Business Combination (Tables)

9 Months Ended

Sep. 30, 2015

Business Combinations [Abstract]

Summary of Estimated Fair Value of Asset Acquired At The Date of Acquisition

The following table summarizes the estimated fair value of the assets acquired at the date of acquisition:

Tangible assets	$	1,847
Identifiable intangible asset		4,000
Goodwill		30,200
Total assets acquired		36,047
Less: liabilities assumed		(2,277	)
Total cash paid	$	33,770

Business Combination Pro Forma Information

Pro Forma Statement of Loss Nine Months Ended September 30, 2015	Company Historical			Titan Agencies Historical Six Months Ended June 30, 2015			Pro Forma Adjustments				Pro Forma Combined
Revenues:
Premiums earned	$	197,423		$	-		$	-			$	197,423
Commission and fee income		42,252			14,547			-				56,799
Investment income		3,695			-			-				3,695
Net realized losses on investments, available-for-sale		(13	)		-			-				(13	)
		243,357			14,547			-				257,904
Costs and expenses:
Losses and loss adjustment expenses		160,304			-			-				160,304
Insurance operating expenses		78,039			14,555			(180	)	(a)		92,414
Other operating expenses		881			-			-				881
Litigation settlement		3,645			-			-				3,645
Stock-based compensation		109			-			-				109
Depreciation		1,224			-			50		(b)		1,274
Amortization of identifiable intangibles assets		261			-			387		(c)		648
Interest expense		1,924			-			1,193		(d)		3,117
		246,387			14,555			1,450				262,392
Loss before income taxes		(3,030	)		(8	)		(1,450	)			(4,488	)
Income tax benefit		(813	)		(3	)		(580	)	(e)		(1,396	)
Net loss per share:	$	(2,217	)	$	(5	)	$	(870	)		$	(3,092	)
Net loss per share:
Basic	$	(0.05	)								$	(0.08	)
Diluted	$	(0.05	)								$	(0.08	)
Number of shares used to calculate net loss per share:
Basic		41,026										41,026
Diluted		41,026										41,026

Pro Forma Statement of Income Three Months Ended September 30, 2014	Company Historical			Titan Agencies Historical		Pro Forma Adjustments				Pro Forma Combined
Revenues:
Premiums earned	$	54,369		$	-	$	-			$	54,369
Commission and fee income		10,097			7,223		-				17,320
Investment income		1,142			-		-				1,142
Net realized losses on investments, available-for-sale		(4	)		-		-				(4	)
		65,604			7,223		-				72,827
Costs and expenses:
Losses and loss adjustment expenses		41,440			-		-				41,440
Insurance operating expenses		20,624			6,377		-				27,001
Other operating expenses		244			-		-				244
Litigation settlement		30			-		-				30
Stock-based compensation		39			-		-				39
Depreciation		423			-		25		(b)		448
Amortization of identifiable intangibles assets		-			-		228		(c)		228
Interest expense		427			-		613		(d)		1,040
		63,227			6,377		866				70,470
Income before income taxes		2,377			846		(866	)			2,357
Provision for income taxes		257			338		(346	)	(e)		249
Net income	$	2,120		$	508	$	(520	)		$	2,108
Net income per share:
Basic	$	0.05								$	0.05
Diluted	$	0.05								$	0.05
Number of shares used to calculate net income per share:
Basic		40,995									40,995
Diluted		41,297									41,297

Pro Forma Statement of Income Nine Months Ended September 30, 2014	Company Historical		Titan Agencies Historical		Pro Forma Adjustments				Pro Forma Combined
Revenues:
Premiums earned	$	161,971	$	-	$	-			$	161,971
Commission and fee income		29,323		21,926		-				51,249
Investment income		3,936		-		-				3,936
Net realized gains on investments, available-for-sale		36		-		-				36
		195,266		21,926		-				217,192
Costs and expenses:
Losses and loss adjustment expenses		119,323		-		-				119,323
Insurance operating expenses		65,739		21,073		-				86,812
Other operating expenses		722		-		-				722
Litigation settlement		106		-		-				106
Stock-based compensation		151		-		-				151
Depreciation		1,303		-		75		(b)		1,378
Amortization of identifiable intangibles assets		-		-		715		(c)		715
Interest expense		1,275		-		1,820		(d)		3,095
		188,619		21,073		2,610				212,302
Income before income taxes		6,647		853		(2,610	)			4,890
Provision (benefit) for income taxes		547		341		(1,044	)	(e)		(156	)
Net income	$	6,100	$	512	$	(1,566	)		$	5,046
Net income per share:
Basic	$	0.15							$	0.12
Diluted	$	0.15							$	0.12
Number of shares used to calculate net income per share:
Basic		40,981								40,981
Diluted		41,285								41,285

Pro forma adjustments

The following adjustments have been reflected in the unaudited pro forma combined financial information.

(a) Elimination of acquisition costs incurred

(b) Depreciation expense related to acquired tangible asset

(c) Amortization expense related to acquired identifiable intangible asset

(d) Interest expense related to acquisition financing

(e) Calculated income tax effect of pro forma adjustments at the estimated combined federal and state statutory rate of 40%