Good afternoon, and welcome to Everbridge's Earnings Conference Call for the Fourth Quarter and Full Year 2016. This is Ken Goldman, Senior Vice President and Chief Financial Officer of Everbridge.

With me on the call today is Jamie Ellertson, CEO and Chairman.

After the market closed today, we issued a press release with details regarding our fourth quarter and full year performance, which can be accessed on the Investor Relations section of our website at ir.everbridge.com.

This call is being recorded, and a replay will be available on our IR website following the conclusion of the call.

During today's call, we will make statements related to our business that may be considered forward-looking under federal securities laws. These statements reflect our views only as of today and should not be considered representative of our views as of any subsequent date.

We disclaim any obligation to update any forward-looking statements or outlook. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations.

These results are summarized in the press release that we issued today. For a further discussion of the material risks and other important factors that we -- could affect our actual results, please refer to the filings with the SEC included in our recent 10-Q filed on November 14, 2016.

Also, during the course of today's call, we will refer to certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in our press release.

Finally, at times in our prepared comments and responses to your questions, we may offer metrics that are incremental to our usual presentation to provide greater insight into the dynamics of our business or our quarterly results. Please be advised that we may or may not continue to provide this additional detail in the future.

With that, let me turn the call over to Jamie for his prepared remarks.

Thanks, Ken, and welcome to those of you who are joining our call today. Everbridge produced a solid finish to 2016 highlighted by both revenue and adjusted EBITDA exceeding our guidance for the fourth quarter.

Revenue of $21.3 million increased 31% from a year ago, and we posted another quarter of positive adjusted EBITDA. The trends that we outlined on our last call are continuing to drive demand for our expanded suite of SaaS-based applications focused on critical communications and enterprise safety.

These trends include the increased pace, severity and cost of critical events that threaten the safety of people and disrupt organizations; the growing dependency on the availability of IT services 24x7 to deliver for enterprises, governments, employees and constituents; and today's workforce continues to go mobile, making it more challenging to both reach and locate employees during such critical events.

Our SaaS platform addresses the challenges created by these trends and enables customers to rapidly assess, automate and communicate across virtually any device to ensure that critical events are managed in the most efficient and effective manner. We believe the enterprises are increasingly appreciative that the strategic and mission-critical nature of Everbridge's platform is real.

And during the fourth quarter, we again successfully expanded our business through a combination of attracting new customers and deepening our relationship with existing customers.

We ended the year with 3,205 customers, a net increase of 129 new customers added during the quarter and an increase of 543 new customers for 2016 overall. These customers continued to increase the utilization of our platform by sending approximately 400 million communications in Q4, over 1.5 billion in 2016 for the year.

And turning to customers. Our Q4 results demonstrate the strong demand for our core mass notification and instant management solutions across all of our major verticals.

In our largest vertical market, corporate, we won significant 6-figure deals at Northrop Grumman and Aon and added market-leading brands like MongoDB, Snap Inc., Pacific Life as well as major transportation organizations such as Alaska Airlines or the Ontario Airport. And in the health care vertical, we signed a number of new customers, including Main Line hospitals and Baptist Health Care.

Finally, in the state and local vertical, we continue to see strong new customer traction with major regional government organizations like Pierce County, Washington, the second largest county in the state of Washington; Denton County, Texas; and Brunswick County, Virginia; as well as major cities like Phoenix, Arizona and Anaheim, California. Our relationship in communities forms one of the key pillars of our network effect strategy and often leads to our success in much larger regional government wins like our recent win at the state of Florida.

Additionally, our work in the government space enables our growing success at the corporate enterprise level.

During the fourth quarter, we also continued to see success with the expand component of our land-and-expand strategy. Key customer expansions, and I'm specifically speaking here about the expanded usage and broader deployment of existing applications within existing customer implementations.

And those scenarios in Q4, examples included Uber, TIAA, Panera, Microdynamics as well as transportation organizations like Dell, [indiscernible] and Tucson Airport Authority and the government space organizations like city of San Francisco and Orange Country, North Carolina. Overseas, we also saw numerous expansions at leading names like PricewaterhouseCoopers, the United Nations and De Beers.

And finally, at higher ed, we added several new customers such as Stanley [ph] American College and Oregon Institute of Technology.

On the new product front, we continue to reinforce our growth strategy of focusing our platform sales comprising multiple products into enterprise customers, which increases our value and elevates our strategic position.

In the quarter, our new products accounted for 30% of all new and growth product sales on a trailing 12-month basis. These numbers increased every quarter for the past 4 quarters and is evidence of the strong adoption of our newest applications.

In addition to our core mass notification and instant communication applications, we have delivered new applications like Safety Connection, IT Alerting and Community Engagement, which address multiple customer pain points as well as increase our overall market opportunity.

These newer products were also an important reason we saw an acceleration in multiproduct wins in the fourth quarter with 42 multiproduct wins in the quarter, growing 35% from our prior 12-month average of 31 per quarter. This new metric, I'll call it multiproduct deals, provides visibility into our progress, leveraging the breadth of our platform to build larger and deeper customer relationships.

This is also one of our key business plan initiatives for 2017. Specifically, we are looking to increase the number of platform or multiproduct deals, which will increase our penetration across our enterprise customer organizations and thereby position us to become a more strategic partner.

An additional advantage, which I am certain you can all understand, is that the more products on our platform we have placed on an account, the broader the reach and ultimately the stickier we become with these customers.

Now let me provide you some detail on these new applications. Safety Connection was a meaningful contributor in the fourth quarter with new multiproduct wins at AIG, Gilead Pharmaceuticals, Delta Air Lines and Jacobs Engineering.

Safety Connection was also part of our multiproduct expansion deals from our large installed base customers, including Anthem, Sanofi, Fannie Mae and Gulfstream. Organizations across a wide range of industries continue to turn to Safety Connection to more effectively manage the physical safety and security of an increasingly mobile workforce.

For our IT Alerting application, new multiproduct customers included major corporate brands like Visa as well as Virtua and Penn State in the health care market. And in our installed customer base, we continue to see the adoption of our IT Alerting solution wins at Cargill, Express Scripts, First Financial and [indiscernible].

IT Alerting momentum reflects our expansion beyond the traditional business continuity buyer into the IT and general operations area of major enterprises.

Our Nixle Community Engagement business also saw continued new and growth customer wins at local governments such as Auburn Hills, Michigan; Albany, New York; and Guilford County, North Carolina. By the way, Guilford, in addition to the existing customers, Mecklenburg County, Orange County, means that Everbridge has 3 of the largest counties in North Carolina.

We also had very high-profile wins like Washington D.C. where Community Engagement was used toward visitors at the inauguration events in January.

Perhaps the most interesting new wins for Community Engagement came from our corporate base though in the quarter where customers saw such as Shawmut, a construction company, chose to deploy our Community Engagement to manage the visitor and transient populations related to major job sites as a way to communicate with these nonemployees, and a similar use case was used by the world's largest theme park to communicate with thousands of daily visitors to each of their parks. This recent progress with the expansion of our government use case and the corporate market represents important step for creating a long-term growth business around our Community Engagement product.

In Q4, our channels international business also delivered solid results in North America. Everbridge signed a strategic partnership with Lenel Corporation.

The global leader in advanced physical security systems will be partnering with Everbridge to resell and deliver our Safety Connection solution through its large system integration channel.

During the fourth quarter, our existing strategic partnership with International SOS continued to gain momentum as well with multiple new customer wins like CFA Institute and INTELLISAT. Both of these new strategic partnerships are examples of our focused effort to extend our overall Everbridge ecosystem to support the broader area of Critical Event Management for global enterprises.

Our international business also completed a number of large direct deals in Q4, including the aforementioned De Beers and United Nations deals, which I mentioned, but equally, Epson Europe, to name just a few. And our expanded efforts in Europe are beginning to bear fruit as one of our newest European distributors in Italy closed a major luxury retailer, [indiscernible], near the end of the quarter.

Operationally, we recently opened and staffed new sales and support offices in Singapore and Paris to help increase our penetration in Asia and Europe and support our long-term growth internationally.

In addition to organic sales success, we also expanded our new application product portfolio by acquisition. As I stated previously, a primary driver of our overall growth strategy is the addition of new applications or solutions onto the Everbridge platform.

During our IPO roadshow and during the last quarter's earnings call, I stated our goal is to add at least one new application to our platform each year and to do so through a combination of organic development, partnership or technology acquisition. Consistent with this objective, in late Q4 of 2016, we completed the acquisition of Crisis Commander.

And shortly thereafter, in January, we completed the acquisition of IDV Solutions.

Crisis Commander provides organizations with a mobile-based solution for accessing crisis and brand protection plans as well as the ability to manage these events through role-based assignments and status updates. Crisis Commander is used by numerous leading corporate or government organizations, including Volvo, Nestles, Swedish Air Traffic Control, Siemens, Nissan, Absolut, Norwegian Post Office and the TUI Group.

We believe that Crisis Commander will integrate well with our existing suite of Everbridge solutions and provide us with a strong up-sell opportunity for our large base of installed customers.

IDV Solutions is a leading provider of threat assessment and operational digitalization software. Its marquee solution, Visual Command Center, or VCC as I'll often refer to it, simultaneously monitors more than 100 types of threat data as well as social media and other contextual information and then displays an integrated picture of external threats and internal incidents overlaid on an organization's people, assets and supply chains.

As an example, VCC can generate and visualize an alert whenever potential risks occur within the proximity of an organization's resources in order to mitigate risk to personal safety, business continuity, assets and supply operations. IDV's customers include a number of leading government and corporate entities around the globe, including Amazon, Dell, Microsoft, Pfizer, Tiffany, VMware, Noble Energy and St.

Clair County in Michigan. IDV has been an Everbridge strategic partner since 2014, and VCC can already leverage our mass notification solutions to communicate with employees and help manage critical events.

These were both strategic acquisitions, and the combination with Everbridge's Critical Communications suite will help us to deliver the industry's first complete enterprise-grade Critical Event Management Platform, or as I'll often refer to it, CEM.

Today, many large organizations lack a coordinated approach to critical events, which negatively impacts the efficiency and effectiveness of their response. They maintain separate emergency, security, IT and supply chain command centers that prevent a common view of threat assessment and the resolution process.

Moreover, each of these disparate systems requires 24x7 availability, and each can rely on a different set of silo tools and processes that make coordination, communication and management across these groups difficult and expensive. The annual cost to leading enterprise of these types of critical events exceeded $500 billion in 2015, and they are complex to assess, manage and mitigate.

The Everbridge Critical Event Management Platform will provide organizations with a more integrated operational approach to the often disparate system used today by delivering an end-to-end view integrating threats, operational impact, response status information, all on a single pane of glass. Organizations will be able to access the full array of intelligence, coordination, task execution items required to speed the response to many critical incidents that impact daily operations, including severe weather, terrorism, workplace violence, IT outages, cyber attacks, supply chain disruptions, product recalls, environmental accidents and power outages.

Perhaps most importantly, existing customers such as one of the largest banks, one of the largest manufacturers and one of the largest technology companies in North America had already begun to integrate the Everbridge and IDV Solutions to achieve this unified approach to managing critical events across their enterprises.

a common integrated platform for Critical Event Management to enable them to quickly assess threats, then visualize the impact to their organization, then more efficiently and effectively manage their response and ultimately allow them to analyze the overall event with an eye towards mitigating future risk and business disruption to keep people safe and businesses running.

We're extremely excited to bring this new CEM platform to the marketplace. We expect that our CEM platform will help Everbridge expand our value proposition, increase our TAM and elevate our strategic position with customers as well as expand our potential usage throughout the enterprise space.

We believe our more comprehensive capabilities will attract an even broader set of new customers to Everbridge in addition to adding fuel to the expand component of our land-and-expand model. Further, as we continue to add a number of applications that our customers can use, we believe that Everbridge will become increasingly embedded as a strategic technology supplier and trusted partner.

In summary, we had a strong finish to 2016. This past year, we successfully executed on our strategy to drive growth from our continued adoption of our core mass notification application while simultaneously growing our revenue from new applications such as IT Alerting, Safety Connection and Community Engagement.

As we look to 2017, our aim is to both further expand our platform by delivering Critical Event Management as well as elevate our strategic position by helping enterprises assess, visualize, manage and analyze the events that impact the entire organization. We're excited about this opportunity we see in the marketplace.

And we believe the company is in a strong position to capture share in an even larger market in 2017.

Now I'd like to turn the call back over to Ken for details on our financial performance during the quarter and our outlook for 2017. Ken?

Thanks, Jamie. I'd like to go into more detail on our financial performance for the fourth quarter and the year and then provide you with our outlook for 2017.

From a summary perspective, fourth quarter revenue of $21.3 million was above the high end of our guidance range and represented growth of 31% from a year ago.

During the fourth quarter, our dollar-based net retention rate remained above 110% at 116%. As such, we delivered another quarter of solidly balancing growth between new and existing customers.

While we continue to invest in longer-term growth opportunities, some of our revenue upside did fall to the bottom line to produce positive adjusted EBITDA of $400,000, which was also above the top end of our guidance range.

Now I'd like to turn to the rest of the P&L. Unless otherwise indicated, I will be discussing income statement metrics on a non-GAAP basis.

A reconciliation of GAAP to non-GAAP measures has been provided in the earnings release we issued earlier today.

Gross margin in the fourth quarter was 72.6%, representing an improvement of 279 basis points from a year ago. While gross margins may fluctuate on a quarter-to-quarter basis, we believe we can drive continued gradual improvements in gross margins as our business continues to scale.

Total operating expenses were $16.3 million in the quarter, an increase of 18% from a year ago, reflecting continued product and infrastructure investments to support our long-term growth.

As I noted, adjusted EBITDA for the quarter was positive $400,000, a meaningful improvement from a loss of $1.7 million for the fourth quarter 2015 and represented the third quarter in a row of positive adjusted EBITDA as we continue to run the business with a focus on balance between growth and efficiency.

Net loss for the fourth quarter was $900,000 compared to a loss of $2.5 million in the year of -- ended a quarter ago. Based on 27.1 million basic and diluted weighted average shares outstanding, net loss per share was negative $0.03 for the fourth quarter.

Looking at the year as a whole. Revenue increased 31% to $76.8 million as new products, multiproduct deals, up-sells and expansions all contributed to strong growth.

Gross margin was 72.3%, up from 70% in 2015, reflecting the leverage we can generate with scale. Adjusted EBITDA for the year was just above breakeven compared to a loss of $3.4 million in 2015.

Turning to our balance sheet. We ended the year with $60.8 million in cash, a small decrease from $62.3 million at the end of the third quarter, due to the payments for our Crisis Commander acquisition.

Total deferred revenue was $52.6 million at the end of the year, which was up 30% compared to the end of the prior year. As we noted on our prior call, when the year-over-year growth of our deferred revenue increased to 30%, our deferred revenue balance at the end of any quarter can vary due to a number of factors.

As such, even though we have predominantly annual payment terms, deferred revenue was not always a meaningful indicator of the underlying momentum in our business from a quarterly perspective, though we believe it is directionally relevant over a longer trended period.

Our operating cash flow in the quarter was $3 million. Free cash flow was $1.5 million for the quarter and $3 million for the full year, which is a meaningful improvement when compared to outflow of $3 million in 2015.

Now let me turn to our outlook, starting with the full year of 2017. We anticipate revenue to be in the range of $100 million to $101 million, representing year-over-year growth of 30% to 31%.

Our full year guidance assumes a combined contribution of approximately $4 million from our Crisis Commander and IDV acquisitions after taking into account the impact of purchase accounting on acquired deferred revenue. In addition, this acquisition contribution for 2017 includes an expectation that we will be reducing certain revenue-producing services for the acquired businesses as we focus on driving adoption of our expanded platform.

From a profitability perspective, we continue to expect our core Everbridge business to generate positive adjusted EBITDA in 2017. However, with an approximately $3 million negative impact associated with the upfront dilution from the Crisis Commander, IDV acquisitions, the majority of which is due to purchase accounting impact on deferred revenue, we're anticipating an adjusted EBITDA loss of between $2.8 million and $1.8 million for the full year 2017.

This guidance assumes an estimated stock-based compensation expense of approximately $3.8 million for the year. Looking beyond 2017, we expect combined impact from these acquisitions to be at least neutral to our overall adjusted EBITDA.

We expect a non-GAAP net loss of between $9.1 million and $8.1 million for the full year of 2017 or between negative $0.33 and negative $0.30 per share based on 27.4 billion basic weighted average outstanding shares.

Our long-term view on how we plan to run the business remains unchanged. We remain focused on driving strong top line growth while being responsible regarding our bottom line performance.

We believe this is the best way to build long-term shareholder value.

Now let's turn to first quarter of 2017. We expect revenue to be between $22 million and $22.2 million, including a contribution of approximately $0.5 million from our Crisis Commander and IDV acquisitions.

We anticipate an adjusted EBITDA loss of between $3.7 million and $3.5 million. This adjusted EBITDA guidance assumes an estimated stock-based compensation expense of approximately $900,000 for the first quarter.

We're anticipating a non-GAAP net loss of between $5.2 million and $5 million or between negative $0.19 and negative $0.18 per share based on 27.2 million basic weighted average shares outstanding.

Finally, ahead of our lock-up expiration on March 15, today, we also announced that we intend to file a registration statement for secondary offering in late March. The proposed $50 million offering is expected to consist predominantly of secondary shares from existing shareholders.

In summary, we're excited to have delivered strong results for 2016, and in addition, have a positive view of the business as we begin 2017. We believe we're well positioned to meet the growing demand for Critical Event Management solutions and capitalize on the large multibillion-dollar market opportunity Everbridge is addressing.

With that, operator, can we now open the call up to questions, please?

Two quick questions. One for Ken.

Can you just, high level, say how much of the revenue disappeared due to purchase accounting? And then second, kind of staying on that same notion, I think you have explained a good rationale for Crisis Commander, IDV and stuff like that.

And obviously, while you can't say specifically and you may not even know what your next acquisition is, as an outsider, at least at a high level, kind of what should we expect in terms of broad product direction and/or tolerance for short-term dilution?

So Richard, with regard to the first question, we're not giving out specifics yet. We hadn't completed the audit for the acquisitions.

So we are using our best estimate as of today. But roughly, half the deferred revenue or perhaps a little bit more deferred disappeared as a result of purchase accounting.

As I said, we're still finalizing the audit for that. It's an unfortunate by-product of the accounting regulations when you do an acquisition.

And we will be providing more detail in the future. But for now, I would tell you, it's about half of what we saw.

And then on your question, Richard, on futures, we've done 2 rather rapidly because we had a strategic plan that we've been executing on for the past 2 or 3 years towards critical debt management anyway. But I would tell you that the 2 we've done are enough for right now.

We need to digest those and execute on those. And so we frankly are focused on adding pieces to the platform probably around the analyzed components and the predictive components of our Critical Event Management, but that's a little ways off.

I wouldn't -- just as we said at the roadshow and have continued to say, you don't expect us to sit on the cash. I would caution you to think that we're going to do anything else in the very near term here.

Jamie, it sounds like the number of multiple product new wins is accelerating. That's good to see.

Can you maybe rank in order of the new business which, coming from the non-mass notification products, are generating the most new -- or generated the most new recurring revenue in the quarter?

Well, we've been consistent in this, right? So we're not going to give specific numbers until the products get to $10 million.

I would tell you that as we said last quarter, Safety Connection continued to be a very fast-growing product, the fastest one we've launched to-date. ITA, because it's the longest product in terms of our ownership and being integrated to the platform, we built it internally, is today probably the largest, and again, growing at a very fast rate.

And then you have Community Engagement, which was acquired and brand new only approximately 1 year ago, so it's probably the smallest of the 3. But we haven't given specific components, and I wouldn't be shocked to see that the IDV product gets to be the first one to our metric for individual performance and numbers released.

But past that color, we're trying to stay away from specific numbers, Michael.

That's helpful, Jamie. And then in terms of the competitive landscape, has anything been changing over the last couple of months?

Has going public increased your profile with new customer growth? I'm just kind of curious because you've always been the premium-priced product compared to the competition.

I'm just -- I just want to know if that's changed or if there's any pricing pressure now than there was previously.

I don't know that there's any more pricing pressure. As we mentioned on the roadshow, I think we addressed it marginally last quarter, the pure mass notification business is the most mature of all of our products, and as such, has a little more pricing pressure because there are more competitors in that specific market.

That's the reason, quite frankly. I think ahead of the entire market, after being the sole leader of the Magic Quadrant every year it was published and the largest player in that market, that's the reason we added the additional products, because we didn't want a risk of commoditization.

In this most recent quarter, we had a strong quarter in mass notification. We had everything from the city of Sudbury, Ontario announcing in a press conference that the analogy they used was we were better than the Batman signal.

And although I don't believe we're superhuman, I enjoyed being compared to superheroes and the value and effect to society. But that is a more mature market, and as such, that's why initially critical communications and our much broader thematic of Critical Event Management is so important, because when we get in Mass Notification, Safety Connection, Community Engagement and perhaps Secure Messaging, which we're starting to see 2 -- not only 2 products on a multiproduct deal but 3 products into an account, you can imagine how much more difficult it is for a competitor to price against us because they can only price against Mass Notification.

No other competitors exists with Safety Connection and integration with your leading travel provider or integration with your physical security provider like Lenel or Tyco or G4S. And so for us, that expansion into multiple products is the best way to avoid broad-based commoditization.

And in those accounts, we certainly see virtually no pressure. So obviously, the most mature market is going to have the most pressure.

Haven't seen much of a change. It's a competitive market because there's a lot of people in it.

And we're hopefully moving the high ground to where our competitors can't compete at all, which is the Critical Event Management space. So in a major technology company, perhaps the largest software company in North America that uses, for instance, us as one, other pillars and the other pillar is IDV, we think it's going to be very difficult for someone to come in say, I'll do that for $0.50 less a message or $0.50 less a contact or some other individual pricing item and commoditize us because of the more enterprise play.

Okay. A couple of questions here.

I have a follow-up on the new metric you gave us on multiproduct deals, 42 in the quarter. Was that driven a little bit by seasonality, you think?

Or what's the pipeline look at on kind of multiproduct deal front? And what's driving that?

Is this a change in sales compensation where you're starting to see more success and incentive to sell multiproducts? Walk us through kind of the dynamics that's driving that and if we should expect that to continue here in Q1.

Or is there a seasonal factor to consider?

Well, as much as I'd like, there's always a little bit of seasonality. I think our Q4 and sometimes our Q2 are good quarters because you have the government effect in Q2 with the end of the government quarter in Q4.

We try -- and I think we've successfully, in the technology and the software business, trained all of our buyers that we're trying to close a strong year. But I would tell you that our multiproduct transactions are all of the above is your answer.

We absolutely categorically are focusing our sales reps on selling more products into an account and making an enterprise sale that gives above a basic business continuity, a security or an individual operational departmental manager, HR or travel. We want to sell at that enterprise level.

We're compensating the sales team to do that. We are targeting specific multiproduct sales, and the multiproduct sale involves different whole new sales from each category.

So it's Safety Connection, Mass Notification, IT Alerting, Community Engagement. One of -- you have to have 2 or 3 or 4 or 5 of our 6, 7 products in each one.

And we're comparing that metric on a trailing 12-month basis because then you have a stable average you could see. And I will tell you, I would be shocked if you didn't see continued strong increase in that multiproduct number every one of the quarters this year on a trailing 12 month average.

Sure. You bet.

That's helpful color. Just really down in the Safety Connection, one of your newer products, a little surprised with the success you're having there at new customer, AIG.

You called out Gilead, Delta and even existing customers. You talked a little bit about the up-sell.

What's resonating on the Safety Connection product with customers? And what product are you replacing?

That's what's great. We're not really replacing anything with Safety Connection as much as we're augmenting their ability to know where the hell all their nonbuilding employees are.

So think of any large campus, think of a major software player, a major pharmaceutical like we've announced in the last couple of quarters, the -- those guys have 12 buildings or 15 buildings or a university with 25 or 40 buildings on a campus. And at any given point of the day, 24x7, 365, there are 50% of the occupants with an address in a specific building not resident.

They can be not resident because they're in the next building over having lunch, chatting up a male or a female, a social environment or just traveling that day to another office somewhere in the world. An event happens on a campus, the corporate security, the business continuity and safety people, the HR people, the travel people, all get calls from the Chief Risk Officer, the Chief Operating Officer or the CEO when a major event happens.

And the first thing they ask is, are our people safe? We have to be able to put a message out that we know our employees are safe, our students are safe.

It's a fundamental just like it is for government. And so when we can come in and say between our technology that locates traveling people or people in other offices without turning on your phone and creating a Big Brother scenario and gives you that ability to understand where people are and then communicating with location awareness the right message at the right place, the right time and the right device, it literally is a matter of life and death in an active shooter or a terrorism event, which get a lot of press and therefore focus major corporations, enterprises, campus police and administration on this problem.

But it can be as simple as there's a tornado coming or a tsunami in a town that you have a lot of salespeople in Japan and you got to figure out where all those employees are, are they safe. And so that's -- what's resonating is our ability to provide an extension to the old physical building, ability to say you badged in and therefore you're there when people are now 50% of the time outside their physical office where they maintain a permanent address.

And in a mobile workplace, in a place where people travel more and more globally connected, that's a requirement. And this is the first product that does it.

So it's disruptive to that space. We're ultimately taking spend away from the larger physical security companies.

That's why you'll see the partnerships announced there, because they want us to extend them and not to be less out of that. But it is an opportunity for major corporations to get control of all their mobile population and surround them with the security that you have today with a badging system, doors, locks and locks and alarms and windows.

Certainly makes sense. My last question for you, Jamie, is really kind of around IDV Solutions.

A new business. It almost looks like a new product.

I know you've been working with them as a partner since '14. Could you talk a little bit about the Visual Command Center product?

Is that something you plan to productize on a stand-alone basis or either integrate with your existing products? And then what's the overlap?

You have been working with them. Is there a lot of overlap, customer overlap, at this point?

Or is there a pretty big cross-selling opportunity on that product?

Yes, the best way to describe Visual Command Center is they built-- they started in the visualization space. So I'm going to try to paint a picture for you guys.

I'm sure most of you will get it. I apologize if others don't.

But if you've seen the recent Jason Bourne movie and they walk into that space where all the CIA operatives are throwing up all the highway cams and all the street cams and all the data and they're mixing in any recent sci-fi or just a thriller movie, these operation centers are mixing 1 million pieces of data to come up with the location of that one individual that they're trying to save or track down in Jason Bourne's case, that is IDV. It's the ability to take a lot of data, identify the intersection of that data of a threat.

Could be weather, could be -- you've had 20 flat tires with your Toyota distribution trucks. It could be Amazon delivering packages.

It could be executive threat, any type of threat to the organization, its assets, its people, its entire supply chain. And then the minute those threats overlap with your assets, you instantly can visualize it.

So we now can see the difference between a supply chain event that looks like it's an individual event with 6 things that are going to create a cascading problem for me and I'm not going to be able to get my cars to my dealers or my drives into my factories and build these machines. And as a result, you obviously have to manage the event and communicate.

We do that very really well with our instant communication product and our overall mass notification products. So we have the communication and the instant management piece down.

They have the threat assessment. They've taken over 100 different forms of threat data, and these are big companies, Amazon, Microsoft, Pfizer.

And we can integrate that together on a single pane of glass. And these major corporations and governments spend millions and millions of dollars trying to do that.

In many cases, one for the cyber team, denial-of-service attacks and bugs on software and other things. For the physical types of impact, things like terrorism or active shooter, workplace violence and then separate systems yet again for things like supply chain.

In our case, we believe we're going to be able to, with existing products, and remember, these guys have been partners for 2 years, integrate all of that together, provide it in a single pane of glass. And these are big dollar solutions.

Their product average selling price is roughly 7x to 8x ours. So it really elevates our strategic positioning and should increase our ASP in that important multiproduct metric.

To your final point of the question, do we have a lot of overlap? If you already sold out of whatever it is, 50, 100 customers that's already in most of them, we have about a 5% penetration in their base.

So they've got a lot of customers we are working on jointly now closely that they've got and we have customers that they are trying to get into. So we look forward to quite a few new opportunities to be announced this year where we'll be able to say, yes, that's now a real Critical Event Management customer.

They've got IDV for threat visualization. They've got Everbridge for mass notification, Safety Connection and instant communication.

And those are large transactions.

Yes, that's very helpful color on that transaction. Ken, I'm going to squeeze one in here for you, if I could.

It's my last one, I promise here. D&A, obviously, last year was about $7.7 million.

You've made a couple of acquisitions, I assume, continued investment in kind of the data center footprint. What should we think about D&A expenses for this year?

Yes, I mean, you'll see a marginal increase but nothing significant. The nice thing about our business is it's primarily in the cloud, and so we don't have an equipment-centric business.

The only thing here is a result of purchase accounting.

Jamie, I appreciate kind of the finer points on the IDV acquisition and sort of -- that was a great example. I was actually hoping you could do the same thing for Crisis Commander and just give us sort of a real-world example, particularly how it might bolt on top of your existing suite.

Secondarily to that question, can you just go into the plans around sort of sales and marketing integration, how many reps or which reps you're kind of taking on here? Or will this kind of be effectively bolted on to your suite and be sold predominantly by your sales reps?

Yes, sure. Great questions, too, because the deal is fundamentally how we can execute on the acquisitions, which is important to us here.

Both IDV and Crisis Commander are sold directly into our core base. Our core base is -- with Safety Connection and mass notification and instant communication is the business continuity, emergency manager, Chief Risk Officer, securities -- Chief Security Officer.

And both of these products, IDV's Visual Command Center, VCC, as well as Crisis Commander, are sold into those 2 constituent bases. So the majority of our sales force, which is differentiated, for instance, with IT Alerting, that's a separate team of people that concentrate on selling to the IT and the more operational user.

These are straight down our sweet spot. And so in the Crisis Commander case, what happened and transpired was for the past couple of years, we had been selling and working with a few different parties that had similar tools.

And it's all pretty good success of our base. And the tools, when we looked at Crisis Commander, were, we believe, inferior.

They didn't have the functionality and the implementation history. And Crisis Commander also did something else for us.

It allowed us to add some new territories in Europe to our customer geography base because they're based out of Sweden, selling primarily throughout Europe, London, Germany and the Nordics, along with the U.S. And so in Crisis Commander's case, it allows you to take a standard business continuity plan, a product recall plan, some sort of emergency transfer plan that you would instinctively go to and for compliance reasons, have to build.

But traditionally, we saw them sitting in a bound notebook behind someone's desk in the bowels of an organization. And the truth is when an emergency happens, no one could do much because the last thing you're going to do when a building is on fire, there's a flood or you have some sort of huge discontinuity event is you pull out a binder and start reading and calling off actions.

So what Crisis Commander did was very simple. They took those plans, automated them, made them digital and converted them to task lists and made them assignable so that you can track them and did it all through a mobile application.

So today, often when we're used from a communication standpoint, it's because an emergency, a business continuity and emergency manager or Chief Risk Officer is executing an emergency plan of some sort, whether it's active shooter or flooding or fire or natural act. And they're trying to communicate to the outside audience.

In Crisis Commander's case, it takes those manual plans historically, automates them and converts them into task list with appointed individuals and automation, including location capabilities worldwide and even on the smartphone now, have the plan on their phone. So if you're running 1,000 stores throughout the world and 10 of them in the Paris region get flooded this month, the manager doesn't call home or look at a book.

He simply looks at his mobile phone and says, "What I do in case of a flood?" And it tells him to do these 20 events and as he finishes them, check them off.

The managers back at corporate can see them being checked off, can reassign them. And it's a way for them to automate and manage through mobile technology the actual crises or critical event.

So a perfect extension of our platform and one that we think sells very nicely into the base. It's slightly lower ASP, more in the $10,000 to $15,000 range than our historic $28,000, $30,000 price point, but a nice add-on with a customer base already in all the markets we sell into.

Looks like a nice collection of add-ons there. One quick follow-up just on the [indiscernible] side of the business.

I know you've been clear to characterize this as part of the more mature side of the business, but at the same time, it's still very early in your opportunity at the state and local side. You have some key wins in the last year and you mentioned the Sudbury opportunity here that was just recently a very good [indiscernible] customer.

Can you talk about the pipeline for state and local and how you think about that opportunity and that addressable market in the next couple of years?

Yes. I mean, it continues to be, by far, our largest market.

We said that on the roadshow and simple math tells you that from looking at our historics. From an overall Mass Notification product side, from a market segment standpoint, I think we said generally, corporate represents about 50%, state and local 35% and 15% for health care, which are the numbers we throw out, haven't changed all that much from the IPO.

And so as we look at that market going forward, a lot of -- continues to be a lot of opportunity in virtually all those segments. We have to balance making sure we don't provide too many shiny new objects with the sales force.

So we have some vertical focus and some product concentration. But the opportunity set there, specifically embedded in a larger product offering like Critical Event Management, we think, is still the way to go because it differentiates us.

We have tried to historically to stay away from selling just Mass Notification or just IT Alerting because after the market does get to a certain size, there will be natural commoditization. We avoided that by having more of an enterprise suite and embedding those individual products in an integrated fashion, giving the customer an advantage to do that and solving a much broader problem for the enterprise.

But as we look at Mass Notification long term, we remain bullish about it. We had a good quarter this past quarter.

And we will continue to not only see that grow in the U.S., grow with our channel partners, the support that we're getting some of those up -- finally up to sales and then growing just purely internationally along the channels.

Just wanted to ask about IT Alerting. I know this is a different sales audience than your core security manager.

But you're seeing real success there. Is that really a function of just getting more traction now with these other departments?

And I guess how natural is it of a cross-sell when you already have Mass Notification in the physical security department, for example, to kind of move organically into IT Alerting?

So every new product that we enter into, if we're not the first to sell -- in Safety Connection, for instance, we invented that space. We're the first in the market, and you can hear it in our excitement around the product.

There isn't a lot of competition. We're disruptive to a multibillion-dollar existing market.

So it's a little bit easier. IT Alerting, we were not the first to the party, but it is a basic alerting function.

You're connected to one of the big ITSM vendors ServiceNow or BMC or CA or someone. You're taking their typical e-mail output that there's something wrong, and you're parsing that and looking at a set of profiles and then connecting to the right person and the right location on the right device to quickly make a change because it can cost hundreds of thousands of dollars per hour when major corporations have an outage, retailers, et cetera.

And so that's -- and that is a different buyer, IT buyer. So like anyone else, we've had to work with the sales force.

We've specialized that. We recently announced that we brought on a new Senior Vice President, Vick, who comes from a background of being at BMC as a senior product manager for the ITSM space, and prior to that, with BladeLogic in the related space.

And so we've added some bulk to that team and specialized it more as we continue to be successful and see a good future in that market. But it is different.

We do get the cross-sell opportunity you'd asked about though. We get a specific brand, a specific example of a major corporation.

I was just at this last week, a major banking corporation, they told us, they're working with us on some of our newest products, on some of our existing products. And they said, "By the way, we just did an IT Alerting RFP and we weren't sure we were going to include you.

But now because we're using you for so many other things, we're going to include you into the finals round automatically on that." So we do see those types of opportunities, and we believe they're going to continue to get better and better because once you've built that profile database, and we're communicating to all those employees anyway, why would anyone want to introduce a new product.

It's just like if you have SAP for financials and HR, are you really going to change out and buy a specific different manufacturing solution? Some people do.

But probably 80%, 90% go with the suite because there's a value to the integration and putting in a new product in the mix just causes a headache for that enterprise CIO or CTO or business owner. And we see the same things here.

So it's not a new playbook. The successful enterprise software companies have been running this playbook for the last 10 years.

We're running the same playbook. We are clearly differentiated from the rest of the market, which is almost all single application products, not multiple products with an enterprise play.

And we think that's differentiator that's going to allow us to continue to grow in the future.

And then one on the state deal that you've already won, Florida, Connecticut. I know there's not a lot of history with Florida yet, but in the past, you've spoken about some pull-through effect when you win the state, you'll get some counties and municipalities downstream.

Are you seeing that? And also corporates.

Are you seeing that trend continue or even start for state of Florida and with state of Connecticut as well?

Yes, the state of Connecticut, it's well established. We have -- we mentioned on our roadshow we have everything from the state to, I think, like 253 of the 258 or 61 piece apps.

And all of the state hospitals now, many of the major education facilities, I think 3 of the top 5 employers or 3 out of the top 3. I mean, we have been able to run most of the tables there, and that's worked.

Florida, I would tell you, that big implementation is relatively new. And we were very fortunate that not only did we get about 1/3 or 1/2 of the state up in some of the biggest counties, but then we had the first hurricane, as you guys well know, in the last 10 years and the solution came out with flying colors.

I mean, we added hundreds of thousands of opt-ins in one day before the hurricane actually landed and made sure that each of the products performed incredibly well, and our relationship with Florida has grown as a result. So we're thinking about that.

But there's still work to do in Florida, and the technical account managers we have down there are working hard to bring it up fully. And as we do that, then you'll start to see some of those announcements.

A little early in the first 6 months because remember, it was announced in July of -- at the second, third quarter of last year. So it's still a little bit early, but I'm sure you're going to see the exact same results.

We see those in DC, and some of the results you're seeing today are a result of those wins. So that network effect, as we call it, continues to do -- work magic for us because when we get a certain concentration within an area, it makes it easier to sell, focused on you're already in our database for the state or for the major city, we have the hospitals running, the major educational institutions, why choose another vendor.

Doesn't always, but it's a much better pitch than trying to say use us just because.

Right, right, great, okay. One more, if I may, please.

You mentioned earlier IDV kind of being more of a TAM expansion [indiscernible] on that. Are these, I just assume, more sophisticated organizations, so potentially moving upmarket a little bit?

Is that what you meant by TAM expansion?

Well -- excuse me, I have a cold. The IDV customers are almost all exclusively enterprise accounts.

So as we have some -- we will have, in our 3,000 base, $15,000 accounts. That does not exist in the IDV base.

The IDV base is the true Fortune 5000 base. You don't find an Everbridge size company in there.

And so from that standpoint, they provide us the opportunity to jointly go after the Fortune 500 or Fortune 1000 North America and even internationally with an extreme blue-chip customer base. I mentioned just a few of them, if that's any representation, including the highest level of government.

It's a solid base and very little overlap, about 5% shared customers. So lots of up-sell in both side.

And actually, in almost every case, there's at least competitor's implementation of Mass Notification there. So we would hope that with the integration we're delivering as fast as this next quarter, customers will see that and say, well, I'm going to go with the bundle instead of buying separately.

Again, it's a basic suite concept. It's not new.

We just think we can run that playbook extremely well here and build on it. And the exciting piece about IDV is it's -- an average sale price that's 7 or 8x our ASP.

So it's certainly going to elevate our total sale price where we can sell those 2 as an enterprise solution.

I've got 30 seconds here. And since I don't have much time, I guess I'm going to have to wait for a callback for my Batman questions and analogy.

But my first question just relates to the $4 million revenue contribution, Ken, that you talked about. I guess just for risk mitigation purposes, where is the confidence level in terms of derisking those acquisitions?

Is this the book of business that they had late-stage pipeline with? Or is this just deferred revenue that does carry over?

Just trying to understand how much you're putting into the forecast related to them having to go out and find new business to get the $4 million?

So the answer is yes, meaning it's a little bit of both. We've been doing this long enough that we're not going to put out anything that we think is extremely risky in terms of numbers.

So some of it is deferred revenue that we expect to bleed out. Remember, they're a subscription business as well, so it's recurring revenue.

And then there will be new growth as well. But you know us well enough to believe that we're relatively conservative in terms of how we're looking at things.

And throughout the year, we may adjust our guidance as we've come to live with them.

Okay. And Jamie, in terms of the multiproduct sales and the color you provided, it sounds like there is strong traction and you guys are proud of what's happening there.

But I guess though just to understand this, in terms of as you think about evolving your go-to-market strategies in '17, I mean, there's always kind of sales changes, territory changes at the beginning of the year. Is there anything more meaningful than normal that you're doing on the go-to-market side because of some of the multiproduct opportunities and we need to think about that as something potentially disruptive to the sales organization?

It's a very fair and it's, I think, a very good question because that does happen, right? So we have taken an approach to keep the acquired businesses somewhat separated and unique in terms of the sales forces.

We're going to take advantage of those opportunities, but slowly, and some of that is the conservatism you're hearing from Ken. We do not like substantive changes to the sales team at the start of the year or in the middle of the year, and that's why getting these transactions done at the very end of last year and a few days into 2017 was important to us, because if we're going to make a change, we want to announce to the customer base early enough to digest, and quite honestly, to be able to gestate sales opportunities and close them within the year.

The worst opportunity is something that closes in June or July and all you do is turn up your sales force for 6 months of shiny new object but no real revenue traction. And so it was important to get them done early.

It has been important to segment them to some extent and make very clear lines of delineation as to who can sell and how they're getting compensated. And there, as an example, in our core, the bulk of our sales teams, their #1 priority is selling the Mass Notification product and things like up-selling the Safety Connection, which are proven products and we have traction with and know how to implement.

And we'll see, because we have so many customers asking for, we believe, some CEM sales, and we don't need a lot of them to make a difference because they're so much larger than our historical ASP. But we are being somewhat cautious with that, and we're not going to disrupt the sales force with -- it's a free-for-all.

Everyone is allowed to sell. There are very strict rules we're focused on.

And you see that coming into the numbers we provided you for IDV and Crisis Commander. We're trying to be pretty mature about that.

Okay. And just the last question.

Lenel and International SOS. We obviously knew about International SOS in the past.

We always had the assumption here. The indirect is an interesting opportunity, not betting everything on that.

It could be a potential upside driver. But this is mostly a direct sales type dynamic forward.

Could you give us a sense on what kind of sales capacity these partners are adding? And does anything change on what you're seeing in terms of how influential the indirect could be going forward?

Sure. I mean, the International SOS, I mentioned before as a sales force -- a direct sales force of 300 to 400 people around the globe.

And what's most important about International SOS, they're in 70% of the Fortune 500 already or the Global 2000. And so when we go into those accounts that I mentioned, many of them, Bank of America or Microsoft, they already have or are choosing International SOS as their medical and travel emergency provider.

And so we come in and we can take that data and immediately locate it on a mapping interface and show the threat related to any traveler in the world anytime of day, 24x7, 365 and make it pop to those people so they immediately know we've got a problem in Nigeria right now, that team that was from Goldman that's working on that resource deal, that major bank or this team over here traveling from a big technology partner. That is what International SOS helps with and they turn up some of those new opportunities.

We get revenue from International SOS because we are their communication provider for every single one of their, I don't know, thousand travel tracker or 700 travel tracker customers. We really don't count them as customers until we bring them and up-sell them an Everbridge product.

So we're pretty, again, mature and conservative about that number. And as I announced, customers like INTELLISAT, I mean, big corporation, selecting Everbridge because of the combination.

It's still only a couple of quarters in, but it's growing pretty rapidly. And we have pretty strong hopes of the International SOS partnership.

It's a good partnership that's working. On the Lenel side, that's a little different.

Lenel is the largest in the Fortune 5000 physical security companies. They compete with the Tycos, the G4Ss, the S2, the Honeywells.

But they're the largest. I think they have -- they count like 70% or 80%, again, of the Fortune 1000, the Fortune 500 companies.

And so the benefit there is we've integrated with all of them, but what Lenel is going to be doing is they're going to be packaging up Safety Connection and Mass Notification and adding it to their OnGuard solution to combine the physical badging system with Safety Connection and selling it through their largest system integration partners, which have thousands of reps throughout North America. And so our focus there is going to be on getting 4, 5, 10 of those large system integrators knowledgeable of the product and opening up much larger opportunities for us.

It's validation of the Safety Connection product because why would someone that large partner with us and agree to sell it unless, obviously, we have some really good technology and secret sauce there to manage, locate and coordinate and communicate to mobile employees and extend that physical security to the virtual security you need for a traveler or a mobile employee. And it represents a pretty good-sized channel for us, but it's brand new.

This is just announced. In fact, you guys are hearing it first.

The actual press release formally on the Lenel relationship comes out of Lenel in about the next 2 to 3 weeks.

Well, thanks, everyone, for joining us for the fourth quarter call. We're certainly excited to deliver some strong and positive growth in adjusted EBITDA in 2016, and we're obviously very excited about 2017 and our Critical Event Management Platform and the recent acquisitions.

And we look forward to seeing you in the market and speaking to you. Thanks again for joining today.

Goodbye.