Company: BL
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0001666134-25-000003
Chunk: 133

Company: BLACKLINE, INC.
Filing Date: 2025-02-21
Form: 10-K
Item: Item 8
Chunk 133
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 years ended December 31, 2024, 2023, and 2022, respectively.Research and developmentResearch and development expenses are comprised primarily of salaries, benefits and stock-based compensation associated with the Company’s engineering, product and quality assurance personnel. Research and development expenses also include third-party contractors and supplies, computer software-related costs, transaction-related costs, and allocated overhead. Other than software development costs that qualify for capitalization, as discussed above, research and development costs are expensed as incurred.General and administrativeGeneral and administrative expenses consist primarily of personnel costs associated with the Company’s executive, finance, legal, human resources, compliance, and other administrative personnel, as well as accounting and legal professional fees, other corporate-related expenses and allocated overhead. General and administrative expenses also include amortization of covenant not-to-compete and trade name intangible assets, the change in value of the contingent consideration, transaction-related costs, and impairment of cloud computing implementation costs.Stock-based compensationThe Company accounts for stock-based compensation awards granted to employees and directors based on the awards’ estimated grant date fair value. The Company estimates the fair value of its stock options using the Black-Scholes option-pricing model. For awards that vest solely based on continued service (“service-only vesting conditions”), the resulting fair value is recognized on a straight-line basis over the period during which an employee is required to provide service in exchange for the award, usually the vesting period, which is generally four years. The Company recognizes the fair value of restricted stock units with performance and service conditions based upon the probability of the performance conditions being met, using the graded vesting method. The Company recognizes the fair value of restricted stock units with market and service conditions based upon the achievement of total stockholder return (“TSR”) relative to an industry index being met, using the graded vesting method. The Company estimates the fair value of its restricted stock units with market and service conditions using the Monte Carlo simulation valuation model, which requires the use of various assumptions, including the stock price volatility and risk-free interest rate as of the valuation date corresponding to the length of time remaining in the performance period. The Company accounts for forfeitures when they occur rather than estimating a forfeiture rate. The Company recognizes the fair value of ESPP shares using the Black-Scholes option valuation model based on the following assumptions:Expected volatility. The expected volatility is based on a weighted average of the historical volatility of the Company’s common stock over the expected term.Expected term. The expected term represents the amount of time