Quarterly report pursuant to Section 13 or 15(d)

Acquisitions

v3.19.1
Acquisitions
3 Months Ended
Mar. 31, 2019
Business Combinations [Abstract]  
Acquisitions
Acquisitions
2019 Acquisitions
No acquisitions were completed during the three months ended March 31, 2019.
2018 Acquisitions
We completed four acquisitions during fiscal year 2018. For the acquisitions in the table below, the estimated fair values of assets acquired and liabilities assumed are provisional. We expect to finalize the valuation of these assets and liabilities as soon as practicable, but no later than one year from the acquisition dates. The allocation of each purchase price, including effects of measurement period adjustments recorded as of March 31, 2019, is as follows:
 
 
Date of Acquisition
 
Aggregate Purchase Price
 
Closing Cash Payment, Net of Cash Acquired
 
Net Tangible Assets Acquired (Liabilities Assumed)
 
Identified Intangible Assets
 
Goodwill Recognized
 
 
 
 
(in thousands)
ClickPay Services, Inc.
 
April 2018
 
$
221,063

 
$
138,983

 
$
(4,550
)
 
$
52,700

 
$
172,913

Blu Trend, LLC
 
July 2018
 
$
8,500

 
$
8,500

 
$
343

 
$
4,270

 
$
3,887

LeaseLabs, Inc.
 
September 2018
 
$
112,892

 
$
84,498

 
$
1,188

 
$
27,200

 
$
84,504

Rentlytics, Inc.
 
October 2018
 
$
55,391

 
$
47,895

 
$
726

 
$
12,200

 
$
42,465


Purchase consideration for LeaseLabs, Inc. included contingent consideration of up to $9.9 million based on the collection of acquisition date accounts receivable balances during the six-month period after the acquisition date. The fair value of the contingent consideration was $7.0 million on the date of acquisition. The final contingent consideration amount of $6.0 million was paid in April 2019. Refer to Note 13 for additional information regarding our contingent consideration obligation.
Deferred Obligations and Contingent Consideration Activity
The following table presents changes in the Company’s deferred cash and stock obligations and contingent consideration for the three months ended March 31, 2019 and the year ended December 31, 2018:
 
Deferred Cash and Stock Obligations
 
Contingent Consideration
 
Total
 
(in thousands)
Balance at January 1, 2018
$
47,016

 
$
414

 
$
47,430

Additions, net of fair value discount
36,313

 
7,000

 
43,313

Cash payments
(29,600
)
 
(247
)
 
(29,847
)
Accretion expense
1,970

 

 
1,970

Change in fair value

 
(1,167
)
 
(1,167
)
Indemnification claims and other adjustments
(3,557
)
 

 
(3,557
)
Balance at December 31, 2018
52,142

 
6,000

 
58,142

Cash payments
(11,729
)
 

 
(11,729
)
Accretion expense
662

 

 
662

Indemnification claims and other adjustments
(3
)
 

 
(3
)
Balance at March 31, 2019
$
41,072

 
$
6,000

 
$
47,072


In May 2019, in connection with our April 2018 acquisitions of NovelPay, LLC (“NovelPay”) and ClickPay Services, Inc. (collectively with NovelPay, “ClickPay”), we issued an aggregate of 154,281 shares of our common stock to certain of the equity holders of ClickPay. These shares are subject to a holdback in respect of indemnification and post-closing purchase price adjustments pursuant to the acquisition agreements.
Pro Forma Results of Acquisitions
The following table presents unaudited pro forma results of operations for the three months ended March 31, 2018, as if the aforementioned 2018 acquisitions had occurred as of January 1, 2017. The pro forma information includes the business combination accounting effects resulting from these acquisitions, including interest expense, tax expense or benefit, issuance of shares of our common stock, and additional amortization resulting from the valuation of amortizable intangible assets. We prepared the pro forma financial information for the combined entities for comparative purposes only, and it is not indicative of what actual results would have been if the acquisitions had occurred at the beginning of the periods presented, or of future results.
 
Three Months Ended
March 31, 2018
Pro Forma
 
(unaudited)
 
(in thousands, except per share amounts)
Total revenue
$
216,151

Net income
$
7,888

Net income per share:
 
Basic
$
0.10

Diluted
$
0.09


No pro forma results of operations are presented for the three months ended March 31, 2019, as no acquisitions were completed during the first quarter of 2019.