|
þ
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
|
¨
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Delaware
|
65-0694077
|
|
(State
or other jurisdiction of incorporation)
|
(I.R.S.
Employer Identification No.)
|
|
or
organization
|
2000 Ultimate Way, Weston,
FL
|
33326
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Large
accelerated filer þ
|
Accelerated
filer ¨
|
|
Non-accelerated
filer ¨
|
(Do
not check if a smaller reporting company)
|
Smaller
reporting company ¨
|
Page(s)
|
||||
Part
I – Financial Information:
|
||||
Item
1 – Financial Statements:
|
||||
1 | ||||
2 | ||||
3 | ||||
4 | ||||
5-10 | ||||
11-14 | ||||
15 | ||||
Item
4 – Controls and Procedures
|
15 | |||
Part
II – Other Information:
|
||||
Item
1A – Risk Factors
|
16 | |||
16 | ||||
Item
6 – Exhibits
|
17 | |||
18 | ||||
Certifications
|
PART
1 – FINANCIAL INFORMATION
|
||||||||
Item
1 – Financial Statements
|
||||||||
THE
ULTIMATE SOFTWARE GROUP, INC. AND SUBSIDIARIES
|
||||||||
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
||||||||
(Dollars
in thousands, except share and per share data)
|
||||||||
As
of
|
As
of
|
|||||||
September
30,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 22,934 | $ | 17,200 | ||||
Short-term
investments in marketable securities
|
6,781 | 5,805 | ||||||
Accounts
receivable, net of allowance for doubtful accounts of
$650
for 2009 and $700 for 2008
|
35,258 | 38,302 | ||||||
Prepaid
expenses and other current assets
|
15,669 | 16,011 | ||||||
Deferred
tax assets, net
|
3,533 | 3,533 | ||||||
Total
current assets before funds held for customers
|
84,175 | 80,851 | ||||||
Funds
held for customers
|
11,230 | 5,863 | ||||||
Total
current assets
|
95,405 | 86,714 | ||||||
Property
and equipment, net
|
20,290 | 22,984 | ||||||
Capitalized
software, net
|
4,801 | 5,642 | ||||||
Goodwill
|
3,196 | 2,906 | ||||||
Long-term
investments in marketable securities
|
937 | – | ||||||
Other
assets, net
|
11,929 | 11,668 | ||||||
Long-term
deferred tax assets, net
|
17,708 | 17,343 | ||||||
Total
assets
|
$ | 154,266 | $ | 147,257 | ||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 4,903 | $ | 7,200 | ||||
Accrued
expenses
|
9,754 | 12,701 | ||||||
Current
portion of deferred revenue
|
56,569 | 54,687 | ||||||
Current
portion of capital lease obligations
|
1,856 | 2,034 | ||||||
Current
portion of long-term debt
|
– | 320 | ||||||
Total
current liabilities before customer funds obligations
|
73,082 | 76,942 | ||||||
Customer
funds obligations
|
11,230 | 5,863 | ||||||
Total
current liabilities
|
84,312 | 82,805 | ||||||
Deferred
revenue, net of current portion
|
7,797 | 8,807 | ||||||
Deferred
rent
|
3,248 | 3,054 | ||||||
Capital
lease obligations, net of current portion
|
1,451 | 1,519 | ||||||
Total
liabilities
|
96,808 | 96,185 | ||||||
Stockholders’
equity:
|
||||||||
Preferred
Stock, $.01 par value, 2,000,000 shares authorized, no shares issued or
outstanding
|
– | – | ||||||
Series
A Junior Participating Preferred Stock, $.01 par value, 500,000 shares
authorized, no shares issued or outstanding
|
– | – | ||||||
Common
Stock, $.01 par value, 50,000,000 shares authorized, 27,347,107 and
26,796,169 shares issued in 2009 and 2008, respectively
|
273 | 268 | ||||||
Additional
paid-in capital
|
179,050 | 164,574 | ||||||
Accumulated
other comprehensive loss
|
(728 | ) | (1,002 | ) | ||||
Accumulated
deficit
|
(54,480 | ) | (53,268 | ) | ||||
124,115 | 110,572 | |||||||
Treasury stock, 2,796,825 and
2,533,575 shares, at cost, for 2009 and 2008, respectively
|
(66,657 | ) | (59,500 | ) | ||||
Total
stockholders’ equity
|
57,458 | 51,072 | ||||||
Total
liabilities and stockholders’ equity
|
$ | 154,266 | $ | 147,257 |
THE
ULTIMATE SOFTWARE GROUP, INC. AND SUBSIDIARIES
|
||||||||||||||||
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
(In
thousands, except per share amounts)
|
||||||||||||||||
For
the Three Months
|
For
the Nine Months
|
|||||||||||||||
Ended
September 30,
|
Ended
September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Recurring
|
$ | 34,153 | $ | 26,738 | $ | 97,664 | $ | 77,811 | ||||||||
Services
|
13,792 | 15,002 | 43,131 | 42,287 | ||||||||||||
License
|
252 | 2,172 | 3,527 | 8,782 | ||||||||||||
Total
revenues
|
48,197 | 43,912 | 144,322 | 128,880 | ||||||||||||
Cost
of revenues:
|
||||||||||||||||
Recurring
|
9,959 | 7,927 | 28,432 | 21,454 | ||||||||||||
Services
|
11,593 | 12,751 | 35,032 |
34,630
|
||||||||||||
License
|
– | 463 | 598 | 1,355 | ||||||||||||
Total
cost of revenues
|
21,552 | 21,141 | 64,062 | 57,439 | ||||||||||||
Gross
profit
|
26,645 | 22,771 | 80,260 | 71,441 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
Sales
and marketing
|
13,049 | 12,483 | 39,768 | 35,548 | ||||||||||||
Research
and development
|
9,940 | 9,912 | 28,860 | 28,090 | ||||||||||||
General
and administrative
|
4,351 | 4,697 | 13,239 | 13,398 | ||||||||||||
Total
operating expenses
|
27,340 | 27,092 | 81,867 | 77,036 | ||||||||||||
Operating
loss
|
(695 | ) | (4,321 | ) | (1,607 | ) | (5,595 | ) | ||||||||
Other
income (expense):
|
||||||||||||||||
Interest
expense and other
|
(29 | ) | (33 | ) | (111 | ) | (173 | ) | ||||||||
Other
income, net
|
30 | 168 | 141 | 747 | ||||||||||||
Total
other income, net
|
1 | 135 | 30 | 574 | ||||||||||||
Loss
before benefit for income taxes
|
(694 | ) | (4,186 | ) | (1,577 | ) | (5,021 | ) | ||||||||
Benefit
for income taxes
|
225 | 1,135 | 365 | 1,509 | ||||||||||||
Net
loss
|
$ | (469 | ) | $ | (3,051 | ) | $ | (1,212 | ) | $ | (3,512 | ) | ||||
Net
loss per share:
|
||||||||||||||||
Basic
|
$ | (0.02 | ) | $ | (0.12 | ) | $ | (0.05 | ) | $ | (0.14 | ) | ||||
Diluted
|
$ | (0.02 | ) | $ | (0.12 | ) | $ | (0.05 | ) | $ | (0.14 | ) | ||||
Weighted
average shares outstanding:
|
||||||||||||||||
Basic
|
24,539 | 24,613 | 24,416 | 24,654 | ||||||||||||
Diluted
|
24,539 | 24,613 | 24,416 | 24,654 | ||||||||||||
THE
ULTIMATE SOFTWARE GROUP, INC. AND SUBSIDIARIES
|
||||||||
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
(In
thousands)
|
||||||||
For
the Nine Months
|
||||||||
Ended
September 30,
|
||||||||
2009
|
2008
|
|||||||
Cash flows from operating
activities:
|
||||||||
Net
loss
|
$ | (1,212 | ) | $ | (3,512 | ) | ||
Adjustments
to reconcile net loss to net cash provided by operating
activities:
|
||||||||
Depreciation
and amortization
|
8,855 | 7,108 | ||||||
Provision
for doubtful accounts
|
661 | 1,325 | ||||||
Non-cash
stock-based compensation expense
|
9,912 | 11,969 | ||||||
Deferred
income taxes
|
(365 | ) | (1,509 | ) | ||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable
|
2,383 | 1,105 | ||||||
Prepaid
expenses and other current assets
|
342 | (3,197 | ) | |||||
Other
assets
|
(409 | ) | (1,780 | ) | ||||
Accounts
payable
|
(2,297 | ) | 2,506 | |||||
Accrued
expenses and deferred rent
|
(2,528 | ) | (721 | ) | ||||
Deferred
revenue
|
872 | 5,219 | ||||||
Net
cash provided by operating activities
|
16,214 | 18,513 | ||||||
Cash
flows from investing activities:
|
||||||||
Purchases
of property and equipment
|
(3,162 | ) | (10,137 | ) | ||||
Purchases
of marketable securities
|
(7,640 | ) | (6,688 | ) | ||||
Maturities
of marketable securities
|
5,722 | 16,563 | ||||||
Net
purchases of securities with customer funds
|
(5,367 | ) | (1,734 | ) | ||||
Capitalized
software
|
(632 | ) | (1,511 | ) | ||||
Net
cash used in investing activities
|
(11,079 | ) | (3,507 | ) | ||||
Cash
flows from financing activities:
|
||||||||
Repurchases
of common stock
|
(7,157 | ) | (21,690 | ) | ||||
Principal
payments on capital lease obligations
|
(1,849 | ) | (1,598 | ) | ||||
Net
increase in customer fund obligations
|
5,367 | 1,727 | ||||||
Repayments
of borrowings of long-term debt
|
(320 | ) | (529 | ) | ||||
Net
proceeds from issuances of common stock
|
4,569 | 4,919 | ||||||
Net
cash provided by (used in) financing activities
|
610 | (17,171 | ) | |||||
Effect
of exchange rate changes on cash
|
(11 | ) | (19 | ) | ||||
Net
increase in cash and cash equivalents
|
5,734 | (2,184 | ) | |||||
Cash
and cash equivalents, beginning of period
|
17,200 | 17,462 | ||||||
Cash
and cash equivalents, end of period
|
$ | 22,934 | $ | 15,278 | ||||
Supplemental
disclosure of cash flow information:
|
||||||||
Cash
paid for interest
|
$ | 109 | $ | 57 | ||||
Cash
paid for income taxes
|
$ | 155 | $ | 316 | ||||
Supplemental
disclosure of non-cash financing activities:
|
||||||||
- The
Company entered into capital lease obligations to acquire new equipment
totaling $1.6 million and $0.7 million for the nine
|
||||||||
months
ended September 30, 2009 and September 30, 2008,
respectively.
|
||||||||
- The
Company entered into an agreement to purchase certain source code from a
third-party vendor for $2.0 million, of which
|
||||||||
$0.5
million and $1.0 million were paid during each of the nine months ended
September 30, 2009 and September 30, 2008, respectively, and $0.5 million
was paid during the three months ended December 31, 2008.
|
||||||||
|
Common
Stock
|
Additional
Paid-in
|
Accumulated
Other Comprehensive
|
Accumulated
|
Treasury Stock
|
Total
Stockholders’
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Loss
|
Deficit
|
Shares
|
Amount
|
Equity
|
|||||||||||||||||||||||||
Balance, December 31, 2008
|
26,796 | $ | 268 | $ | 164,574 | $ | (1,002 | ) | $ | (53,268 | ) | 2,534 | $ | (59,500 | ) | $ | 51,072 | |||||||||||||||
Net
loss
|
– | – | – | – | (1,212 | ) | – | – | (1,212 | ) | ||||||||||||||||||||||
Unrealized
loss on investments in marketable securities available for
sale
|
– | – | – | (4 | ) | – | – | – | (4 | ) | ||||||||||||||||||||||
Unrealized
gain on foreign currency translation
|
||||||||||||||||||||||||||||||||
adjustments
|
– | – | – | 278 | – | – | – | 278 | ||||||||||||||||||||||||
Comprehensive
loss
|
– | – | – | – | – | – | – | (938 | ) | |||||||||||||||||||||||
Issuances
of Common Stock from exercises of stock options
|
551 | 5 | 4,564 | – | – | – | – | 4,569 | ||||||||||||||||||||||||
Repurchases
of Common Stock
|
– | – | – | – | – | 263 | (7,157 | ) | (7,157 | ) | ||||||||||||||||||||||
Non-cash
stock-based compensation
|
– | – | 9,912 | – | – | – | – | 9,912 | ||||||||||||||||||||||||
Balance,
September 30, 2009
|
27,347 | $ | 273 | $ | 179,050 | $ | (728 | ) | $ | (54,480 | ) | 2,797 | $ | (66,657 | ) | $ | 57,458 |
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
|
As
of September 30, 2009
|
As
of December 31, 2008
|
|||||||||||||||||||||||
Net
|
Net
|
|||||||||||||||||||||||
Amortized
|
Unrealized
|
Fair
|
Amortized
|
Unrealized
|
Fair
|
|||||||||||||||||||
Cost
|
Gain/(Loss)
|
Value
|
Cost
|
Gain
|
Value
|
|||||||||||||||||||
Corporate
debentures – bonds
|
$ | 3,029 | $ | (3 | ) | $ | 3,026 | $ | 4,306 | $ | 2 | $ | 4,308 | |||||||||||
Commercial
paper
|
1,198 | (1 | ) | 1,197 | 995 | 2 | 997 | |||||||||||||||||
Agency
bonds
|
1,009 | 1 | 1,010 | –– | –– | –– | ||||||||||||||||||
U.S.
Treasury bills
|
1,993 | 2 | 1,995 | –– | –– | –– | ||||||||||||||||||
Certificates
of deposit
|
490 | – | 490 | 500 | –– | 500 | ||||||||||||||||||
Total
investments
|
$ | 7,719 | $ | (1 | ) | $ | 7,718 | $ | 5,801 | $ | 4 | $ | 5,805 |
As
of September 30, 2009
|
As
of December 31, 2008
|
|||||||||||||||
Amortized
|
Fair
|
Amortized
|
Fair
|
|||||||||||||
Cost
|
Value
|
Cost
|
Value
|
|||||||||||||
Due
in one year or less
|
$ | 6,780 | $ | 6,781 | $ | 5,801 | $ | 5,805 | ||||||||
Due
after one year
|
939 | 937 | — | — | ||||||||||||
Total
|
$ | 7,719 | $ | 7,718 | $ | 5,801 | $ | 5,805 |
|
Level
1:
|
Unadjusted
quoted prices in active markets that are accessible at the measurement
date for identical, unrestricted assets and
liabilities.
|
|
Level
2:
|
Quoted
prices in markets that are not active or financial instruments for which
all significant inputs are observable, either directly or
indirectly.
|
|
Level
3:
|
Prices
or valuations that require inputs that are both significant to the fair
value measurement and unobservable.
|
|
input
that is significant to the fair value
measurement.
|
As
of September 30, 2009
|
As
of December 31, 2008
|
|||||||||||||||||||||||||||||||
Quoted
|
Quoted
|
|||||||||||||||||||||||||||||||
Prices
in
|
Other
|
Un-
|
Prices
in
|
Other
|
Un-
|
|||||||||||||||||||||||||||
Active
|
Observable
|
Observable
|
Active
|
Observable
|
Observable
|
|||||||||||||||||||||||||||
Markets
|
Inputs
|
Inputs
|
Markets
|
Inputs
|
Inputs
|
|||||||||||||||||||||||||||
Total
|
(Level
1)
|
(Level
2)
|
(Level
3)
|
Total
|
(Level
1)
|
(Level
2)
|
(Level
3)
|
|||||||||||||||||||||||||
Corporate
debentures – bonds
|
$ | 3,026 | $ | – | $ | 3,026 | $ | – | $ | 4,308 | $ | – | $ | 4,308 | $ | – | ||||||||||||||||
Commercial
paper
|
1,197 | – | 1,197 | – | 997 | – | 997 | – | ||||||||||||||||||||||||
Agency
bonds
|
1,010 | – | 1,010 | – | – | – | – | |||||||||||||||||||||||||
U.S.
Treasury bills
|
1,995 | – | 1,995 | – | – | – | – | |||||||||||||||||||||||||
Certificates
of deposit
|
490 | 490 | – | – | 500 | 500 | – | – | ||||||||||||||||||||||||
Total
|
$ | 7,718 | $ | 490 | $ | 7,228 | $ | – | $ | 5,805 | $ | 500 | $ | 5,305 | $ | – |
As
of
|
As
of
|
|||||||
September
30, 2009
|
December
31, 2008
|
|||||||
Property
and equipment
|
$ | 70,951 | $ | 65,934 | ||||
Less: accumulated
depreciation and amortization
|
50,661 | 42,950 | ||||||
$ | 20,290 | $ | 22,984 |
For
the Three Months
Ended
September 30,
|
For
the Nine Months Ended September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Basic
weighted average shares outstanding
|
24,539 | 24,613 | 24,416 | 24,654 | ||||||||||||
Effect
of dilutive equity instruments
|
– | – | – | – | ||||||||||||
Dilutive
weighted average shares outstanding
|
24,539 | 24,613 | 24,416 | 24,654 | ||||||||||||
Options
to purchase shares of Common Stock and other stock-based awards
outstanding which are not included in the calculation of diluted income
(loss) per share because their impact is anti-dilutive
|
||||||||||||||||
6,074 | 5,843 | 6,264 | 5,816 |
For
the Three Months
Ended
September 30,
|
For
the Nine Months
Ended
September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Net
loss
|
$ | (469 | ) | $ | (3,051 | ) | (1,212 | ) | $ | (3,512 | ) | |||||
Other
comprehensive income (loss)
|
||||||||||||||||
Unrealized
loss on investments in
|
||||||||||||||||
marketable
available-for-sale securities
|
(3 | ) | (50 | ) | (4 | ) | (26 | ) | ||||||||
Unrealized
gain (loss) on foreign currency
|
||||||||||||||||
translation
adjustments
|
(117 | ) | (9 | ) | 278 | (19 | ) | |||||||||
Comprehensive
loss
|
$ | (589 | ) | $ | (3,110 | ) | $ | (938 | ) | $ | (3,557 | ) |
For
the Three Months
Ended
September 30,
|
For
the Nine Months
Ended
September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Non-cash stock-based compensation
expense:
|
||||||||||||||||
Cost
of recurring revenues
|
$ | 170 | $ | 191 | $ | 506 | $ | 689 | ||||||||
Cost
of services revenues
|
326 | 479 | 994 | 1,565 | ||||||||||||
Cost
of license revenues
|
– | 2 | – | 9 | ||||||||||||
Sales
and marketing
|
1,776 | 2,043 | 5,311 | 5,656 | ||||||||||||
Research
and development
|
316 | 316 | 926 | 1,257 | ||||||||||||
General
and administrative
|
735 | 924 | 2,175 | 2,793 | ||||||||||||
Total
non-cash stock-based compensation expense
|
$ | 3,323 | $ | 3,955 | $ | 9,912 | $ | 11,969 |
Weighted
|
||||||||||||||||
Average
|
||||||||||||||||
Weighted
|
Remaining
|
Aggregate
|
||||||||||||||
Average
|
Contractual
|
Intrinsic
|
||||||||||||||
Stock
Options
|
Shares
|
Exercise
Price
|
Term
(in Years)
|
Value
|
||||||||||||
Outstanding
at December 31, 2008
|
4,964 | $ | 16.85 | |||||||||||||
Granted
|
– | – | ||||||||||||||
Exercised
|
(516 | ) | 8.86 | |||||||||||||
Forfeited
or expired
|
(116 | ) | 24.57 | |||||||||||||
Outstanding
at September 30, 2009
|
4,332 | $ | 17.60 | 5.69 | $ | 50,021 | ||||||||||
Exercisable
at September 30, 2009
|
3,685 | $ | 15.86 | 5.28 | $ | 48,559 |
Restricted
Stock Awards
|
Restricted
Stock Unit Awards
|
|||||||||||
Weighted
|
||||||||||||
Average
|
||||||||||||
Grant
Date
|
||||||||||||
Shares
|
Fair
Value
|
Shares
|
||||||||||
Outstanding
at December 31, 2008
|
1,361 | $ | 23.09 | 45 | ||||||||
Granted
|
29 | 19.61 | 198 | |||||||||
Vested
|
– | – | – | |||||||||
Released
|
(35 | ) | 15.90 | – | ||||||||
Forfeited
or expired
|
– | – | (6 | ) | ||||||||
Outstanding
at September 30, 2009
|
1,355 | $ | 23.20 | 237 |
For
the Three Months
|
For
the Nine Months
|
|||||||||||||||
Ended
September 30,
|
Ended
September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Revenues:
|
||||||||||||||||
Recurring
|
70.9 | % | 60.9 | % | 67.7 | % | 60.4 | % | ||||||||
Services
|
28.6 | 34.2 | 29.9 | 32.8 | ||||||||||||
License
|
0.5 | 4.9 | 2.4 | 6.8 | ||||||||||||
Total
revenues
|
100.0 | 100.0 | 100.0 | 100.0 | ||||||||||||
Cost
of revenues:
|
||||||||||||||||
Recurring
|
20.7 | 18.1 | 19.7 | 16.6 | ||||||||||||
Services
|
24.1 | 29.0 | 24.3 | 26.9 | ||||||||||||
License
|
0.0 | 1.1 | 0.4 | 1.1 | ||||||||||||
Total
cost of revenues
|
44.8 | 48.2 | 44.4 | 44.6 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
Sales
and marketing
|
27.1 | 28.4 | 27.6 | 27.5 | ||||||||||||
Research
and development
|
20.6 | 22.5 | 20.0 | 21.8 | ||||||||||||
General
and administrative
|
9.0 | 10.7 | 9.2 | 10.4 | ||||||||||||
Total
operating expenses
|
56.7 | 61.7 | 56.8 | 59.7 | ||||||||||||
Operating
loss
|
(1.4 | ) | (9.8 | ) | (1.1 | ) | (4.3 | ) | ||||||||
Other
income (expense):
|
||||||||||||||||
Interest
expense and other
|
(0.1 | ) | (0.1 | ) | (0.1 | ) | (0.1 | ) | ||||||||
Other
income, net
|
0.1 | 0.4 | 0.1 | 0.5 | ||||||||||||
Total
other income, net
|
0.0 | 0.3 | 0.0 | 0.4 | ||||||||||||
Loss
before income taxes
|
(1.4 | ) | (9.5 | ) | (1.1 | ) | (3.9 | ) | ||||||||
Benefit
for income taxes
|
0.5 | 2.6 | 0.3 | 1.2 | ||||||||||||
Net
loss
|
(0.9 | ) % | (6.9 | ) % | (0.8 | ) % | (2.7 | ) % |
For
the Three Months
Ended
September 30,
|
For
the Nine Months
Ended
September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Stock-based compensation:
|
||||||||||||||||
Cost
of recurring revenues
|
170 | 191 | 506 | 689 | ||||||||||||
Cost
of services revenues
|
326 | 479 | 994 | 1,565 | ||||||||||||
Cost
of license revenues
|
– | 2 | – | 9 | ||||||||||||
Sales
and marketing
|
1,776 | 2,043 | 5,311 | 5,656 | ||||||||||||
Research
and development
|
316 | 316 | 926 | 1,257 | ||||||||||||
General
and administrative
|
735 | 924 | 2,175 | 2,793 | ||||||||||||
Total
non-cash stock-based compensation expense
|
$ | 3,323 | $ | 3,955 | $ | 9,912 | $ | 11,969 | ||||||||
Amortization
of acquired intangibles:
|
||||||||||||||||
General
and administrative
|
$ | 55 | $ | 46 | $ | 147 | $ | 139 |
|
a)
|
Intersourcing
revenues increased 41.8% and 41.0% for the three and nine months ended
September 30, 2009, respectively, in comparison to the same periods in
2008. The increases in Intersourcing revenues were based on the revenue
impact of incremental units sold that have gone Live since September 30,
2008, including Core UltiPro and, to a lesser extent, Optional Features of
UltiPro. Intersourcing revenues from the Workplace solution in
2009 also contributed to the year-over-year growth, particularly since
this solution was introduced late in 2007 and was ramping up in
2008. Recognition of recurring subscription revenues for
Intersourcing sales begins when the related customer goes
Live.
|
|
b)
|
Maintenance
revenues from past license sales increased 1.7% and 2.5% for the three and
nine months ended September 30, 2009, in comparison to the same periods of
2008, due to additional maintenance fees resulting from cumulative net
increases in the customer base subsequent to September 30, 2008 resulting
from incremental license sales since such date. Maintenance
revenues are recognized over the initial term of the related license
contract, which is typically 12 months, and then on a monthly recurring
basis thereafter as the maintenance contracts renew
annually.
|
|
·
|
Maximum
safety of principal;
|
|
·
|
Maintenance
of appropriate liquidity for regular cash
needs;
|
|
·
|
Maximum
yields in relationship to guidelines and market
conditions;
|
|
·
|
Diversification
of risks; and
|
|
·
|
Fiduciary
control of all investments.
|
Total
Cumulative Number of
|
Maximum
Number of
|
|||||||||||||||
Shares
Purchased as Part
|
Shares
That May Yet
|
|||||||||||||||
Total
Number of
|
Average
Price
|
Of
Publicly Announced
|
Be
Purchased Under the
|
|||||||||||||
Period
|
Shares Purchased (1)
|
Paid per Share
|
Plans or Programs
|
Plans or Programs
|
||||||||||||
July
1 – 31, 2009………….
|
– | – | 2,533,575 | 466,425 | ||||||||||||
August
1 – 31, 2009………
|
187,600 | 26.57 | 2,721,175 | 278,825 | ||||||||||||
September
1 – 30, 2009…..
|
75,650 | 28.73 | 2,796,825 | 203,175 | ||||||||||||
Total………………………
|
263,250 | $ | 27.19 | 2,796,825 | 203,175 | |||||||||||
(1) All
shares were purchased through the publicly announced Stock Repurchase Plan
in open-market transactions.
|
Number
|
Description
|
31.1
|
Certification
Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange
Act of 1934, as amended *
|
31.2
|
Certification
Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange
Act of 1934, as amended *
|
32.1
|
Certification
Pursuant to 18 U.S.C. Section 1350, as Adopted
|
Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002, as amended
*
|
|
32.2
|
Certification
Pursuant to 18 U.S.C. Section 1350, as Adopted
|
Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002, as amended
*
|
The
Ultimate Software Group, Inc.
|
||
Date: November
9, 2009
|
By:
|
/s/ Mitchell K. Dauerman
|
Mitchell
K. Dauerman
|
||
Executive
Vice President, Chief Financial Officer and Treasurer (Authorized
Signatory and Principal Financial and Accounting
Officer)
|