENSATION PLANS

Stock Repurchase Program. We currently have a stock repurchase program, approved by our Board, authorizing us to repurchase our common stock from time-to-time as market and business conditions warrant (the “Stock Repurchase Program”).  During the first quarters of 2021 and 2020 we repurchased approximately 142,000 shares of our common stock for $6.5 million (weighted-average price of $45.94 per share) and approximately 142,000 shares of our common stock for $6.4 million (weighted-average price of $45.26 per share), respectively,  under a SEC Rule 10b5-1 Plan.  

As of March 31, 2021, the total remaining number of shares available for repurchase under the Stock Repurchase Program totaled 4.2 million shares.

13

Stock Repurchases for Tax Withholdings. In addition to the above-mentioned stock repurchases, during the first quarters of 2021 and 2020 we repurchased and then cancelled approximately 110,000 shares of common stock for $5.2 million and approximately 157,000 shares of common stock for $7.6 million, respectively,  in connection with minimum tax withholding requirements resulting from the vesting of restricted common stock under our stock incentive plans.

Cash Dividends.  During the first quarter of 2021, the Board approved a quarterly cash dividend of $0.25 per share of common stock, totaling $8.2 million.  During the first quarter of 2020, the Board approved a quarterly cash dividend of $0.235 per share of common stock, totaling $7.7 million. 

Warrants.  In 2014, in conjunction with the execution of an amendment to our current agreement with Comcast Corporation (“Comcast”), we issued stock warrants (the “Warrant Agreement”) for the right to purchase up to 2.9 million shares of our common stock (the “Stock Warrants”) as an additional incentive for Comcast to convert customer accounts onto our Advanced Convergent Platform (“ACP”) based on various milestones.  The Stock Warrants have a ten-year term and an exercise price of $26.68 per warrant.        

As of March 31, 2021, 1.0 million Stock Warrants remain issued, none of which were vested.  The remaining unvested Stock Warrants will be accounted for as a customer contract cost asset once the performance conditions necessary for vesting are considered probable.

Stock-Based Awards. A summary of our unvested restricted common stock activity during the first quarter of 2021 is as follows (shares in thousands):

	Quarter Ended
	March 31, 2021
	Shares			Weighted- Average Grant Date Fair Value
Unvested awards, beginning		1,041		$	41.31
Awards granted		513			47.88
Awards forfeited/cancelled		(2	)		40.81
Awards vested		(340	)		41.65
Unvested awards, ending		1,212		$	43.87

Included in the awards granted during the first quarter of 2021 are performance-based awards for 0.1 million restricted common stock shares issued to members of executive management and certain key employees, which vest in the first quarter of 2023 upon meeting certain pre-established financial performance objectives over a two-year performance period. Certain of these awards become fully vested upon a change in control, as defined, and the subsequent involuntary termination of employment.

The other restricted common stock shares granted during the first quarter of 2021 are primarily time-based awards, which vest annually over four years with no restrictions other than the passage of time.  Certain shares of the restricted common stock become fully vested upon a change in control, as defined, and the subsequent involuntary termination of employment, or death.

We recorded stock-based compensation expense for the first quarters of 2021 and 2020 of $5.4 million and $4.9 million, respectively. 

14

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The information contained in this MD&A should be read in conjunction with the Financial Statements and Notes thereto included in this Form 10-Q and the audited consolidated financial statements and notes thereto in our 2020 10-K.

Forward-Looking Statements

This report contains a number of forward-looking statements relative to our future plans and our expectations concerning our business and the industries we serve.  These forward-looking statements are based on assumptions about a number of important factors, and involve risks and uncertainties that could cause actual results to differ materially from estimates contained in the forward-looking statements.  Some of the risks that are foreseen by management are outlined within Part I Item 1A. Risk Factors of our 2020 10-K.  Readers are strongly encouraged to review that section closely in conjunction with MD&A.

Company Overview

We are one of the world’s leading providers of revenue management, customer engagement, and payment solutions that enable a growing list of companies around the world to monetize relationships with their customers in an era of rapid change and digital transformation.  We leverage more than 35 years of experience to deliver innovative customer engagement solutions that help our customers solve their toughest challenges, helping them make ordinary customer experiences extraordinary.  Our diverse, worldwide workforce draws from real-world knowledge and extensive expertise to design and implement business solutions that make our customers’ hardest decisions simpler so that they can focus on delivering differentiated and real-time experiences to their customers.

We offer solutions for every stage of the customer lifecycle so service providers can deliver an outstanding customer experience that adapts to their customers’ rapidly changing demands.  Our proven solutions are built on a combination of on-premise, public and private cloud platforms, either customized or pre-integrated, as well as managed services models that adapt to fit our customers’ unique business needs and enable the transformative change required to create personalized experiences that drive loyalty and retention.

We focus our research and development (“R&D”) and acquisition investments on expanding our offerings in a timely and efficient manner to address the complex, transformative needs of service providers.  Our scalable, modular, and flexible solutions combined with our domain expertise and our ability to effectively migrate customers to our solutions, provide the industry with proven solutions to improve their profitability and consumers’ experiences.  We have specifically architected our solutions to offer service providers a phased, incremental approach to transforming their businesses, thereby reducing the business interruption risk associated with this evolution.

As discussed in Note 2 to our Financial Statements, we generate our revenue primarily from the global communications markets; however, we serve an expanding group of customers in other markets including financial services, healthcare, media and entertainment companies, and government entities.

We are a member of the S&P Small Cap 600 and Russell 2000 indices.

Impact of COVID-19

In March 2020, the World Health Organization declared a global pandemic related to the rapidly spreading coronavirus (COVID-19) outbreak which has led to a global health emergency.  Throughout the COVID-19 crisis, we have remained focused on protecting the health and safety of our employees, while meeting the needs of our customers. While we have taken measures to protect our employees, to include a remote working environment for those employees who are able to conduct business from home and significantly reduced travel, we are still conducting business as usual and are working with our customers to minimize any potential disruption. For those locations that remain open, such as our statement production centers, we require daily temperature checks and self-assessments. We will continue to provide work from home options through December 31, 2021, or such later date as conditions warrant. At this time, we do not believe that our work from home options and limited staffing in select office locations have adversely impacted our internal controls, financial reporting systems, or our operations.

The full extent of the impact of the COVID-19 pandemic on our business, operations, and financial results will depend on numerous evolving factors that we may not be able to accurately predict.  As we continue to manage our business in this uncertain environment, our priorities will remain the health and safety of our employees, providing our customers with world-class services and solutions, and prudently managing our liquidity to ensure our continued financial strength.  As of March 31, 2021, we had approximately $205 million in cash, cash equivalents and short-term investments, and an additional $200 million available to borrow under our revolving credit facility.  

See our Risk Factors in our 2020 Form 10-K for additional details.

15

Management Overview of Quarterly Results

First Quarter Highlights.  A summary of our results of operations for the first quarter of 2021, when compared to the first quarter of 2020, is as follows (in thousands, except per share amounts and percentages):

	Quarter Ended
	March 31, 2021			March 31, 2020
Revenue	$	253,119		$	245,617
Transaction fees (1)		16,450			18,324
Operating Results:
Operating income	$	31,377		$	33,159
Operating income margin		12.4	%		13.5	%
Diluted EPS	$	0.61		$	0.66
Supplemental Data:
Restructuring and reorganization charges	$	1,060		$	966
Executive transition costs		55			-
Acquisition-related costs:
Amortization of acquired intangible assets		2,241			3,051
Transaction-related costs		79			53
Stock-based compensation (2)		5,395			4,925
Amortization of OID		772			730

(1) Transaction fees are primarily comprised of interchange and other payment-related fees that we pay, in conjunction with the delivery of service to customers under our payment services contracts, to third-party payment processors and financial institutions.  Because we control the integrated service provided under our payment services customer contracts, these transaction fees are presented gross, and not netted against revenue.

(2) Stock-based compensation included in the table above excludes amounts that have been recorded in restructuring and reorganization charges.

Revenue.  Revenue for the first quarter of 2021 was $253.1 million, a 3.1% increase when compared to revenue of $245.6 million for the first quarter of 2020, with the increase mainly attributed to continued growth in our revenue management solutions along with a strong quarter of professional services revenue.

Operating Results.  Operating income for the first quarter of 2021 was $31.4 million, or a 12.4% operating margin percentage, compared to $33.2 million, or a 13.5% operating margin percentage for the first quarter of 2020, with the decrease mainly attributed to increased employee-related costs.  The first quarter of 2020 operating income benefited from a mark-to-market reduction in a compensation liability that resulted from the unexpected and steep decline in the stock market that quarter.  

Diluted EPS.  Diluted EPS for the first quarter of 2021 was $0.61 compared to $0.66 for the first quarter of 2020, with the decrease mainly due the lower operating income, as discussed above.

Cash and Cash Flows.  As of March 31, 2021, we had cash, cash equivalents and short-term investments of $205.1 million, as compared to $240.3 million as of December 31, 2020.  Our cash flows from operating activities for the quarter ended March 31, 2021 were $(2.8) million due to the timing of a key recurring customer payment due before quarter-end which was received just after quarter-end, and the payment of the 2020 year-end accrued employee incentive compensation.  See the Liquidity section below for further discussion of our cash flows.

16

Significant Customer Relationships

Customer Concentration.  A large percentage of our historical revenue has been generated from our two largest customers, which are Comcast and Charter Corporation Inc. (“Charter”).

Revenue from these customers for the indicated periods was as follows (in thousands, except percentages):

	Quarter Ended
	March 31, 2021					December 31, 2020					March 31, 2020
	Amount		% of Revenue			Amount		% of Revenue			Amount		% of Revenue
Comcast	$	53,454		21	%	$	54,845		21	%	$	52,679		21	%
Charter		53,382		21	%		54,121		21	%		50,712		21	%

The percentages of net billed accounts receivable balances attributable to our largest customers as of the indicated dates were as follows:

	As of
	March 31,			December 31,			March 31,
	2021			2020			2020
Comcast		20	%		19	%		20	%
Charter		31	%		20	%		30	%

See our 2020 10-K for additional discussion of our business relationships and contractual terms with Comcast and Charter.

Charter.  Charter is one of our significant customers representing approximately 21% of our revenue.  Our agreement with Charter runs through December 31, 2021, with an option to extend the agreement for an additional one-year term. We are currently engaged in discussions with Charter regarding contract renewal terms.

Risk of Customer Concentration.  We expect to continue to generate a significant percentage of our future revenue from our largest customers mentioned above.  There are inherent risks whenever a large percentage of total revenue are concentrated with a limited number of customers.  Should a significant customer: (i) terminate or fail to renew their contracts with us, in whole or in part, for any reason; (ii) significantly reduce the number of customer accounts processed on our solutions, the price paid for our services, or the scope of services that we provide; or (iii) experience significant financial or operating difficulties, it could have a material adverse effect on our financial condition and results of operations.  

Critical Accounting Policies

The preparation of our Financial Statements in conformity with U.S. GAAP requires us to select appropriate accounting policies, and to make judgments and estimates affecting the application of those accounting policies.  In applying our accounting policies, different business conditions or the use of different assumptions may result in materially different amounts reported in our Financial Statements.

We have identified the most critical accounting policies that affect our financial position and the results of our operations.  Those critical accounting policies were determined by considering the accounting policies that involve the most complex or subjective decisions or assessments.  The most critical accounting policies identified relate to the following items: (i) revenue recognition; (ii) impairment assessments of long-lived assets; (iii) income taxes; and (iv) loss contingencies.  These critical accounting policies, as well as our other significant accounting policies, are discussed in our 2020 10-K.

17

Results of Operations

Revenue.  Total revenue for the first quarter of 2021 was $253.1 million, a 3.1% increase when compared to $245.6 million for the first quarter of 2020.  This increase can be attributed to the year-over-year growth in our revenue management solutions along with a strong quarter of professional services revenue.  

We use the location of the customer as the basis of attributing revenue to individual countries.  Revenue by geographic regions for the first quarters of 2021 and 2020 was as follows (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Americas (principally the U.S.)	$	217,652	$	216,997
Europe, Middle East, and Africa		24,768		21,032
Asia Pacific		10,699		7,588
Total revenue	$	253,119	$	245,617

Total Operating Expenses.  Total operating expenses for the first quarter of 2021 were $221.7 million, a 4.4% increase when compared to $212.5 million for the first quarter of 2020,   resulting from a year-over-year increase in employee-related costs as we continue to grow the business.  In addition, the first quarter of 2020 reflects a benefit due to a mark-to-market reduction in a compensation liability that resulted from the unexpected and steep decline in the stock market.

The components of total expenses are discussed in more detail below.

Cost of Revenue (Exclusive of Depreciation).  The cost of revenue for the first quarter of 2021 was $133.5 million, a 1.8% increase when compared to $131.2 million for the first quarter of 2020.  The increase in cost of revenue between quarters is reflective of the year-over-year revenue growth, as discussed above.  Total cost of revenue as a percentage of revenue for the first quarters of 2021 and 2020 was 52.8% and 53.4%, respectively. 

R&D Expense.  R&D expense for the first quarter of 2021 was $32.2 million, a 6.2% increase when compared to $30.3 million for the first quarter of 2020.  This increase in R&D expense is mainly attributed to increased employee-related costs, to include personnel and the related costs previously assigned to cost of revenue projects being reassigned to R&D projects.  As a percentage of total revenue, R&D expense for the first quarters of 2021 and 2020 was 12.7% and 12.4%, respectively.

Our R&D efforts are focused on the continued evolution of our solutions that enable service providers worldwide to provide a more personalized customer experience while introducing new digital products and services.  This includes the continued investment in our cloud-based solutions. 

SG&A Expense.  SG&A expense for the first quarter of 2021 was $48.8 million, a 10.0% increase when compared to $44.4 million for the first quarter of 2020.  The increase in SG&A expense is mainly attributed to the increase in employee-related costs, discussed above, and is reflective of our accelerated growth strategy, as we continue to pursue organic and inorganic growth opportunities.  Our SG&A costs as a percentage of total revenue for the first quarters of 2021 and 2020 were 19.3% and 18.1%, respectively.

Depreciation.  Depreciation expense for the first quarter of 2021 was $6.1 million, a 9.8% increase when compared to $5.6 million for the first quarter of 2020.  This increase can be primarily attributed to the increased level of capital expenditures on items such as technology, security, infrastructure, and modernization of equipment.

Operating Income. Operating income for the first quarter of 2021 was $31.4 million, or 12.4% of total revenue, compared to $33.2 million, or 13.5% of total revenue for the first quarter of 2020, with the decrease mainly attributed to increased employee-related costs.  The first quarter of 2020 operating income benefited from a mark-to-market reduction in a compensation liability that resulted from the unexpected and steep decline in the stock market that quarter.    

  Income Tax Provision. The effective income tax rates for the first quarters of 2021 and 2020 were as follows:

Quarter Ended
March 31,
2021			2020
	26	%		25	%

Our estimated full year 2021 effective income tax rate is approximately 27%.

18

Liquidity

Cash and Liquidity.  As of March 31, 2021, our principal sources of liquidity included cash, cash equivalents and short-term investments of $205.1 million, as compared to $240.3 million as of December 31, 2020. We generally invest our excess cash balances in low-risk, short-term investments to limit our exposure to market and credit risks.  

As part of our 2018 Credit Agreement, we have a $200 million senior secured revolving loan facility with a syndicate of financial institutions that expires in March 2023.  As of March 31, 2021, there were no borrowings outstanding on the 2018 Revolver.  The 2018 Credit Agreement contains customary affirmative covenants and financial covenants.  As of March 31, 2021, and the date of this filing, we believe that we are in compliance with the provisions of the 2018 Credit Agreement.  

Our cash, cash equivalents, and short-term investment balances as of the end of the indicated periods were located in the following geographical regions (in thousands):

	March 31,		December 31,
	2021		2020
Americas (principally the U.S.)	$	149,863	$	183,918
Europe, Middle East and Africa		47,302		47,513
Asia Pacific		7,983		8,866
Total cash, equivalents and short-term investments	$	205,148	$	240,297

We generally have ready access to substantially all of our cash, cash equivalents, and short-term investment balances, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.  As of March 31, 2021, we had $1.9 million of cash restricted as to use primarily to collateralize outstanding letters of credit.

Cash Flows from Operating Activities.  We calculate our cash flows from operating activities beginning with net income, adding back the impact of non-cash items or non-operating activity (e.g., depreciation, amortization, amortization of OID, impairments, gain/loss from debt extinguishments, deferred income taxes, stock-based compensation, etc.), and then factoring in the impact of changes in operating assets and liabilities.  See our 2020 10-K for a description of the primary uses and sources of our cash flows from operating activities.  

Our 2021 and 2020 net cash flows from operating activities, broken out between operations and changes in operating assets and liabilities, for the indicated quarterly periods are as follows (in thousands):

						Net Cash
			Changes in			Provided by
			Operating			(Used In) Operating
			Assets and			Activities –
	Operations		Liabilities			Totals
Cash Flows from Operating Activities:
2021:
March 31	$	49,273	$	(52,082)		$	(2,809)
2020:
March 31	$	52,938	$	(60,151	)	$	(7,213	)

Cash flows from operating activities for the first quarters of 2021 and 2020 were negatively impacted by the timing of certain recurring key customer payments that were delayed and received subsequent to quarter-end, of approximately $26 million and $33 million for the first quarters of 2021 and 2020, respectively.  

Additionally, cash flows from operating activities for the first quarters of 2021 and 2020 reflect the impacts of the payment of the 2020 and 2019 year-end accrued employee incentive compensation in the first quarter subsequent to the year-end accrual for these items.  

We believe the above table illustrates our ability to generate recurring quarterly cash flows from our operations, and the importance of managing our working capital items.  Variations in our net cash provided by operating activities are generally related to the changes in our operating assets and liabilities (related mostly to fluctuations in timing at quarter-end of customer payments and changes in accrued expenses), and generally over longer periods of time, do not significantly impact our cash flows from operations.

19

Significant fluctuations in key operating assets and liabilities between 2021 and 2020 that impacted our cash flows from operating activities are as follows:

Billed Trade Accounts Receivable

Management of our billed accounts receivable is one of the primary factors in maintaining strong cash flows from operating activities.  Our billed trade accounts receivable balance includes significant billings for several non-revenue items (primarily postage, sales tax, and deferred revenue items).  As a result, we evaluate our performance in collecting our accounts receivable through our calculation of days billings outstanding (“DBO”) rather than a typical days sales outstanding (“DSO”) calculation.  

Our gross and net billed trade accounts receivable and related allowance for doubtful accounts receivable (“Allowance”) as of the end of the indicated quarterly periods, and the related DBOs for the quarters then ended, are as follows (in thousands, except DBOs):

Quarter Ended	Gross		Allowance			Net Billed		DBOs
2021:
March 31	$	250,743	$	(3,718	)	$	247,025	70
2020:
March 31	$	264,601	$	(3,888	)	$	260,713		72

As of March 31, 2021 and 2020, approximately 97% and 95%, respectively, of our billed accounts receivable balance were less than 60 days past due.  

The higher than normal DBO metric for the first quarters of 2021 and 2020 can be directly attributed to the delay of certain recurring key customer payments, as noted above.  We may experience future adverse impacts to our DBOs if we experience payment delays. However, these recurring monthly payments that cross a reporting period-end do not raise any collectability concerns, as payment is generally received subsequent to quarter-end.  All other changes in our gross and net billed accounts receivable reflect the normal fluctuations in the timing of customer payments at quarter-end, as evidenced by our relatively consistent DBO metric.  

As a global provider of software and professional services, a portion of our accounts receivable balance relates to international customers. This diversity in the geographic composition of our customer base may adversely impact our DBOs as longer billing cycles (i.e., billing terms and cash collection cycles) are an inherent characteristic of international software and professional services transactions. For example, our ability to invoice and collect arrangement fees may be dependent upon, among other things: (i) the completion of various customer administrative matters, local country billing protocols and processes (including local cultural differences), and non-customer administrative matters; (ii) meeting certain contractual invoicing milestones; or (iii) the overall project status in certain situations in which we act as a subcontractor to another vendor on a project.

Accrued Employee Compensation

Accrued employee compensation decreased $15.2 million to $71.1 million as of March 31, 2021, from $86.3 million as of December 31, 2020, due primarily to the payment of the 2020 employee incentive compensation that was fully accrued at December 31, 2020, offset to a certain degree by the accrual for the 2021 employee incentive compensation.

Cash Flows from Investing Activities.  Our typical investing activities consist of purchases/sales of short-term investments and purchases of software, property and equipment, which are discussed below.  Additionally, during the first quarter of 2020 we acquired Tekzenit, Inc. for approximately $10 million, which is included in our cash flows from investing activities.

Purchases/Sales of Short-Term Investments  

For the first quarters of 2021 and 2020, we purchased $32.3 million and $16.0 million, respectively, and sold (or had mature) $29.3 million and $18.7 million, respectively, of short-term investments.  We continually evaluate the appropriate mix of our investment of excess cash balances between cash equivalents and short-term investments in order to maximize our investment returns and liquidity.

20

Software, Property and Equipment

Our capital expenditures for the first quarters of 2021 and 2020 for software, property and equipment were $8.2 million and $4.8 million, respectively, and consisted principally of investments in statement production equipment and computer hardware, software, and related equipment.

Cash Flows from Financing Activities.  Our financing activities typically consist of activities associated with our common stock and our long-term debt.  

Cash Dividends Paid on Common Stock

During the first quarters of 2021 and 2020, the Board approved dividends totaling $8.2 million and $7.7 million, respectively, and made dividend payments of $8.6 million and $8.3 million, respectively, through March 31, 2021 and 2020, with the differences attributed to dividends on unvested incentive shares that are paid upon vesting of those shares.

Repurchase of Common Stock  

During the first quarters of 2021 and 2020, we repurchased approximately 142,000 shares of our common stock, for both periods, under the guidelines of our Stock Repurchase Program for $6.5 million and $6.4 million, respectively, and paid $6.5 million and $6.3 million, respectively, through March 31, 2021 and 2020, with the differences attributed to the timing of share settlement.

Outside of our Stock Repurchase Program, during the first quarters of 2021 and 2020, we repurchased from our employees and then cancelled approximately 110,000 and 157,000 shares of our common stock, respectively, for $5.2 million and $7.6 million, respectively, in connection with minimum tax withholding requirements resulting from the vesting of restricted common stock under our stock incentive plans.

Long-term Debt

During the first quarters of 2021 and 2020, we made principal repayments of $2.8 million and $1.9 million, respectively. See Note 4 to our Financial Statements for additional discussion of our long-term debt.

Off-Balance Sheet Arrangements

Our off-balance sheet arrangements are mainly limited to money transmitter bonds, bid bonds, and performance bonds.  These arrangements do not have a material impact and are not reasonably likely to have a material future impact to our financial condition, results of operation, liquidity, capital expenditures, or capital resources.  See Note 5 to our Financial Statements for additional information on these guarantees.

Capital Resources

The following are the key items to consider in assessing our sources and uses of capital resources:

Current Sources of Capital Resources.  Below are the key items to consider in assessing our current sources of capital resources:

• Cash, Cash Equivalents and Short-term Investments.  As of March 31, 2021, we had cash, cash equivalents, and short-term investments of $205.1 million, of which approximately 69% is in U.S. dollars and held in the U.S.  We have $1.9 million of restricted cash, used primarily to collateralize outstanding letters of credit.  For the remainder of the monies denominated in foreign currencies and/or located outside the U.S., we do not anticipate any material amounts being unavailable for use in funding our business, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.

• Operating Cash Flows.  As described in the Liquidity section above, we believe we have the ability to generate strong cash flows to fund our operating activities and act as a source of funds for our capital resource needs.

• Revolving Credit Facility.  We currently have a $200 million revolving loan facility, our 2018 Revolver.  As of March 31, 2021, we had no borrowing outstanding on our 2018 Revolver and had the entire $200 million available to us.  Our long-term debt obligations are discussed in more detail in Note 4 to our Financial Statements.

21

Uses/Potential Uses of Capital Resources. Below are the key items to consider in assessing our uses/potential uses of capital resources:

• Common Stock Repurchases.  We have made repurchases of our common stock in the past under our Stock Repurchase Program.  As of March 31, 2021, we had 4.2 million shares authorized for repurchase remaining under our Stock Repurchase Program.  Our 2018 Credit Agreement may place certain limitations on our ability to repurchase our common stock.

Under our Stock Repurchase Program, we may repurchase shares in the open market or in privately negotiated transactions, including through an accelerated stock repurchase plan or under a SEC Rule 10b5-1 plan.  The actual timing and amount of share repurchases are dependent on the current market conditions and other business-related factors.  Our common stock repurchases are discussed in more detail in Note 7 to our Financial Statements.

During the first quarter of 2021, we repurchased approximately 142,000 shares of our common stock for $6.5 million (weighted-average price of $45.94 per share).  

Outside of our Stock Repurchase Program, during the first quarter of 2021, we repurchased from our employees and then cancelled approximately 110,000 shares of our common stock for $5.2 million in connection with minimum tax withholding requirements resulting from the vesting of restricted common stock under our stock incentive plans.

• Executive Transition. In August 2020, we entered into a Separation Agreement with our then President and CEO which includes a commitment to pay additional compensation of approximately $7 million, for which approximately $5 million will be paid in 2021 and approximately $2 million will be paid in 2022.

• Cash Dividends.  During the first quarter of 2021, the Board declared dividends totaling $8.2 million.  Going forward, we expect to pay cash dividends each year in March, June, September, and December, with the amount and timing subject to the Board’s approval.

• Acquisitions.  The 2018 Forte acquisition purchase agreement, as amended, includes provisions for $18.8 million of potential future earn-out payments over a measurement period through September 30, 2023.  The earn-out payments are tied to performance-based goals and continued employment by the eligible recipients.

The 2020 Tekzenit acquisition includes provisions for additional purchase price payments in the form of earn-out and qualified sales payments for up to $10 million over a measurement period through March 31, 2023.

As of March 31, 2021, we have made no earn-out or qualified sales payments for either of these acquisitions.  

As part of our growth strategy, we are continually evaluating potential business and/or asset acquisitions and investments in market share expansion with our existing and potential new customers and expansion into verticals outside the global communications market.

• Capital Expenditures.  During the first quarter of 2021, we spent $8.2 million on capital expenditures.  As of March 31, 2021, we had committed to purchase $2.5 million of equipment.

• Stock Warrants.  We have issued Stock Warrants with an exercise price of $26.68 per warrant to Comcast as an incentive for Comcast to convert new customer accounts to ACP.  Once vested, Comcast may exercise the Stock Warrants and elect either physical delivery of common shares or net share settlement (cashless exercise).  Alternatively, the exercise of the Stock Warrants may be settled with cash based solely on our approval, or if Comcast were to beneficially own or control in excess of 19.99% of the common stock or voting of the Company.  As of March 31, 2021, approximately 1.0 million Stock Warrants remain issued, none of which are vested.

The Stock Warrants are discussed in more detail in Note 7 to our Financial Statements.  

22

• Long-Term Debt.  As of March 31, 2021, our long-term debt consisted of the following: (i) 2016 Convertible Notes with a par value of $230.0 million; and (ii) 2018 Credit Agreement with term loan borrowings of $123.8 million.  

2016 Convertible Notes

Our 2016 Convertible Notes will be convertible at the option of the note holders during the period from December 15, 2021 to the close of business on the day immediately preceding March 15, 2022, subject to an observation holding period of 40 days.  For notes presented during this time frame, the settlement amount will be equal to the sum of the daily settlement amounts for each of the following 40 consecutive trading days during the related observation period.  As a result, we have reclassified our 2016 Convertible Notes to a current liability in our Balance Sheet. If none of the notes are converted, called, or put, our debt service cash outlay during the next twelve months for the 2016 Convertible Notes will be $9.8 million of interest payments.

2018 Credit Agreement

Our 2018 Credit Agreement mandatory repayments and the cash interest expense (based upon current interest rates) for the next twelve months is $15.0 million, and $2.0 million, respectively. We have the ability to make prepayments on our 2018 Credit Agreement without penalty.  

Our long-term debt obligations are discussed in more detail in Note 4 to our Financial Statements.  

In summary, we expect to continue to have material needs for capital resources going forward, as noted above.  We believe that our current cash, cash equivalents and short-term investments balances and our 2018 Revolver, together with cash expected to be generated in the future from our current operating activities, will be sufficient to meet our anticipated capital resource requirements for at least the next twelve months.  We also believe we could obtain additional capital through other debt sources which may be available to us if deemed appropriate.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk is the potential loss arising from adverse changes in market rates and prices.  As of March 31, 2021, we are exposed to various market risks, including changes in interest rates, fluctuations and changes in the market value of our cash equivalents and short-term investments, and changes in foreign currency exchange rates.  We have not historically entered into derivatives or other financial instruments for trading or speculative purposes.

Interest Rate Risk

Long-Term Debt.  The interest rate on our 2016 Convertible Notes is fixed, and thus, as it relates to our convertible debt borrowings, we are not exposed to changes in interest rates.

The interest rates on our 2018 Credit Agreement are based upon an adjusted LIBOR rate plus an applicable margin, or an alternate base rate plus an applicable margin.  See Note 4 to our Financial Statements for further details of our long-term debt.

A hypothetical adverse change of 10% in the March 31, 2021 adjusted LIBOR rate would not have had a material impact upon our results of operations.

Market Risk

Cash Equivalents and Short-term Investments.  Our cash and cash equivalents as of March 31, 2021 and December 31, 2020 were $150.6 million and $188.7 million, respectively.  Certain of our cash balances are “swept” into overnight money market accounts on a daily basis, and at times, any excess funds are invested in low-risk, somewhat longer term, cash equivalent instruments and short-term investments.  Our cash equivalents are invested primarily in institutional money market funds, commercial paper, and time deposits held at major banks.  We have minimal market risk for our cash and cash equivalents due to the relatively short maturities of the instruments.

Our short-term investments as of March 31, 2021 and December 31, 2020 were $54.5 million and $51.6 million, respectively.  Currently, we utilize short-term investments as a means to invest our excess cash only in the U.S.  The day-to-day management of our short-term investments is performed by a large financial institution in the U.S., using strict and formal investment guidelines approved by our Board.  Under these guidelines, short-term investments are limited to certain acceptable investments with: (i) a maximum maturity; (ii) a maximum concentration and diversification; and (iii) a minimum acceptable credit quality.  At this time, we believe we have minimal liquidity risk associated with the short-term investments included in our portfolio.

23

Settlement Assets.  We are exposed to market risk associated with cash held on behalf of our customers related to our payment processing services.  As of March 31, 2021 and December 31, 2020, we had $108.6 million and $149.8 million, respectively, of cash collected on behalf of our customers which is held for an established holding period until settlement with the customer.  The holding period is generally one to four business days depending on the payment model and contractual terms with the customer.  During the holding period, cash is held in accounts with various major financial institutions in the U.S. in an amount equal to at least 100% of the aggregate amount owed to our customers.  These balances can significantly fluctuate between periods due to activity at the end of the period and the day in which the period ends.

Long-Term Debt.  The fair value of our convertible debt is exposed to market risk.  We do not carry our convertible debt at fair value but present the fair value for disclosure purposes (see Note 2 to our Financial Statements).  Generally, the fair value of our convertible debt is impacted by changes in interest rates and changes in the price and volatility of our common stock.  As of March 31, 2021, the fair value of the 2016 Convertible Notes was estimated at $243.5 million, using quoted market prices.  

Foreign Currency Exchange Rate Risk

Due to foreign operations around the world, our balance sheet and income statement are exposed to foreign currency exchange risk due to the fluctuations in the value of currencies in which we conduct business.  While we attempt to maximize natural hedges by incurring expenses in the same currency in which we contract revenue, the related expenses for that revenue could be in one or more differing currencies than the revenue stream.

During the first quarter of 2021, we generated approximately 88% of our revenue in U.S. dollars.  We expect that, in the foreseeable future, we will continue to generate a very large percentage of our revenue in U.S. dollars.

As of March 31, 2021 and December 31, 2020, the carrying amounts of our monetary assets and monetary liabilities on the books of our non-U.S. subsidiaries in currencies denominated in a currency other than the functional currency of those non-U.S. subsidiaries are as follows (in thousands, in U.S. dollar equivalents):

	March 31, 2021					December 31, 2020
	Monetary			Monetary		Monetary			Monetary
	Liabilities			Assets		Liabilities			Assets
Pounds sterling	$	-		$	1,935	$	(148	)	$	1,673
Euro		(285	)		7,831		(288	)		7,734
U.S. Dollar		(2,357	)		29,303		(292	)		24,445
South African Rand		(33	)		4,302		-			4,809
Other		(32	)		1,016		(6	)		1,071
Totals	$	(2,707	)	$	44,387	$	(734	)	$	39,732

A hypothetical adverse change of 10% in the March 31, 2021 exchange rates would not have had a material impact upon our results of operations based on the monetary assets and liabilities as of March 31, 2021.

Item 4. Controls and Procedures

(a) Disclosure Controls and Procedures

As required by Rule 13a-15(b), our management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), conducted an evaluation as of the end of the period covered by this report of the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e).  Based on that evaluation, the CEO and CFO concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

(b) Internal Control Over Financial Reporting

As required by Rule 13a-15(d), our management, including the CEO and CFO, also conducted an evaluation of our internal control over financial reporting, as defined by Rule 13a-15(f), to determine whether any changes occurred during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  Based on that evaluation, the CEO and CFO concluded that there has been no such change during the quarter covered by this report.  

24

CSG SYSTEMS INTERNATIONAL, INC.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time-to-time, we are involved in litigation relating to claims arising out of our operations in the normal course of business.  We are not presently a party to any material pending or threatened legal proceedings.

Item 1A. Risk Factors

A discussion of our risk factors can be found in Item 1A.  Risk Factors in our 2020 Form 10-K.  There were no material changes to the risk factors disclosed in our 2020 Form 10-K during the first quarter of 2021.  

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table presents information with respect to purchases of our common stock made during the first quarter of 2021 by CSG Systems International, Inc. or any “affiliated purchaser” of CSG Systems International, Inc., as defined in Rule 10b-18(a)(3) under the Exchange Act.

Period	Total Number of Shares Purchased (1) (2)		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2)		Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plan or Programs (2)
January 1 - January 31		54,911	$	44.68		53,900		4,283,217
February 1 - February 28		87,732		46.22		38,700		4,244,517
March 1 - March 31		109,044		47.97		49,300		4,195,217
Total		251,687	$	46.64		141,900

(1) The total number of shares purchased that are not part of the Stock Repurchase Program represents shares purchased and cancelled in connection with stock incentive plans.

(2) See Note 7 to our Financial Statements for additional information regarding our share repurchases.

Item 3. Defaults Upon Senior Securities

None

Item 4. Mine Safety Disclosures

None

Item 5. Other Information

None

Item 6. Exhibits

The Exhibits filed or incorporated by reference herewith are as specified in the Exhibit Index.

25

CSG SYSTEMS INTERNATIONAL, INC.

INDEX TO EXHIBITS

Exhibit Number	Description
10.26AP*	Forty-Eighth Amendment to Consolidated CSG Master Subscriber Management System Agreement between CSG Systems, Inc. and Charter Communications Operating, LLC
10.26AQ*	Forty-Ninth Amendment to Consolidated CSG Master Subscriber Management System Agreement between CSG Systems, Inc. and Charter Communications Operating, LLC
10.26AR*	Fiftieth Amendment to Consolidated CSG Master Subscriber Management System Agreement between CSG Systems, Inc. and Charter Communications Operating, LLC
10.27D*	Third Amendment to the CSG Master Subscriber Management System Agreement between CSG Systems, Inc. and Comcast Cable Communications Management, LLC
31.01	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.02	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.01	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Portions of the exhibit have been omitted pursuant to SEC rules regarding confidential information.  

26

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: May 6, 2021

CSG SYSTEMS INTERNATIONAL, INC.

/s/ Brian A. Shepherd

Brian A. Shepherd

President and Chief Executive Officer

(Principal Executive Officer)

/s/ Rolland B. Johns

Rolland B. Johns

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

/s/ David N. Schaaf

David N. Schaaf

Chief Accounting Officer

(Principal Accounting Officer)

27

EX-10.26AP

Exhibit 10.26AP

THIS DOCUMENT CONTAINS INFORMATION WHICH HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED.  SUCH EXCLUDED INFORMATION IS IDENTIFIED BY BRACKETS AND MARKED WITH (***).

FORTY-EIGHTH AMENDMENT

TO

CONSOLIDATED

CSG MASTER SUBSCRIBER MANAGEMENT SYSTEM AGREEMENT

BETWEEN

CSG SYSTEMS, INC.

AND

CHARTER COMMUNICATIONS OPERATING, LLC

SCHEDULE AMENDMENT

This Forty-eighth Amendment (the “Amendment”) is made by and between CSG Systems, Inc., a Delaware corporation (“CSG”), and Charter Communications Operating, LLC, a Delaware limited liability company (“Customer”).  CSG and Customer entered into that certain Consolidated CSG Master Subscriber Management System Agreement effective as of August 1, 2017 (CSG document no. 4114281), as amended (the “Agreement”), and now desire to further amend the Agreement in accordance with the terms and conditions set forth in this Amendment.  If the terms and conditions set forth in this Amendment shall be in conflict with the Agreement, the terms and conditions of this Amendment shall control.  Any terms in initial capital letters or all capital letters used as a defined term but not defined in this Amendment shall have the meaning set forth in the Agreement.  Upon execution of this Amendment by the parties, any subsequent reference to the Agreement between the parties shall mean the Agreement as amended by this Amendment.  Except as amended by this Amendment, the terms and conditions set forth in the Agreement shall continue in full force and effect according to their terms. The effective date of this Amendment is the date last signed below (the “Amendment Effective Date”).

WHEREAS, CSG currently provides Lockbox Processing Reconciliation Services to Customer pursuant to Exhibit C-3(h), “Lockbox Processing Reconciliation” to Exhibit C-3, “Financial Services,” to Schedule C, “Recurring Services” to the Agreement; and

WHEREAS, Customer desires and CSG agrees to provide Lockbox Processing Reconciliation Services utilizing a separate processing model for one (1) named Customer-selected third party vendor; and

Whereas, CSG and Customer desire to amend the Agreement to provide the Lockbox Processing Reconciliation Services to the named Customer-selected third party vendor.  

NOW THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, CSG and Customer agree to amend the Agreement as follows:

1. Customer has engaged the services of [****** ********* ********* *** (“******”)] as a third party provider necessary for Customer’s consumption of the Lockbox Processing Reconciliation Services to be provided by CSG utilizing a separate processing model.  As a result, CSG and Customer agree to amend the Agreement by adding Exhibit C-3(h) to Exhibit C-3, “Financial Services,” to Schedule C, “Recurring Services,” to the Agreement, pursuant to the terms provided in Attachment 1, attached hereto and incorporated herein by reference.

[Signature Page Follows]

Exhibit 10.26AP

THIS AMENDMENT is executed on the days and year last signed below to be effective as of the Amendment Effective Date (defined above).

CHARTER COMMUNICATIONS HOLDING COMPANY, LLC (“CUSTOMER”) By: Charter Communications, Inc., its Manager	CSG SYSTEMS, INC.(“CSG”)
By: /s/ Michael Ciszek	By:  /s/ Gregory L. Cannon
Title:  SVP Billing Strategy & Design	Title:  SVP, General Counsel & Secretary
Name:  Michael Ciszek	Name:  Gregory L. Cannon
Date: Mar 11, 2021	Date:  Mar 11, 2021

Exhibit 10.26AP

ATTACHMENT 1

Exhibit C-3(h)

[******] Lockbox Processing Reconciliation Services

1.[******] Lockbox Processing Reconciliation and Authorization.  CSG shall provide Customer with reconciliation services to settle Customer’s Connected Subscribers’ accounts following receipt by Customer of payments from Connected Subscribers via a lockbox, as more particularly described in Schedule A to this Exhibit C-3(h).  Customer authorizes CSG to provide [******] necessary Customer Confidential Information as CSG and Customer deem appropriate to provide the Services identified herein.

2.Requirements. CSG shall provide and Customer shall consume the [******] Lockbox Processing Reconciliation Services pursuant to Schedule A.

3.Termination of [******] Lockbox Processing Reconciliation Services.  Customer shall have the right, in its sole discretion and at any time, to terminate or discontinue use of the [******] Lockbox Processing Reconciliation Services by providing written notice to CSG not less than [****** (**) ****] prior to such termination or discontinuance (email is sufficient).  Upon receipt of such notice, CSG shall immediately cease its provision of the [******] Lockbox Processing Reconciliation Services to Customer pursuant to such written notice.

4.[******] Lockbox Reconciliation Requirements and Instructions.  Customer shall be responsible for providing [******] with requirements and instructions (“[******] Lockbox Reconciliation Requirements and Instructions”) for provision of the [******] Lockbox Processing Reconciliation Services pursuant to Schedule A.  Non-compliance by [******] with these requirements and instructions may degrade the Services.

5.Payment Data Delivery.  Customer acknowledges and agrees that to the extent [******] is provided incomplete, inaccurate or untimely payment data by Customer or if [******] provides any such incomplete, inaccurate or untimely payment data or provides incorrectly formatted payment data, there may be an impact or delay to CSG’s ability to provide Customer with the [******] Lockbox Processing Reconciliation Services.

6.Payment Data Format and File Naming Compliance.  The parties agree to work together to ensure [******] provides the payment data to CSG in the previously agreed format and utilizing the naming conventions specified in Schedule A and Customer acknowledges that any deviation from such agreed format or naming conventions will result in impacts and/or delays to (i) processing of Customer’s lockbox file, (ii) posting of payments to Customer’s Connected Subscribers’ accounts and (iii) payment reporting by CSG to Customer.

7.Changes to Requirements and Instructions.  The parties agree if there are changes to the [******] Lockbox Reconciliation Requirements and Instructions, such changes will be agreed in writing by the parties (email is sufficient with Vice President or above approval from each party) and Customer shall be responsible for providing such changes to the [******] Lockbox Reconciliation Requirements and Instructions to [******] in a timely manner.  

8.Non-Exclusive Relationship.  The parties agree that this does not create an exclusive relationship and CSG will continue to have the ability to provide the Lockbox Processing Reconciliation Services using [******] as a processor for other CSG customers and Customer shall continue to have the ability to provide the Lockbox Processing Reconciliation Services from CSG using processors other than [******].

Exhibit 10.26AP

SCHEDULE A

to

Exhibit C-3(h)

[******] Lockbox Reconciliation Requirements and Instructions

1.[****** Lockbox Reconciliation Requirements and Instructions in this Schedule A will be provided by Customer to ******]:

1.1 Definitions (as relates to this Schedule A).

1.1.1 “Bill” means a bill or invoice for the payment of goods and/or services sold, licensed or otherwise supplied by Customer.

1.1.2 “Payment File” means a payment file prepared by [******] and containing Bill payment information.

1.2 [********] Obligations.

1.2.1 [******] shall have a valid agreement in effect with Customer prior to sending Payment File data to CSG

1.2.1 [****** shall provide a Payment File to CSG in accordance with the file format (the “Payment File Format”), a copy of which is attached hereto as Exhibit 1 to this Schedule A, provided to ****** by Customer pursuant to these ******] Lockbox Reconciliation Requirements and Instructions.  

1.2.2 [****** is responsible to Customer for failure to provide accurate content to CSG in the Payment File.  To the extent that the content of the data in any Payment File provided by ******] to CSG is incorrect, CSG shall have no liability under this Agreement as relates to such Payment File.

1.2.3 Pursuant to these [****** Lockbox Reconciliation Requirements and Instructions, ******] shall review and validate the information provided in each Confirmation Email (as defined in Section 1.3.4 below) sent by CSG.  Any errors identified by [****** shall be reported to the CSG International Support Desk within *** (*) **** of receipt of the Confirmation Email.  CSG shall not be responsible for errors not timely reported to CSG by ******] as provided herein.

1.2.4 [****** shall have adequately trained personnel available to resolve any Payment File issues or questions from the time a daily Payment File is submitted to CSG up to the time that a Confirmation Email is provided by CSG to ******].

1.2.5 Pursuant to the [****** Lockbox Reconciliation Requirements and Instructions, ******] will adhere at all times to the file naming conventions (the “File Naming Conventions”), attached as Exhibit 2 to this Schedule A.

1.2.6 Pursuant to the [****** Lockbox Reconciliation Requirements and Instructions, payment information shall be provided by ****** to CSG and ******] shall be responsible for certifying with CSG that its Payment File is consistent with the Payment File Format and the File Naming Conventions.

1.3 CSG’s Obligations.

1.3.1 CSG shall have a valid agreement in effect with Customer prior to receiving payments from [******].

1.3.2 CSG shall post all Bill payment information and other data and information contained in the Payment Files to the CSG billing system for Customer's database on the day such Payment File is received, provided that the Payment File is received prior to CSG’s cutoff time.  If a Payment File is received after the CSG cutoff time, the payment information and other data and information contained in such Payment File will post the next day.  

1.3.3 CSG shall not amend, rectify, or delete any data or information contained in any Payment File without having received written instruction from Customer and [******] to do so.

1.3.4 CSG shall send [******] a confirmation email with the dollar amount of successfully posted transactions (“Confirmation Email”) as specified in Exhibit 3 to this Schedule A – Lockbox Confirmation Email.

Exhibit 10.26AP

Exhibit 1

to

Schedule A

[******* **** ******]

******* ******* ******
***** ***** * ****	*******	***** ***	*** ***	******	********
***** **** ****** ****** ****	**	*	*	*	*–** *–** *–** *–** *–** *** ******* ******* ********** * ******* ********* ******* ***** *** ***** ********** ********* ************ *** ******* ***** ** ******* ** *** *** **** *** **** ***** ** (******* ******* *****) *** ********* **** ********** *** ******* ********** **** *** *** *** ** ****** ******* ***** ** *** ******* *** ******* * ***(** $******
***** *****	*	*	*	*	**** **** *** ******* ***** ** *******
***** ***	*	*	*	*
***** *******	*	*	*	*
**********	*	*	*	*
******* ****	**	**	**	*	********* ** ********  ******* *** ******** ******* **** ** ** ******** ********  ** **** *** ******* ********** **** ***** **** *****
*****************	**	**	**	*	****** * **** ***** ****** * ********** ***** *    * * ******* ** ********** *****
******	**	**	***	***

Exhibit 10.26AP

******* ******* ******
***** ***** * ****	*******	***** ***	*** ***	******	********
*** ******************	**	*	*	*	**** ***** **** ** *** ** ***** *** ****** ********
***	*	*	*	*	************** *** *** ******* ********  ***** *** ******** ****** *** *** ******** ** ****
****	*	*	*	*
*****	*	**	**	*
*********** **** **************	**	**	**	**
*********** *****	*	**	**	*	**** **** *** *********** *** **********
*********** ***	*	**	**	*
*********** *******	*	**	**	*
*********** ****	*	**	**	*
*********** ***	*	**	**	**	*** **** * ****** **** ***** *** ***** *** *** ***** ******* ** *** *******
*********** ** *********** ****	**	**	**	*	* * ******* ***********  ******* *** ******** ******* **** ** ** ******** ********  ** **** *** ***** ********** **** ***** **** *****
*********** ******** ******	**	**	**	*	***** ** *********** **** *** *********** ***** ***  ***** *** ***** ***** ******* ****** ** ******** ****** *** ****** ******* ******
*********** ***** **	**	**	**	*
************* **** *	**	**	**	**	***** *** ****** *** *********  ** *********** **** ** ****** ** ***** *** ******* ** **** *** ** *******  ******** **** **** **** ** ******** ** *** ***************
************* **** *	**	**	**	**
******** ****	**	**	***	**	******** ***** **** *** **** *** ** ** ***** *** ********** *****  ** ***** ** **** ** **** ****** ** **** ** ******** ** *** ***************  ** **** ***** ** *** ******** ** ***** ** ** ****** **** *** *******
******** ****** ****	**	***	***	*	******** ***** **** *** **** *** ** ** ***** * ****** ****** *****  ** ***** ** **** ** **** ****** ** **** ** ******** ** *** ***************  ******* *** ******** *** ****** ****** ****** **** **** ** ******** *** ********** ** *** *******  ** **** ***** ** *** ******** ** ***** ** ** ****** **** *** *******

Exhibit 10.26AP

******* ******* ******
***** ***** * ****	*******	***** ***	*** ***	******	********
******	**	***	***	**	**** ** ******

******* ******* *******
***** ***** * ****	*******	***** ***	*** ***	******	********
******* ****** ****	**	*	*	*	******** ***** ******** ******* *******
****** *****	*	*	**	*	******** * ****** ***** *** *** ****** ** ****** ******* **** *** ** *** ******
****** *** ******	*	**	**	**	*** ************ ****** **** ** ******* ** **** ***** ** * *** ** *** ** *** ****** ****** ********
******	**	**	***	***	**** ** ******

Exhibit

Exhibit 10.26AP

2

to

Schedule A

[**** ****** ***********

{******}*{*******}*{******}*{***}*{****** *******}********

    ****** ***** ** ** *** **** ******

    ******* * ******* *** **** ****

    ****** * ** ******* ** ******  ** ******* ******* ************

    *** * **** ******

    ****** ******* * **** **** *** *** ****** (** ****** *******)]

Exhibit 10.26AP

Exhibit 3

to

Schedule A

Lockbox Confirmation Email

Pursuant to the [******] Lockbox Reconciliation Requirements and Instructions, CSG will provide file confirmation emails to [******]:

1. [******] will be set up to receive file confirmation emails (“Confirmation Emails”).  When [******] transmits a file and it is successfully received and processed by CSG, a Confirmation Email will automatically be sent to [********] specified email address.  The subject line of the email will be: “CSG LOCKBOX FILE CONFIRMATION.”

Each Confirmation Email will have a confirmation document attached in Notepad format.

2. The purpose of the confirmation email is to provide [******] with ability to supervise its payment file after the payment file has been transmitted.  

3. An individual file will be made up of one (1) or more batches.  When received, the Confirmation Email will provide the following information for each batch within a processed file:

• system principal assigned to the batch

• whether the entire batch was accepted or rejected

- a reject reason will be provided for any rejected batch

• total dollar amount of a rejected batch

• total dollar amount of accepted items within an accepted batch

- individual items of an accepted batch can be rejected; when that occurs the totals of those items do not show in the total for the batch

4. The Confirmation Email will also provide the total dollar amount of all (i) accepted payments and (ii) returned batches.  The totals for any rejected batches will not show in the overall totals.  

5. Every Confirmation Email will contain the following ending statement:

IF YOU HAVE  QUESTIONS REGARDING THE CONTENTS OF THIS EMAIL,  CONTACT CSG'S INTERNATIONAL SERVICE DESK ("ISD") AT [**************; REFERENCE JOB ******].

Note: [****** has been assigned a unique **** ***] name that will be provided in the confirmation email.

6. If a payment file is transmitted and processed at CSG successfully, [****** will receive the Confirmation Email within ****** (**) *******] of transmission.  

7. If [****** does not receive a Confirmation Email within such ****** (**) ****** time period, ****** should contact the ISD and provide the designated **** job name.  The ISD will open a priority * **** ********] and the CSG Financial Services on-call team will be paged.

8. The CSG Financial Services on call team will assess the situation to determine what [*** ***** ****(*)] to engage.

EX-10.26AQ

Exhibit 10.26AQ

THIS DOCUMENT CONTAINS INFORMATION WHICH HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED.  SUCH EXCLUDED INFORMATION IS IDENTIFIED BY BRACKETS AND MARKED WITH (***).

FORTY-NINTH AMENDMENT

TO

CONSOLIDATED

CSG MASTER SUBSCRIBER MANAGEMENT SYSTEM AGREEMENT

BETWEEN

CSG SYSTEMS, INC.

AND

CHARTER COMMUNICATIONS OPERATING, LLC

SCHEDULE AMENDMENT

This Forty-ninth Amendment (the “Amendment”) is made by and between CSG Systems, Inc., a Delaware corporation (“CSG”), and Charter Communications Operating, LLC, a Delaware limited liability company (“Customer”).  CSG and Customer entered into that certain Consolidated CSG Master Subscriber Management System Agreement effective as of August 1, 2017 (CSG document no. 4114281), as amended (the “Agreement”), and now desire to further amend the Agreement in accordance with the terms and conditions set forth in this Amendment.  If the terms and conditions set forth in this Amendment shall be in conflict with the Agreement, the terms and conditions of this Amendment shall control.  Any terms in initial capital letters or all capital letters used as a defined term but not defined in this Amendment shall have the meaning set forth in the Agreement.  Upon execution of this Amendment by the parties, any subsequent reference to the Agreement between the parties shall mean the Agreement as amended by this Amendment.  Except as amended by this Amendment, the terms and conditions set forth in the Agreement shall continue in full force and effect according to their terms. The effective date of this Amendment is the date last signed below (the “Amendment Effective Date”).

WHEREAS, pursuant to the Agreement, as more particularly described in that certain Twentieth Amendment to the Agreement (CSG document no. 4123172) executed by the parties and effective as of January 18, 2019, Customer requested and CSG agreed to provide “CSG Composed XML Output” Services, pursuant to Schedule C to the Agreement; and

WHEREAS, Customer has requested and CSG agrees to provide additional enhanced availability to Customer of the CSG Composed XML Output Services, pursuant to the terms hereunder.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, CSG and Customer agree as follows:

1. Upon execution of this Amendment and pursuant to the terms and conditions of the Agreement, Schedule F, “Fees,” Section 1., “CSG Services,” subsection III., “Payment Procurement,” subsection A, “Direct Solutions (Print and Mail),” subsection 15, “CSG Composed XML Output,” is amended to add the following new subsection (c), “Enhanced Availability Recurring Fees,” and Note 36:

Description	Frequency	Fee
15.CSG Composed XML Output
(c)  Enhanced Availability Recurring Fees (Note 36)
i.  Statement Pulls available for a rolling [*********** (**) ******].	[*******]	$[********]

Note 36: Enhanced Availability CSG Composed XML Output will allow for retrieval by Customer from the API of Composed XML Output for a rolling [*********** (**) ******].  Should Customer choose to terminate the Enhanced Availability CSG Composed XML Output Services, Customer will provide CSG with no less than [********** (**) ***** ***** ******] of such discontinuance.

Exhibit 10.26AQ

THIS AMENDMENT is executed on the days and year last signed below to be effective as of the Effective Date (defined above).

CHARTER COMMUNICATIONS HOLDING COMPANY, LLC (“CUSTOMER”) By: Charter Communications, Inc., its Manager	CSG SYSTEMS, INC.(“CSG”)
By: /s/ Michael Ciszek	By:  /s/ Gregory L. Cannon
Title:  SVP Billing Strategy & Design	Title:  SVP, General Counsel & Secretary
Name:  Michael Ciszek	Name:  Gregory L. Cannon
Date: Mar 11, 2021	Date:  Mar 11, 2021

EX-10.26AR

Exhibit 10.26AR

THIS DOCUMENT CONTAINS INFORMATION WHICH HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED.  SUCH EXCLUDED INFORMATION IS IDENTIFIED BY BRACKETS AND MARKED WITH (***).

FIFTIETH AMENDMENT

TO

CONSOLIDATED

CSG MASTER SUBSCRIBER MANAGEMENT SYSTEM AGREEMENT

BETWEEN

CSG SYSTEMS, INC.

AND

CHARTER COMMUNICATIONS OPERATING, LLC

SCHEDULE AMENDMENT

This Fiftieth Amendment (the “Amendment”) is made by and between CSG Systems, Inc., a Delaware corporation (“CSG”), and Charter Communications Operating, LLC, a Delaware limited liability company (“Customer”).  CSG and Customer entered into that certain Consolidated CSG Master Subscriber Management System Agreement effective as of August 1, 2017 (CSG document no. 4114281), as amended (the “Agreement”), and now desire to further amend the Agreement in accordance with the terms and conditions set forth in this Amendment.  If the terms and conditions set forth in this Amendment shall be in conflict with the Agreement, the terms and conditions of this Amendment shall control.  Any terms in initial capital letters or all capital letters used as a defined term but not defined in this Amendment shall have the meaning set forth in the Agreement.  Upon execution of this Amendment by the parties, any subsequent reference to the Agreement between the parties shall mean the Agreement as amended by this Amendment.  Except as amended by this Amendment, the terms and conditions set forth in the Agreement shall continue in full force and effect according to their terms.

WHEREAS, CSG currently provides access to and Customer currently uses [*** (*)] test environments on CSG’s Advanced Convergent Platform (“ACP”): (i) [**** and ****] in the Customer Test Environment Region (“CTER”), a test environment dedicated to Customer, and (ii) [**** and ****] in the Customer Shared Test Environment; and

WHEREAS, Customer desires to use and CSG agrees to provide Customer with access to [** **********] Customer-use only test environment containing [*** (*)] regions that will be known as [**** and ****].

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, CSG and Customer agree to the following as of the Amendment Effective Date (as defined below).

1. Customer has requested and CSG has agreed to configure and make available to Customer [*** (*) **********] Customer-use only test environment that will be identified and known as the [**** and ****] regions of the test environment to Customer, pursuant to the terms herein.

2. As a result, CSG and Customer, upon execution of this Amendment, acknowledge and agree that Schedule F, Section 1., “Services,” subsection I., “Processing,” subsection B., “Test Environments,” shall be amended to (i) add a new subsection 3, “Test Environment [(**********)],” (ii) delete in their entirety and replace Note 4 and Note 5, respectively, of the Fee Table, and (iii) add Note 13 and Note 14, as follows:

B. Test Environments  

Description of Item/Unit of Measure	Frequency	Fee
3.  Test Environment [(*********)] (Note 4) (Note 5) (Note 13) (Note 15)
a. Support Services Fees (Note 14)	[*******]	$[**********]

Exhibit 10.26AR

Note 4: For the Support Services Fees provided herein, Customer shall receive the following:  

➣ Maintenance of the regions with [*** ********** ********** **** ********* ************ ***** ****** (“**”), ***** *** ******* ********** **********(*); and *** ********** ********** **** implemented approximately *** (*) ***** prior to ***** ******** to production and approximately **** (*) ***** prior to ***** ********] to production (CSG's major and minor releases are regularly scheduled software updates to CSG products)

➣ Monitoring of all system components to ensure that such components are operational (including hardware, software, and all application components) and system access

➣ Provision of help desk support via CSG's International Service Desk (“ISD”) as follows:

• Tickets for issue resolution support can be called into the ISD any time but will only be worked between the hours of [****** * ****** Central time, ****** ******* ******]  

• Tickets will be logged no higher than a [******** ***** *] and handled through CSG standard procedures, pursuant to published Service Level Agreements

• There will be [** ******** ***** ****** ** ******* *******]

• CTER, Customer Shared Test Environment and [********* test environment are quality assurance (“QA”) regions and will not be supported ****; support will be provided during normal business hours, ************* (****** – **** ***)].  Builds will run [****** ********* * ****** ********* and cycle runs ****** ************** ***** with ** ******** ***** ****** ** ******* *******].  

➣ Provision of ongoing support via CSG's Customer Business Unit (“CBU”), production implementation manager ("PIM") and client implementation analyst ("CIA"), consistent with support currently provided to the existing prerelease environments through implementation and on-going support

Note 5: CTER and [********* are sized for ***** (**) **** ****, which for CTER shall apply to **** and **** ** *** *********].  If Customer’s usage of either CTER or [********* exceeds the ***** (**) **** for any **** (*) **** within a ******** *****], Customer will be charged $[****** *** **** per ***** for the actual number of **** in ****** ******* ***** (**) ****].  [**** capacity will be ***** ** ***** (**) **** per *********** **** ***** and any amount in excess shall be provided as identified herein, but in any event shall be ** **** **** ***** (**) **** per ***********].

Note 13: Configuration and set up of [**** and ****] test environment shall be mutually agreed and documented in that certain Statement of Work entitled Configure and Make [**** and ****] Test Environment Available to Customer (CSG document no. 33151) (the “[*********] SOW”).  

Note 14: The Support Services Fees shall commence following availability of the [**** and ****] test environment.

Note 15: CSG and Customer agree that in consideration of the mutually agreed upon Support Services Fees provided hereunder and the terms pursuant to the [********* *** ******* *** ************* *** *** ** ****, Customer agrees to utilize the **** and **** test environment for * ******* ** *********** (**) ****** (the “** ***** ******* **********”)].  For purposes of clarification the parties acknowledge and agree that the Support Services Fees are the parties’ agreed upon payment terms for the [**** and **** test environment and that such *********** (**) ***** period ******* *** ******* **** ** *** *********.  In the event Customer chooses to terminate the Support Services for the **** and **** test environment (other than by natural expiration of the Agreement), Customer will provide CSG with no less than ********** (**) ***** ***** ****** ** **** **************].  If such cancellation of the [**** and **** test environment occurs prior to the end of the ** ***** ******* **********, in addition to all other amounts then due and owing to CSG, *** **** ******* ******** *** ***** ********* **** ************ *** ******** **** *** ** *** ** ****** ***** $************] in accordance with the Terms of the Agreement.

THIS AMENDMENT is executed on the days and year last signed below to be effective as of the date last signed below (the "Amendment Effective Date").

CHARTER COMMUNICATIONS HOLDING COMPANY, LLC (“CUSTOMER”) By: Charter Communications, Inc., its Manager	CSG SYSTEMS, INC.(“CSG”)
By: /s/ Michael Ciszek	By:  /s/ Gregory L. Cannon
Title:  SVP Billing Strategy & Design	Title:  SVP, General Counsel & Secretary
Name:  Michael Ciszek	Name:  Gregory L. Cannon
Date: Mar 11, 2021	Date:  Mar 11, 2021

EX-10.27D

Exhibit 10.27D

THIS DOCUMENT CONTAINS INFORMATION WHICH HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED.  SUCH EXCLUDED INFORMATION IS IDENTIFIED BY BRACKETS AND MARKED WITH (***).

THIRD AMENDMENTTOTHE

CSGMASTERSUBSCRIBERMANAGEMENTSYSTEMAGREEMENTBETWEEN

CSGSYSTEMS,INC.AND

COMCASTCABLECOMMUNICATIONSMANAGEMENT,LLC

THIS THIRD AMENDMENT (the “Amendment”) is made by and between CSG Systems, Inc. (“CSG”) and ComcastCable Communications Management, LLC (“Customer”). The Effective Date of this Amendment is the date lastsigned below.CSG and Customer entered into a certain CSG Master Subscriber Management System Agreement(CSG document #4131273) with an effective date of January 1, 2020 (the “Agreement”) and now desire to furtheramend the Agreement in accordance with the terms and conditions set forth in this Amendment. If the terms andconditions set forth in this Amendment conflict with the Agreement, the terms and conditions of this Amendmentshall control. Any terms in initial capital letters or all capital letters used as a defined term but not defined in thisAmendment shall have the meaning set forth in the Agreement. Upon execution of this Amendment by the Parties,any subsequent reference to the Agreement between the Parties shall mean the Agreement as amended by thisAmendment. Except as amended by this Amendment, the terms and conditions set forth in the Agreement shallcontinueinfull force and effect accordingtotheir terms.

CSGandCustomeragreetothefollowing:

1. Customer has requested and CSG agrees to provide a custom interface to Customer in support of the [*******************]API.

2. Schedule F, “Fees,” section entitled “IV. Ancillary Products and Services,” Subsection entitled “A. Ancillaryservices for Non-Rated Video and Non-Rated High-Speed Data and Residential Voice Services,” is amended toadd anew subsection “10.Custom [*******************]APIInterface”asfollows:

L.Custom [******* ************]APIInterface(Notes1 & 2)
1.[*******************************]Fee(Notes3,4,5&6)	[********]	$[*********]

Note 1: The Custom [******* ************ API Interface from CSG to Customer replaces CSG’s ******* *********currentlyusedbyCustomer.ThenewCustom *******************APIInterfacewillbe usedtodetermine a****************** *****].

Note 2: Implementation services and the associated fees applicable to the Custom [******* ************ API Interfaceareset forth inthatcertainStatementofWork (CSGdocumentno.*******)(“SOW*******”)].

Note 3: Production support and maintenance (“Production Support”) shall commence on [*** ********** ** **********. CSG agrees to ******* *** ***** **** ** ********** ******* ** ** ****** ** ******************, ProductionSupportis******************the*************************************Fee,whichfeeisduetoCSG***************************andwillbeinvoiced****************toCustomer*******the***************ofthe**********************].

Note4:ProductionSupport [(****************and**********upon*******ofthe*****************and**************)covers**********(***)*****of*********************,including************************************************ ******** ********]. CSG will be responsible for resolution of Custom [******* ************ API Interfacedefects caused by CSG or the CSG systems used to provide such interface.Such ********** ******* ***** must be******** and ******** by Customer. ********** ******* is intended to address ********** issues only. CSG shall alsoupdatetheCustom*******************APIInterfaceconsistentwithanyCSG*********************the********** (***)*******************]. [*****************doesnotincludeanyrequestbyCustomerfor********************************** ** *********** ************* ******* to the Custom ******* ************ API Interface, each of whichshallrequirethepartiestoenteraseparateStatementofWorkorotherdocumenttoprescribesuchadditional***********and/or ************* **** (and, if applicable, an amendment to this Agreement to specify any additional fees, termsand/orconditionsrelativetosuchresulting*********** **************).************spenttorespondtosuch********are*** *******tothe**********************].

Note5:IfCustomer [*******the****************(***)*****of*****************,CSGshallchargeandCustomeragreestopay**************forthe**********************************************]pursuanttoaseparateStatementofWorkor Letterof Authorization.

Note6:ThefeessetforthinthefeetableabovearesubjecttoincreasepursuanttoSection5.4oftheAgreement,AdjustmenttoFees,of theAgreement.

Exhibit 10.27D

INWITNESSWHEREOFthepartiesheretohavecausedthisAmendmenttobeexecutedbytheirdulyauthorizedrepresentatives.

COMCAST CABLE COMMUNICATIONS MANAGEMENT, LLC (“CUSTOMER”)	CSG SYSTEMS, INC.(“CSG”)
By: /s/ Deepak Bharathan	By:  /s/ Gregory L. Cannon
Name: Deepak Bharathan	Name:  Gregory L. Cannon
Title:  Vice President, Procurement	Title:  SVP, General Counsel & Secretary
Date: 2/3/2021	Date:  Jan 28, 2021

EX-31.01

EXHIBIT 31.01

CERTIFICATION PURSUANT TO

SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Brian A. Shepherd, certify that:

1. I have reviewed this report on Form 10-Q of CSG Systems International, Inc.;

2. 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;

3. 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;

4. 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:

(a) 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;

(b) 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;

(c) 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

(d) 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

5. 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):

(a) 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

(b) 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.

Date: May 6, 2021	/s/ Brian A. Shepherd
	Brian A. Shepherd
	President and Chief Executive Officer

EX-31.02

EXHIBIT 31.02

CERTIFICATION PURSUANT TO

SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Rolland B. Johns, certify that:

1. I have reviewed this report on Form 10-Q of CSG Systems International, Inc.;

2. 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;

3. 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;

4. 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:

(a) 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;

(b) 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;

(c) 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

(d) 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

5. 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):

(a) 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

(b) 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.

Date: May 6, 2021	/s/ Rolland B. Johns
	Rolland B. Johns
	Executive Vice President and Chief Financial Officer

EX-32.01

EXHIBIT 32.01

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The certification set forth below is being submitted in connection with the Quarterly Report on Form 10-Q (the “Report”) for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code.

Brian A. Shepherd, the Chief Executive Officer and Rolland B. Johns, the Chief Financial Officer of CSG Systems International Inc., each certifies that, to the best of his knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of CSG Systems International, Inc.

May 6, 2021

/s/ Brian A. Shepherd

Brian A. Shepherd

President and Chief Executive Officer

May 6, 2021

/s/ Rolland B. Johns

Rolland B. Johns

Executive Vice President and Chief Financial Officer

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2021	Apr. 30, 2021
Cover [Abstract]
Entity Registrant Name	CSG SYSTEMS INTERNATIONAL, INC.
Entity Central Index Key	0001005757
Document Type	10-Q
Document Period End Date	Mar. 31, 2021
Amendment Flag	false
Entity Small Business	false
Entity Emerging Growth Company	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Trading Symbol	CSGS
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		32,889,346
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	0-27512
Entity Tax Identification Number	47-0783182
Entity Address, Address Line One	6175 S. Willow Drive
Entity Address, Address Line Two	10th Floor
Entity Address, City or Town	Greenwood Village
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80111
City Area Code	(303)
Local Phone Number	200-2000
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false
Title of 12(b) Security	Common Stock, Par Value $0.01 Per Share
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 150,609	$ 188,699
Short-term investments	54,539	51,598
Total cash, cash equivalents and short-term investments	205,148	240,297
Settlement assets	108,578	149,785
Trade accounts receivable:
Billed, net of allowance of $3,718 and $3,628	247,025	226,623
Unbilled	40,789	37,785
Income taxes receivable	2,421	2,167
Other current assets	39,047	41,688
Total current assets	643,008	698,345
Non-current assets:
Property and equipment, net of depreciation of $110,797 and $105,073	81,944	81,759
Operating lease right-of-use assets	106,173	110,756
Intangible assets	71,858	74,465
Goodwill	273,265	272,322
Customer costs, net of amortization of $42,802 and $39,893	47,334	47,238
Deferred income taxes	9,892	10,205
Other assets	41,007	36,910
Total non-current assets	631,473	633,655
Total assets	1,274,481	1,332,000
Current liabilities:
Current portion of long-term debt, net of unamortized discounts of $3,119 and zero	241,881	14,063
Operating lease liabilities	23,309	22,651
Customer deposits	32,565	39,992
Trade accounts payable	32,949	29,834
Accrued employee compensation	71,120	86,289
Settlement liabilities	107,023	148,819
Deferred revenue	55,840	52,357
Income taxes payable	5,797	6,627
Other current liabilities	17,249	19,383
Total current liabilities	587,733	420,015
Non-current liabilities:
Long-term debt, net of unamortized discounts of $1,017 and $5,346	107,733	337,154
Operating lease liabilities	91,028	95,926
Deferred revenue	15,505	17,275
Income taxes payable	2,467	2,436
Deferred income taxes	11,569	5,109
Other non-current liabilities	30,731	31,690
Total non-current liabilities	259,033	489,590
Total liabilities	846,766	909,605
Stockholders' equity:
Preferred stock, par value $.01 per share; 10,000 shares authorized; zero shares issued and outstanding
Common stock, par value $.01 per share; 100,000 shares authorized; 32,963 and 32,713 shares outstanding	704	700
Additional paid-in capital	471,364	470,557
Treasury stock, at cost; 36,122 and 35,980 shares	(900,644)	(894,126)
Accumulated other comprehensive income (loss):
Unrealized gains on short-term investments, net of tax	7	13
Cumulative foreign currency translation adjustments	(31,506)	(31,151)
Accumulated earnings	887,790	876,402
Total stockholders' equity	427,715	422,395
Total liabilities and stockholders' equity	1,274,481	1,332,000
Software
Non-current assets:
Intangible assets	25,585	26,453
Acquired customer contracts
Non-current assets:
Intangible assets	$ 46,273	$ 48,012

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Trade accounts receivable-billed, allowance	$ 3,718	$ 3,628
Property and equipment, accumulated depreciation	110,797	105,073
Intangibles, accumulated amortization	251,508	245,614
Customer costs, accumulated amortization	42,802	39,893
Current portion of long-term debt, unamortized discounts	3,119	0
Long-term debt, unamortized discounts	$ 1,017	$ 5,346
Preferred stock, par value	$ 0.01	$ 0.01
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	100,000,000	100,000,000
Common stock, shares outstanding	32,963,000	32,713,000
Treasury stock, shares	36,122,000	35,980,000
Software
Intangibles, accumulated amortization	$ 143,662	$ 139,836
Acquired customer contracts
Intangibles, accumulated amortization	$ 107,846	$ 105,778

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Income Statement [Abstract]
Revenue	$ 253,119	$ 245,617
Cost of revenue (exclusive of depreciation, shown separately below)	133,542	131,206
Other operating expenses:
Research and development	32,212	30,337
Selling, general and administrative	48,815	44,384
Depreciation	6,113	5,565
Restructuring and reorganization charges	1,060	966
Total operating expenses	221,742	212,458
Operating income	31,377	33,159
Other income (expense):
Interest expense	(3,592)	(4,213)
Amortization of original issue discount	(772)	(730)
Interest and investment income, net	124	529
Other, net	(555)	(69)
Total other	(4,795)	(4,483)
Income before income taxes	26,582	28,676
Income tax provision	(6,951)	(7,162)
Net income	$ 19,631	$ 21,514
Weighted-average shares outstanding:
Basic	31,844	31,994
Diluted	32,146	32,358
Earnings per common share:
Basic	$ 0.62	$ 0.67
Diluted	$ 0.61	$ 0.66

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - UNAUDITED - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Statement Of Income And Comprehensive Income [Abstract]
Net income	$ 19,631	$ 21,514
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(355)	(15,084)
Unrealized holding losses on short-term investments arising during period	(6)	(24)
Other comprehensive loss, net of tax	(361)	(15,108)
Total comprehensive income, net of tax	$ 19,270	$ 6,406

XML

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - UNAUDITED - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated Other Comprehensive Income (Loss)	Accumulated Earnings
Balance, beginning of period at Dec. 31, 2019	$ 396,662	$ 696	$ 454,663	$ (867,817)	$ (39,503)	$ 848,623
Balance, beginning of period, shares at Dec. 31, 2019		32,891
Net income	21,514					21,514
Unrealized gain on short-term investments, net of tax	(24)				(24)
Foreign currency translation adjustments	(15,084)				(15,084)
Total comprehensive income	6,406
Repurchase of common stock	(13,965)	$ (2)	(7,555)	(6,408)
Repurchase of common stock, shares		(299)
Issuance of common stock pursuant to employee stock purchase plan	564		564
Issuance of common stock pursuant to employee stock purchase plan, shares		14
Issuance of restricted common stock pursuant to stock-based compensation plans		$ 5	(5)
Issuance of restricted common stock pursuant to stock-based compensation plans, shares		476
Cancellation of restricted common stock issued pursuant to stock-based compensation plans, shares		(7)
Stock-based compensation expense	4,857		4,857
Dividends	(7,693)					(7,693)
Balance, ending of period at Mar. 31, 2020	386,831	$ 699	452,524	(874,225)	(54,611)	862,444
Balance, ending of period, shares at Mar. 31, 2020		33,075
Balance, beginning of period at Dec. 31, 2020	$ 422,395	$ 700	470,557	(894,126)	(31,138)	876,402
Balance, beginning of period, shares at Dec. 31, 2020	32,713	32,713
Net income	$ 19,631					19,631
Unrealized gain on short-term investments, net of tax	(6)				(6)
Foreign currency translation adjustments	(355)				(355)
Total comprehensive income	19,270
Repurchase of common stock	(11,721)	$ (1)	(5,202)	(6,518)
Repurchase of common stock, shares		(252)
Issuance of common stock pursuant to employee stock purchase plan	619		619
Issuance of common stock pursuant to employee stock purchase plan, shares		16
Issuance of restricted common stock pursuant to stock-based compensation plans		$ 5	(5)
Issuance of restricted common stock pursuant to stock-based compensation plans, shares		487
Cancellation of restricted common stock issued pursuant to stock-based compensation plans, shares		(1)
Stock-based compensation expense	5,395		5,395
Dividends	(8,243)					(8,243)
Balance, ending of period at Mar. 31, 2021	$ 427,715	$ 704	$ 471,364	$ (900,644)	$ (31,499)	$ 887,790
Balance, ending of period, shares at Mar. 31, 2021	32,963	32,963

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Cash flows from operating activities:
Net income	$ 19,631	$ 21,514
Adjustments to reconcile net income to net cash used in operating activities -
Depreciation	6,113	5,565
Amortization	10,737	10,788
Amortization of original issue discount	772	730
Asset impairment	102	259
(Gain)/loss on short-term investments	15	(85)
Deferred income taxes	6,508	9,310
Stock-based compensation	5,395	4,857
Changes in operating assets and liabilities, net of acquired amounts:
Trade accounts receivable, net	(23,874)	(23,304)
Other current and non-current assets and liabilities	(999)	(8,452)
Income taxes payable/receivable	(1,022)	(3,092)
Trade accounts payable and accrued liabilities	(28,101)	(32,455)
Deferred revenue	1,914	7,152
Net cash used in operating activities	(2,809)	(7,213)
Cash flows from investing activities:
Purchases of software, property and equipment	(8,239)	(4,822)
Purchases of short-term investments	(32,304)	(16,037)
Proceeds from sale/maturity of short-term investments	29,340	18,670
Acquisition of and investments in business, net of cash acquired	(648)	(9,991)
Net cash used in investing activities	(11,851)	(12,180)
Cash flows from financing activities:
Proceeds from issuance of common stock	619	564
Payment of cash dividends	(8,635)	(8,277)
Repurchase of common stock	(11,738)	(13,876)
Payments on long-term debt	(2,813)	(1,875)
Net cash used in financing activities	(22,567)	(23,464)
Effect of exchange rate fluctuations on cash	(863)	(5,947)
Net decrease in cash and cash equivalents	(38,090)	(48,804)
Cash and cash equivalents, beginning of period	188,699	156,548
Cash and cash equivalents, end of period	150,609	107,744
Cash paid during the period for -
Interest	5,661	6,194
Income taxes	$ 1,468	$ 857

XML

General

3 Months Ended

Mar. 31, 2021

Organization Consolidation And Presentation Of Financial Statements [Abstract]

General

1.  GENERAL

We have prepared the accompanying unaudited condensed consolidated financial statements as of March 31, 2021 and December 31, 2020, and for the quarters ended March 31, 2021 and 2020, in accordance with accounting principles generally accepted in the United States of America (“U.S.”) (“GAAP”) for interim financial information, and pursuant to the instructions to Form 10-Q and the rules and regulations of the Securities and Exchange Commission (the “SEC”).  Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.  In the opinion of our management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position and operating results have been included.  The unaudited Condensed Consolidated Financial Statements (the “Financial Statements”) should be read in conjunction with the Consolidated Financial Statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), contained in our Annual Report on Form 10-K for the year ended December 31, 2020 (our “2020 10-K”), filed with the SEC.  The results of operations for the quarter ended March 31, 2021 are not necessarily indicative of the expected results for the entire year ending December 31, 2021.

XML

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates in Preparation of Financial Statements. The preparation of the accompanying Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of our Financial Statements, and the reported amounts of revenue and expenses during the reporting periods.  Actual results could differ from those estimates.  

Revenue.  The majority of our future revenue is related to our revenue management solution customer contracts that include variable consideration dependent upon a series of monthly volumes and/or daily usage of services and have contractual terms ending from 2021 through 2028.  Our customer contracts may include guaranteed minimums and fixed monthly or annual fees.  As of March 31, 2021, our aggregate amount of the transaction price allocated to the remaining performance obligations is approximately $900 million, which is made up of fixed fee consideration and guaranteed minimums expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied).  We expect to recognize approximately 80% of this amount by the end of 2023, with the remaining amount recognized by the end of 2028.  We have excluded from this amount variable consideration expected to be recognized in the future related to performance obligations that are unsatisfied.    

The nature, amount, timing, and uncertainty of our revenue and how revenue and cash flows are affected by economic factors is most appropriately depicted by revenue type, geographic region, and customer vertical.

Revenue by type for the first quarters of 2021 and 2020 was as follows (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Cloud and related solutions	$	227,019	$	222,220
Software and services		14,779		13,206
Maintenance		11,321		10,191
Total revenue	$	253,119	$	245,617

We use the location of the customer as the basis of attributing revenue to geographic regions.  Revenue by geographic region for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Americas (principally the U.S.)		86	%		88	%
Europe, Middle East, and Africa		10	%		9	%
Asia Pacific		4	%		3	%
Total revenue		100	%		100	%

We generate our revenue primarily from the global communications markets; however, we serve an expanding group of customers in markets including financial services, healthcare, media and entertainment companies, and government entities.  Revenue by customer vertical for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Broadband/Cable/Satellite		57	%		58	%
Telecommunications		18	%		17	%
Other		25	%		25	%
Total revenue		100	%		100	%

Deferred revenue recognized for the first quarters of 2021and 2020 was $20.1 million and $17.7 million, respectively.

Cash and Cash Equivalents. We consider all highly liquid investments with original maturities of three months or less at the date of the purchase to be cash equivalents.  As of March 31, 2021 and December 31, 2020, our cash equivalents consist primarily of institutional money market funds, commercial paper, and time deposits held at major banks.

As of March 31, 2021 and December 31, 2020, we had $1.9 million and $1.7 million, respectively, of restricted cash that serves to collateralize outstanding letters of credit.  This restricted cash is included in cash and cash equivalents in our Condensed Consolidated Balance Sheets (“Balance Sheets” or “Balance Sheet”).  For the cash and cash equivalents denominated in foreign currencies and/or located outside the U.S., we do not anticipate any material amounts being unavailable for use in running our business, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.

Short-term Investments and Other Financial Instruments.  Our financial instruments as of March 31, 2021 and December 31, 2020 include cash and cash equivalents, short-term investments, accounts receivable, accounts payable, and debt.  Due to their short maturities, the carrying amounts of cash equivalents, accounts receivable, and accounts payable approximate their fair value.

Our short-term investments and certain of our cash equivalents are considered “available-for-sale” and are reported at fair value in our Balance Sheets, with unrealized gains and losses, net of the related income tax effect, excluded from earnings and reported in a separate component of stockholders’ equity.  Realized and unrealized gains and losses were not material in any period presented.

Primarily all short-term investments held by us as of March 31, 2021 and December 31, 2020 have contractual maturities of less than two years from the time of acquisition.  Our short-term investments as of March 31, 2021 and December 31, 2020 consisted almost entirely of fixed income securities.  Proceeds from the sale/maturity of short-term investments for the first quarters of March 31, 2021 and 2020 were $29.3 million and $18.7 million, respectively.

Our short-term investments as of March 31, 2021 and December 31, 2020 were $54.5 million and $51.6 million, respectively.

The following table represents the fair value hierarchy based upon three levels of inputs, of which Levels 1 and 2 are considered observable and Level 3 is unobservable, for our financial assets measured at fair value (in thousands):

	March 31, 2021						December 31, 2020
	Level 1		Level 2		Total		Level 1		Level 2		Total
Cash equivalents:
Money market funds	$	33,546	$	—	$	33,546	$	33,535	$	—	$	33,535
Commercial paper		—		9,224		9,224		—		15,746		15,746
Corporate debt securities		—		—		—		—		1,351		1,351
Short-term investments:
Corporate debt securities		—		42,544		42,544		—		38,672		38,672
U.S. government agency bonds		—		4,628		4,628		—		4,642		4,642
Asset-backed securities		—		7,367		7,367		—		8,284		8,284
Total	$	33,546	$	63,763	$	97,309	$	33,535	$	68,695	$	102,230

Valuation inputs used to measure the fair values of our money market funds were derived from quoted market prices.  The fair values of all other financial instruments are based upon pricing provided by third-party pricing services.  These prices were derived from observable market inputs.

We have chosen not to record our debt at fair value, with changes recognized in earnings each reporting period.  The following table indicates the carrying value (par value for convertible debt) and estimated fair value of our debt as of the indicated periods (in thousands):

	March 31, 2021				December 31, 2020
	Carrying		Fair		Carrying		Fair
	Value		Value		Value		Value
2018 Credit Agreement (carrying value including current maturities)	$	123,750	$	123,750	$	126,563	$	126,563
2016 Convertible debt (par value)		230,000		243,513		230,000		244,663

The fair value for our credit agreement was estimated using a discounted cash flow methodology, while the fair value for our convertible debt was estimated based upon quoted market prices or recent sales activity, both of which are considered Level 2 inputs.

Equity Method Investment.  We held a 15% noncontrolling interest in a payment technology and services company with a carrying value of approximately $8 million as of March 31, 2021 and December 31, 2020, included in other non-current assets in our Balance Sheets.

Accounting Pronouncement Issued But Not Yet Effective.  In August 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. ASU 2020-06 also amends the related Earnings Per Share guidance. ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, and can be adopted on either a fully retrospective or modified retrospective basis. We are currently evaluating the timing, method of adoption, and overall impact of this standard on our Financial Statements.

XML

Long-Lived Assets

3 Months Ended

Mar. 31, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Long-Lived Assets

3.  LONG-LIVED ASSETS

Goodwill. The changes in the carrying amount of goodwill for the first quarter of 2021 were as follows (in thousands):

January 1, 2021 balance	$	272,322
Goodwill acquired during period		168
Adjustments related to prior acquisitions		(15	)
Effects of changes in foreign currency exchange rates		790
March 31, 2021 balance	$	273,265

Other Intangible Assets.  Our other intangible assets subject to ongoing amortization consist primarily of acquired customer contracts and software.  As of March 31, 2021 and December 31, 2020, the carrying values of these assets were as follows (in thousands):

	March 31, 2021							December 31, 2020
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Acquired customer contracts	$	154,119	$	(107,846	)	$	46,273	$	153,790	$	(105,778	)	$	48,012
Software		169,247		(143,662	)		25,585		166,289		(139,836	)		26,453
Total intangible assets	$	323,366	$	(251,508	)	$	71,858	$	320,079	$	(245,614	)	$	74,465

The total amortization expense related to other intangible assets for the first quarters of 2021 and 2020 were $5.6 million and $6.3 million, respectively.  Based on the March 31, 2021 net carrying value of our other intangible assets, the estimated total amortization expense for each of the five succeeding fiscal years ending December 31 are: 2021 – $20.5 million; 2022 – $14.7 million; 2023 – $10.8 million; 2024 – $7.4 million; and 2025 – $6.5 million. 

Customer Contract Costs.  As of March 31, 2021 and December 31, 2020, the carrying values of our customer contract cost assets, related to those contracts with a contractual term greater than one year, were as follows (in thousands):

	March 31, 2021							December 31, 2020
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Customer contract costs	$	90,136	$	(42,802	)	$	47,334	$	87,131	$	(39,893	)	$	47,238

The total amortization expense related to customer contract costs for the first quarters of 2021 and 2020 were $4.7 million and $4.0 million, respectively. 

XML

Debt

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Debt

4.  DEBT

Our long-term debt, as of March 31, 2021 and December 31, 2020, was as follows (in thousands):

	March 31,			December 31,
	2021			2020
2018 Credit Agreement:
Term loan, due March 2023, interest at adjusted LIBOR plus 1.5% (combined rate of 1.70% at March 31, 2021 and 1.75% at December 31, 2020)	$	123,750		$	126,563
Less – deferred financing costs		(1,017	)		(1,155	)
2018 Term Loan, net of unamortized discounts		122,733			125,408
$200 million revolving loan facility, due March 2023, interest at adjusted LIBOR plus applicable margin	—			—
2016 Convertible Notes:
Convertible Notes – Senior convertible notes; due March 15, 2036; cash interest at 4.25%		230,000			230,000
Less – unamortized original issue discount		(2,249	)		(3,021	)
Less – deferred financing costs		(870	)		(1,170	)
2016 Convertible Notes, net of unamortized discounts		226,881			225,809
Total debt, net of unamortized discounts		349,614			351,217
Current portion of long-term debt, net of unamortized discounts		(241,881	)		(14,063	)
Long-term debt, net of unamortized discounts	$	107,733		$	337,154

2018 Credit Agreement.  During the quarter ended March 31, 2021, we made $2.8 million of principal repayments on our $150 million aggregate principal five-year term loan (the “2018 Term Loan”).  As of March 31, 2021, our interest rate on the 2018 Term Loan is 1.70% (adjusted LIBOR plus 1.50% per annum), effective through June 2021, and our commitment fee on the unused $200 million aggregate principal five-year revolving loan facility (the “2018 Revolver”) is 0.20%.  As of March 31, 2021, we had no borrowings outstanding on our 2018 Revolver and had the entire $200.0 million available to us.  

The interest rates under the 2018 Credit Agreement are based upon our choice of an adjusted LIBOR rate plus an applicable margin of 1.50% – 2.50%, or an alternate base rate plus an applicable margin of 0.50% – 1.50%, with the applicable margin, depending on our then-net secured total leverage ratio.  We will pay a commitment fee of 0.200% – 0.375% of the average daily unused amount of the 2018 Revolver, with the commitment fee rate also dependent upon our then-net secured total leverage ratio.  If the LIBOR rate is no longer available, then our interest rate under the Credit Agreement will be determined by the alternate base rate plus an applicable margin as discussed above.  

2016 Convertible Notes.  We will settle conversions of the 2016 Convertible Notes by paying or delivering, as the case may be, cash, shares of our common stock, or a combination thereof, at our election.  It is our current intent and policy to settle our conversion obligations as follows: (i) pay cash for 100% of the par value of the 2016 Convertible Notes that are converted; and (ii) to the extent the value of our conversion obligation exceeds the par value, we can satisfy the remaining conversion obligation in our common stock, cash, or a combination thereof.

The 2016 Convertible Notes will be convertible at the option of the note holders upon the satisfaction of specified conditions and during certain periods.  During the period from, and including, December 15, 2021 to the close of business on the business day immediately preceding March 15, 2022 and on or after December 15, 2035, holders may convert all or any portion of their 2016 Convertible Notes at the conversion rate then in effect at any time regardless of these conditions. For the 2016 Convertible Notes presented during this time frame, the settlement amount will be equal to the sum of the daily settlement amounts for each of the following 40 consecutive trading days during the related observation period.

As the 2016 Convertible Notes can be converted at the holder's option beginning December 15, 2021 and ending March 15, 2022, subject to an observation holding period of 40 days, the net carrying value of the 2016 Convertible Notes of $226.9 million has been classified as a current liability in our Balance Sheet as of March 31, 2021.

As a result of our quarterly dividend in March 2021 (see Note 7), the previous conversion rate for the 2016 Convertible Notes of 17.6656 shares of our common stock per $1,000 principal amount of the 2016 Convertible Notes, which is equivalent to an initial conversion price of $56.61 per share of our common stock, has been adjusted to 17.6898 shares of our common stock per $1,000 principal amount of the 2016 Convertible Notes, which is equivalent to an initial conversion price of $56.53 per share of our common stock.  Holders may require us to repurchase the 2016 Convertible Notes for cash on each of March 15, 2022, March 15, 2026, and March 15, 2031, or upon the occurrence of a fundamental change (as defined in the 2016 Convertible Notes Indenture) in each case at a purchase price equal to the principal amount thereof plus accrued and unpaid interest.

We may redeem for cash all or part of the 2016 Convertible Notes if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption.  On or after March 15, 2022, we may redeem for cash all or part of the 2016 Convertible Notes regardless of the sales price condition described in the preceding sentence.  In each case, the redemption price will equal the principal amount of the 2016 Convertible Notes to be redeemed, plus accrued and unpaid interest.

As of March 31, 2021, none of the conversion features have been achieved, and thus, the 2016 Convertible Notes are not convertible by the holders.

XML

Commitments, Guarantees and Contingencies

3 Months Ended

Mar. 31, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments, Guarantees and Contingencies

5.  COMMITMENTS, GUARANTEES AND CONTINGENCIES

Guarantees.  In the ordinary course of business, we may provide guarantees in the form of bid bonds, performance bonds, or standby letters of credit.  At March 31, 2021, we had $2.9 million of restricted assets used to collateralize these guarantees, with $1.9 million included in cash and cash equivalents and $1.0 million included in other non-current assets. We have bid bonds and performance guarantees in form of surety bonds issued through a third-party of $4.4 million that were not required to be recorded on our Balance Sheet.  We are ultimately liable for claims that may occur against these guarantees.  We have no history of material claims or are aware of circumstances that would require us to pay under any of these arrangements.  We also believe that the resolution of any claim that may arise in the future, either individually or in the aggregate, would not be material to our Financial Statements.

Additionally, we have money transmitter bonds issued through a third-party for the benefit of various states to comply with the states’ financial requirements and industry regulations for money transmitter licenses.  At March 31, 2021, we had total aggregate money transmitter bonds of approximately $15 million outstanding.

Warranties. We generally warrant that our solutions and related offerings will conform to published specifications, or to specifications provided in an individual customer arrangement, as applicable.  The typical warranty period is 90 days from the date of acceptance of the solution or offering.  For certain service offerings we provide a warranty for the duration of the services provided.  We generally warrant that services will be performed in a professional and workmanlike manner.  The typical remedy for breach of warranty is to correct or replace any defective deliverable, and if not possible or practical, we will accept the return of the defective deliverable and refund the amount paid under the customer arrangement that is allocable to the defective deliverable.  Our contracts also generally contain limitation of damages provisions in an effort to reduce our exposure to monetary damages arising from breach of warranty claims.  Historically, we have incurred minimal warranty costs, and as a result, do not maintain a warranty reserve.

Solution and Services Indemnifications. Our arrangements with our customers generally include an indemnification provision that will indemnify and defend a customer in actions brought against the customer that claim our products and/or services infringe upon a

copyright, trade secret, or valid patent.  Historically, we have not incurred any significant costs related to such indemnification claims, and as a result, do not maintain a reserve for such exposure.

Claims for Company Non-performance.  Our arrangements with our customers typically limit our liability for breach to a specified amount of the direct damages incurred by the customer resulting from the breach.  From time-to-time, these arrangements may also include provisions for possible liquidated damages or other financial remedies for our non-performance, or in the case of certain of our outsourced customer care and billing solutions, provisions for damages related to service level performance requirements.  The service level performance requirements typically relate to system availability and timeliness of service delivery.  As of March 31, 2021, we believe we have adequate reserves, based on our historical experience, to cover any reasonably anticipated exposure as a result of our nonperformance for any past or current arrangements with our customers.  

Indemnifications Related to Officers and the Board of Directors.  We have agreed to indemnify members of our Board of Directors (the “Board”) and certain of our officers if they are named or threatened to be named as a party to any proceeding by reason of the fact that they acted in such capacity.  We maintain directors’ and officers’ (D&O) insurance coverage to protect against such losses.  We have not historically incurred any losses related to these types of indemnifications, and are not aware of any pending or threatened actions or claims against any officer or member of our Board.  As a result, we have not recorded any liabilities related to such indemnifications as of March 31, 2021.  In addition, as a result of the insurance policy coverage, we believe these indemnification agreements are not significant to our results of operations.       

Legal Proceedings.  From time-to-time, we are involved in litigation relating to claims arising out of our operations in the normal course of business.  

XML

Earnings Per Common Share

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Earnings Per Common Share

6.  EARNINGS PER COMMON SHARE

Basic and diluted earnings per common share (“EPS”) amounts are presented on the face of the accompanying Income Statements.

No reconciliation of the basic and diluted EPS numerators is necessary as net income is used as the numerators for all periods presented. The reconciliation of the basic and diluted EPS denominators related to the common shares is included in the following table (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Basic weighted-average common shares		31,844		31,994
Dilutive effect of restricted common stock		302		364
Diluted weighted-average common shares		32,146		32,358

The Convertible Notes have a dilutive effect only in those quarterly periods in which our average stock price exceeds the current effective conversion price (see Note 4).

The stock warrants have a dilutive effect only in those quarterly periods in which our average stock price exceeds the exercise price of $26.68 per warrant (under the treasury stock method), and are not subject to performance vesting conditions (see Note 7).  Potentially dilutive common shares related to non-participating unvested restricted stock excluded from the computation of diluted EPS, as the effect was antidilutive, were not material in any period presented.

XML

Stockholders' Equity and Equity Compensation Plans

3 Months Ended

Mar. 31, 2021

Stockholders Equity Note [Abstract]

Stockholders' Equity and Equity Compensation Plans

7.  STOCKHOLDERS’ EQUITY AND EQUITY COMPENSATION PLANS

Stock Repurchase Program. We currently have a stock repurchase program, approved by our Board, authorizing us to repurchase our common stock from time-to-time as market and business conditions warrant (the “Stock Repurchase Program”).  During the first quarters of 2021 and 2020 we repurchased approximately 142,000 shares of our common stock for $6.5 million (weighted-average price of $45.94 per share) and approximately 142,000 shares of our common stock for $6.4 million (weighted-average price of $45.26 per share), respectively,  under a SEC Rule 10b5-1 Plan.  

As of March 31, 2021, the total remaining number of shares available for repurchase under the Stock Repurchase Program totaled 4.2 million shares.

Stock Repurchases for Tax Withholdings. In addition to the above-mentioned stock repurchases, during the first quarters of 2021 and 2020 we repurchased and then cancelled approximately 110,000 shares of common stock for $5.2 million and approximately 157,000 shares of common stock for $7.6 million, respectively,  in connection with minimum tax withholding requirements resulting from the vesting of restricted common stock under our stock incentive plans.

Cash Dividends.  During the first quarter of 2021, the Board approved a quarterly cash dividend of $0.25 per share of common stock, totaling $8.2 million.  During the first quarter of 2020, the Board approved a quarterly cash dividend of $0.235 per share of common stock, totaling $7.7 million. 

Warrants.  In 2014, in conjunction with the execution of an amendment to our current agreement with Comcast Corporation (“Comcast”), we issued stock warrants (the “Warrant Agreement”) for the right to purchase up to 2.9 million shares of our common stock (the “Stock Warrants”) as an additional incentive for Comcast to convert customer accounts onto our Advanced Convergent Platform (“ACP”) based on various milestones.  The Stock Warrants have a ten-year term and an exercise price of $26.68 per warrant.        

As of March 31, 2021, 1.0 million Stock Warrants remain issued, none of which were vested.  The remaining unvested Stock Warrants will be accounted for as a customer contract cost asset once the performance conditions necessary for vesting are considered probable.

Stock-Based Awards. A summary of our unvested restricted common stock activity during the first quarter of 2021 is as follows (shares in thousands):

	Quarter Ended
	March 31, 2021
	Shares			Weighted- Average Grant Date Fair Value
Unvested awards, beginning		1,041		$	41.31
Awards granted		513			47.88
Awards forfeited/cancelled		(2	)		40.81
Awards vested		(340	)		41.65
Unvested awards, ending		1,212		$	43.87

Included in the awards granted during the first quarter of 2021 are performance-based awards for 0.1 million restricted common stock shares issued to members of executive management and certain key employees, which vest in the first quarter of 2023 upon meeting certain pre-established financial performance objectives over a two-year performance period. Certain of these awards become fully vested upon a change in control, as defined, and the subsequent involuntary termination of employment.

The other restricted common stock shares granted during the first quarter of 2021 are primarily time-based awards, which vest annually over four years with no restrictions other than the passage of time.  Certain shares of the restricted common stock become fully vested upon a change in control, as defined, and the subsequent involuntary termination of employment, or death.

We recorded stock-based compensation expense for the first quarters of 2021 and 2020 of $5.4 million and $4.9 million, respectively. 

XML

Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Use of Estimates in Preparation of Financial Statements

Use of Estimates in Preparation of Financial Statements. The preparation of the accompanying Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of our Financial Statements, and the reported amounts of revenue and expenses during the reporting periods.  Actual results could differ from those estimates.  

Revenue

Revenue.  The majority of our future revenue is related to our revenue management solution customer contracts that include variable consideration dependent upon a series of monthly volumes and/or daily usage of services and have contractual terms ending from 2021 through 2028.  Our customer contracts may include guaranteed minimums and fixed monthly or annual fees.  As of March 31, 2021, our aggregate amount of the transaction price allocated to the remaining performance obligations is approximately $900 million, which is made up of fixed fee consideration and guaranteed minimums expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied).  We expect to recognize approximately 80% of this amount by the end of 2023, with the remaining amount recognized by the end of 2028.  We have excluded from this amount variable consideration expected to be recognized in the future related to performance obligations that are unsatisfied.    

The nature, amount, timing, and uncertainty of our revenue and how revenue and cash flows are affected by economic factors is most appropriately depicted by revenue type, geographic region, and customer vertical.

Revenue by type for the first quarters of 2021 and 2020 was as follows (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Cloud and related solutions	$	227,019	$	222,220
Software and services		14,779		13,206
Maintenance		11,321		10,191
Total revenue	$	253,119	$	245,617

We use the location of the customer as the basis of attributing revenue to geographic regions.  Revenue by geographic region for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Americas (principally the U.S.)		86	%		88	%
Europe, Middle East, and Africa		10	%		9	%
Asia Pacific		4	%		3	%
Total revenue		100	%		100	%

We generate our revenue primarily from the global communications markets; however, we serve an expanding group of customers in markets including financial services, healthcare, media and entertainment companies, and government entities.  Revenue by customer vertical for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Broadband/Cable/Satellite		57	%		58	%
Telecommunications		18	%		17	%
Other		25	%		25	%
Total revenue		100	%		100	%

Deferred revenue recognized for the first quarters of 2021and 2020 was $20.1 million and $17.7 million, respectively.

Cash and Cash Equivalents

Cash and Cash Equivalents. We consider all highly liquid investments with original maturities of three months or less at the date of the purchase to be cash equivalents.  As of March 31, 2021 and December 31, 2020, our cash equivalents consist primarily of institutional money market funds, commercial paper, and time deposits held at major banks.

As of March 31, 2021 and December 31, 2020, we had $1.9 million and $1.7 million, respectively, of restricted cash that serves to collateralize outstanding letters of credit.  This restricted cash is included in cash and cash equivalents in our Condensed Consolidated Balance Sheets (“Balance Sheets” or “Balance Sheet”).  For the cash and cash equivalents denominated in foreign currencies and/or located outside the U.S., we do not anticipate any material amounts being unavailable for use in running our business, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.

Short-term Investments and Other Financial Instruments

Short-term Investments and Other Financial Instruments.  Our financial instruments as of March 31, 2021 and December 31, 2020 include cash and cash equivalents, short-term investments, accounts receivable, accounts payable, and debt.  Due to their short maturities, the carrying amounts of cash equivalents, accounts receivable, and accounts payable approximate their fair value.

Our short-term investments and certain of our cash equivalents are considered “available-for-sale” and are reported at fair value in our Balance Sheets, with unrealized gains and losses, net of the related income tax effect, excluded from earnings and reported in a separate component of stockholders’ equity.  Realized and unrealized gains and losses were not material in any period presented.

Primarily all short-term investments held by us as of March 31, 2021 and December 31, 2020 have contractual maturities of less than two years from the time of acquisition.  Our short-term investments as of March 31, 2021 and December 31, 2020 consisted almost entirely of fixed income securities.  Proceeds from the sale/maturity of short-term investments for the first quarters of March 31, 2021 and 2020 were $29.3 million and $18.7 million, respectively.

Our short-term investments as of March 31, 2021 and December 31, 2020 were $54.5 million and $51.6 million, respectively.

The following table represents the fair value hierarchy based upon three levels of inputs, of which Levels 1 and 2 are considered observable and Level 3 is unobservable, for our financial assets measured at fair value (in thousands):

	March 31, 2021						December 31, 2020
	Level 1		Level 2		Total		Level 1		Level 2		Total
Cash equivalents:
Money market funds	$	33,546	$	—	$	33,546	$	33,535	$	—	$	33,535
Commercial paper		—		9,224		9,224		—		15,746		15,746
Corporate debt securities		—		—		—		—		1,351		1,351
Short-term investments:
Corporate debt securities		—		42,544		42,544		—		38,672		38,672
U.S. government agency bonds		—		4,628		4,628		—		4,642		4,642
Asset-backed securities		—		7,367		7,367		—		8,284		8,284
Total	$	33,546	$	63,763	$	97,309	$	33,535	$	68,695	$	102,230

Valuation inputs used to measure the fair values of our money market funds were derived from quoted market prices.  The fair values of all other financial instruments are based upon pricing provided by third-party pricing services.  These prices were derived from observable market inputs.

We have chosen not to record our debt at fair value, with changes recognized in earnings each reporting period.  The following table indicates the carrying value (par value for convertible debt) and estimated fair value of our debt as of the indicated periods (in thousands):

	March 31, 2021				December 31, 2020
	Carrying		Fair		Carrying		Fair
	Value		Value		Value		Value
2018 Credit Agreement (carrying value including current maturities)	$	123,750	$	123,750	$	126,563	$	126,563
2016 Convertible debt (par value)		230,000		243,513		230,000		244,663

The fair value for our credit agreement was estimated using a discounted cash flow methodology, while the fair value for our convertible debt was estimated based upon quoted market prices or recent sales activity, both of which are considered Level 2 inputs.

Equity Method Investment

Equity Method Investment.  We held a 15% noncontrolling interest in a payment technology and services company with a carrying value of approximately $8 million as of March 31, 2021 and December 31, 2020, included in other non-current assets in our Balance Sheets.

Accounting Pronouncement Issued But Not Yet Effective

Accounting Pronouncement Issued But Not Yet Effective.  In August 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. ASU 2020-06 also amends the related Earnings Per Share guidance. ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, and can be adopted on either a fully retrospective or modified retrospective basis. We are currently evaluating the timing, method of adoption, and overall impact of this standard on our Financial Statements.

XML

Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Schedule of Revenue Disaggregated by Revenue Type, Geographic Region and Customer

The nature, amount, timing, and uncertainty of our revenue and how revenue and cash flows are affected by economic factors is most appropriately depicted by revenue type, geographic region, and customer vertical.

Revenue by type for the first quarters of 2021 and 2020 was as follows (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Cloud and related solutions	$	227,019	$	222,220
Software and services		14,779		13,206
Maintenance		11,321		10,191
Total revenue	$	253,119	$	245,617

We use the location of the customer as the basis of attributing revenue to geographic regions.  Revenue by geographic region for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Americas (principally the U.S.)		86	%		88	%
Europe, Middle East, and Africa		10	%		9	%
Asia Pacific		4	%		3	%
Total revenue		100	%		100	%

We generate our revenue primarily from the global communications markets; however, we serve an expanding group of customers in markets including financial services, healthcare, media and entertainment companies, and government entities.  Revenue by customer vertical for the first quarters of 2021 and 2020, as a percentage of our total revenue, was as follows:

	Quarter Ended
	March 31,
	2021			2020
Broadband/Cable/Satellite		57	%		58	%
Telecommunications		18	%		17	%
Other		25	%		25	%
Total revenue		100	%		100	%

Fair Value Measurements

The following table represents the fair value hierarchy based upon three levels of inputs, of which Levels 1 and 2 are considered observable and Level 3 is unobservable, for our financial assets measured at fair value (in thousands):

	March 31, 2021						December 31, 2020
	Level 1		Level 2		Total		Level 1		Level 2		Total
Cash equivalents:
Money market funds	$	33,546	$	—	$	33,546	$	33,535	$	—	$	33,535
Commercial paper		—		9,224		9,224		—		15,746		15,746
Corporate debt securities		—		—		—		—		1,351		1,351
Short-term investments:
Corporate debt securities		—		42,544		42,544		—		38,672		38,672
U.S. government agency bonds		—		4,628		4,628		—		4,642		4,642
Asset-backed securities		—		7,367		7,367		—		8,284		8,284
Total	$	33,546	$	63,763	$	97,309	$	33,535	$	68,695	$	102,230

Carrying Value (Par Value for Convertible Debt) and Estimated Fair Value of Debt

We have chosen not to record our debt at fair value, with changes recognized in earnings each reporting period.  The following table indicates the carrying value (par value for convertible debt) and estimated fair value of our debt as of the indicated periods (in thousands):

	March 31, 2021				December 31, 2020
	Carrying		Fair		Carrying		Fair
	Value		Value		Value		Value
2018 Credit Agreement (carrying value including current maturities)	$	123,750	$	123,750	$	126,563	$	126,563
2016 Convertible debt (par value)		230,000		243,513		230,000		244,663

XML

Long-Lived Assets (Tables)

3 Months Ended

Mar. 31, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Summary of Changes in Carrying Amount of Goodwill

Goodwill. The changes in the carrying amount of goodwill for the first quarter of 2021 were as follows (in thousands):

January 1, 2021 balance	$	272,322
Goodwill acquired during period		168
Adjustments related to prior acquisitions		(15	)
Effects of changes in foreign currency exchange rates		790
March 31, 2021 balance	$	273,265

Summary of Carrying Value of Assets

As of March 31, 2021 and December 31, 2020, the carrying values of these assets were as follows (in thousands):

	March 31, 2021							December 31, 2020
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Acquired customer contracts	$	154,119	$	(107,846	)	$	46,273	$	153,790	$	(105,778	)	$	48,012
Software		169,247		(143,662	)		25,585		166,289		(139,836	)		26,453
Total intangible assets	$	323,366	$	(251,508	)	$	71,858	$	320,079	$	(245,614	)	$	74,465

Summary of Carrying Values of Customer Contract Cost Assets

Customer Contract Costs.  As of March 31, 2021 and December 31, 2020, the carrying values of our customer contract cost assets, related to those contracts with a contractual term greater than one year, were as follows (in thousands):

	March 31, 2021							December 31, 2020
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Customer contract costs	$	90,136	$	(42,802	)	$	47,334	$	87,131	$	(39,893	)	$	47,238

XML

Debt (Tables)

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Long-Term Debt

Our long-term debt, as of March 31, 2021 and December 31, 2020, was as follows (in thousands):

	March 31,			December 31,
	2021			2020
2018 Credit Agreement:
Term loan, due March 2023, interest at adjusted LIBOR plus 1.5% (combined rate of 1.70% at March 31, 2021 and 1.75% at December 31, 2020)	$	123,750		$	126,563
Less – deferred financing costs		(1,017	)		(1,155	)
2018 Term Loan, net of unamortized discounts		122,733			125,408
$200 million revolving loan facility, due March 2023, interest at adjusted LIBOR plus applicable margin	—			—
2016 Convertible Notes:
Convertible Notes – Senior convertible notes; due March 15, 2036; cash interest at 4.25%		230,000			230,000
Less – unamortized original issue discount		(2,249	)		(3,021	)
Less – deferred financing costs		(870	)		(1,170	)
2016 Convertible Notes, net of unamortized discounts		226,881			225,809
Total debt, net of unamortized discounts		349,614			351,217
Current portion of long-term debt, net of unamortized discounts		(241,881	)		(14,063	)
Long-term debt, net of unamortized discounts	$	107,733		$	337,154

XML

Earnings Per Common Share (Tables)

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Reconciliation of the Basic and Diluted EPS Denominators

The reconciliation of the basic and diluted EPS denominators related to the common shares is included in the following table (in thousands):

	Quarter Ended
	March 31,
	2021		2020
Basic weighted-average common shares		31,844		31,994
Dilutive effect of restricted common stock		302		364
Diluted weighted-average common shares		32,146		32,358

XML

Stockholders' Equity and Equity Compensation Plans (Tables)

3 Months Ended

Mar. 31, 2021

Stockholders Equity Note [Abstract]

Summary of Unvested Restricted Common Stock Activity

A summary of our unvested restricted common stock activity during the first quarter of 2021 is as follows (shares in thousands):

	Quarter Ended
	March 31, 2021
	Shares			Weighted- Average Grant Date Fair Value
Unvested awards, beginning		1,041		$	41.31
Awards granted		513			47.88
Awards forfeited/cancelled		(2	)		40.81
Awards vested		(340	)		41.65
Unvested awards, ending		1,212		$	43.87

XML

Summary of Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Summary Of Significant Accounting Policies [Line Items]
Aggregate amount of transaction price allocated to remaining performance obligations	$ 900,000
Remaining performance obligations expected to be recognized, year	2028
Deferred revenue recognized	$ 20,100	$ 17,700
Restricted cash	1,900		$ 1,700
Proceeds from sale/maturity of short-term investments	29,340	$ 18,670
Short-term investments	54,539		51,598
Other Non-current Assets
Summary Of Significant Accounting Policies [Line Items]
Equity method investment, carrying value	$ 8,000		$ 8,000
Payment Technology and Services Company
Summary Of Significant Accounting Policies [Line Items]
Equity method investment, noncontrolling interest	15.00%
Minimum
Summary Of Significant Accounting Policies [Line Items]
Future revenue including variable consideration, contractual terms ending, year	2021
Maximum
Summary Of Significant Accounting Policies [Line Items]
Future revenue including variable consideration, contractual terms ending, year	2028
Short-term investment contractual maturities	2 years		2 years

XML

Summary of Significant Accounting Policies (Details Textual 1) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-04-01	Mar. 31, 2021
Summary Of Significant Accounting Policies [Line Items]
Remaining performance obligations expected to be recognized, percentage	80.00%
Remaining performance obligations expected to be recognized, period	2 years 9 months

XML

Summary of Significant Accounting Policies - Schedule of Revenue Disaggregated by Revenue Type, Geographic Region and Customer (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Disaggregation Of Revenue [Line Items]
Total revenue	$ 253,119	$ 245,617
Percentage of total revenue	100.00%	100.00%
Broadband/Cable/Satellite
Disaggregation Of Revenue [Line Items]
Percentage of total revenue	57.00%	58.00%
Telecommunications
Disaggregation Of Revenue [Line Items]
Percentage of total revenue	18.00%	17.00%
Other
Disaggregation Of Revenue [Line Items]
Percentage of total revenue	25.00%	25.00%
Americas (principally the U.S.)
Disaggregation Of Revenue [Line Items]
Percentage of total revenue	86.00%	88.00%
Europe, Middle East and Africa
Disaggregation Of Revenue [Line Items]
Percentage of total revenue	10.00%	9.00%
Asia Pacific
Disaggregation Of Revenue [Line Items]
Percentage of total revenue	4.00%	3.00%
Cloud and Related Solutions
Disaggregation Of Revenue [Line Items]
Total revenue	$ 227,019	$ 222,220
Software and Services
Disaggregation Of Revenue [Line Items]
Total revenue	14,779	13,206
Maintenance
Disaggregation Of Revenue [Line Items]
Total revenue	$ 11,321	$ 10,191

XML

Summary of Significant Accounting Policies - Fair Value Measurements (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Assets:
Assets fair value	$ 97,309	$ 102,230
Cash equivalents | Money Market Funds
Assets:
Assets fair value	33,546	33,535
Cash equivalents | Commercial Paper
Assets:
Assets fair value	9,224	15,746
Cash equivalents | Corporate Debt Securities
Assets:
Assets fair value		1,351
Short-term Investments | Corporate Debt Securities
Assets:
Assets fair value	42,544	38,672
Short-term Investments | U.S. Government Agency Bonds
Assets:
Assets fair value	4,628	4,642
Short-term Investments | Asset-backed securities
Assets:
Assets fair value	7,367	8,284
Level 1
Assets:
Assets fair value	33,546	33,535
Level 1 | Cash equivalents | Money Market Funds
Assets:
Assets fair value	33,546	33,535
Level 2
Assets:
Assets fair value	63,763	68,695
Level 2 | Cash equivalents | Commercial Paper
Assets:
Assets fair value	9,224	15,746
Level 2 | Cash equivalents | Corporate Debt Securities
Assets:
Assets fair value		1,351
Level 2 | Short-term Investments | Corporate Debt Securities
Assets:
Assets fair value	42,544	38,672
Level 2 | Short-term Investments | U.S. Government Agency Bonds
Assets:
Assets fair value	4,628	4,642
Level 2 | Short-term Investments | Asset-backed securities
Assets:
Assets fair value	$ 7,367	$ 8,284

XML

Summary of Significant Accounting Policies - Carrying Value (Par Value for Convertible Debt) and Estimated Fair Value of Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
2018 Credit Agreement | 2018 Term Loan
Carrying value and estimated fair value of debt
Fair Value	$ 123,750	$ 126,563
Carrying Value	123,750	126,563
Senior Convertible Notes 2016
Carrying value and estimated fair value of debt
Fair Value	243,513	244,663
Carrying Value	$ 230,000	$ 230,000

XML

Long-Lived Assets - Summary of Changes in Carrying Amount of Goodwill (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2021 USD ($)
Goodwill RollForward
Beginning balance	$ 272,322
Goodwill acquired during period	168
Adjustments related to prior acquisitions	(15)
Effects of changes in foreign currency exchange rates	790
Ending balance	$ 273,265

XML

Long-Lived Assets - Summary of Carrying Value of Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 323,366	$ 320,079
Accumulated Amortization	(251,508)	(245,614)
Net Amount	71,858	74,465
Acquired customer contracts
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	154,119	153,790
Accumulated Amortization	(107,846)	(105,778)
Net Amount	46,273	48,012
Software
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	169,247	166,289
Accumulated Amortization	(143,662)	(139,836)
Net Amount	$ 25,585	$ 26,453

XML

Long-Lived Assets (Details Textual) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Finite Lived Intangible Assets [Line Items]
Total amortization expense	$ 5.6	$ 6.3
Estimated total amortization expense 2021	20.5
Estimated total amortization expense 2022	14.7
Estimated total amortization expense 2023	10.8
Estimated total amortization expense 2024	7.4
Estimated total amortization expense 2025	6.5
Customer contract costs
Finite Lived Intangible Assets [Line Items]
Total amortization expense	$ 4.7	$ 4.0

XML

Long-Lived Assets - Summary of Carrying Values of Customer Contract Cost Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Capitalized Contract Cost [Abstract]
Customer contract costs, Gross Carrying Amount	$ 90,136	$ 87,131
Customer contract costs, Accumulated Amortization	(42,802)	(39,893)
Customer contract costs, Net Amount	$ 47,334	$ 47,238

XML

Debt - Long-Term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Less - unamortized original issue discount	$ (1,017)	$ (5,346)
Total debt, net of unamortized discounts	349,614	351,217
Current portion of long-term debt, net of unamortized discounts	(241,881)	(14,063)
Long-term debt, net of unamortized discounts	107,733	337,154
2018 Credit Agreement | 2018 Term Loan
Debt Instrument [Line Items]
Total long-term debt, gross	123,750	126,563
Less – deferred financing costs	(1,017)	(1,155)
Total debt, net of unamortized discounts	122,733	125,408
Senior Convertible Notes 2016
Debt Instrument [Line Items]
Total long-term debt, gross	230,000	230,000
Less - unamortized original issue discount	(2,249)	(3,021)
Less – deferred financing costs	(870)	(1,170)
Total debt, net of unamortized discounts	226,881	$ 225,809
Current portion of long-term debt, net of unamortized discounts	$ (226,900)

XML

Debt - Long-Term Debt (Parenthetical) (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
2018 Credit Agreement | 2018 Term Loan
Debt Instrument [Line Items]
Basis spread on term loan	1.50%
Term loan combined interest rate	1.70%	1.75%
Maturity period	Mar. 31, 2023
2018 Credit Agreement | Revolving Loan
Debt Instrument [Line Items]
Amount available under credit facility	$ 200,000,000
Maturity period	Mar. 31, 2023
Senior Convertible Notes 2016
Debt Instrument [Line Items]
Maturity period	Mar. 15, 2036
Interest rate on senior subordinated convertible notes	4.25%

XML

Debt - Credit Agreement (Details Textual) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Debt Instrument [Line Items]
Principal repayments	$ 2,813,000	$ 1,875,000
2018 Credit Agreement | Minimum
Debt Instrument [Line Items]
Line of credit facility, unused capacity, commitment fee percentage	0.20%
2018 Credit Agreement | Maximum
Debt Instrument [Line Items]
Line of credit facility, unused capacity, commitment fee percentage	0.375%
2018 Credit Agreement | London Interbank Offered Rate (LIBOR) | Minimum
Debt Instrument [Line Items]
Basis spread on term loan	1.50%
2018 Credit Agreement | London Interbank Offered Rate (LIBOR) | Maximum
Debt Instrument [Line Items]
Basis spread on term loan	2.50%
2018 Credit Agreement | Base Rate | Minimum
Debt Instrument [Line Items]
Basis spread on term loan	0.50%
2018 Credit Agreement | Base Rate | Maximum
Debt Instrument [Line Items]
Basis spread on term loan	1.50%
2018 Credit Agreement | Revolving Loan
Debt Instrument [Line Items]
Amount available under credit facility	$ 200,000,000
Credit facility term	5 years
Line of credit facility, unused capacity, commitment fee percentage	0.20%
Credit facility, outstanding borrowings	$ 0
Credit facility, current borrowing capacity	200,000,000.0
2018 Credit Agreement | 2018 Term Loan
Debt Instrument [Line Items]
Principal repayments	2,800,000
Term loan aggregate principal amount	$ 150,000,000
Term loan period	5 years
Term loan combined interest rate	1.70%		1.75%
Basis spread on term loan	1.50%

XML

Debt - 2016 Convertible Notes (Details Textual) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2021 USD ($) Tradingday $ / shares	Dec. 31, 2020 USD ($) $ / shares
Debt Instrument [Line Items]
Net carrying value	$ 241,881	$ 14,063
Senior Convertible Notes 2016
Debt Instrument [Line Items]
Percentage of par value of convertible notes to be settled in cash	100.00%
Observation holding period	40 days
Net carrying value	$ 226,900
Initial conversion rate of common stock	17.6898	17.6656
Convertible Notes, initial conversion of Par Value Convertible Notes to common stock	$ 1	$ 1
Initial conversion price | $ / shares	$ 56.53	$ 56.61
Rate of conversion price	130.00%
Debt instrument, convertible, threshold consecutive trading days | Tradingday	30
Debt instrument, convertible, threshold trading days | Tradingday	20

XML

Commitments, Guarantees and Contingencies (Details Textual) $ in Millions	3 Months Ended
	Mar. 31, 2021 USD ($)
Other Commitments [Line Items]
Restricted assets used to collateralize guarantees	$ 2.9
Money transmitter bonds	$ 15.0
Warranty Period	90 days
Surety Bond
Other Commitments [Line Items]
Restricted assets used to collateralize guarantees	$ 4.4
Cash equivalents
Other Commitments [Line Items]
Restricted assets used to collateralize guarantees	1.9
Other Non-current Assets
Other Commitments [Line Items]
Restricted assets used to collateralize guarantees	$ 1.0

XML

Earnings Per Common Share - Reconciliation of the Basic and Diluted EPS Denominators (Details) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Reconciliation of the basic and diluted EPS denominators
Basic weighted-average common shares	31,844	31,994
Dilutive effect of restricted common stock	302	364
Diluted weighted-average common shares	32,146	32,358

XML

Earnings Per Common Share (Details Textual) - $ / shares	Mar. 31, 2021	Dec. 31, 2014
Earnings Per Share [Abstract]
Common stock warrants issued, per warrant	$ 26.68	$ 26.68

XML

Stockholders' Equity and Equity Compensation Plans (Details Textual) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2014
Stockholders Equity And Equity Compensation Plans [Line Items]
Remaining number of shares available for repurchase	4,200,000
Repurchase of common stock for employee tax withholdings, shares	110,000	157,000
Repurchase of common stock for tax withholdings, value	$ 5,200	$ 7,600
Cash dividends declared per common share	$ 0.25	$ 0.235
Cash dividend	$ 8,200	$ 7,700
Stock warrants term			10 years
Stock warrants, exercise price	$ 26.68		$ 26.68
Stock-based compensation expense	$ 5,395	4,857
Performance Shares
Stockholders Equity And Equity Compensation Plans [Line Items]
Performance based awards granted to executive management and certain key employees shares	100,000
Vesting maturity date	first quarter of 2023
Vesting period	2 years
Restricted common stock
Stockholders Equity And Equity Compensation Plans [Line Items]
Vesting period	4 years
Separation Agreement
Stockholders Equity And Equity Compensation Plans [Line Items]
Stock-based compensation expense	$ 5,400	$ 4,900
Comcast
Stockholders Equity And Equity Compensation Plans [Line Items]
Issuance of stock warrants			2,900,000
Stock warrants issued	1,000,000.0
Stock warrants vested	0
SEC Rule 10b5-1 Plan
Stockholders Equity And Equity Compensation Plans [Line Items]
Repurchase of common stock, shares	142,000	142,000
Total amount paid	$ 6,500	$ 6,400
Weighted-average price per share	$ 45.94	$ 45.26

XML

Stockholders' Equity and Equity Compensation Plans - Summary of Unvested Restricted Common Stock Activity (Details) - Restricted common stock shares in Thousands	3 Months Ended
	Mar. 31, 2021 $ / shares shares
Shares
Shares, Unvested awards, beginning balance | shares	1,041
Shares, Awards granted | shares	513
Shares, Awards forfeited/cancelled | shares	(2)
Shares, Awards vested | shares	(340)
Shares, Unvested awards, ending balance | shares	1,212
Weighted-Average Grant Date Fair Value
Weighted-Average Grant Date Fair Value, Unvested awards, beginning balance | $ / shares	$ 41.31
Weighted-Average Grant Date Fair Value, Awards granted | $ / shares	47.88
Weighted-Average Grant Date Fair Value, Awards forfeited/cancelled | $ / shares	40.81
Weighted-Average Grant Date Fair Value, Awards vested | $ / shares	41.65
Weighted-Average Grant Date Fair Value, Unvested awards, ending balance | $ / shares	$ 43.87