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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, 2022
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: 0-25259
——————
Bottomline Technologies, Inc.

(Exact name of registrant as specified in its charter)
——————
Delaware02-0433294
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
325 Corporate Drive03801-6808
    Portsmouth,New Hampshire
(Address of principal executive offices)(Zip Code)
 
(603) 436-0700
(Registrant’s telephone number, including area code)


(Former name, former address and former fiscal year, if changed since last report)
——————
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, $.001 par value per shareEPAYThe Nasdaq Global Select Market

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, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.



Large accelerated filerAccelerated filer
Non-accelerated filerSmaller 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     
The number of shares outstanding of the registrant’s common stock as of April 30, 2022 was 45,386,591.



2

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Bottomline Technologies, Inc.
Unaudited Condensed Consolidated Balance Sheets
(in thousands, except per share amounts)
March 31,June 30,
20222021
ASSETS
Current assets:
Cash and cash equivalents$117,605 $133,932 
Cash held for customers6,807 9,836 
Marketable securities964 10,216 
Accounts receivable net of allowances for doubtful accounts of $747 at March 31, 2022 and $1,304 at June 30, 2021
81,027 72,978 
Prepaid expenses and other current assets36,511 34,653 
Total current assets242,914 261,615 
Property and equipment, net65,340 68,471 
Operating lease right-of-use assets, net28,440 27,570 
Goodwill249,219 246,698 
Intangible assets, net157,873 162,691 
Other assets51,442 48,683 
Total assets$795,228 $815,728 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable$16,514 $11,428 
Accrued expenses and other current liabilities54,655 45,925 
Customer account liabilities6,807 9,836 
Deferred revenue102,372 88,679 
Total current liabilities180,348 155,868 
Borrowings under credit facility130,000 130,000 
Deferred revenue, non-current10,213 12,559 
Operating lease liabilities, non-current26,861 26,629 
Deferred income taxes12,027 14,574 
Other liabilities19,196 19,864 
Total liabilities$378,645 $359,494 
Stockholders' equity
Preferred Stock, $.001 par value:
Authorized shares- 4,000; issued and outstanding shares- none
  
Common Stock, $.001 par value:
Authorized shares-100,000; issued shares- 50,003 at March 31, 2022 and 49,294 at June 30, 2021; outstanding shares- 42,943 at March 31, 2022 and 43,237 at June 30, 2021
50 49 
Additional paid-in-capital861,617 819,392 
Accumulated other comprehensive loss(23,197)(16,081)
Treasury stock: 7,060 shares at March 31, 2022 and 6,057 shares at June 30, 2021, at cost
(195,978)(150,282)
Accumulated deficit(225,909)(196,844)
Total stockholders' equity$416,583 $456,234 
Total liabilities and stockholders' equity$795,228 $815,728 
See accompanying notes.
3

Bottomline Technologies, Inc.
Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)
(in thousands, except per share amounts)
Three Months Ended March 31,Nine Months Ended March 31,
2022202120222021
Revenues:
Subscriptions$112,135 $99,939 $324,113 $283,721 
Software licenses1,006 1,092 3,086 3,871 
Service and maintenance18,138 19,292 55,478 59,878 
Other557 562 1,551 1,804 
Total revenues131,836 120,885 384,228 349,274 
Cost of revenues:
Subscriptions45,792 39,194 134,515 111,607 
Software licenses142 116 283 332 
Service and maintenance9,362 10,450 27,856 31,752 
Other364 375 989 1,235 
Total cost of revenues55,660 50,135 163,643 144,926 
Gross profit76,176 70,750 220,585 204,348 
Operating expenses:
Sales and marketing37,346 31,525 105,815 86,505 
Product development and engineering23,095 20,224 66,312 57,906 
General and administrative19,925 15,678 59,291 45,962 
Amortization of acquisition-related intangible assets5,255 5,443 15,506 15,614 
Total operating expenses85,621 72,870 246,924 205,987 
Loss from operations(9,445)(2,120)(26,339)(1,639)
Other income ( expense), net2,064 (1,314)327 (2,982)
Loss before income taxes(7,381)(3,434)(26,012)(4,621)
Income tax provision(143)(1,335)(3,053)(4,372)
Net loss $(7,524)$(4,769)$(29,065)$(8,993)
Basic and diluted net loss per share$(0.18)$(0.11)$(0.68)$(0.21)
Shares used in computing net loss per share:
Basic and diluted42,778 42,838 42,937 42,682 
Other comprehensive (loss) income, net of tax:
Unrealized (loss) gain on available for sale securities(1)4  (31)
Change in fair value on interest rate hedging instruments1,705 614 3,028 1,526 
Minimum pension liability adjustments(142)453 (354)(111)
Foreign currency translation adjustments(5,274)(3,721)(9,790)19,028 
Other comprehensive (loss) income, net of tax:(3,712)(2,650)(7,116)20,412 
Comprehensive (loss) income$(11,236)$(7,419)$(36,181)$11,419 

See accompanying notes.
4

Bottomline Technologies, Inc.
Unaudited Condensed Consolidated Statements of Stockholders' Equity
(in thousands)
Three Months Ended March 31, 2022
Common StockAdditional Paid-in CapitalAccumulated Other Comprehensive Income (Loss)Treasury StockAccumulated DeficitTotal Stockholders' Equity
SharesAmountSharesAmount
Balance at December 31, 202149,809 $50 $847,195 $(19,485)7,142 $(198,247)$(218,385)$411,128 
Issuance of common stock for employee stock purchase plan and upon exercise of stock options— — 178 — (82)2,269 — 2,447 
Vesting of restricted stock awards194  — — — — — — 
Stock compensation plan expense— — 14,244 — — — — 14,244 
Minimum pension liability adjustments, net of tax— — — (142)— — — (142)
Net loss— — — — — — (7,524)(7,524)
Unrealized loss on available for sale securities, net of tax— — — (1)— — — (1)
Change in fair value on interest rate hedging instruments— — — 1,705 — — — 1,705 
Foreign currency translation adjustment— — — (5,274)— — — (5,274)
Balance at March 31, 202250,003 $50 $861,617 $(23,197)7,060 $(195,978)$(225,909)$416,583 


Three Months Ended March 31, 2021
Common StockAdditional Paid-in CapitalAccumulated Other Comprehensive Income (Loss)Treasury StockAccumulated DeficitTotal Stockholders' Equity
SharesAmountSharesAmount
Balance at December 31, 202048,856 $49 $795,630 $(25,613)6,138 $(152,299)$(184,780)$432,987 
Issuance of common stock for employee stock purchase plan and upon exercise of stock options— — 404 — (81)2,017 — 2,421 
Vesting of restricted stock awards185 — — — — — — — 
Stock compensation plan expense— — 11,493 — — — — 11,493 
Minimum pension liability adjustments, net of tax— — — 453 — — — 453 
Net loss— — — — — — (4,769)(4,769)
Unrealized gain on available for sale securities, net of tax— — — 4 — — — 4 
Change in fair value on interest rate hedging instruments— — — 614 — — — 614 
Foreign currency translation adjustment— — — (3,721)— — — (3,721)
Balance at March 31, 202149,041 $49 $807,527 $(28,263)6,057 $(150,282)$(189,549)$439,482 
5

Bottomline Technologies, Inc.
Unaudited Condensed Consolidated Statements of Stockholders' Equity
(in thousands)
Nine Months Ended March 31, 2022
Common StockAdditional Paid-in CapitalAccumulated Other Comprehensive Income (Loss)Treasury StockAccumulated DeficitTotal Stockholders' Equity
SharesAmountSharesAmount
Balance at June 30, 202149,294$49$819,392$(16,081)6,057$(150,282)$(196,844)$456,234
Issuance of common stock for employee stock purchase plan and upon exercise of stock options456(160)4,3044,760
Vesting of restricted stock awards70911
Repurchase of common stock to be held in treasury1,163(50,000)(50,000)
Stock compensation plan expense41,76941,769
Minimum pension liability adjustments, net of tax(354)(354)
Net loss(29,065)(29,065)
Change in fair value on interest rate hedging instruments3,0283,028
Foreign currency translation adjustment(9,790)(9,790)
Balance at March 31, 202250,003$50$861,617$(23,197)7,060$(195,978)$(225,909)$416,583


Nine Months Ended March 31, 2021
Common StockAdditional Paid-in CapitalAccumulated Other Comprehensive Income (Loss)Treasury StockAccumulated DeficitTotal Stockholders' Equity
SharesAmountSharesAmount
Balance at June 30, 202048,147$48$764,906$(48,675)5,975$(143,333)$(180,612)$392,334
Issuance of common stock for employee stock purchase plan and upon exercise of stock options783(156)3,8064,589
Vesting of restricted stock awards72811
Issuance of common stock in connection with acquisition1668,1838,183
Repurchase of common stock to be held in treasury238(10,755)(10,755)
Stock compensation plan expense33,65533,655
Minimum pension liability adjustments, net of tax(111)(111)
Net loss(8,993)(8,993)
Cumulative effect of adoption of current expected credit loss of accounting standard5656
Unrealized loss on available for sale securities, net of tax(31)(31)
Change in fair value on interest rate hedging instruments1,5261,526
Foreign currency translation adjustment19,02819,028
Balance at March 31, 202149,041$49$807,527$(28,263)6,057$(150,282)$(189,549)$439,482
6

Bottomline Technologies, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(in thousands)
Nine Months Ended March 31,
20222021
Operating activities:
Net loss$(29,065)$(8,993)
Adjustments to reconcile net loss to net cash provided by operating activities:
Amortization of acquisition-related intangible assets15,506 15,614 
Stock-based compensation plan expense41,848 33,644 
Depreciation and other amortization28,955 24,290 
Gain on sale of cost-method investment(80) 
Deferred income tax benefit(1,900)(92)
Change in provision for allowances on accounts receivable(293)218 
Amortization of debt issuance costs332 310 
Amortization of premium on investments52 58 
Fair value adjustment on other investments(2,576) 
Gain on other investments (166)
Loss on disposal of equipment4 38 
(Gain) loss on foreign exchange(370)292 
Changes in operating assets and liabilities:
Accounts receivable(8,732)(5,942)
Prepaid expenses and other current assets(2,279)(4,612)
Operating lease right-of-use asset, net(972)(5,055)
Other assets(808)(5,160)
Accounts payable4,338 808 
Accrued expenses7,129 707 
Operating lease liabilities1,170 5,734 
Customer account liabilities(2,621)1,391 
Deferred revenue12,918 8,924 
Other liabilities694 (611)
Net cash provided by operating activities63,250 61,397 
Investing activities:
Acquisition of businesses and assets, net of cash acquired(15,115)(41,331)
Investment distributions received161  
Purchases of other investments(125)(7,150)
Issuance of note receivable (2,600)
Purchases of available-for-sale securities(900)(10,224)
Proceeds from sales of available-for-sale securities10,100 10,100 
Capital expenditures, including capitalization of software costs(29,209)(24,267)
Net cash used in investing activities(35,088)(75,472)
Financing activities:
Repurchase of common stock(50,000)(10,755)
Repayment of amounts borrowed under revolving credit facility (50,000)
Proceeds from exercise of stock options and employee stock purchase plan4,760 4,589 
Net cash used in financing activities(45,240)(56,166)
Effect of exchange rate changes on cash(2,278)5,849 
Decrease in cash, cash equivalents and restricted cash(19,356)(64,392)
Cash, cash equivalents and restricted cash at beginning of period143,768 201,136 
Cash, cash equivalents and restricted cash at end of period$124,412 $136,744 
Cash and cash equivalents at end of period$117,605 $128,188 
Cash held for customers at end of period6,807 8,556 
Cash, cash equivalents and restricted cash at end of period$124,412 $136,744 
Supplemental disclosures of non-cash investing activities:
Issuance of common stock in connection with acquisition$ $8,183 
See accompanying notes.
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Bottomline Technologies, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements
March 31, 2022
Note 1—Basis of Presentation
    The accompanying unaudited condensed consolidated financial statements of Bottomline Technologies, Inc. (referred to below as we, us, our or Bottomline) have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States (GAAP) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals and adjustments) considered necessary for a fair presentation of the interim financial information have been included. Operating results for the three and nine months ended March 31, 2022 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending June 30, 2022. For further information, refer to the consolidated financial statements and footnotes included in the Annual Report on Form 10-K as filed with the Securities and Exchange Commission on August 30, 2021.
Note 2—Pending Merger
On December 16, 2021, we entered into an Agreement and Plan of Merger (as it may be amended from time to time, the Merger Agreement), with Bottomline Intermediate Holdings III, LLC (formerly known as Project RB Parent, LLC), a Delaware limited liability company (Parent), and Project RB Merger Sub, Inc., a Delaware corporation (Merger Sub). Parent and Merger Sub are affiliates of Thoma Bravo Fund XV, L.P. (the Thoma Bravo Fund), a private equity fund managed by Thoma Bravo, L.P. (Thoma Bravo). Capitalized terms not otherwise defined have the meaning set forth in the Merger Agreement.
Pursuant to the terms of the Merger Agreement, Merger Sub will merge with and into Bottomline (the Merger), and we will become a wholly owned subsidiary of Parent. At the Effective Time of the Merger, each outstanding share of our common stock (other than shares owned by (1) Parent or Merger Sub; (2) any subsidiary of ours; and (3) stockholders who are entitled to and who properly exercise appraisal rights under the General Corporation Law of the State of Delaware) will be converted into the right to receive $57.00 per share, less any applicable withholding taxes without interest (the Per Share Merger Consideration). All shares converted into the right to receive the Per Share Merger Consideration will no longer be outstanding and will automatically be cancelled at the Effective Time of the Merger and the holders of such shares will cease to have any rights thereto, except for the right to receive the Per Share Merger Consideration.
In connection with the Merger, on December 16, 2021, Parent entered into an equity commitment letter with the Thoma Bravo Fund (the Equity Commitment Letter), pursuant to which the Thoma Bravo Fund has committed to purchase, or cause the purchase of, an amount of equity securities of Parent at or immediately prior to the Effective Time of the Merger equal to the estimated amount of aggregate consideration that will be due and payable at closing. The Equity Commitment Letter provides, among other things, that we are an express third party beneficiary thereof in connection with our exercise of the rights related to specific performance under the Merger Agreement. The Equity Commitment Letter may not be amended, revoked, modified or terminated, and no provision thereunder may be waived, except by an instrument in writing signed by Parent, us and the Thoma Bravo Fund.
Consummation of the Merger is subject to customary closing conditions, including, without limitation, the absence of certain legal impediments, no Company Material Adverse Effect having occurred since the signing of the Merger Agreement, the expiration or termination of the required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the HSR Act), approval of the change in control over Bottomline Payment Services Limited by the Financial Conduct Authority in the United Kingdom (the FCA), and approval by Bottomline’s stockholders. Our stockholders approved the transaction at a special meeting of stockholders held on March 8,2022. The transaction is not subject to a financing condition. We and Parent made the necessary filings with the Federal Trade Commission and the Antitrust Division of the Department of Justice on December 30, 2021, and Parent submitted a change in control application with the FCA on January 20, 2022. The required waiting period under the HSR Act with respect to the Merger expired at 11:59 p.m., Eastern Time on January 31, 2022.
We have made customary representations and warranties in the Merger Agreement and have agreed to customary covenants regarding the operation of our business prior to the Effective Time of the Merger. We are also subject to customary restrictions on the ability to solicit alternative acquisition proposals from third parties and to provide non-public information to, and participate in discussions and engage in negotiations with, third parties regarding alternative acquisition proposals, with customary exceptions to allow our Board of Directors to exercise its fiduciary duties.
The Merger Agreement contains certain termination rights for us and Parent. Upon termination of the Merger Agreement under specified circumstances, we will be required to pay Parent a termination fee of $78 million. Such circumstances include where the Merger Agreement is terminated in connection with our acceptance of a Superior Proposal or due to our Board of Directors changing or withdrawing its recommendation of the Merger. This termination fee will also be payable if the Merger is not consummated before December 16, 2022 or we breach our representations, warranties or covenants in a manner that would cause the related closing conditions to not be met, and prior to any such termination, a proposal to acquire at least 50% of our stock or assets is publicly known or announced and we enter into an agreement for a transaction contemplated by such proposal within one year of termination and such transaction is subsequently consummated. In addition, we will be required to reimburse Parent for up to $5 million of its expenses associated with the transaction if the Merger Agreement is terminated because the Merger is not consummated before December 16, 2022 or we breach our representations, warranties or covenants in a manner that would cause the related closing conditions to not be
8

met, in each case where the termination fee is not then payable but could potentially become payable in the future under certain circumstances.
Note 3—Recent Accounting Pronouncements
Accounting Pronouncements to be Adopted
    Interest Rate Reform: In March 2020, the Financial Accounting Standards Board (FASB) issued an accounting standard update to address financial reporting related to the transition from the London Interbank Offered Rate (LIBOR) to alternative reference rates. The standard provides optional expedients and exceptions to existing guidance for the accounting of contracts and hedging relationship modified as a result of reference rate reform. We may elect to apply the standard prospectively to contracts modified on or before December 31, 2022. We do not expect the adoption of this standard to have a material impact on our financial statements.
Accounting Pronouncements Adopted
Business Combinations - Acquired Contract Assets and Contract Liabilities: In October 2021, the FASB issued an accounting standard update requiring contract assets and contract liabilities acquired in a business combination to be recognized and measured in accordance with ASC 606, Revenue from Contracts with Customers. Per the update, at the acquisition date, an acquirer should account for the related revenue contracts in accordance with ASC 606, as if it had originated the contracts. The update is effective for us on July 1, 2023, with early adoption permitted. We adopted this standard during the quarter ended December 31, 2021 and it did not have a material impact on our financial statements.
Note 4—Revenue Recognition
Remaining Performance Obligations
    The transaction price we allocate to remaining performance obligations that are unsatisfied, or partially unsatisfied, as of March 31, 2022 represents contracted revenue that will be recognized in future periods. Our future performance obligations consist primarily of SaaS / stand-ready performance obligations relating to future periods, contracted but uncompleted professional services obligations and support and maintenance obligations. During the three and nine months ended March 31, 2022 and 2021, the amount of revenue recognized from performance obligations satisfied in prior periods was not significant.
The transaction price allocated to unsatisfied performance obligations was $444 million as of March 31, 2022 of which we expect to recognize approximately $192.7 million over the next twelve months and the remainder thereafter. The timing of the amounts we estimate recognizing in revenue is based primarily on the estimated go-live dates of our SaaS arrangements, or the date the customer has been provided access to the solution. These estimated dates can change for a variety of reasons and the timing of our recognition of revenue is affected by these changes. Once the implementation services for our SaaS solutions have concluded, we generally anticipate that the amount of revenue that will be recognized after the next twelve months will be recognized in a relatively consistent amount over the following two to five year periods. We exclude from our measure of remaining performance obligations amounts related to future transactional or usage-based fees for which the value of services transferred to the customer will correspond to the amount we will invoice for those services.
Contract Assets and Liabilities
    The table below presents our contract assets and deferred revenue balances as of March 31, 2022 and June 30, 2021.
March 31,June 30,
20222021$ Change
(in thousands)
Contract assets5,348 6,627 (1,279)
Deferred revenue112,585 101,238 11,347 
    Contract assets arise when we recognize revenue in excess of amounts billed to the customer and the right to payment is contingent on conditions other than simply the passage of time, such as the future completion of a related performance obligation. Contract assets are classified in our consolidated balance sheets as other current assets for those contract assets with recognition periods of one year or less and other assets for contract assets with recognition periods greater than one year. We assess outstanding accounts receivable and contract assets for credit loss on an ongoing basis. In estimating credit losses, we pool accounts with similar risk characteristics. Accounts that do not share the same risk characteristics are assessed for credit loss on an individual basis. The allowance for credit losses is based on historical loss data, customer specific information and current market conditions. Historically, our bad debt expense has not been significant.
Deferred revenue consists of billings or customer payments in excess of amounts recognized as revenue. The increase in deferred revenue at March 31, 2022 as compared to June 30, 2021 reflects the deferral of revenue from maintenance contracts, a significant portion of which are billed on a calendar year basis.


    For the three and nine months ended March 31, 2022, we recognized $11.7 million and $89.3 million, respectively, in revenue from amounts that were included in deferred revenue as of June 30, 2021. For the three and nine months ended March 31, 2021, we recognized $12.6 million and $81.2 million, respectively, in revenue from amounts that were included in deferred revenue as of June 30, 2020.     
Note 5—Fair Value
Fair Values of Assets and Liabilities
    We measure fair value at the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the assumptions that market participants would use in pricing an asset or liability (the inputs) are based on a tiered fair value hierarchy consisting of three levels, as follows:
Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets.
Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar instruments in active markets or for similar markets that are not active.
Level 3: Unobservable inputs for which there is little or no market data which require us to develop our own assumptions about how market participants would price the asset or liability.
    Valuation techniques for assets and liabilities include methodologies such as the market approach, the income approach or the cost approach, and may use unobservable inputs such as projections, estimates and management’s interpretation of current market data. These unobservable inputs are only utilized to the extent that observable inputs are not available or cost-effective to obtain.
    At March 31, 2022 and June 30, 2021, our assets and liabilities measured at fair value on a recurring basis were as follows:
March 31, 2022June 30, 2021
Fair Value Measurements Using Input TypesFair Value Measurements Using Input Types
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
(in thousands)
Assets
Money market funds (cash and cash equivalents)$9,603 $ $ $9,603 $340 $ $ $340 
Available for sale securities - Debt 898  898  10,150  10,150 
Other investments (long-term) 792 1,380 2,172  966 1,014 1,980 
Interest rate swap (long-term) 230  230     
Total assets$9,603 $1,920 $1,380 $12,903 $340 $11,116 $1,014 $12,470 
Liabilities
Interest rate swap (short-term)$ $316 $ $316 $ $1,564 $ $1,564 
Interest rate swap (long-term)     1,550  1,550 
Total liabilities$ $316 $ $316 $ $3,114 $ $3,114 
Fair Value of Financial Instruments
    We have certain financial instruments which consist of cash and cash equivalents, cash held for customers, marketable securities, accounts receivable, contract assets, equity securities, accounts payable, customer account liabilities, certain derivative instruments, assets related to deposits made to fund future requirements associated with Israeli severance arrangements and debt drawn on our Credit Facility (as defined in Note 12). Fair value information for each of these instruments is as follows:
•    Cash and cash equivalents, cash held for customers, accounts receivable, contract assets, accounts payable and customer account liabilities fair values approximate their carrying values, due to the expected duration of these instruments.
•    Marketable securities classified as held to maturity, all of which mature within one year, are recorded at amortized cost, which at March 31, 2022 and June 30, 2021, approximated fair value.
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•    Marketable debt securities classified as available for sale, which are comprised of U.S. treasury securities, are recorded at fair value. Unrealized gains and losses are included as a component of accumulated other comprehensive income (loss) in stockholders’ equity, net of tax. We use the specific identification method to determine any realized gains or losses from the sale of our marketable debt securities classified as available for sale. We assess securities with an amortized cost basis in excess of estimated fair value for credit loss. As of March 31, 2022 and June 30, 2021, the unrealized losses associated with available for sale securities were not material. No credit loss has been recorded as we do not intend to sell the investments prior to recovering their amortized costs basis.
•    The fair value of our interest rate swaps are based on the present value of projected cash flows that will occur over the life of the instruments, after considering certain contractual terms and counterparty credit risk.
•     We hold certain other investments accounted for at fair value. The estimated fair value of these investments, which are in a private equity fund, are Level 3 measurements as they rely on significant unobservable inputs and depending on the specific nature of the investment, consider such factors as pricing models that consider a comparative analysis of acquisitions and pricing multiples from market participants as well as discounted cash flow analyses. We also have investments for which there is no readily determinable fair value. The carrying value of these investments was $14.4 million and $12.0 million at March 31, 2022 and June 30, 2021, respectively, and are reported as a component of other assets. The increase in the carrying value of investments was due to a fair value adjustment recorded on an investment during the three months ended March 31, 2022. The fair value adjustment was based on an observable price change arising from a recent financing transaction by the investee. Investments for which we cannot readily determine fair value are recorded at cost, less impairment (if any), plus or minus adjustments for observable price changes.
•     We have borrowings of $130 million against our Credit Facility. The fair value of these borrowings, which are classified as Level 2, approximates their carrying value at March 31, 2022 as the instrument carries a variable rate of interest which reflects current market rates.
Marketable Securities
    The table below presents information regarding our marketable securities by major security type as of March 31, 2022 and June 30, 2021.
March 31, 2022June 30, 2021
Held to MaturityAvailable for SaleTotalHeld to MaturityAvailable for SaleTotal
(in thousands)
Marketable securities:
Government and other debt securities$66 $898 $964 $66 $10,150 $10,216 
Total marketable securities$66 $898 $964 $66 $10,150 $10,216 
    The following table summarizes the estimated fair value of our investments in available for sale marketable securities classified by the contractual maturity date of the securities:
March 31, 2022
(in thousands)
Due within 1 year$898 
Due in 1 year through 5 years 
Total$898 
    All of our securities are classified as current assets.
    The following table presents the aggregate fair values and gross unrealized losses for those available for sale investments that were in an unrealized loss position as of March 31, 2022 and June 30, 2021, respectively, aggregated by investment category and the length of time that individual securities have been in a continuous loss position:
At March 31, 2022At June 30, 2021
Less than 12 Months
Fair ValueUnrealized Loss Fair ValueUnrealized Loss
(in thousands)
Government - U.S. treasury securities$898 $(2)$5,930 $(1)
Total$898 $(2)$5,930 $(1)
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Note 6—Business and Asset Acquisitions
Current Year Acquisitions
Bora Payment Systems, LLC
In October 2021 we acquired substantially all of the assets and assumed certain liabilities of Bora Payment Systems, LLC (Bora), a provider of electronic payment solutions for businesses, for a purchase price of $15 million in cash.
We are still obtaining fair value estimates for the intangible assets acquired. In the preliminary allocation of the purchase price at March 31, 2022, we recorded $8.1 million of goodwill. The goodwill is deductible for tax purposes and arose principally due to the anticipated future benefits arising from the acquisition. Identifiable intangible assets of $6.9 million, consisting of customer and technology related assets, are being amortized on a weighted average estimated useful life of 11 years.
Through the Bora acquisition, we acquired technology that will be used predominantly in our Paymode-X solution to facilitate straight through processing of payments made via virtual card. This provides a significant benefit to suppliers who process a high volume of business to business virtual card transactions. The operating results of Bora are included as a component of our Payments Platform segment from the acquisition date forward. Bora's operating results did not have a material impact on our revenue or net loss. Acquisition related costs were recorded as a component of general and administrative expenses and were not material.
Prior Year Acquisitions
TreasuryXpress
In January 2021 we acquired French-headquartered TreasuryXpress Holding SAS (TX) for a total purchase price of $31.9 million in cash. Additionally, we issued 66,403 shares of our common stock to certain selling stockholders of TX with vesting conditions tied to continued employment with us. These shares are compensatory and we will record share-based payment expense over their vesting period of five years.
We recorded $20.4 million of goodwill and $17.3 million of identifiable intangible assets in connection with the acquisition. The goodwill is not deductible for tax purposes and arose principally due to the anticipated future benefits arising from the acquisition. Identifiable intangible assets, consisting of acquired technology, customer related assets and a trade name, are being amortized over a weighted average estimated useful life of 10 years.
Our acquisition of TX, a leading provider of cloud-based treasury management solutions for corporations and banks around the world, extended our geographic presence in France, the United States and the Middle-East. The operating results of TX are an immaterial component of our Payment Platforms operating segment. TX operating results did not have a material impact on our revenue or net loss, and acquisit