UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☑ 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

Commission File Number 001-37394

Black Knight, Inc.

______________________________________________________________________________________________________________________________________________________

(Exact name of registrant as specified in its charter)

Delaware	81-5265638
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
601 Riverside Avenue, Jacksoville, Florida	32204
(Address of principal executive offices)	(Zip Code)

(904) 854-5100

___________________________________________________________________

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.0001 par value	BKI	New York Stock Exchange

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 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 ☑

There were 155,965,894 shares outstanding of the Registrant’s common stock as of May 6, 2022.

FORM 10-Q

QUARTERLY REPORT

Quarter Ended March 31, 2022

TABLE OF CONTENTS

	Page
Part I: FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)
A. Condensed Consolidated Balance Sheets (Unaudited) as of March 31, 2022 and December 31, 2021	1
B. Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited) for the three months ended March 31, 2022 and 2021	2
C. Condensed Consolidated Statements of Equity (Unaudited) for the three months ended March 31, 2022 and 2021	3
D. Condensed Consolidated Statements of Cash Flows (Unaudited) for the three months ended March 31, 2022 and 2021	4
E. Notes to Condensed Consolidated Financial Statements (Unaudited)	5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3. Quantitative and Qualitative Disclosure About Market Risk	29
Item 4. Controls and Procedures	30
Part II: OTHER INFORMATION	31
Item 1. Legal Proceedings	31
Item 1A. Risk Factors	31
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3. Defaults Upon Senior Securities	34
Item 4. Mine Safety Disclosures	34
Item 5. Other Information	34
Item 6. Exhibits	35

i

Part I: FINANCIAL INFORMATION

Item 1.Condensed Consolidated Financial Statements (Unaudited)

BLACK KNIGHT, INC.

Condensed Consolidated Balance Sheets

(In millions)

(Unaudited)

	March 31, 2022			December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	27.6	$	77.1
Trade receivables, net		194.3		191.8
Prepaid expenses and other current assets		85.1		83.0
Receivables from related parties		0.1		0.2
Total current assets		307.1		352.1
Property and equipment, net		151.1		154.5
Software, net		482.3		497.0
Other intangible assets, net		576.4		613.2
Goodwill		3,817.3		3,817.3
Investments in unconsolidated affiliates		170.0		490.5
Deferred contract costs, net		199.0		196.0
Other non-current assets		239.8		230.3
Total assets	$	5,943.0	$	6,350.9
LIABILITIES AND EQUITY
Current liabilities:
Trade accounts payable and other accrued liabilities	$	55.4	$	64.5
Income taxes payable		139.9		11.8
Accrued compensation and benefits		69.0		91.4
Current portion of debt		33.5		32.5
Deferred revenues		68.1		64.6
Total current liabilities		365.9		264.8
Deferred revenues		74.2		81.5
Deferred income taxes		251.2		284.1
Long-term debt, net of current portion		2,697.2		2,362.6
Other non-current liabilities		63.3		78.7
Total liabilities		3,451.8		3,071.7
Commitments and contingencies (Note 10)
Redeemable noncontrolling interests		40.2		1,188.8
Equity:
Common stock; $0.0001 par value; 550,000,000 shares authorized; 160,040,598 shares issued and 155,965,390 shares outstanding as of March 31, 2022, and 160,040,598 shares issued and 155,357,705 shares outstanding as of December 31, 2021		—		—
Preferred stock; $0.0001 par value; 25,000,000 shares authorized; issued and outstanding, none as of March 31, 2022 and December 31, 2021		—		—
Additional paid-in capital		1,364.8		1,410.9
Retained earnings		1,327.4		968.2
Accumulated other comprehensive loss		(7.0)		(17.5)
Treasury stock, at cost, 4,075,208 shares as of March 31, 2022 and 4,682,893 shares as of December 31, 2021		(234.2)		(271.2)
Total shareholders’ equity		2,451.0		2,090.4
Total liabilities, redeemable noncontrolling interests and shareholders’ equity	$	5,943.0	$	6,350.9

See Notes to Condensed Consolidated Financial Statements (Unaudited).

1

BLACK KNIGHT, INC.

Condensed Consolidated Statements of Earnings and Comprehensive Earnings

(In millions, except per share data)

(Unaudited)

	Three months ended March 31,
	2022		2021
Revenues	$	387.2	$	349.7
Expenses:
Operating expenses		207.9		186.2
Depreciation and amortization		91.5		87.8
Transition and integration costs		7.6		7.9
Total expenses		307.0		281.9
Operating income		80.2		67.8
Other income and expense:
Interest expense, net		(21.1)		(20.3)
Other expense, net		(1.2)		(3.2)
Total other expense, net		(22.3)		(23.5)
Earnings before income taxes and equity in earnings of unconsolidated affiliates		57.9		44.3
Income tax (benefit) expense		(1.1)		5.2
Earnings before equity in earnings of unconsolidated affiliates		59.0		39.1
Equity in earnings of unconsolidated affiliates, net of tax		303.1		6.4
Net earnings		362.1		45.5
Net losses attributable to redeemable noncontrolling interests		2.5		8.6
Net earnings attributable to Black Knight	$	364.6	$	54.1
Other comprehensive earnings:
Unrealized holding gains, net of tax(1)		4.3		0.5
Reclassification adjustments for losses included in net earnings, net of tax(2)		3.2		3.9
Total unrealized gains on interest rate swaps, net of tax		7.5		4.4
Foreign currency translation adjustment, net of tax (3)		(0.2)		(0.3)
Unrealized gains (losses) on investments in unconsolidated affiliates, net of tax(4)		3.2		(3.1)
Other comprehensive earnings		10.5		1.0
Comprehensive earnings		372.6		46.5
Net losses attributable to redeemable noncontrolling interests		2.5		8.6
Comprehensive earnings attributable to Black Knight	$	375.1	$	55.1
Net earnings per share attributable to Black Knight common shareholders:
Basic	$	2.36	$	0.35
Diluted	$	2.35	$	0.35
Weighted average shares of common stock outstanding (see Note 5):
Basic		154.2		155.6
Diluted		155.4		155.9

(1) Net of income tax expense of $1.4 million and of $0.2 million for the three months ended March 31, 2022 and 2021, respectively.

(2) Amounts reclassified to net earnings relate to losses on interest rate swaps and are included in Interest expense, net above. Amounts are net of income tax benefit of $1.1 million and $1.3 million for the three months ended March 31, 2022 and 2021, respectively.

(3) Net of income tax benefit of less than $0.1 million for the three months ended March 31, 2022 and 2021.

(4) Net of income tax expense of $1.1 million and income tax benefit of $1.0 million for the three months ended March 31, 2022 and 2021, respectively.

See Notes to Condensed Consolidated Financial Statements (Unaudited).

2

BLACK KNIGHT, INC.

Condensed Consolidated Statements of Equity

(In millions)

(Unaudited)

	Three months ended March 31, 2022
								Accumulated
				Additional				other					Total		Redeemable
	Common stock			paid-in		Retained		comprehensive		Treasury stock			shareholders’		noncontrolling
	Shares	$		capital		earnings		loss		Shares	$		equity		interests
Balance, December 31, 2021	160.0	$	—	$	1,410.9	$	968.2	$	(17.5)	4.7	$	(271.2)	$	2,090.4	$	1,188.8
Fair value adjustment to redeemable noncontrolling interests in Optimal Blue Holdco, LLC	—		—		(9.9)		—		—	—		—		(9.9)		9.9
Acquisition of remaining redeemable noncontroling interests in Optimal Blue Holdco, LLC	—		—		—		—		—	—		—		—		(1,156.0)
Grant of restricted shares of common stock	—		—		(46.6)		—		—	(0.8)		46.6		—		—
Forfeitures of restricted shares of common stock	—		—		1.0		—		—	—		(1.0)		—		—
Tax withholding payments for restricted share vesting	—		—		(10.7)		—		—	—		—		(10.7)		—
Vesting of restricted shares granted from treasury stock	—		—		8.6		—		—	0.2		(8.6)		—		—
Equity-based compensation expense	—		—		10.7		—		—	—		—		10.7		—
Net earnings (losses)	—		—		—		364.6		—	—		—		364.6		(2.5)
Equity-based compensation expense of unconsolidated affiliates	—		—		—		(5.4)		—	—		—		(5.4)		—
Foreign currency translation adjustment	—		—		—		—		(0.2)	—		—		(0.2)		—
Unrealized gains on interest rate swaps, net	—		—		—		—		7.5	—		—		7.5		—
Other comprehensive gains on investments in unconsolidated affiliates	—		—		—		—		3.2	—		—		3.2		—
Other	—		—		0.8		—		—	—		—		0.8		—
Balance, March 31, 2022	160.0	$	—	$	1,364.8	$	1,327.4	$	(7.0)	4.1	$	(234.2)	$	2,451.0	$	40.2

	Three months ended March 31, 2021
								Accumulated
				Additional				other						Total	Redeemable
	Common stock			paid-in		Retained		comprehensive		Treasury stock			shareholders’		noncontrolling
	Shares	$		capital		earnings		loss		Shares	$		equity		interests
Balance, December 31, 2020	160.1	$	—	$	2,053.7	$	757.4	$	(38.8)	3.1	$	(144.6)	$	2,627.7	$	578.0
Fair value adjustment to redeemable noncontrolling interests in Optimal Blue Holdco, LLC	—		—		(8.6)		—		—	—		—		(8.6)		8.6
Grant of restricted shares of common stock	—		—		(25.3)		—		—	(0.5)		25.3		—		—
Forfeitures of restricted shares of common stock	—		—		0.1		—		—	—		(0.1)		—		—
Tax withholding payments for restricted share vesting	(0.1)		—		(22.7)		—		—	—		—		(22.7)		—
Vesting of restricted shares granted from treasury stock	—		—		10.4		—		—	0.2		(10.4)		—		—
Equity-based compensation expense	—		—		9.4		—		—	—		—		9.4		—
Net earnings (losses)	—		—		—		54.1		—	—		—		54.1		(8.6)
Equity-based compensation expense of unconsolidated affiliates	—		—		—		0.5		—	—		—		0.5		—
Purchases of treasury stock	—		—		—		—		—	0.6		(46.7)		(46.7)		—
Foreign currency translation adjustment	—		—		—		—		(0.3)	—		—		(0.3)		—
Unrealized gains on interest rate swaps, net	—		—		—		—		4.4	—		—		4.4		—
Other comprehensive losses on investments in unconsolidated affiliates	—		—		—		—		(3.1)	—		—		(3.1)		—
Balance, March 31, 2021	160.0	$	—	$	2,017.0	$	812.0	$	(37.8)	3.4	$	(176.5)	$	2,614.7	$	578.0

See Notes to Condensed Consolidated Financial Statements (Unaudited).

3

BLACK KNIGHT, INC.

Condensed Consolidated Statements of Cash Flows

(In millions)

(Unaudited)

	Three months ended March 31,
	2022		2021
Cash flows from operating activities:
Net earnings	$	362.1	$	45.5
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		91.5		87.8
Amortization of debt issuance costs and original issue discount		0.9		1.0
Loss on extinguishment of debt		—		2.5
Deferred income taxes, net		(135.8)		(1.8)
Equity in earnings of unconsolidated affiliates, net of tax		(303.1)		(6.4)
Equity-based compensation		10.7		9.4
Changes in assets and liabilities, net of acquired assets and liabilities:
Trade receivables, including receivables from related parties		(2.5)		0.1
Prepaid expenses and other assets		(11.9)		(35.1)
Deferred contract costs		(12.3)		(11.0)
Deferred revenues		(3.8)		6.4
Trade accounts payable and other liabilities		89.3		(21.0)
Net cash provided by operating activities		85.1		77.4
Cash flows from investing activities:
Additions to property and equipment		(6.6)		(5.2)
Additions to software		(20.8)		(24.7)
Business acquisitions, net of cash acquired		—		(20.0)
Asset acquisitions		—		(10.0)
Net cash used in investing activities		(27.4)		(59.9)
Cash flows from financing activities:
Revolver borrowings		460.1		167.8
Revolver payments		(115.1)		(98.5)
Term loan borrowings		—		1.6
Term loan payments		(7.2)		—
Payments made for redeemable noncontrolling interests		(433.5)		—
Purchases of treasury stock		—		(46.7)
Tax withholding payments for restricted share vesting		(10.7)		(22.7)
Finance lease payments		(0.8)		(1.2)
Debt issuance costs paid		—		(7.6)
Net cash used in financing activities		(107.2)		(7.3)
Net (decrease) increase in cash and cash equivalents		(49.5)		10.2
Cash and cash equivalents, beginning of period		77.1		34.7
Cash and cash equivalents, end of period	$	27.6	$	44.9
Supplemental cash flow information:
Interest paid, net	$	(29.3)	$	(29.1)
Income taxes paid, net	$	(0.3)	$	(0.9)

See Notes to Condensed Consolidated Financial Statements (Unaudited).

4

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(1)Basis of Presentation and Overview

The accompanying Condensed Consolidated Financial Statements (Unaudited) of Black Knight, Inc. (“BKI”) and its subsidiaries ("Black Knight," the "Company," "we," "us" or "our") were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), and all adjustments considered necessary for a fair presentation have been included. All significant intercompany accounts and transactions have been eliminated.

The preparation of these Condensed Consolidated Financial Statements (Unaudited) in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Condensed Consolidated Financial Statements (Unaudited), as well as the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

This Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission ("SEC") on February 25, 2022 and other filings with the SEC.

Description of Business

We are a premier provider of integrated, innovative, mission-critical, high-performance software solutions, data and analytics to the U.S. mortgage and real estate markets. Our mission is to transform the markets we serve by delivering innovative solutions that are integrated across the homeownership lifecycle and that result in realized efficiencies, reduced risk and new opportunities for our clients to help them achieve greater levels of success.

Principles of Consolidation

The Condensed Consolidated Financial Statements (Unaudited) include the accounts of BKI, its wholly-owned subsidiaries and non-wholly owned subsidiaries in which we have a controlling financial interest either through voting rights or means other than voting rights. Intercompany transactions and balances have been eliminated in consolidation. Where our ownership interest in a consolidated subsidiary is less than 100%, the noncontrolling interests’ share of these non-wholly owned subsidiaries is reported in our Condensed Consolidated Balance Sheets (Unaudited) as a separate component of equity or within temporary equity. The noncontrolling interests’ share of the net earnings (loss) of these non-wholly owned subsidiaries is reported in our Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited) as an adjustment to our net earnings to arrive at Net earnings attributable to Black Knight.

Redeemable Noncontrolling Interests

Prior to February 15, 2022, Optimal Blue Holdco, LLC (“Optimal Blue Holdco”) was a non-wholly owned subsidiary and considered a variable interest entity. We were the primary beneficiary of Optimal Blue Holdco through our controlling interest and our rights established in the Second Amended and Restated Limited Liability Company Agreement of Optimal Blue Holdco dated November 24, 2020 (the “OB Holdco LLC Agreement”). As such, we controlled Optimal Blue Holdco and its subsidiaries, and we consolidated its financial position and results of operations. Prior to February 15, 2022, we owned 60% of Optimal Blue Holdco. Redeemable noncontrolling interests represented the collective 40% equity interest in Optimal Blue Holdco owned by Cannae Holdings, LLC ("Cannae") and affiliates of Thomas H. Lee Partners, L.P. ("THL"). As these redeemable noncontrolling interests provided for redemption features not solely within our control, they were presented outside of shareholders' equity.

On February 15, 2022, we entered into a purchase agreement with Cannae and THL and acquired all of their issued and outstanding Class A units of Optimal Blue Holdco through Optimal Blue I, LLC (“Optimal Blue I”), a Delaware limited liability company and our wholly-owned subsidiary, in exchange for aggregate consideration of 36.4 million shares of Dun & Bradstreet Holdings, Inc. (“DNB”) common stock valued at $722.5 million and $433.5 million in cash, included as a financing cash outflow on the Condensed Consolidated Statements of Cash Flows (Unaudited), funded with borrowings under our revolving credit facility. The aggregate consideration of $1.156 billion and number of shares of DNB common stock paid to Cannae and THL was based on the 20-day volume-weighted average trading price of DNB for the period ended on February 14, 2022. As of February 15, 2022, we own 100% of the Class A units of Optimal Blue Holdco.

5

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

Reporting Segments

We conduct our operations through two reporting segments: (1) Software Solutions and (2) Data and Analytics. See further discussion in Note 13 — Segment Information.

Reclassifications

Certain reclassifications have been made to the prior year amounts to conform to the classifications used in 2022. Certain receivables previously included in Trade and other receivables, including receivables from related parties on our Condensed Consolidated Statements of Cash Flows (Unaudited) are now included in Prepaid expenses and other assets. We also reclassified certain deferred compensation plan assets and liabilities between Prepaid expenses and other assets and Trade accounts payable and other liabilities on our Condensed Consolidated Statements of Cash Flows (Unaudited).

Merger Agreement

On May 4, 2022, we entered into a definitive agreement to be acquired by Intercontinental Exchange, Inc. (“ICE”), a leading global provider of data, technology, and market infrastructure, in a transaction valued at approximately $13.1 billion, or $85 per share, with consideration in the form of a mix of cash (80%) and stock (20%) (the “Transaction”). The aggregate cash consideration in the Transaction consists of approximately $10.5 billion and the aggregate stock consideration is valued at approximately $2.6 billion based on ICE’s 10-day volume weighted average price as of May 2, 2022 of $118.09. Black Knight shareholders can elect to receive either cash or stock, subject to proration, with the value of the cash election and the stock election equalized at closing. The Transaction is expected to close in the first half of 2023, following the receipt of regulatory approvals, Black Knight shareholder approval and the satisfaction of customary closing conditions. The Transaction has been approved by the Boards of Directors of Black Knight and ICE.

(2)Condensed Consolidated Financial Statement Details

Cash and Cash Equivalents

Cash and cash equivalents are unrestricted and include the following (in millions):

	March 31, 2022		December 31, 2021
Cash	$	21.1	$	24.0
Cash equivalents		6.5		53.1
Cash and cash equivalents	$	27.6	$	77.1

Trade Receivables, Net

A summary of Trade receivables, net of allowance for credit losses is as follows (in millions):

	March 31, 2022		December 31, 2021
Trade receivables — billed	$	149.4	$	147.4
Trade receivables — unbilled		47.8		47.1
Trade receivables		197.2		194.5
Allowance for credit losses		(2.9)		(2.7)
Trade receivables, net	$	194.3	$	191.8

6

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in millions):

	March 31, 2022		December 31, 2021
Prepaid expenses	$	52.4	$	44.7
Contract assets, net		21.6		23.0
Income tax receivables		0.9		6.5
Other current assets		10.2		8.8
Prepaid expenses and other current assets	$	85.1	$	83.0

Other Non-Current Assets

Other non-current assets consist of the following (in millions):

	March 31, 2022		December 31, 2021
Contract assets, net	$	90.3	$	80.2
Property records database		60.6		60.6
Right-of-use assets		30.7		32.9
Deferred compensation plan related assets		26.5		25.2
Contract credits		23.1		23.6
Prepaid expenses		6.2		4.5
Other		2.4		3.3
Other non-current assets	$	239.8	$	230.3

Trade Accounts Payable and Other Accrued Liabilities

Trade accounts payable and other accrued liabilities consist of the following (in millions):

	March 31, 2022		December 31, 2021
Accrued interest	$	3.1	$	12.3
Lease liabilities, current		10.3		10.8
Trade accounts payable		10.1		7.9
Other taxes payable and accrued		5.7		4.8
Accrued client liabilities		3.7		3.8
Other		22.5		24.9
Trade accounts payable and accrued liabilities	$	55.4	$	64.5

Deferred Revenues

During the three months ended March 31, 2022 and 2021, revenues recognized related to the amount included in the Deferred revenues balance at the beginning of each year were $20.9 million and $17.7 million, respectively.

7

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

Depreciation and Amortization

Depreciation and amortization includes the following (in millions):

	Three months ended March 31,
	2022		2021
Other intangible assets	$	36.8	$	38.8
Software		35.5		30.6
Property and equipment		9.9		10.2
Deferred contract costs		9.3		8.2
Total	$	91.5	$	87.8

Other Non-Current Liabilities

Other non-current liabilities consist of the following (in millions):

	March 31, 2022		December 31, 2021
Lease liabilities, non-current	$	22.9	$	26.4
Deferred compensation plan		24.8		24.4
Unrealized losses on interest rate swaps (Note 7)		2.1		13.9
Other		13.5		14.0
Other non-current liabilities	$	63.3	$	78.7

A

(3)Business Acquisitions

2021 Acquisitions

On March 16, 2021, we completed the acquisition of the technology assets and business of NexSpring Financial, LLC (“NexSpring”), which is reported within our Software Solutions segment, and is expected to broaden our ability to serve mortgage brokers.

On May 17, 2021, we completed the acquisition of 100% of the equity interests in eMBS, Inc. (“eMBS”), a leading data and analytics aggregator for residential mortgage-backed securities, which is reported within our Data & Analytics segment, and is expected to solidify and further expand our market leadership in solutions and data for agency-backed securities.

On July 7, 2021, we completed the acquisition of 100% of the equity interests in TOMN Holdings, Inc. and its subsidiaries (“Top of Mind”), which is reported within our Software Solutions segment. Top of Mind is the developer of Surefire^SM, a leading customer relationship management and marketing automation system for the mortgage industry.

We did not record any measurement period adjustments related to our prior year acquisitions during the three months ended March 31, 2022. The estimates related to our 2021 acquisitions of eMBS and Top of Mind are preliminary and subject to adjustments as we complete our valuation process with respect to certain assumed liabilities, including estimated liabilities for pre-acquisition tax exposure.

(4)Investments in Unconsolidated Affiliates

DNB is a leading global provider of business decisioning data and analytics. On January 8, 2021, DNB completed its acquisition of Bisnode Business Information Group AB (the “Bisnode acquisition”). In connection with the Bisnode acquisition, DNB issued 6.2 million shares of common stock, which resulted in a decrease in our ownership interest in DNB from 13.0% to 12.8% at that time.

On February 15, 2022, we exchanged 36.4 million shares of DNB common stock in connection for a portion of the remaining Class A units in Optimal Blue Holdco we acquired from Cannae and THL. The number of shares of DNB common stock was valued at $722.5 million based on the 20-day volume-weighted average trading price of DNB for the period ended on February 14, 2022. We recognized a

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gain of $305.4 million, net of tax of $102.6 million, related to this transaction. As of March 31, 2022, we own approximately 4.3% of DNB’s outstanding common stock.

We hold less than 20% of the outstanding common equity of DNB, but we continue to account for our investment under the equity method because we continue to have significant influence over DNB primarily through a combination of an agreement with certain other DNB investors pursuant to which we agreed to collectively vote together on matters related to the election of DNB directors for a period of three years following the initial public offering of DNB, our shared Chief Executive Officer and our investment.

As of March 31, 2022, DNB’s closing share price was $17.52, and the fair value of our investment in DNB was $323.7 million before tax.

Summarized consolidated financial information for DNB is presented below (in millions):

	March 31, 2022		December 31, 2021
Current assets	$	732.3	$	718.0
Non-current assets		9,124.9		9,279.2
Total assets	$	9,857.2	$	9,997.2
Current liabilities, including short-term debt	$	973.4	$	1,004.9
Non-current liabilities		5,174.9		5,247.0
Total liabilities		6,148.3		6,251.9
Total equity		3,708.9		3,745.3
Total liabilities and shareholders' equity	$	9,857.2	$	9,997.2

	Three months ended March 31,
	2022		2021
Revenues	$	536.0	$	504.5
Loss before provision for income taxes and equity in net income of affiliates		(39.8)		(33.7)
Net loss		(29.8)		(23.3)
Net loss attributable to DNB		(31.3)		(25.0)

Equity in earnings of unconsolidated affiliates, net of tax consists of the following (in millions):

	Three months ended March 31,
	2022		2021
Equity in losses of unconsolidated affiliates, net of tax	$	(2.3)	$	(3.5)
Non-cash gain related to DNB's issuance of common stock, net of tax		—		9.9
Gain related to DNB investment, net of tax		305.4		—
Equity in earnings of unconsolidated affiliates, net of tax	$	303.1	$	6.4

(5)Earnings Per Share

Diluted net earnings per share includes the effect of unvested restricted stock awards, restricted stock unit awards (“RSUs”) and Optimal Blue Holdco profits interests units (“OB PIUs”). For the three months ended March 31, 2021, the OB PIUs were excluded from the diluted

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earnings per share calculation because the effect of their inclusion would have been antidilutive. The following table sets forth the computation of basic and diluted net earnings per share (in millions, except per share amounts):

	Three months ended March 31,
	2022		2021
Basic:
Net earnings attributable to Black Knight	$	364.6	$	54.1
Shares used for basic net earnings per share:
Weighted average shares of common stock outstanding		154.2		155.6
Basic net earnings per share	$	2.36	$	0.35
Diluted:
Net earnings attributable to Black Knight	$	364.6	$	54.1
Shares used for diluted net earnings per share:
Weighted average shares of common stock outstanding		154.2		155.6
Dilutive effect of unvested restricted shares of common stock and OB PIUs		1.2		0.3
Weighted average shares of common stock, diluted		155.4		155.9
Diluted net earnings per share	$	2.35	$	0.35

(6)Related Party Transactions

Our service arrangements with related parties are priced within the range of prices we offer to third parties. We believe the amounts earned from or charged by us under each of the following arrangements are fair and reasonable. However, the amounts we earned or that were charged under these arrangements were not negotiated at arm's length and may not represent the terms that we might have obtained from an unrelated third party.

DNB

DNB is considered to be a related party primarily due to the combination of our investment in DNB and our shared Chief Executive Officer. Refer to Note 4 — Investments in Unconsolidated Affiliates for additional details.

In June 2021, we entered into a five-year agreement with DNB to provide them with certain products and data over the term of the agreement, as well as professional services, for an aggregate fee of approximately $34 million over the term of the agreement. As of March 31, 2022, related party deferred revenues of $6.6 million are included in Deferred revenues (current) in our Condensed Consolidated Balance Sheets (Unaudited). As of December 31, 2021, related party deferred revenues were $7.6 million, of which $6.2 million was included in Deferred revenues (current) and $1.4 million was included in Deferred revenues (non-current). During the three months ended March 31, 2022, revenues from related parties of $1.0 million are included in our Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited).

In June 2021, we also entered into an agreement with DNB for access to certain of their data assets for an aggregate fee of approximately $24 million over the term of the agreement. In addition, we will jointly market certain solutions and data. As of March 31, 2022 and December 31, 2021, related party prepaid fees were $1.1 million and $2.3 million, respectively, which are included in Prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets (Unaudited). During the three months ended March 31, 2022, expenses from related parties of $1.1 million are included in Operating expenses in our Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited).

As of March 31, 2022 and December 31, 2021, we had related party receivables from DNB of $0.1 million and $0.2 million, respectively.

Trasimene

Prior to June 16, 2021, Trasimene Capital Management, LLC ("Trasimene") was considered a related party because the former Chairman of our Board of Directors (the “Board”) owns a controlling interest in Trasimene. As of June 16, 2021, our former Chairman retired from

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the Board and became our Chairman Emeritus, and Trasimene is no longer considered a related party. For the three months ended March 31, 2021, we recognized $0.3 million in fees paid to Trasimene related to our acquisition of NexSpring, which are included in Transition and integration costs in our Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited).

(7)Long-Term Debt

Long-term debt consists of the following (in millions):

	March 31, 2022		December 31, 2021
Term A Loan	$	1,142.8	$	1,150.0
Revolving Credit Facility		601.0		256.0
Senior Notes