INTERNATIONAL MONEY EXPRESS, INC.
|
(Exact name of registrant as specified in its charter)
|
Delaware
|
47-4219082
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
9480 South Dixie Highway
Miami, Florida
|
33156
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
(305) 671-8000
|
(Registrant’s telephone number, including area code)
|
FINTECH ACQUISITION CORP. II, 2929 Arch Street, Suite 1703, Philadelphia, PA 19104
|
(Former name, former address and former fiscal year, if changed since last report)
|
☐ Large accelerated filer
|
☐ Accelerated filer
|
|
☒ Non-accelerated filer
|
☐ Smaller reporting company
|
|
☒ Emerging growth company
|
Page
|
||
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
|
||
PART 1 - FINANCIAL INFORMATION
|
||
Item 1.
|
1 |
|
1 |
||
2 |
||
3 |
||
4 |
||
6 |
||
Item 2.
|
19 |
|
Item 3.
|
33 |
|
Item 4.
|
34 |
|
PART II - OTHER INFORMATION
|
||
Item 1.
|
35 |
|
Item 1A.
|
35 |
|
Item 2.
|
35 |
|
Item 3.
|
35 |
|
Item 4.
|
35 |
|
Item 5.
|
35 |
|
Item 6.
|
35 |
|
37 |
· |
the ability to maintain the listing of our common stock on Nasdaq;
|
· |
the ability to recognize the anticipated benefits of the Merger, which may be affected by, among other things, competition, and the ability of the combined business to grow
and manage growth profitably;
|
· |
changes in applicable laws or regulations;
|
· |
the possibility that we may be adversely affected by other economic, business and/or competitive factors;
|
· |
factors relating to our business, operations and financial performance, including:
|
o |
competition in the markets in which we operate;
|
o |
our ability to maintain agent relationships on terms consistent with those currently in place;
|
o |
our ability to maintain banking relationships necessary for us to conduct our business;
|
o |
credit risks from our agents and the financial institutions with which we do business;
|
o |
bank failures, sustained financial illiquidity, or illiquidity at our clearing, cash management or custodial financial institutions;
|
o |
new technology or competitors that disrupt the current ecosystem;
|
o |
cyber-attacks or disruptions to our information technology, computer network systems and data centers;
|
o |
our success in developing and introducing new products, services and infrastructure;
|
o |
customer confidence in our brand and in consumer money transfers generally;
|
o |
our ability to maintain compliance with the regulatory requirements of the jurisdictions in which we operate or plan to operate;
|
o |
international political factors or implementation of tariffs, border taxes or restrictions on remittances or transfers of money out of the United States;
|
o |
changes in tax laws and unfavorable outcomes of tax positions we take;
|
o |
political instability, currency restrictions and devaluation in countries in which we operate or plan to operate;
|
o |
weakness in U.S. or international economic conditions;
|
o |
change or disruption in international migration patterns;
|
o |
our ability to protect our brand and intellectual property rights;
|
o |
our ability to retain key personnel;
|
o |
changes in foreign exchange rates could impact consumer remittance activity; and
|
· |
other economic, business and/or competitive factors, risks and uncertainties, including those described in the section entitled “Risk Factors” in the prospectus, dated
October 25, 2018, filed pursuant to Rule 424(b)(3), as may be updated by the other documents that we file with the Securities and Exchange Commission.
|
Successor Company
|
||||||||
September 30,
2018
|
December 31,
2017
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash
|
$
|
82,490,398
|
$
|
59,155,618
|
||||
Accounts receivable, net of
allowance of $340,178 and $307,562, respectively
|
80,923,807
|
51,374,377
|
||||||
Prepaid wires
|
5,119,778
|
7,675,491
|
||||||
Other prepaid expenses and current assets
|
3,472,124
|
900,386
|
||||||
Total current assets
|
172,006,107
|
119,105,872
|
||||||
Property and equipment, net
|
9,525,295
|
8,490,794
|
||||||
Goodwill
|
36,259,666
|
36,259,666
|
||||||
Intangible assets, net
|
39,389,769
|
48,741,032
|
||||||
Deferred tax asset, net
|
-
|
1,748,854
|
||||||
Other assets
|
639,119
|
1,706,693
|
||||||
Total assets
|
$ |
257,819,956
|
$ |
216,052,911
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
||||||||
Current portion of long-term debt, net
|
$
|
4,078,627
|
$
|
3,913,436
|
||||
Accounts payable
|
14,060,179
|
8,919,796
|
||||||
Wire transfers and money orders payable
|
78,152,404
|
48,276,649
|
||||||
Accrued and other
|
14,018,061
|
11,514,449
|
||||||
Total current liabilities
|
110,309,271
|
72,624,330
|
||||||
Long term liabilities:
|
||||||||
Deferred tax liability, net
|
5,157,019
|
-
|
||||||
Debt, net
|
104,423,502
|
107,526,462
|
||||||
Total long term liabilities
|
109,580,521
|
107,526,462
|
||||||
Commitments and contingencies, see Note 11
|
||||||||
Stockholders' equity:
|
||||||||
Common stock $0.0001 par value; 200,000,000 shares authorized, 36,182,783 and 17,227,682 shares issued
and outstanding as of September 30, 2018 and December 31, 2017, respectively
|
3,619
|
1,723
|
||||||
Additional paid-in capital
|
60,203,431
|
46,076,220
|
||||||
Accumulated deficit
|
(22,281,866
|
)
|
(10,173,453
|
)
|
||||
Accumulated other comprehensive income (loss)
|
4,980
|
(2,371
|
)
|
|||||
Total stockholders' equity
|
37,930,164
|
35,902,119
|
||||||
Total liabilities and stockholders' equity
|
$ |
257,819,956
|
$ |
216,052,911
|
Successor Company
|
Predecessor
Company
|
|||||||||||||||||||
Three Months Ended
September 30,
|
Nine
Months Ended
September 30,
2018
|
Period from
February 1, 2017
to September 30,
2017
|
Period from
January 1, 2017
to January
31,
2017
|
|||||||||||||||||
2018
|
2017
|
|||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||
Revenues:
|
||||||||||||||||||||
Wire transfer and money order fees
|
$ |
61,331,837
|
$ |
47,642,153
|
$ |
168,554,175
|
$
|
119,226,787
|
$ |
11,876,919
|
||||||||||
Foreign exchange
|
10,697,168
|
8,413,051
|
29,013,221
|
21,690,233
|
2,449,709
|
|||||||||||||||
Other income
|
479,461
|
338,090
|
1,276,494
|
854,102
|
98,715
|
|||||||||||||||
Total revenues
|
72,508,466
|
56,393,294
|
198,843,890
|
141,771,122
|
14,425,343
|
|||||||||||||||
Operating expenses:
|
||||||||||||||||||||
Service charges from agents and banks
|
48,305,007
|
37,846,027
|
132,564,938
|
94,607,887
|
9,440,774
|
|||||||||||||||
Salaries and benefits
|
10,959,507
|
5,983,784
|
24,632,910
|
16,395,185
|
4,530,308
|
|||||||||||||||
Other selling, general and administrative expenses
|
5,206,932
|
4,163,419
|
13,390,449
|
10,400,190
|
1,063,379
|
|||||||||||||||
Transaction costs
|
6,304,972
|
-
|
10,319,283
|
6,212,602
|
3,917,188
|
|||||||||||||||
Depreciation and amortization
|
4,142,139
|
4,553,042
|
11,749,513
|
12,056,986
|
381,746
|
|||||||||||||||
Total operating expenses
|
74,918,557
|
52,546,272
|
192,657,093
|
139,672,850
|
19,333,395
|
|||||||||||||||
Operating (loss) income
|
(2,410,091
|
)
|
3,847,022
|
6,186,797
|
2,098,272
|
(4,908,052
|
)
|
|||||||||||||
Interest expense
|
3,433,731
|
4,612,430
|
10,109,664
|
8,107,258
|
613,742
|
|||||||||||||||
Loss before income taxes
|
(5,843,822
|
)
|
(765,408
|
)
|
(3,922,867
|
)
|
(6,008,986
|
)
|
(5,521,794
|
)
|
||||||||||
Income tax provision (benefit)
|
7,569,174
|
(191,727
|
)
|
8,185,546
|
1,052,479
|
(2,203,373
|
)
|
|||||||||||||
Net loss
|
(13,412,996
|
)
|
(573,681
|
)
|
(12,108,413
|
)
|
(7,061,465
|
)
|
(3,318,421
|
)
|
||||||||||
Other comprehensive income (loss)
|
22,452
|
3,859
|
7,351
|
18,990
|
(2,453
|
)
|
||||||||||||||
Comprehensive loss
|
$ |
(13,390,544
|
) |
$
|
(569,822
|
)
|
$ |
(12,101,062
|
) |
$
|
(7,042,475
|
)
|
$
|
(3,320,874
|
)
|
|||||
Loss per common share:
|
||||||||||||||||||||
Basic and diluted
|
$
|
(0.43
|
)
|
$
|
(0.03
|
)
|
$
|
(0.55
|
)
|
$
|
(0.41
|
)
|
||||||||
Weighted-average common shares outstanding:
|
||||||||||||||||||||
Basic and diluted
|
30,975,338
|
17,227,682
|
21,827,082
|
17,227,682
|
Common Stock
|
Additional
Paid-in Capital
|
Accumulated
Deficit
|
Accumulated Other
Comprehensive
Income (Loss)
|
Total
Stockholders'
Equity
|
||||||||||||||||||||
Shares
|
Amount
|
|||||||||||||||||||||||
Balance, December 31, 2017
|
17,227,682
|
$
|
1,723
|
$
|
46,076,220
|
$
|
(10,173,453
|
)
|
$
|
(2,371
|
)
|
$
|
35,902,119
|
|||||||||||
Net equity infusion from reverse recapitalization
|
18,955,101
|
1,896
|
8,961,625
|
-
|
-
|
8,963,521
|
||||||||||||||||||
Share-based compensation
|
-
|
-
|
5,165,586
|
-
|
-
|
5,165,586
|
||||||||||||||||||
Adjustment from foreign currency translation, net
|
-
|
-
|
-
|
-
|
7,351
|
7,351
|
||||||||||||||||||
Net loss
|
-
|
-
|
-
|
(12,108,413
|
)
|
-
|
(12,108,413
|
)
|
||||||||||||||||
Balance, September 30, 2018
|
36,182,783
|
$
|
3,619
|
$
|
60,203,431
|
$
|
(22,281,866
|
)
|
$
|
4,980
|
$
|
37,930,164
|
Successor Company
|
Predecessor
Company
|
|||||||||||
Nine
Months Ended
September 30,
2018
|
Period from
February 1, 2017
to September 30,
2017
|
Period from
January 1, 2017
to January 31,
2017
|
||||||||||
(Unaudited)
|
||||||||||||
Cash flows from operating activities:
|
||||||||||||
Net loss
|
$
|
(12,108,413
|
)
|
$
|
(7,061,465
|
)
|
$
|
(3,318,421
|
)
|
|||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
||||||||||||
Depreciation and amortization
|
11,749,513
|
12,056,986
|
381,746
|
|||||||||
Share-based compensation
|
5,165,586
|
1,534,655
|
2,916,324
|
|||||||||
Provision for bad debts
|
743,285
|
813,641
|
83,695
|
|||||||||
Debt origination costs amortization
|
699,731
|
125,053
|
39,298
|
|||||||||
Deferred taxes
|
6,905,873
|
903,181
|
(2,214,351
|
)
|
||||||||
Loss on disposal of property and equipment
|
151,724
|
86,351
|
13,472
|
|||||||||
Total adjustments
|
25,415,712
|
15,519,867
|
1,220,184
|
|||||||||
Changes in operating assets and liabilities:
|
||||||||||||
Accounts receivable
|
(30,285,672
|
)
|
(26,826,448
|
)
|
3,612,332
|
|||||||
Prepaid wires
|
2,784,622
|
(2,402,576
|
)
|
7,848,641
|
||||||||
Other prepaid expenses and assets
|
(1,427,760
|
)
|
(1,706,487
|
)
|
70,927
|
|||||||
Wire transfers and money orders payables
|
29,639,809
|
13,100,915
|
(1,884,922
|
)
|
||||||||
Accounts payable and accrued other
|
16,497,269
|
(1,458,882
|
)
|
1,103,326
|
||||||||
Net cash provided by (used in) operating activities
|
30,515,567
|
(10,835,076
|
)
|
8,652,067
|
||||||||
Cash flows from investing activities:
|
||||||||||||
Purchases of property and equipment
|
(3,575,065
|
)
|
(3,095,230
|
)
|
(249,382
|
)
|
||||||
Net cash used in acquisition
|
-
|
(923,654
|
)
|
-
|
||||||||
Net cash used in investing activities
|
(3,575,065
|
)
|
(4,018,884
|
)
|
(249,382
|
)
|
||||||
Cash flows from financing activities:
|
||||||||||||
Borrowings under term loan
|
-
|
102,000,000
|
-
|
|||||||||
Proceeds from reverse recapitalization
|
101,663,573
|
-
|
-
|
|||||||||
Cash consideration to Intermex shareholders
|
(101,658,947
|
)
|
-
|
-
|
||||||||
Borrowings (Repayments) under revolving loan, net
|
-
|
12,000,000
|
(2,000,000
|
)
|
||||||||
Repayment of term loan
|
(3,637,500
|
)
|
(75,000,000
|
)
|
-
|
|||||||
Debt origination costs
|
-
|
(4,682,830
|
)
|
-
|
||||||||
Common dividend distributions
|
-
|
(20,000,000
|
)
|
-
|
||||||||
Net cash (used in) provided by financing activities
|
(3,632,874
|
)
|
14,317,170
|
(2,000,000
|
)
|
|||||||
Effect of exchange rate changes on cash
|
27,152
|
405,922
|
(15,196
|
)
|
||||||||
Net increase (decrease) in cash and restricted cash
|
23,334,780
|
(130,868
|
)
|
6,387,489
|
||||||||
Cash and restricted cash, beginning of the period
|
59,795,280
|
44,628,247
|
38,240,758
|
|||||||||
Cash and restricted cash, end of the period
|
$
|
83,130,060
|
$
|
44,497,379
|
$
|
44,628,247
|
Successor Company
|
Predecessor
Company
|
|||||||||||
Nine
Months Ended
September 30,
2018
|
Period from
February 1, 2017
to September 30,
2017
|
Period from
January 1, 2017
to January 31,
2017
|
||||||||||
(Unaudited)
|
||||||||||||
Supplemental disclosure of cash flow information:
|
||||||||||||
Cash paid for interest
|
$
|
9,409,516
|
$
|
8,556,649
|
$
|
658,888
|
||||||
Cash paid for income taxes
|
1,494,900
|
400,000
|
-
|
|||||||||
Supplemental disclosure of non-cash financing activity:
|
||||||||||||
Agent business acquired in exchange for receivables
|
-
|
639,688
|
-
|
|||||||||
Intermex transaction accruals settled by acquisition proceeds
|
9,062,769 | - | - |
Cash balance available to Intermex prior to the consummation of the Merger
|
$
|
110,726,342
|
||
Less:
|
||||
Intermex Merger costs paid from acquisition proceeds at closing
|
(9,062,769
|
)
|
||
Cash consideration to Intermex shareholders
|
(101,658,947
|
)
|
||
Net cash proceeds from reverse recapitalization
|
$
|
4,626
|
||
Cash balance available to Intermex prior to the consummation of the Merger
|
$
|
110,726,342
|
||
Less:
|
||||
Cash consideration to Intermex shareholders
|
(101,658,947
|
)
|
||
Other FinTech assets acquired and liabilities assumed in the Merger:
|
||||
Prepaid expenses
|
76,478
|
|||
Accrued liabilities
|
(180,352
|
)
|
||
Net equity infusion from FinTech
|
$
|
8,963,521
|
Successor
Company
|
||||
Cash
|
$
|
43,064,931
|
||
Accounts receivables
|
24,031,575
|
|||
Prepaid and other current assets
|
3,712,848
|
|||
Property and equipment
|
6,328,146
|
|||
Other assets
|
1,345,562
|
|||
Total tangible assets acquired
|
78,483,062
|
|||
Intangible assets acquired
|
62,660,000
|
|||
Deferred tax asset, net
|
2,118,801
|
|||
Less: Liabilities assumed
|
(115,111,529
|
)
|
||
Net assets
|
28,150,334
|
|||
Goodwill
|
36,259,666
|
|||
Total purchase price
|
$
|
64,410,000
|
Successor Company
|
||||||||
Goodwill
|
Other Intangibles
|
|||||||
Balance at December 31, 2017
|
$
|
36,259,666
|
$
|
48,741,032
|
||||
Amortization expense
|
-
|
(9,351,263
|
)
|
|||||
Balance at September 30, 2018
|
$
|
36,259,666
|
$
|
39,389,769
|
Successor Company
|
||||||||
September 30,
2018
|
December 31,
2017
|
|||||||
Payables to agents
|
$
|
8,302,004
|
$
|
6,875,416
|
||||
Accrued compensation
|
1,542,822
|
1,092,460
|
||||||
Accrued bank charges
|
884,069
|
897,404
|
||||||
Accrued loyalty program rebates
|
840,039
|
164,581
|
||||||
Accrued audit and accounting fees
|
603,322
|
233,592
|
||||||
Accrued legal fees
|
680,000
|
1,644,470
|
||||||
Accrued taxes
|
694,871
|
318,792
|
||||||
Other
|
470,934
|
287,734
|
||||||
$
|
14,018,061
|
$
|
11,514,449
|
Successor Company
|
||||||||
September 30,
2018
|
December 31,
2017
|
|||||||
Revolving credit facility
|
$
|
20,000,000
|
$
|
20,000,000
|
||||
Term loan
|
92,150,000
|
95,787,500
|
||||||
112,150,000
|
115,787,500
|
|||||||
Less: Current portion of long term debt (1)
|
(4,078,627
|
)
|
(3,913,436
|
)
|
||||
Less: Debt origination costs
|
(3,647,871
|
)
|
(4,347,602
|
)
|
||||
$
|
104,423,502
|
$ |
107,526,462
|
(1) |
Current portion of long-term debt is net of debt origination costs of $771,373 at September 30, 2018 and $936,564 at December 31, 2017.
|
Number of
Options
|
Weighted Average
Exercise Price
|
Weighted
Average Remaining
Contractual Term
|
||||||||||
Outstanding at December 31, 2017
|
-
|
-
|
-
|
|||||||||
Granted
|
2,771,719
|
9.91
|
||||||||||
Exercised
|
-
|
-
|
||||||||||
Forfeited
|
(7,500
|
)
|
9.91
|
|||||||||
Expired
|
-
|
-
|
||||||||||
Outstanding at September 30, 2018
|
2,764,219
|
9.91
|
9.83
|
Number of
Class B Units
|
Weighted-
Average
Grant Date
Fair Value
|
Number of
Class C Units
|
Weighted-
Average
Grant Date
Fair Value
|
Number of
Class D Units
|
Weighted-
Average
Grant Date
Fair Value
|
|||||||||||||||||||
Outstanding at
|
||||||||||||||||||||||||
December 31, 2017
|
7,472,000
|
$
|
0.4879
|
4,670,000
|
$
|
0.2080
|
4,670,000
|
$
|
0.1489
|
|||||||||||||||
Granted
|
410,000
|
$
|
0.4948
|
205,000
|
$
|
0.2126
|
205,000
|
$
|
0.1535
|
|||||||||||||||
Vested
|
(7,882,000
|
)
|
$
|
0.4883
|
(4,875,000
|
)
|
$
|
0.2082
|
(4,875,000
|
)
|
$
|
0.1491
|
||||||||||||
September 30, 2018
|
-
|
-
|
-
|
Successor Company
|
||||||||||||||||
Nine
Months Ended
September 30,
2018
|
Period from
February 1, 2017
to September 30,
2017
|
|||||||||||||||
Three Months Ended
September 30,
|
||||||||||||||||
2018
|
2017
|
|||||||||||||||
(Unaudited)
|
||||||||||||||||
Net loss for basic and diluted loss per common shares
|
(13,412,996
|
) |
(573,681
|
)
|
(12,108,413
|
)
|
(7,061,465
|
)
|
||||||||
Shares:
|
||||||||||||||||
Weighted-average common shares outstanding – basic and diluted
|
30,975,338
|
17,227,682
|
21,827,082
|
17,227,682
|
||||||||||||
Net loss per common share - basic and diluted
|
$
|
(0.43
|
)
|
$
|
(0.03
|
)
|
$
|
(0.55
|
)
|
$
|
(0.41
|
)
|
Successor Company
|
Predecessor
Company
|
|||||||||||||||||||
Three Months Ended
September 30,
|
Nine
Months Ended
September 30,
2018
|
Period from
February 1, 2017
to September 30,
2017
|
Period from
January 1, 2017
to January 31,
2017
|
|||||||||||||||||
2018
|
2017
|
|||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||
Loss before income taxes
|
$
|
(5,843,822
|
)
|
$
|
(765,408
|
)
|
$
|
(3,922,867
|
)
|
$
|
(6,008,986
|
)
|
$
|
(5,521,794
|
)
|
|||||
US statutory tax rate
|
21
|
%
|
34
|
%
|
21
|
%
|
34
|
%
|
34
|
%
|
||||||||||
Income tax expense (benefit) at statutory rate
|
(1,227,203
|
)
|
(260,239
|
)
|
(823,802
|
)
|
(2,043,055
|
)
|
(1,877,410
|
)
|
||||||||||
State tax expense (benefit), net of federal
|
1,354,628
|
(19,203
|
)
|
1,470,870
|
(10,628
|
)
|
(278,657
|
)
|
||||||||||||
Foreign tax rates different from US statutory rate
|
113,891
|
3,155
|
147,154
|
93,158
|
(45,631
|
)
|
||||||||||||||
Non-deductible expenses
|
7,411,475
|
153,319
|
7,483,530
|
3,081,763
|
409
|
|||||||||||||||
Change in tax rate
|
-
|
(51,994
|
)
|
-
|
(51,994
|
)
|
-
|
|||||||||||||
Credits
|
(86,275
|
)
|
-
|
(94,864
|
)
|
-
|
-
|
|||||||||||||
Other
|
2,658
|
(16,765
|
)
|
2,658
|
(16,765
|
)
|
(2,084
|
)
|
||||||||||||
Total tax provision (benefit)
|
$
|
7,569,174
|
$
|
(191,727
|
)
|
$
|
8,185,546
|
$
|
1,052,479
|
$
|
(2,203,373
|
)
|
2018
|
$
|
378,224
|
||
2019
|
1,263,467
|
|||
2020
|
981,139
|
|||
2021
|
846,364
|
|||
2022
|
738,385
|
|||
2023
|
753,692
|
|||
Thereafter
|
1,438,239
|
|||
$
|
6,399,510
|
· |
competition in the markets in which we operate;
|
· |
our ability to maintain agent relationships on terms consistent with those currently in place;
|
· |
our ability to maintain banking relationships necessary for us to conduct our business;
|
· |
credit risks from our agents and the financial institutions with which we do business;
|
· |
bank failures, sustained financial illiquidity, or illiquidity at our clearing, cash management or custodial financial institutions;
|
· |
new technology or competitors that disrupt the current ecosystem;
|
· |
cyber-attacks or disruptions to our information technology, computer network systems and data centers;
|
· |
our success in developing and introducing new products, services and infrastructure;
|
· |
customer confidence in our brand and in consumer money transfers generally;
|
· |
our ability to maintain compliance with the regulatory requirements of the jurisdictions in which we operate or plan to operate;
|
· |
international political factors or implementation of tariffs, border taxes or restrictions on remittances or transfers of money out of the United States;
|
· |
changes in tax laws and unfavorable outcomes of tax positions we take;
|
· |
political instability, currency restrictions and devaluation in countries in which we operate or plan to operate;
|
· |
weakness in U.S. or international economic conditions;
|
· |
change or disruption in international migration patterns;
|
· |
our ability to protect our brand and intellectual property rights;
|
· |
our ability to retain key personnel; and
|
· |
changes in foreign exchange rates could impact consumer remittance activity
|
· |
an exemption from the auditor attestation requirement of Section 404 of the Sarbanes-Oxley Act in the assessment of the emerging growth company’s internal control over
financial reporting;
|
· |
an exemption from the adoption of new or revised financial accounting standards until they would apply to private companies; and
|
· |
an exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation or a supplement
to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer.
|
Successor Company
|
Predecessor
Company
|
|||||||||||||||||||
Three Months Ended
September 30,
|
Nine
Months Ended
September 30,
|
Period from
February 1, 2017
to September 30,
|
Period from
January 1, 2017
to January 31,
|
|||||||||||||||||
(in thousands)
|
2018
|
2017
|
2018
|
2017
|
2017
|
|||||||||||||||
(Unaudited)
|
||||||||||||||||||||
Revenues:
|
||||||||||||||||||||
Wire transfer and money order fees
|
$
|
61,332
|
$
|
47,642
|
$
|
168,554
|
$
|
119,227
|
$
|
11,877
|
||||||||||
Foreign exchange
|
10,697
|
8,413
|
29,013
|
21,690
|
2,450
|
|||||||||||||||
Other income
|
479
|
338
|
1,277
|
854
|
99
|
|||||||||||||||
Total revenues
|
72,508
|
56,393
|
198,844
|
141,771
|
14,426
|
|||||||||||||||
Operating expenses:
|
||||||||||||||||||||
Service charges from agents and banks
|
48,305
|
37,846
|
132,565
|
94,608
|
9,441
|
|||||||||||||||
Salaries and benefits
|
10,959
|
5,984
|
24,633
|
16,395
|
4,530
|
|||||||||||||||
Other selling, general and administrative expenses
|
5,207
|
4,163
|
13,390
|
10,400
|
1,063
|
|||||||||||||||
Transaction costs
|
6,305
|
-
|
10,319
|
6,213
|
3,917
|
|||||||||||||||
Depreciation and amortization
|
4,142
|
4,553
|
11,750
|
12,057
|
382
|
|||||||||||||||
Total operating expenses
|
74,918
|
52,546
|
192,657
|
139,673
|
19,333
|
|||||||||||||||
Operating (loss) income
|
(2,410
|
)
|
3,847
|
6,187
|
2,098
|
(4,907
|
)
|
|||||||||||||
Interest expense
|
3,434
|
4,613
|
10,110
|
8,107
|
614
|
|||||||||||||||
Loss before income taxes
|
(5,844
|
)
|
(766
|
)
|
(3,923
|
)
|
(6,009
|
)
|
(5,521
|
)
|
||||||||||
Income tax provision (benefit)
|
7,569
|
(192
|
)
|
8,186
|
1,052
|
(2,203
|
)
|
|||||||||||||
Net loss
|
$
|
(13,413
|
)
|
$
|
(574
|
)
|
$
|
(12,109
|
)
|
$
|
(7,061
|
)
|
$
|
(3,318
|
)
|
($ in thousands)
|
|
Three Months
Ended September 30,
2018
|
|
%
of
Revenues
|
|
Three Months
Ended September 30,
2017
|
|
|
%
of
Revenues
|
|
||||||
Revenues:
|
||||||||||||||||
Wire transfer and money order fees
|
$
|
61,332
|
84
|
%
|
$
|
47,642
|
84
|
%
|
||||||||
Foreign exchange
|
10,697
|
15
|
%
|
8,413
|
15
|
%
|
||||||||||
Other income
|
479
|
1
|
%
|
338
|
1
|
%
|
||||||||||
Total revenues
|
$
|
72,508
|
100
|
%
|
$
|
56,393
|
100
|
%
|
($ in thousands)
|
Three Months
Ended September 30,
2018
|
%
of
Revenues
|
Three Months
Ended September 30,
2017
|
%
of
Revenues
|
||||||||||||
Operating expenses:
|
||||||||||||||||
Service charges from agents and banks
|
$
|
48,305
|
67
|
%
|
$
|
37,846
|
67
|
%
|
||||||||
Salaries and benefits
|
10,959
|
15
|
%
|
5,984
|
11
|
%
|
||||||||||
Other selling, general and administrative expenses
|
5,207
|
7
|
%
|
4,163
|
7
|
%
|
||||||||||
Transaction costs
|
6,305
|
9
|
%
|
-
|
0
|
%
|
||||||||||
Depreciation and amortization
|
4,142
|
6
|
%
|
4,553
|
8
|
%
|
||||||||||
Total operating expenses
|
$
|
74,918
|
104
|
%
|
$
|
52,546
|
93
|
%
|
· |
Adjusted EBITDA does not reflect the significant interest expense, or the amounts necessary to service interest or principal payments on our senior secured credit
facility;
|
· |
Adjusted EBITDA does not reflect income tax expense (benefit), and because the payment of taxes is part of our operations, tax expense is a necessary element of our
costs and ability to operate;
|
· |
although depreciation and amortization are eliminated in the calculation of Adjusted EBITDA, the assets being depreciated and amortized will often have to be replaced
in the future, and Adjusted EBITDA does not reflect any costs of such replacements;
|
· |
Adjusted EBITDA does not reflect the noncash component of employee compensation;
|
· |
Adjusted EBITDA does not reflect the impact of earnings or charges resulting from matters we consider not to be reflective, on a recurring basis, of our ongoing
operations; and
|
· |
other companies in our industry may calculate Adjusted EBITDA or similarly titled measures differently than we do, limiting its usefulness as a comparative measure.
|
Three Months Ended September 30,
|
||||||||
(in thousands)
|
2018
|
2017
|
||||||
Net loss
|
$
|
(13,413
|
)
|
$
|
(574
|
)
|
||
Adjusted for:
|
||||||||
Interest expense
|
3,434
|
4,613
|
||||||
Income tax provision (benefit)
|
7,569
|
(192
|
)
|
|||||
Depreciation and amortization
|
4,142
|
4,553
|
||||||
EBITDA
|
1,732
|
8,400
|
||||||
Transaction costs (a)
|
6,305
|
-
|
||||||
Incentive units plan (b)
|
4,023
|
287
|
||||||
Share-based compensation, 2018 Plan (c)
|
430
|
-
|
||||||
Costs related to registering stock underlying warrants (d)
|
615
|
-
|
||||||
Management fee (e)
|
195
|
195
|
||||||
Other employee severance (f)
|
106
|
-
|
||||||
Other charges and expenses (g)
|
38
|
37
|
||||||
Adjusted EBITDA
|
$
|
13,444
|
$
|
8,919
|
(a) |
Represents direct costs related to the Merger for the three months ended September 30, 2018, which are expensed as incurred and included as “transaction costs” in our
condensed consolidated statements of operations and comprehensive loss. These costs include $1.8 million in employee bonuses, $1.6 million to terminate our management fee agreement, $1.5 million change in control fee to our lenders,
and $1.4 million in legal, consulting, accounting, advisory fees all directly related to the Merger.
|
(b) |
In connection with the Stella Point acquisition, Class B, C and D incentive units were granted to our employees by Interwire LLC. The three months ended September 30,
2018 and 2017 included expense regarding these incentive units, which became fully vested and were paid out upon the Closing Date of the Merger. As a result, employees no longer hold profits interests following the Merger.
|
(c) |
Stock options and restricted stock were granted to employees and independent directors of the Company in connection with the completion of the Merger. The Company
recorded $0.4 million of expense related to these equity instruments during the three months ended September 30, 2018.
|
(d) |
The Company incurred $0.6 million of expenses during the three months ended September 30, 2018 for professional fees in connection with the registration of common stock
underlying outstanding warrants.
|
(e) |
Represents payments under our management agreement with Stella Point pursuant to which we paid a quarterly fee for certain advisory and consulting services. In
connection with the Merger, this agreement was terminated.
|
(f) |
Represents $0.1 million of severance costs related to departmental changes.
|
(g) |
Both the three months ended September 30, 2018 and 2017 includes loss on disposal of fixed assets and foreign currency (gains) or losses.
|
Successor Company
|
Predecessor
Company
|
|||||||||||||||||||||||
($ in thousands)
|
Nine Months
Ended September 30,
2018
|
%
of
Revenues
|
Period from
February 1, 2017
to September 30,
2017
|
%
of
Revenues
|
Period from
January 1, 2017
to January 31,
2017
|
%
of
Revenues
|
||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||
Wire transfer and money order fees
|
$
|
168,554
|
85
|
%
|
$
|
119,227
|
84
|
%
|
$
|
11,877
|
82
|
%
|
||||||||||||
Foreign exchange
|
29,013
|
14
|
%
|
21,690
|
15
|
%
|
2,450
|
17
|
%
|
|||||||||||||||
Other income
|
1,277
|
1
|
%
|
854
|
1
|
%
|
99
|
1
|
%
|
|||||||||||||||
Total revenues
|
$
|
198,844
|
100
|
%
|
$
|
141,771
|
100
|
%
|
$
|
14,426
|
100
|
%
|
|
Successor Company
|
Predecessor
Company
|
||||||||||||||||||||||
($ in thousands)
|
Nine Months
Ended September 30,
2018
|
%
of
Revenues
|
Period from
February 1, 2017
to September 30,
2017
|
%
of
Revenues
|
Period from
January 1, 2017
to January 31,
2017
|
%
of
Revenues
|
||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Service charges from agents and banks
|
$
|
132,565
|
67
|
%
|
$
|
94,608
|
67
|
%
|
$
|
9,441
|
65
|
%
|
||||||||||||
Salaries and benefits
|
24,633
|
12
|
%
|
16,395
|
12
|
%
|
4,530
|
31
|
%
|
|||||||||||||||
Other selling, general and administrative expenses
|
13,390
|
7
|
%
|
10,400
|
7
|
%
|
1,063
|
7
|
%
|
|||||||||||||||
Transaction costs
|
10,319
|
5
|
%
|
6,213
|
4
|
%
|
3,917
|
27
|
%
|
|||||||||||||||
Depreciation and amortization
|
11,750
|
6
|
%
|
12,057
|
9
|
%
|
382
|
3
|
%
|
|||||||||||||||
Total operating expenses
|
$
|
192,657
|
97
|
%
|
$
|
139,673
|
99
|
%
|
$
|
19,333
|
133
|
%
|
Successor Company
|
Predecessor
Company
|
|||||||||||
(in thousands)
|
Nine Months
Ended September 30,
2018
|
Period from
February 1, 2017
to September 30,
2017
|
Period from
January 1, 2017
to January 31,
2017
|
|||||||||
Net loss
|
$
|
(12,109
|
)
|
$
|
(7,061
|
)
|
$
|
(3,318
|
)
|
|||
Adjusted for:
|
||||||||||||
Interest expense
|
10,110
|
8,107
|
614
|
|||||||||
Income tax provision (benefit)
|
8,186
|
1,052
|
(2,203
|
)
|
||||||||
Depreciation and amortization
|
11,750
|
12,057
|
382
|
|||||||||
EBITDA
|
17,937
|
14,155
|
(4,525
|
)
|
||||||||
Transaction costs (a)
|
10,319
|
6,213
|
3,917
|
|||||||||
Incentive units plan (b)
|
4,735
|
1,535
|
-
|
|||||||||
Change in control adjustment for stock options (c)
|
-
|
-
|
2,813
|
|||||||||
Share-based compensation, 2018 Plan (d)
|
430
|
-
|
-
|
|||||||||
Costs related to registering stock underlying warrants (e)
|
615
|
-
|
-
|
|||||||||
Transition expenses (f)
|
348
|
-
|
-
|
|||||||||
Management fee (g)
|
585
|
520
|
-
|
|||||||||
TCPA settlement (h)
|
192
|
-
|
-
|
|||||||||
Other employee severance (i)
|
106
|
-
|
-
|
|||||||||
Other charges and expenses (j)
|
346
|
106
|
104
|
|||||||||
Adjusted EBITDA
|
$
|
35,613
|
$
|
22,529
|
$
|
2,309
|
(a) |
Represents direct costs related to the Merger and Stella Point acquisition, which are expensed as incurred and included as “transaction costs” in our condensed
consolidated statements of operations and comprehensive loss. The nine months ended September 30, 2018 includes $10.3 million related to the Merger. Costs related to the Stella Point acquisition amounts to $6.2 million for the 2017
Q3 Successor Period and $3.9 million for the 2017 Predecessor Period. These costs consist primarily of legal, consulting, accounting, advisory fees and certain incentive bonuses directly related to the above transactions.
|
(b) |
In connection with the Stella Point acquisition, Class B, C and D incentive units were granted to our employees by Interwire LLC. The Successor Periods included expense
regarding these incentive units, which became fully vested and where paid out upon the Closing Date of the Merger. As a result, employees no longer hold profits interests following the Merger.
|
(c) |
Represents $2.8 million related to stock options issued by the Predecessor company, which vested upon the Stella Point acquisition.
|
(d) |
Stock options and restricted stock were granted to employees and independent directors of the Company in connection with the completion of the Merger. The Company
recorded $0.4 million of expense related to these equity instruments during the nine months ended September 30, 2018.
|
(e) |
The Company incurred $0.6 million of expenses during the nine months ended September 30, 2018 for professional fees in connection with the registration of common stock
underlying outstanding warrants.
|
(f) |
Represents recruiting fees and severance costs related to managerial changes in connection with becoming a publicly-traded company.
|
(g) |
Represents payments under our management agreement with Stella Point pursuant to which we paid a quarterly fee for certain advisory and consulting services. In
connection with the Merger, this agreement was terminated.
|
(h) |
Represents payments for the settlement of a lawsuit related to the TCPA, which includes a $0.1 million settlement payment and $0.1 million in related legal expenses.
|
(i) |
Represents $0.1 million of severance costs related to departmental changes.
|
(j) |
Includes loss on disposal of fixed assets and foreign currency (gains) or losses. The nine months ended September 30, 2018 also includes a one-time adjustment related
to the Company’s loyalty programs of $0.2 million, while the 2017 Predecessor Period also includes amortization of restricted stock awards.
|
Successor Company
|
Predecessor
Company
|
|||||||||||
(in thousands)
|
Nine Months
Ended September 30,
2018
|
Period from
February 1, 2017
to September 30,
2017
|
Period from
January 1, 2017
to January 31,
2017
|
|||||||||
Statement of Cash Flows Data:
|
||||||||||||
Net cash provided by (used in) operating activities
|
$
|
30,516
|
$
|
(10,835
|
)
|
$
|
8,652
|
|||||
Net cash used in investing activities
|
(3,575
|
)
|
(4,019
|
)
|
(249
|
)
|
||||||
Net cash (used in) provided by financing activities
|
(3,633
|
)
|
14,317
|
(2,000
|
)
|
|||||||
Effect of exchange rate changes on cash
|
27
|
406
|
(15
|
)
|
||||||||
Net increase (decrease) in cash and restricted cash
|
23,335
|
(131
|
)
|
6,388
|
||||||||
Cash and restricted cash, beginning of the period
|
59,795 | 44,628 | 38,240 | |||||||||
Cash and restricted cash, end of the period
|
$
|
83,130
|
$
|
44,497
|
$
|
44,628
|
(in thousands)
|
Total
|
Less than
1 year
|
1 to 3 years
|
3 to 5 years
|
More than
5 years
|
|||||||||||||||
Debt, principal payments
|
$
|
112,150
|
$
|
4,850
|
$
|
19,400
|
$
|
87,900
|
$
|
-
|
||||||||||
Interest payments
|
42,452
|
12,233
|
21,869
|
8,350
|
-
|
|||||||||||||||
Non-cancelable operating leases
|
6,400
|
1,352
|
1,898
|
1,520
|
1,630
|
|||||||||||||||
Total
|
$
|
161,002
|
$
|
18,435
|
$
|
43,167
|
$
|
97,770
|
1,630
|
Exhibit No.
|
Document
|
Second Amended and Restated Certificate of Incorporation of the Company, dated July 26, 2018 (incorporated by reference to Exhibit 3.1 to the
Registrant’s Registration Statement on Form S-1 filed on September 28, 2018 (File No. 333-226948)).
|
|
Second Amended and Restated Bylaws of the Company, effective as of July 26, 2018 (incorporated by reference to Exhibit 3.2 to the Registrant’s
Registration Statement on Form S-1 filed on September 28, 2018 (File No. 333-226948)).
|
|
Shareholders Agreement, dated July 26, 2018, between the Company and the stockholders of the Company signatory thereto (incorporated by
reference to Exhibit 4.3 to the Registrant’s Registration Statement on Form S-1 filed on September 28, 2018 (File No. 333-226948)).
|
|
Registration Rights Agreement, dated July 26, 2018, by and among FinTech Acquisition Corp. II, SPC Investors, Minority Investors and Additional
Investors (incorporated by reference to Exhibit 10.2 to the Registrant’s Registration Statement on Form S-1 filed on September 28, 2018 (File No. 333-226948)).
|
|
International Money Express, Inc. 2018 Omnibus Equity Compensation Plan (incorporated by reference to Exhibit 10.3(a) to the Registrant’s
Registration Statement on Form S-1 filed on September 28, 2018 (File No. 333-226948)).
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act.
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act.
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. § 1350.
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. § 1350.
|
* |
Filed herewith.
|
International Money Express, Inc.
|
||
By:
|
/s/ Robert Lisy
|
|
Robert Lisy
|
||
Chief Executive Officer and President
|
||
Date: November 13, 2018
|
||
International Money Express, Inc.
|
||
By:
|
/s/ Tony Lauro II
|
|
Tony Lauro II
|
||
Chief Financial Officer
|
1. |
I have reviewed this Quarterly Report on Form 10-Q of International Money Express, Inc.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial
condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the
registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s
auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely
affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial
reporting.
|
Date: November 13, 2018
|
|||
By:
|
/s/ Robert Lisy
|
||
Name:
|
Robert Lisy
|
||
Title:
|
President and Chief Executive Officer
|
||
(Principal Executive Officer)
|
1. |
I have reviewed this Quarterly Report on Form 10-Q of International Money Express, Inc.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial
condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the
registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s
auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(c) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely
affect the registrant’s ability to record, process, summarize and report financial information; and
|
(d) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial
reporting.
|
Date: November 13, 2018
|
|||
By:
|
/s/ Tony Lauro II
|
||
Name:
|
Tony Lauro II
|
||
Title:
|
Chief Financial Officer
|
||
(Principal Financial Officer)
|
1. |
the Quarterly Report on Form 10-Q of the Company for the quarterly period ended September 30, 2018 (the “Report”) fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
2. |
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 13, 2018
|
|||
Name:
|
/s/ Robert Lisy
|
||
Title:
|
President and Chief Executive Officer
|
||
(Principal Executive Officer)
|
1. |
the Quarterly Report on Form 10-Q of the Company for the quarterly period ended September 30, 2018 (the “Report”) fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
2. |
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 13, 2018
|
|||
Name:
|
/s/ Tony Lauro II
|
||
Title:
|
Chief Financial Officer
|
||
(Principal Financial Officer)
|
|||
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Nov. 09, 2018 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | International Money Express, Inc. | |
Entity Central Index Key | 0001683695 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 36,182,783 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Current assets: | ||
Accounts receivable, allowance | $ 340,178 | $ 307,562 |
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common shares, authorized (in shares) | 200,000,000 | 200,000,000 |
Common shares, issued (in shares) | 36,182,783 | 17,227,682 |
Common shares, outstanding (in shares) | 36,182,783 | 17,227,682 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) |
1 Months Ended | 3 Months Ended | 8 Months Ended | 9 Months Ended | |
---|---|---|---|---|---|
Jan. 31, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
|
Revenues: | |||||
Wire transfer and money order fees | $ 61,331,837 | $ 47,642,153 | $ 119,226,787 | $ 168,554,175 | |
Foreign exchange | 10,697,168 | 8,413,051 | 21,690,233 | 29,013,221 | |
Other income | 479,461 | 338,090 | 854,102 | 1,276,494 | |
Total revenues | 72,508,466 | 56,393,294 | 141,771,122 | 198,843,890 | |
Operating expenses: | |||||
Service charges from agents and banks | 48,305,007 | 37,846,027 | 94,607,887 | 132,564,938 | |
Salaries and benefits | 10,959,507 | 5,983,784 | 16,395,185 | 24,632,910 | |
Other selling, general and administrative expenses | 5,206,932 | 4,163,419 | 10,400,190 | 13,390,449 | |
Transaction costs | 6,304,972 | 0 | 6,212,602 | 10,319,283 | |
Depreciation and amortization | 4,142,139 | 4,553,042 | 12,056,986 | 11,749,513 | |
Total operating expenses | 74,918,557 | 52,546,272 | 139,672,850 | 192,657,093 | |
Operating (loss) income | (2,410,091) | 3,847,022 | 2,098,272 | 6,186,797 | |
Interest expense | 3,433,731 | 4,612,430 | 8,107,258 | 10,109,664 | |
Loss before income taxes | (5,843,822) | (765,408) | (6,008,986) | (3,922,867) | |
Income tax provision (benefit) | 7,569,174 | (191,727) | 1,052,479 | 8,185,546 | |
Net loss | (13,412,996) | (573,681) | (7,061,465) | (12,108,413) | |
Other comprehensive income (loss) | 22,452 | 3,859 | 18,990 | 7,351 | |
Comprehensive loss | $ (13,390,544) | $ (569,822) | $ (7,042,475) | $ (12,101,062) | |
Loss per common share: | |||||
Basic and diluted (in dollars per share) | $ (0.43) | $ (0.03) | $ (0.41) | $ (0.55) | |
Weighted-average common shares outstanding: | |||||
Basic and diluted (in shares) | 30,975,338 | 17,227,682 | 17,227,682 | 21,827,082 | |
Predecessor Company [Member] | |||||
Revenues: | |||||
Wire transfer and money order fees | $ 11,876,919 | ||||
Foreign exchange | 2,449,709 | ||||
Other income | 98,715 | ||||
Total revenues | 14,425,343 | ||||
Operating expenses: | |||||
Service charges from agents and banks | 9,440,774 | ||||
Salaries and benefits | 4,530,308 | ||||
Other selling, general and administrative expenses | 1,063,379 | ||||
Transaction costs | 3,917,188 | ||||
Depreciation and amortization | 381,746 | ||||
Total operating expenses | 19,333,395 | ||||
Operating (loss) income | (4,908,052) | ||||
Interest expense | 613,742 | ||||
Loss before income taxes | (5,521,794) | ||||
Income tax provision (benefit) | (2,203,373) | ||||
Net loss | (3,318,421) | ||||
Other comprehensive income (loss) | (2,453) | ||||
Comprehensive loss | $ (3,320,874) |
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - 9 months ended Sep. 30, 2018 - USD ($) |
Common Stock [Member] |
Additional Paid-in Capital [Member] |
Accumulated Deficit [Member] |
Accumulated Other Comprehensive Income (Loss) [Member] |
Total |
---|---|---|---|---|---|
Balance at Dec. 31, 2017 | $ 1,723 | $ 46,076,220 | $ (10,173,453) | $ (2,371) | $ 35,902,119 |
Balance (in shares) at Dec. 31, 2017 | 17,227,682 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net equity infusion from reverse recapitalization | $ 1,896 | 8,961,625 | 0 | 0 | 8,963,521 |
Net equity infusion from reverse recapitalization (in shares) | 18,955,101 | ||||
Share-based compensation | $ 0 | 5,165,586 | 0 | 0 | 5,165,586 |
Adjustment from foreign currency translation, net | 0 | 0 | 0 | 7,351 | 7,351 |
Net loss | 0 | 0 | (12,108,413) | 0 | (12,108,413) |
Balance at Sep. 30, 2018 | $ 3,619 | $ 60,203,431 | $ (22,281,866) | $ 4,980 | $ 37,930,164 |
Balance, (in shares) at Sep. 30, 2018 | 36,182,783 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) |
1 Months Ended | 8 Months Ended | 9 Months Ended |
---|---|---|---|
Jan. 31, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
|
Cash flows from operating activities: | |||
Net loss | $ (7,061,465) | $ (12,108,413) | |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 12,056,986 | 11,749,513 | |
Share-based compensation | 1,534,655 | 5,165,586 | |
Provision for bad debts | 813,641 | 743,285 | |
Debt origination costs amortization | 125,053 | 699,731 | |
Deferred taxes | 903,181 | 6,905,873 | |
Loss on disposal of property and equipment | 86,351 | 151,724 | |
Total adjustments | 15,519,867 | 25,415,712 | |
Changes in operating assets and liabilities: | |||
Accounts receivable | (26,826,448) | (30,285,672) | |
Prepaid wires | (2,402,576) | 2,784,622 | |
Other prepaid expenses and assets | (1,706,487) | (1,427,760) | |
Wire transfers and money orders payables | 13,100,915 | 29,639,809 | |
Accounts payable and accrued other | (1,458,882) | 16,497,269 | |
Net cash provided by (used in) operating activities | (10,835,076) | 30,515,567 | |
Cash flows from investing activities: | |||
Purchases of property and equipment | (3,095,230) | (3,575,065) | |
Net cash used in acquisition | (923,654) | 0 | |
Net cash used in investing activities | (4,018,884) | (3,575,065) | |
Cash flows from financing activities: | |||
Borrowings under term loan | 102,000,000 | 0 | |
Proceeds from reverse recapitalization | 0 | 101,663,573 | |
Cash consideration to Intermex shareholders | 0 | (101,658,947) | |
Borrowings (Repayments) under revolving loan, net | 12,000,000 | 0 | |
Repayment of term loan | (75,000,000) | (3,637,500) | |
Debt origination costs | (4,682,830) | 0 | |
Common dividend distributions | (20,000,000) | 0 | |
Net cash (used in) provided by financing activities | 14,317,170 | (3,632,874) | |
Effect of exchange rate changes on cash | 405,922 | 27,152 | |
Net increase (decrease) in cash and restricted cash | (130,868) | 23,334,780 | |
Cash and restricted cash, beginning of the period | 44,628,247 | 59,795,280 | |
Cash and restricted cash, end of the period | $ 44,628,247 | 44,497,379 | 83,130,060 |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest | 8,556,649 | 9,409,516 | |
Cash paid for taxes | 400,000 | 1,494,900 | |
Supplemental disclosure of non-cash financing activity: | |||
Agent businesses acquired in exchange for receivables | 639,688 | 0 | |
Intermex transaction accruals settled by acquisition proceeds | 0 | $ 9,062,769 | |
Predecessor Company [Member] | |||
Cash flows from operating activities: | |||
Net loss | (3,318,421) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 381,746 | ||
Share-based compensation | 2,916,324 | ||
Provision for bad debts | 83,695 | ||
Debt origination costs amortization | 39,298 | ||
Deferred taxes | (2,214,351) | ||
Loss on disposal of property and equipment | 13,472 | ||
Total adjustments | 1,220,184 | ||
Changes in operating assets and liabilities: | |||
Accounts receivable | 3,612,332 | ||
Prepaid wires | 7,848,641 | ||
Other prepaid expenses and assets | 70,927 | ||
Wire transfers and money orders payables | (1,884,922) | ||
Accounts payable and accrued other | 1,103,326 | ||
Net cash provided by (used in) operating activities | 8,652,067 | ||
Cash flows from investing activities: | |||
Purchases of property and equipment | (249,382) | ||
Net cash used in acquisition | 0 | ||
Net cash used in investing activities | (249,382) | ||
Cash flows from financing activities: | |||
Borrowings under term loan | 0 | ||
Proceeds from reverse recapitalization | 0 | ||
Cash consideration to Intermex shareholders | 0 | ||
Borrowings (Repayments) under revolving loan, net | (2,000,000) | ||
Repayment of term loan | 0 | ||
Debt origination costs | 0 | ||
Common dividend distributions | 0 | ||
Net cash (used in) provided by financing activities | (2,000,000) | ||
Effect of exchange rate changes on cash | (15,196) | ||
Net increase (decrease) in cash and restricted cash | 6,387,489 | ||
Cash and restricted cash, beginning of the period | 38,240,758 | $ 44,628,247 | |
Cash and restricted cash, end of the period | 44,628,247 | ||
Supplemental disclosures of cash flow information: | |||
Cash paid for interest | 658,888 | ||
Cash paid for taxes | 0 | ||
Supplemental disclosure of non-cash financing activity: | |||
Agent businesses acquired in exchange for receivables | 0 | ||
Intermex transaction accruals settled by acquisition proceeds | $ 0 |
BUSINESS AND ACCOUNTING POLICIES |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
BUSINESS AND ACCOUNTING POLICIES [Abstract] | |
BUSINESS AND ACCOUNTING POLICIES | NOTE 1 - BUSINESS AND ACCOUNTING POLICIES On July 26, 2018 (the “Closing Date”), International Money Express, Inc. (formerly FinTech Acquisition Corp. II) consummated the previously announced transaction (the “Merger”) by and among FinTech Acquisition Corp. II, a Delaware corporation (“FinTech”), FinTech II Merger Sub Inc., a wholly-owned subsidiary of FinTech (“Merger Sub 1”), FinTech II Merger Sub 2 LLC, a wholly-owned subsidiary of FinTech (“Merger Sub 2”), Intermex Holdings II, Inc. (“Intermex”) and SPC Intermex Representative LLC (“SPC Intermex”)(See Note 2). As a result of the Merger, the separate corporate existence of Intermex ceased and Merger Sub 2 (which changed its name to International Money Express Sub 2, LLC in connection with the closing of the Merger) continued as the surviving entity. In connection with the closing of the Merger, FinTech changed its name to International Money Express, Inc. (the “Company”). Unless the context below otherwise provides, the “Company” refers to the combined company following the Merger and, together with their respective subsidiaries, “FinTech” refers to the registrant prior to the closing of the Merger and “Intermex” refers to Intermex Holdings II, Inc. prior to the closing of Merger. The condensed consolidated financial statements of the Company include Intermex, its wholly-owned indirect subsidiary, Intermex Wire Transfer, LLC (“LLC”), Intermex Wire Transfers de Guatemala, S.A. (“Guatemala”) - 99.8% owned by LLC, Intermex Wire Transfer de Mexico, S.A. and Intermex Transfers de Mexico, S.A. (“Mexico”) - 98% owned by LLC, Intermex Wire Transfer Corp. - 100% owned by LLC and Intermex Wire Transfer II, LLC - 100% owned by LLC. The Merger has been accounted for as a reverse recapitalization where FinTech was treated as the “acquired” company for financial reporting purposes. This determination was primarily based on the facts that following the Merger, the former stockholders of Intermex control the majority of the voting rights in respect of the board of directors of the Company, Intermex comprising the ongoing operations of the Company and Intermex’s senior management comprising the senior management of the Company. Accordingly, the Merger is treated as the equivalent of Intermex issuing stock for the net assets of FinTech, accompanied by a recapitalization. The net assets of FinTech are stated at historical cost, with no goodwill or other intangible assets resulting from the Merger. The consolidated assets, liabilities and results of operations prior to the Closing Date of the Merger are those of Intermex, and FinTech’s assets, liabilities and results of operations are consolidated with Intermex beginning on the Closing Date. The shares and corresponding capital amounts included in common stock and additional paid-in capital, pre-merger, have been retroactively restated as shares reflecting the exchange ratio in the Merger for all Successor periods. The historical financial information and operating results of FinTech prior to the Merger have not been separately presented in these consolidated financial statements as they were not significant or meaningful. Stella Point Capital, LLC (“Stella Point”) acquired a majority interest in Intermex on February 1, 2017 as discussed in further detail in Note 2. In connection with the acquisition of Intermex by Stella Point, the Company applied “push-down” accounting and the assets and liabilities were adjusted to fair value on the closing date of the transaction, February 1, 2017. As a result, the Company's condensed consolidated financial statement presentation distinguishes between a predecessor period ("Predecessor") for periods prior to the transaction, and a successor period ("Successor"), for periods subsequent to the transaction. The Company operates as a money transmitter, primarily between the United States of America (“U.S.”) and Mexico, Guatemala and other countries in Latin America through a network of authorized agents located in various unaffiliated retail establishments throughout the U.S. All significant inter-company balances and transactions have been eliminated from the condensed consolidated financial statements. The condensed consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain reclassifications have been made to prior-year amounts in the consolidated statements of operations and comprehensive loss to conform to current-year reporting classifications. Principally, certain employee benefits that were classified as other selling, general and administrative expenses are now presented within salaries and benefits. The reclassifications had no impact on operating (loss) income or net loss. The Company’s interim condensed consolidated financial statements and related notes are unaudited. In the opinion of management, all adjustments (including normal recurring adjustments) and disclosures necessary for a fair presentation of these interim statements have been included. The results reported in these interim financial statements are not necessarily indicative of the results that may be reported for the entire year. Certain information and footnote disclosures required by GAAP have been condensed or omitted. These interim financial statements should be read in conjunction with the consolidated financial statements and related notes of Intermex Holdings, Inc. (“Holdings”) for the fiscal year ended December 31, 2017 (“Audited Financial Statements”) disclosed in the prospectus, dated October 25, 2018, filed pursuant to Rule 424(b)(3), starting on page F-14. Holdings is an indirect wholly owned subsidiary of the Company and has no operations of its own, other than its ownership of its subsidiaries. Accounting Pronouncements The Financial Accounting Standards Board (“FASB”) issued amended guidance, Restricted Cash, which requires restricted cash to be presented with cash and cash equivalents in the condensed consolidated statements of cash flows. The Company adopted this guidance in the first quarter of 2018 using a retrospective transition method for each period presented. Cash and restricted cash included $639,662 of restricted cash for all beginning and ending periods presented in the condensed consolidated statements of cash flows, which is included in other prepaid expenses and current assets, and other assets in the Company’s condensed consolidated balance sheets at September 30, 2018 and December 31, 2017, respectively. The restricted cash was deposited with a U.S. bank as cash collateral for an irrevocable stand-by letter of credit issued as collateral for the operating lease of the Company’s headquarters. This lease was renegotiated in April 2018, and accordingly, the letter of credit is no longer required; the Company expects to collect these funds in the fourth quarter of 2018. The FASB issued guidance, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company adopted this guidance in the first quarter of 2018 and the impact of this adoption did not have a material impact on the Company’s condensed consolidated financial statements. The FASB issued guidance, Revenue from Contracts with Customers, which amended the existing accounting standards for revenue recognition. The new guidance establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. This guidance is required to be adopted by the Company in the first quarter of 2019 and can be applied using either a retrospective or a modified retrospective approach. Based on our assessment of the new standard, we have determined the vast majority of our revenues include only one performance obligation, which is to collect the consumer's money and make funds available for payment, generally on the same day, to a designated recipient in the currency requested. Accordingly, management believes this standard will not have a material impact on the Company’s financial statements and expects to adopt this standard using the modified retrospective approach, with the cumulative effect of adoption, if any, included in accumulated deficit as of January 1, 2019. However, management is continuing to assess the requirements of the new revenue guidance, including enhanced disclosures and reporting requirements. The FASB issued amended guidance, Business Combinations - Clarifying the Definition of a Business, which assists entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This guidance is required to be adopted by the Company in the first quarter of 2019 on a prospective basis, and the Company does not believe it will have a material impact on the consolidated financial statements. The FASB issued guidance, Leases, to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under previous U.S. GAAP. The guidance requires that a lessee recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term on the balance sheet. This guidance is required to be adopted by the Company in the first quarter of 2020 and must be applied using a modified retrospective approach. The Company is currently evaluating the impact this guidance will have on the consolidated financial statements. The FASB issued amended guidance, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments, which clarifies how certain cash receipts and cash payments are presented and classified in the consolidated statements of cash flows. The amendments are aimed at reducing the existing diversity in practice. This guidance is required to be adopted by the Company in the first quarter of 2019 and must be applied using a retrospective approach for each period presented. The adoption of this guidance is not expected to have a material impact on the consolidated financial statements. The FASB issued amended guidance, Intangibles – Goodwill and other (Topic 350): Simplifying the Test for Goodwill Impairment. The amended standard simplifies how an entity tests goodwill by eliminating Step 2 of the goodwill impairment test related to measuring an impairment charge. Instead, impairment will be recorded for the amount that the carrying amount of a reporting unit exceeds its fair value. This new guidance is effective for the Company beginning in in the first quarter of 2021. The adoption of this guidance is not expected to have a material impact on the consolidated financial statements. The FASB issued guidance, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, regarding the measurement of credit losses for certain financial instruments. The new standard replaces the incurred loss model with a current expected credit loss (“CECL”) model. The CECL model is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. The Company currently is required to adopt the new standard in the first quarter of 2021. The Company is currently evaluating the impact this guidance will have on the consolidated financial statements. |
FINTECH MERGER AND STELLA POINT ACQUISITION |
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FINTECH MERGER AND STELLA POINT ACQUISITION [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINTECH MERGER AND STELLA POINT ACQUISITION | NOTE 2 – FINTECH MERGER AND STELLA POINT ACQUISITION FinTech Merger As discussed in Note 1, on July 26, 2018, Intermex and FinTech consummated the Merger, which has been accounted for as a reverse recapitalization. Immediately prior to the Merger, FinTech’s shareholders exercised their right to redeem certain of their outstanding shares for cash, resulting in the redemption of 4,938,232 shares of FinTech for gross redemption payments of $49,808,935. Subsequent to this redemption, there were 18,955,101 outstanding shares. The aggregate consideration paid in the Merger by FinTech to the Intermex shareholders consisted of approximately (i) $102.0 million in cash and (ii) 17.2 million shares of FinTech common stock. In accounting for the reverse recapitalization, the net cash proceeds received from FinTech amounted to $4,626 as shown in the table below:
Cash consideration to Intermex shareholders includes the payout of all vested Incentive Units issued to employees of the Company as discussed in Note 8. After the completion of the Merger on July 26, 2018, there were 36,182,783 shares of International Money Express, Inc. common stock outstanding, warrants to purchase 8,959,999 shares of common stock and 3,371,389 shares reserved for issuance under the International Money Express, Inc. 2018 Omnibus Equity Compensation Plan (See Note 8). Acquisition by Stella Point On February 1, 2016, Intermex and its majority owner at the time, Lindsay Goldberg LLC, entered into an agreement with Stella Point, acquirer, for the sale of Intermex. This acquisition was accounted for as a business combination and became effective on February 1, 2017 for a transaction price of $52,000,000 in cash, plus $12,410,000 of rollover equity from certain existing management holders, the assumption of approximately $78,000,000 of Intermex’s outstanding debt and an additional funding of $5,000,000 of Intermex debt. There was no contingent consideration in the transaction. As a result, Stella Point acquired 80.7% of the voting equity interest in Intermex and other minority stockholders acquired the remaining interest, none individually greater than 10%. The purchase price in excess of the fair value of acquired assets was accounted for as goodwill, as discussed further below. Net Assets Acquired The acquisition method for a business combination requires that the assets acquired and liabilities assumed be recognized at their allocated fair values as of the February 1, 2017 acquisition date, which is summarized below:
The intangible assets acquired consist primarily of a trade name, agent relationships and developed technology. The excess of the purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill, which is attributable to the workforce and reputation of Intermex. The accounting for this business combination has been completed, therefore the measurement period is closed. Goodwill was not deductible for income tax purposes. Transaction Costs Direct costs related to the Merger and Stella Point acquisition were expensed as incurred and included as “transaction costs” in the condensed consolidated statements of operations and comprehensive loss. Transaction costs in the condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2018 amounted to $6,304,972 and $10,319,283, respectively, and related specifically to the Merger, while expenses of $6,212,602 for the Successor period from February 1, 2017 through September 30, 2017 and $3,917,188 for the Predecessor period from January 1, 2017 through January 31, 2017 relate to the Stella Point acquisition. Transaction costs include all internal and external costs directly related to the Merger and Stella Point acquisition, consisting primarily of legal, consulting, accounting, advisory and financing fees and certain incentive bonuses directly related to the Merger and Stella Point acquisition. |
GOODWILL AND OTHER INTANGIBLE ASSETS |
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GOODWILL AND OTHER INTANGIBLE ASSETS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 3 – GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill and the majority of the other intangible assets on the condensed consolidated balance sheets of the Company were recognized upon the acquisition by Stella Point (see Note 2). Agent relationships, trade name and developed technology are all amortized over 15 years using an accelerated method that correlates with the projected realization of the benefit. Other intangibles primarily relate to the acquisition of certain agent locations, which are amortized straight line over 10 years. The determination of our other intangible fair values includes several assumptions that are subject to various risks and uncertainties. Management believes it has made reasonable estimates and judgments concerning these risks and uncertainties. A change in the conditions, circumstances or strategy of the Company may result in a need to recognize an impairment charge. The following table presents the changes in goodwill and other intangible assets:
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ACCRUED AND OTHER LIABILITIES |
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ACCRUED AND OTHER LIABILITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCRUED AND OTHER LIABILITIES | NOTE 4 – ACCRUED AND OTHER LIABILITIES Accrued and other liabilities consisted of the following:
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DEBT |
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DEBT [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEBT | NOTE 5 – DEBT Debt consisted of the following:
On August 23, 2017, Intermex entered into a Financing Agreement (the “Financing Agreement”) with MC Credit Partners to refinance its debt. The Financing Agreement includes a revolving credit facility that provides for funding of up to $20 million in the aggregate and a term loan in an aggregate principal amount of $97 million (together the “Senior Secured Credit Facility”). Interest on the term loan and revolving credit facility is determined by reference to either LIBOR or a “base rate”, in each case plus an applicable margin of 9% per annum for LIBOR loans or 8% per annum for base rate loans. The principal amount of the term loan must be repaid in consecutive quarterly installments on the last business day of each March, June, September and December commencing in December 2017. The Company must repay an amount equal to 1.25% of the original amount borrowed for each quarterly payment from December 31, 2017 through September 30, 2019 and 2.50% of the original amount borrowed for each quarterly payment from December 31, 2019 and thereafter. On December 19, 2017, the Financing Agreement was amended to allow for the change of control of Intermex pursuant to the Merger. Upon closing of the Merger, the Company was required to pay $1.5 million in fees to MC Credit Partners, which were expensed as transaction costs in the condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2018 and funded by the proceeds received in the Merger. On November 7, 2018, the Company entered into a new financing agreement (the “Credit Agreement”) with, among others, certain of its domestic subsidiaries as borrowers, certain other domestic subsidiaries and a group of banking institutions. The Credit Agreement provides for a $35 million revolving credit facility, a $90 million term loan facility and an up to $30 million incremental facility. The Credit Agreement also provides for the issuance of letters of credit, which would reduce availability under the revolving credit facility. The proceeds of the loans were used to repay existing indebtedness, for working capital purposes and to pay fees and expenses in connection with the transaction. The maturity date of the Credit Agreement is November 7, 2023. Interest on the term loan facility and revolving credit facility is determined by reference to either LIBOR or a “base rate”, in each case plus an applicable margin of 4.50% per annum for LIBOR loans or 3.50% per annum for base rate loans. The Company is also required to pay a fee on the unused portion of the revolving credit facility equal to 0.35% per annum. The principal amount of the term loan facility must be repaid in consecutive quarterly installments of 5% in year 1, 7.5% in years 2 and 3, 10% in years 4 and 5, in each case on the last day of each quarter, commencing in March 2019 with a final payment at maturity. The loans under the Credit Agreement may be prepaid at any time without payment or penalty. The obligations under the Credit Agreement are guaranteed by the Company and certain domestic subsidiaries of the Company and secured by liens substantially all of the assets of the loan parties, subject to certain exclusions and limitations. |
FAIR VALUE MEASUREMENTS |
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FAIR VALUE MEASUREMENTS [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 6 - FAIR VALUE MEASUREMENTS Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a three- level fair value hierarchy that prioritizes the inputs used to measure fair value was established. There are three levels of inputs used to measure fair value. Level 1 relates to quoted market prices for identical assets or liabilities. Level 2 relates to observable inputs other than quoted prices included in Level 1. Level 3 relates to unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s non-financial assets measured at fair value on a nonrecurring basis include the goodwill and other intangibles derived on February 1, 2017 as a result of the Stella Point acquisition as disclosed in Note 2 and more fully disclosed in detail in Note 4 of the Audited Financial Statements. The Company’s cash is representative of fair value as these balances are comprised of deposits available on demand. Accounts receivable, prepaid wires, accounts payable and wire transfers and money orders payable are representative of their fair values because of the short turnover of these items. The Company’s financial instruments that are not measured at fair value on a recurring basis include its revolving credit facility and term loan. The estimated fair value of the term loan approximates book value as the debt bears a market interest rate that adjusts periodically. The estimated fair value of the revolving credit facility would approximate face value given the payment schedule and variable interest rate structure. |
RELATED PARTY TRANSACTIONS |
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RELATED PARTY TRANSACTIONS [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 7 - RELATED PARTY TRANSACTIONS During the Successor periods prior to the Merger, Intermex paid a monthly management fee of $65,000, plus reimbursement of expenses, to a related party for management services, which is included in other selling, general and administrative expenses on the Company’s condensed consolidated statements of operations and comprehensive loss. During the Predecessor period from January 1, 2017 to January 31, 2017, all management fees were waived. There were no amounts payable to or receivable from related parties included in the condensed consolidated balance sheets at September 30, 2018 and December 30, 2017. Upon closing of the Merger on July 26, 2018 (See Note 2), the management fee agreement with the related party was terminated, and a one-time termination fee of $1.6 million was included as part of transaction costs in the condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2018. |
STOCKHOLDER'S EQUITY AND SHARE-BASED COMPENSATION |
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STOCKHOLDER'S EQUITY AND SHARE-BASED COMPENSATION | NOTE 8 – STOCKHOLDERS’ EQUITY AND SHARE-BASED COMPENSATION After the completion of the Merger on the Closing Date, there were 36,182,783 shares of International Money Express, Inc. common stock outstanding and outstanding warrants to purchase 8,959,999 shares of common stock. As of the Closing Date, the former stockholders of Intermex owned approximately 48.3% and the former stockholders of FinTech owned approximately 51.7% of the combined company’s outstanding common stock. At September 30, 2018, the Company was authorized to issue 200,000,000 shares of common stock and had 36,182,783 shares of common stock issued and outstanding at $0.0001 par value per common share. Equity Warrants Prior to the Merger, FinTech issued 8,749,999 public warrants (“Public Warrants”) and 210,000 private placement warrants (“Placement Warrants”)(combined are referred to as the “Warrants”). The Company assumed the FinTech equity warrants upon the change of control event. As a result of the Merger, the Warrants issued by FinTech are no longer exercisable for shares of FinTech common stock but instead are exercisable for common stock of the Company. All other features of the Warrants remain unchanged. There are no cash obligations for the Company pertaining to these Warrants, and they are recognized in equity upon any exercise. Each whole Warrant entitles the holder to purchase one share of the Company's common stock at a price of $11.50 per share. The Warrants became exercisable 30 days after the completion of the Merger and expire five years after that date, or earlier upon redemption or liquidation. The Company may call the Public Warrants for redemption, in whole and not in part, at a price of $0.01 per warrant upon not less than 30 days prior written notice of redemption to each warrant holder if the reported last sale price of the Company’s common stock equals or exceeds $24.00 per share for any 20 trading days within a 30-trading day period ended three business days before the Company sends the notice of redemption to the warrant holders. The Company cannot call the Placement Warrants as long as they are held by the original holders or transferred to certain permitted transferees established in the Warrant Agreement. International Money Express, Inc. 2018 Omnibus Equity Compensation Plan In connection with the Merger, the stockholders of FinTech approved the International Money Express, Inc. 2018 Omnibus Equity Compensation Plan (the “2018 Plan”). There were 3,371,389 shares reserved for issuance under the 2018 Plan, of which stock options to purchase 2,771,719 shares of common stock and restricted stock units in respect of 21,189 shares of common stock were granted to employees and independent directors of the Company in connection with the completion of the transactions at the Closing Date. The value of each option grant is estimated on the grant date using the Black-Scholes option pricing model. The option pricing model requires the input of highly subjective assumptions, including the grant date fair value of our common stock, expected volatility, expected forfeitures and risk-free interest rates. To determine the grant date fair value of the Company’s common stock, we use the closing market price of our common stock at the grant date. We also use an expected volatility based on the historical volatilities of a group of guideline companies and the "simplified" method for calculating the expected life of our stock options. We have elected to account for forfeitures as they occur. The risk-free interest rates are obtained from publicly available U.S. Treasury yield curve rates. Share-based compensation is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period. The stock options issued under the 2018 Plan vest in four equal installments over four years. The Company recognized compensation expense for stock options of $395,250 for the three and nine months ended September 30, 2018, which is included in salaries and benefits in the condensed consolidated statements of operations and comprehensive loss. No stock options vested during the third quarter of 2018. The weighted-average grant date fair value for the stock options to purchase 2,771,719 shares of common stock granted on the Closing Date was $3.43 per share. As of September 30, 2018, there were 2,764,219 non-vested stock options and unrecognized compensation expense of approximately $9.1 million is expected to be recognized over a weighted-average period of 3.8 years. A summary of the stock option activity during the nine months ended September 30, 2018 is presented below:
The restricted stock units issued under the 2018 Plan to the Company’s independent directors vest on the one-year anniversary from the grant date. The Company recognized compensation expense for restricted stock units of $35,000 for the three and nine months ended September 30, 2018, which is included in salaries and benefits in the condensed consolidated statements of operations and comprehensive loss. There were no forfeited or vested restricted stock units during the third quarter of 2018. As of September 30, 2018, there was $175,000 of unrecognized compensation expense for the restricted stock units. In addition to the grant of restricted stock units, each of the independent directors receives an annual cash retainer of $40,000 for services as a director. Incentive Units Interwire LLC, the former parent company of Intermex, issued Class B, C and D incentive units to employees of the Company (collectively “incentive units”). As these units were issued as compensation to the Company’s employees, the expense was recorded by the Company. In connection with the Merger, on the closing date, all unvested incentive units for Class B, C and D became fully vested and were immediately recognized as share-based compensation expense in the third quarter of 2018. Share-based compensation expense recognized related to these incentive units and included in salaries and benefits in the condensed consolidated statements of operations and comprehensive loss, amounted to $4,022,738 and $287,440 for the three months ended September 30, 2018 and 2017, respectively, $4,735,336 for the nine months ended September 30, 2018, and $1,534,655 for the Successor period from February 1, 2017 through September 30, 2017. The performance conditions related to the Class C and D units were not considered probable of being achieved prior to the Merger, and therefore, no compensation was recognized for all prior periods. Subsequent to this settlement, all incentive units ceased to exist. Share-based compensation of $2,916,324 for the Predecessor period from January 1, 2017 through January 31, 2017 primarily included the expense associated with stock options and restricted awards that vested due to the Stella acquisition. During the Successor period from January 1, 2018 through September 30, 2018, the number of units and the weighted-average grant date fair value for the incentive units are as follows:
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LOSS PER SHARE |
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LOSS PER SHARE [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOSS PER SHARE | NOTE 9 – LOSS PER SHARE Basic (income) loss per share is calculated by dividing net income (loss) for period by the weighted average number of common shares outstanding for the period. In computing dilutive income (loss) per share, basic income (loss) per share is adjusted for the assumed issuance of all applicable potentially dilutive share-based awards, including common stock options, restricted stock and warrants. Below are basic and diluted net loss per share for the periods indicated:
The computation of diluted loss per share above excludes the effect of 1,587 and 531 restricted stock units for the three month and nine-month periods ending September 30, 2018, respectively, because the inclusion of these would be anti-dilutive. |
INCOME TAXES |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES | NOTE 10 - INCOME TAXES A reconciliation between the income tax provision (benefit) at the US statutory tax rate and the Company’s income tax provision (benefit) on the condensed consolidated statements of operations and comprehensive loss is below:
Effective income tax rates for interim periods are based upon our current estimated annual rate. The Company’s effective income tax rate varies based upon an estimate of taxable earnings as well as on the mix of taxable earnings in the various states and countries in which we operate. Changes in the annual allocation and apportionment of the Company’s activity among these jurisdictions results in changes to the effective rate utilized to measure the Company’s deferred tax assets and liabilities. As presented in the income tax reconciliation above, the tax provision (benefit) recognized on the condensed consolidated statements of operations and comprehensive loss was impacted by state taxes, non-deductible expenses such as share-based compensation expense, transaction costs and foreign tax rates applicable to the Company’s foreign subsidiaries that are higher or lower than the U.S. statutory rate. On December 22, 2017, the U.S. enacted tax reform legislation known as H.R. 1, commonly referred to as the “Tax Cuts and Jobs Act” (the “Act”), resulting in significant modifications to existing law. Due to the timing of the Act and the complexity involved in applying the provisions of the Act, the Company made a reasonable estimate of the effects and recorded provisional amounts in the fourth quarter of 2017, which primarily included the impact of the remeasurement of the Company’s deferred tax balances to reflect the change in the corporate tax rate. As a result of the changes to tax laws and tax rates under the Act, the Company reduced its deferred tax asset as of December 31, 2017 by $656,000. As the Company collects and prepares necessary data and interprets the Act and any additional guidance issued by the U.S. Treasury Department, the IRS, and other standard-setting bodies, the Company may make adjustments to the provisional amounts recorded in December 2017. Those adjustments may materially impact the provision for income taxes and effective tax rate in the period in which the adjustments are made. During the nine months ended September 30, 2018, there were no such adjustments made to the provisional amounts recorded in December 2017. As of September 30, 2018, the Company did not have any amounts accrued for interest and penalties or recorded for uncertain tax positions. |
COMMITMENTS AND CONTINGENCIES |
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Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | NOTE 11 - COMMITMENTS AND CONTINGENCIES Leases The Company is a party to leases for office space and branch locations, several of which are on a month-to-month basis. Rent expense under all operating leases, included in other selling, general and administrative expenses in the condensed consolidated statements of operations and comprehensive loss, amounted to $491,212 and $440,511 for the three months ended September 30, 2018 and 2017, respectively, $1,418,350 for the nine months ended September 30, 2018, $1,155,440 for the Successor period from February 1, 2017 through September 30, 2017, and $135,636 for the Predecessor period from January 1, 2017 through January 31, 2017. In April 2018, the Company renegotiated its corporate lease to extend the term through November 2025. At September 30, 2018 future minimum rental payments required under operating leases for the remainder of 2018 and thereafter are as follows for the Company:
Litigation The Company is subject to legal proceedings and claims that have arisen in the ordinary course of its business and have not been finally adjudicated. Although there can be no assurance as to the ultimate disposition of these matters, it is the opinion of the Company’s management, based upon the information available at this time, that the expected outcome of these matters, both individually or in the aggregate, will not have a material adverse effect on either the results of operations or financial condition of the Company. Contingencies The Company operates in 50 U.S. states and two territories. Money transmitters and their agents are under regulation by State and Federal laws. Violations may result in civil or criminal penalties or a prohibition from providing money transfer services in a particular jurisdiction. It is the opinion of the Company’s management, based on information available at this time, that the expected outcome of regulatory matters will not have a material adverse effect on either the results of operations or financial condition of the Company. On August 28, 2018, the Company received a notice from the Staff of the Listing Qualifications Department (the "Staff") of The Nasdaq Stock Market LLC ("Nasdaq") indicating that, based upon the Company's non-compliance with the minimum number of round lot holders for the listing of its common stock and warrants on The Nasdaq Capital Market, as set forth in Nasdaq Listing Rules 5550(a)(3) and 5515(a)(4), respectively, the Company's common stock and warrants may be subject to delisting from Nasdaq unless the Company timely requests a hearing before a Nasdaq Hearings Panel (the "Panel"). On October 29, 2018, the Company received a notice from Nasdaq (the “Nasdaq Notice”) informing the Company that it has met the listing requirements with respect to its common stock and that the Company’s common stock will continue to be listed and trade on The Nasdaq Capital Market under the symbol “IMXI.” Additionally, the Nasdaq Notice informed the Company that it had not demonstrated compliance with the warrant listing requirements. The Company has withdrawn its request for a hearing before the Panel with respect to the warrant listing requirements. Accordingly, the Nasdaq Notice informed the Company that the Panel had determined to delist the Company’s warrants and suspend the trading of the warrants from The Nasdaq Capital Market effective as of the open of business on October 31, 2018. |
SUBSEQUENT EVENTS |
9 Months Ended |
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Sep. 30, 2018 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS | NOTE 12 – SUBSEQUENT EVENTS The Company evaluates subsequent events and transactions that occur after the balance sheet date up to the date the condensed consolidated financial statements were issued. Except for the matters discussed in Notes 5 and 11, there were no other subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements. |
BUSINESS AND ACCOUNTING POLICIES (Policies) |
9 Months Ended |
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Sep. 30, 2018 | |
BUSINESS AND ACCOUNTING POLICIES [Abstract] | |
Accounting Pronouncements | Accounting Pronouncements The Financial Accounting Standards Board (“FASB”) issued amended guidance, Restricted Cash, which requires restricted cash to be presented with cash and cash equivalents in the condensed consolidated statements of cash flows. The Company adopted this guidance in the first quarter of 2018 using a retrospective transition method for each period presented. Cash and restricted cash included $639,662 of restricted cash for all beginning and ending periods presented in the condensed consolidated statements of cash flows, which is included in other prepaid expenses and current assets, and other assets in the Company’s condensed consolidated balance sheets at September 30, 2018 and December 31, 2017, respectively. The restricted cash was deposited with a U.S. bank as cash collateral for an irrevocable stand-by letter of credit issued as collateral for the operating lease of the Company’s headquarters. This lease was renegotiated in April 2018, and accordingly, the letter of credit is no longer required; the Company expects to collect these funds in the fourth quarter of 2018. The FASB issued guidance, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company adopted this guidance in the first quarter of 2018 and the impact of this adoption did not have a material impact on the Company’s condensed consolidated financial statements. The FASB issued guidance, Revenue from Contracts with Customers, which amended the existing accounting standards for revenue recognition. The new guidance establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. This guidance is required to be adopted by the Company in the first quarter of 2019 and can be applied using either a retrospective or a modified retrospective approach. Based on our assessment of the new standard, we have determined the vast majority of our revenues include only one performance obligation, which is to collect the consumer's money and make funds available for payment, generally on the same day, to a designated recipient in the currency requested. Accordingly, management believes this standard will not have a material impact on the Company’s financial statements and expects to adopt this standard using the modified retrospective approach, with the cumulative effect of adoption, if any, included in accumulated deficit as of January 1, 2019. However, management is continuing to assess the requirements of the new revenue guidance, including enhanced disclosures and reporting requirements. The FASB issued amended guidance, Business Combinations - Clarifying the Definition of a Business, which assists entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This guidance is required to be adopted by the Company in the first quarter of 2019 on a prospective basis, and the Company does not believe it will have a material impact on the consolidated financial statements. The FASB issued guidance, Leases, to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under previous U.S. GAAP. The guidance requires that a lessee recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term on the balance sheet. This guidance is required to be adopted by the Company in the first quarter of 2020 and must be applied using a modified retrospective approach. The Company is currently evaluating the impact this guidance will have on the consolidated financial statements. The FASB issued amended guidance, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments, which clarifies how certain cash receipts and cash payments are presented and classified in the consolidated statements of cash flows. The amendments are aimed at reducing the existing diversity in practice. This guidance is required to be adopted by the Company in the first quarter of 2019 and must be applied using a retrospective approach for each period presented. The adoption of this guidance is not expected to have a material impact on the consolidated financial statements. The FASB issued amended guidance, Intangibles – Goodwill and other (Topic 350): Simplifying the Test for Goodwill Impairment. The amended standard simplifies how an entity tests goodwill by eliminating Step 2 of the goodwill impairment test related to measuring an impairment charge. Instead, impairment will be recorded for the amount that the carrying amount of a reporting unit exceeds its fair value. This new guidance is effective for the Company beginning in in the first quarter of 2021. The adoption of this guidance is not expected to have a material impact on the consolidated financial statements. The FASB issued guidance, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, regarding the measurement of credit losses for certain financial instruments. The new standard replaces the incurred loss model with a current expected credit loss (“CECL”) model. The CECL model is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. The Company currently is required to adopt the new standard in the first quarter of 2021. The Company is currently evaluating the impact this guidance will have on the consolidated financial statements. |
FINTECH MERGER AND STELLA POINT ACQUISITION (Tables) |
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FINTECH MERGER AND STELLA POINT ACQUISITION [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Cash Proceeds Received in Reverse Recapitalization | In accounting for the reverse recapitalization, the net cash proceeds received from FinTech amounted to $4,626 as shown in the table below:
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Assets Acquired and Liabilities Assumed | The acquisition method for a business combination requires that the assets acquired and liabilities assumed be recognized at their allocated fair values as of the February 1, 2017 acquisition date, which is summarized below:
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GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) |
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GOODWILL AND OTHER INTANGIBLE ASSETS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Changes in Goodwill and Other Intangible Assets | The following table presents the changes in goodwill and other intangible assets:
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ACCRUED AND OTHER LIABILITIES (Tables) |
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ACCRUED AND OTHER LIABILITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued and Other Liabilities | Accrued and other liabilities consisted of the following:
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DEBT (Tables) |
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DEBT [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instruments | Debt consisted of the following:
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STOCKHOLDER'S EQUITY AND SHARE-BASED COMPENSATION (Tables) |
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STOCKHOLDER'S EQUITY AND SHARE-BASED COMPENSATION [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Option Activity | A summary of the stock option activity during the nine months ended September 30, 2018 is presented below:
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Weighted-average Grant Date Fair Value for Incentive Units | During the Successor period from January 1, 2018 through September 30, 2018, the number of units and the weighted-average grant date fair value for the incentive units are as follows:
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LOSS PER SHARE (Tables) |
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LOSS PER SHARE [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and Diluted Net Loss per Share | Below are basic and diluted net loss per share for the periods indicated:
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INCOME TAXES (Tables) |
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INCOME TAXES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Income Tax Expense (Benefit) | A reconciliation between the income tax provision (benefit) at the US statutory tax rate and the Company’s income tax provision (benefit) on the condensed consolidated statements of operations and comprehensive loss is below:
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COMMITMENTS AND CONTINGENCIES (Tables) |
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Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Future Minimum Rental Payments | At September 30, 2018 future minimum rental payments required under operating leases for the remainder of 2018 and thereafter are as follows for the Company:
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BUSINESS AND ACCOUNTING POLICIES (Details) - USD ($) |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Accounting Pronouncements [Abstract] | ||
Restricted cash | $ 639,662 | $ 639,662 |
Intermex Wire Transfers de Guatemala, S.A. [Member] | ||
Noncontrolling Interest Items [Abstract] | ||
Ownership percentage | 99.80% | |
Intermex Transfers de Mexico, S.A [Member] | ||
Noncontrolling Interest Items [Abstract] | ||
Ownership percentage | 98.00% | |
Intermex Wire Transfer Corp [Member] | ||
Noncontrolling Interest Items [Abstract] | ||
Ownership percentage | 100.00% | |
Intermex Wire Transfer II, LLC [Member] | ||
Noncontrolling Interest Items [Abstract] | ||
Ownership percentage | 100.00% |
FINTECH MERGER AND STELLA POINT ACQUISITION, Fintech Merger (Details) - USD ($) |
8 Months Ended | 9 Months Ended | ||
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Jul. 26, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Dec. 31, 2017 |
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Reverse Recapitalization [Abstract] | ||||
Cash balance available to Intermex prior to the consummation of the Merger | $ 110,726,342 | $ 37,930,164 | $ 35,902,119 | |
Cash consideration to shareholders | $ 0 | (101,658,947) | ||
Net equity infusion | $ 8,963,521 | |||
Common shares, outstanding (in shares) | 36,182,783 | 36,182,783 | 17,227,682 | |
Warrants to purchase common stock (in shares) | 8,959,999 | |||
2018 Equity Compensation Plan [Member] | ||||
Reverse Recapitalization [Abstract] | ||||
Shares reserved for issuance (in shares) | 3,371,389 | |||
Intermex [Member] | ||||
Reverse Recapitalization [Abstract] | ||||
Intermex Merger costs paid from acquisition proceeds at closing | $ (9,062,769) | |||
Cash consideration to shareholders | $ (101,658,947) | |||
FinTech [Member] | ||||
Merger [Abstract] | ||||
Redemption of shares (in shares) | 4,938,232 | |||
Gross redemption payments | $ 49,808,935 | |||
Number of outstanding shares subsequent to redemption (in shares) | 18,955,101 | |||
Consideration paid in equity (in shares) | 17,200,000 | |||
Reverse Recapitalization [Abstract] | ||||
Net cash proceeds from reverse recapitalization | $ 4,626 | |||
Prepaid expenses | 76,478 | |||
Accrued liabilities | (180,352) | |||
Net equity infusion | $ 8,963,521 |
FINTECH MERGER AND STELLA POINT ACQUISITION, Stella Point Acquisition (Details) - USD ($) |
1 Months Ended | 3 Months Ended | 5 Months Ended | 8 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|---|---|---|
Feb. 01, 2017 |
Jan. 31, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Dec. 31, 2017 |
|
Assets Acquired and Liabilities Assumed [Abstract] | ||||||||
Goodwill | $ 36,259,666 | $ 36,259,666 | $ 36,259,666 | |||||
Acquisition-Related Costs [Abstract] | ||||||||
Transaction cost | $ 6,304,972 | $ 0 | $ 6,212,602 | $ 10,319,283 | ||||
Stella Point [Member] | ||||||||
Business Combination, Consideration Transferred [Abstract] | ||||||||
Transaction price paid in cash | $ 52,000,000 | |||||||
Transaction price paid in equity | 12,410,000 | |||||||
Outstanding debt | 78,000,000 | |||||||
Additional debt | 5,000,000 | |||||||
Contingent consideration | $ 0 | |||||||
Ownership interest acquired | 80.70% | |||||||
Assets Acquired and Liabilities Assumed [Abstract] | ||||||||
Cash | $ 43,064,931 | |||||||
Accounts receivables | 24,031,575 | |||||||
Prepaid and other current assets | 3,712,848 | |||||||
Property and equipment | 6,328,146 | |||||||
Other assets | 1,345,562 | |||||||
Total tangible assets acquired | 78,483,062 | |||||||
Intangible assets acquired | 62,660,000 | |||||||
Deferred tax asset, net | 2,118,801 | |||||||
Less: Liabilities assumed | (115,111,529) | |||||||
Net assets | 28,150,334 | |||||||
Goodwill | 36,259,666 | |||||||
Total purchase price | 64,410,000 | |||||||
Acquisition-Related Costs [Abstract] | ||||||||
Transaction cost | $ 6,212,602 | |||||||
Predecessor Company [Member] | ||||||||
Acquisition-Related Costs [Abstract] | ||||||||
Transaction cost | 3,917,188 | |||||||
Predecessor Company [Member] | Stella Point [Member] | ||||||||
Acquisition-Related Costs [Abstract] | ||||||||
Transaction cost | $ 3,917,188 |
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) |
9 Months Ended |
---|---|
Sep. 30, 2018
USD ($)
| |
Changes in Goodwill and Other Intangible Assets [Abstract] | |
Goodwill, Beginning | $ 36,259,666 |
Other intangible assets, Beginning | 48,741,032 |
Other intangible assets, amortization expense | (9,351,263) |
Other intangible assets, Ending | 39,389,769 |
Goodwill, Ending | $ 36,259,666 |
Agent Relationships [Member] | |
Finite-Lived Intangible Assets [Abstract] | |
Intangible assets amortization period, under accelerated method | 15 years |
Trade Name [Member] | |
Finite-Lived Intangible Assets [Abstract] | |
Intangible assets amortization period, under accelerated method | 15 years |
Developed Technology [Member] | |
Finite-Lived Intangible Assets [Abstract] | |
Intangible assets amortization period, under accelerated method | 15 years |
Other Intangible Assets [Member] | |
Finite-Lived Intangible Assets [Abstract] | |
Intangible assets amortization period, straight line method | 10 years |
ACCRUED AND OTHER LIABILITIES (Details) - USD ($) |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Accrued Liabilities and Other Liabilities [Abstract] | ||
Payables to agents | $ 8,302,004 | $ 6,875,416 |
Accrued compensation | 1,542,822 | 1,092,460 |
Accrued bank charges | 884,069 | 897,404 |
Accrued loyalty program rebates | 840,039 | 164,581 |
Accrued audit and accounting fees | 603,322 | 233,592 |
Accrued legal fees | 680,000 | 1,644,470 |
Accrued taxes | 694,871 | 318,792 |
Other | 470,934 | 287,734 |
Accrued and other liabilities | $ 14,018,061 | $ 11,514,449 |
DEBT (Details) - USD ($) |
3 Months Ended | 8 Months Ended | 9 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|---|
Nov. 07, 2018 |
Aug. 23, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Dec. 31, 2017 |
|||
Debt Instruments [Abstract] | |||||||||
Long-term debt, gross | $ 112,150,000 | $ 112,150,000 | $ 115,787,500 | ||||||
Less: Current portion of long term debt | [1] | (4,078,627) | (4,078,627) | (3,913,436) | |||||
Less: Debt origination costs | (3,647,871) | (3,647,871) | (4,347,602) | ||||||
Long-term debt, noncurrent | 104,423,502 | 104,423,502 | 107,526,462 | ||||||
Debt origination costs, current | 771,373 | 771,373 | 936,564 | ||||||
Transaction costs | 6,304,972 | $ 0 | $ 6,212,602 | 10,319,283 | |||||
Term Loan [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Long-term debt, gross | 92,150,000 | 92,150,000 | 95,787,500 | ||||||
Revolving Credit Facility [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Long-term debt, gross | 20,000,000 | 20,000,000 | $ 20,000,000 | ||||||
Senior Secured Credit Facility [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Transaction costs | $ 1,500,000 | $ 1,500,000 | |||||||
Wrote off of debt origination costs | $ 3,700,000 | ||||||||
Senior Secured Credit Facility [Member] | LIBOR [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Interest rate | 9.00% | ||||||||
Senior Secured Credit Facility [Member] | Base Rate [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Interest rate | 8.00% | ||||||||
Senior Secured Credit Facility [Member] | Term Loan [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Aggregate principal amount | $ 97,000,000 | ||||||||
Frequency of principal payment | Quarterly | ||||||||
Senior Secured Credit Facility [Member] | Term Loan [Member] | December 31, 2017 through September 30, 2019 [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Periodic repayment percentage | 1.25% | ||||||||
Senior Secured Credit Facility [Member] | Term Loan [Member] | December 31, 2019 and thereafter [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Periodic repayment percentage | 2.50% | ||||||||
Senior Secured Credit Facility [Member] | Revolving Credit Facility [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Maximum borrowing capacity | $ 20,000,000 | ||||||||
Credit Agreement [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Maturity date | Nov. 07, 2023 | ||||||||
Unused line fee percentage | 0.35% | ||||||||
Prepayment penalty amount | $ 2,000,000 | ||||||||
Credit Agreement [Member] | LIBOR [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Interest rate | 4.50% | ||||||||
Credit Agreement [Member] | Base Rate [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Interest rate | 3.50% | ||||||||
Credit Agreement [Member] | Term Loan [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Aggregate principal amount | $ 90,000,000 | ||||||||
Frequency of principal payment | Quarterly | ||||||||
Credit Agreement [Member] | Term Loan [Member] | Year 1 [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Periodic repayment percentage | 5.00% | ||||||||
Credit Agreement [Member] | Term Loan [Member] | Year 2 [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Periodic repayment percentage | 7.50% | ||||||||
Credit Agreement [Member] | Term Loan [Member] | Year 3 [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Periodic repayment percentage | 7.50% | ||||||||
Credit Agreement [Member] | Term Loan [Member] | Year 4 [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Periodic repayment percentage | 10.00% | ||||||||
Credit Agreement [Member] | Term Loan [Member] | Year 5 [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Periodic repayment percentage | 10.00% | ||||||||
Credit Agreement [Member] | Revolving Credit Facility [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Maximum borrowing capacity | $ 35,000,000 | ||||||||
Credit Agreement [Member] | Incremental Facility [Member] | |||||||||
Debt Instruments [Abstract] | |||||||||
Maximum borrowing capacity | $ 30,000,000 | ||||||||
|
RELATED PARTY TRANSACTIONS (Details) - USD ($) |
3 Months Ended | 9 Months Ended |
---|---|---|
Sep. 30, 2018 |
Sep. 30, 2018 |
|
RELATED PARTY TRANSACTIONS [Abstract] | ||
Monthly management fees plus reimbursement expense | $ 65,000 | |
Termination fee | $ 1,600,000 | $ 1,600,000 |
STOCKHOLDER'S EQUITY AND SHARE-BASED COMPENSATION (Details) - $ / shares |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2018 |
Jul. 26, 2018 |
Dec. 31, 2017 |
|
Share-based Compensation Arrangement [Abstract] | |||
Common shares, outstanding (in shares) | 36,182,783 | 36,182,783 | 17,227,682 |
Warrants to purchase common stock (in shares) | 8,959,999 | ||
Common shares, authorized (in shares) | 200,000,000 | 200,000,000 | |
Common shares, issued (in shares) | 36,182,783 | 17,227,682 | |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |
Number of shares of common stock called by each warrant (in shares) | 1 | ||
Warrant exercise price (in dollars per share) | $ 11.50 | ||
Warrants exercisable period on completion of business combination | 30 days | ||
Warrants expiration period | 5 days | ||
Public Warrants [Member] | |||
Share-based Compensation Arrangement [Abstract] | |||
Warrants redemption price (in dollars per share) | $ 0.01 | ||
Stock price to redeem warrants | $ 24.00 | ||
Number of consecutive trading days to redeem warrants | 20 days | ||
Number of trading days to redemption | 30 days | ||
Number of business days before the company sends notice of redemption to warrant holders | 3 days | ||
Public Warrants [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement [Abstract] | |||
Written notice period for warrants redemption | 30 days | ||
Intermex [Member] | |||
Share-based Compensation Arrangement [Abstract] | |||
Percentage of outstanding common stock owned | 48.30% | ||
FinTech [Member] | |||
Share-based Compensation Arrangement [Abstract] | |||
Percentage of outstanding common stock owned | 51.70% | ||
FinTech [Member] | Placement Warrants [Member] | |||
Share-based Compensation Arrangement [Abstract] | |||
Number of warrants issued (in shares) | 210,000 | ||
FinTech [Member] | Public Warrants [Member] | |||
Share-based Compensation Arrangement [Abstract] | |||
Number of warrants issued (in shares) | 8,749,999 |
STOCKHOLDER'S EQUITY AND SHARE-BASED COMPENSATION, 2018 Omnibus Equity Compensation Plan (Details) |
3 Months Ended | 8 Months Ended | 9 Months Ended | ||
---|---|---|---|---|---|
Jul. 26, 2018
shares
|
Sep. 30, 2018
USD ($)
$ / shares
shares
|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2018
USD ($)
Installments
$ / shares
shares
|
|
Share-based Compensation Arrangement [Abstract] | |||||
Share-based compensation expense | $ | $ 4,022,738 | $ 287,440 | $ 1,534,655 | $ 4,735,336 | |
2018 Equity Compensation Plan [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Shares reserved for issuance (in shares) | 3,371,389 | ||||
2018 Equity Compensation Plan [Member] | Stock Option [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Number of equal installments for options vesting | Installments | 4 | ||||
Options vesting period | 4 years | ||||
Share-based compensation expense | $ | $ 395,250 | $ 395,250 | |||
Options vested (in shares) | 0 | ||||
Granted (in dollars per share) | $ / shares | $ 3.43 | ||||
Unrecognized compensation expense | $ | $ 9,100,000 | $ 9,100,000 | |||
Weighted-average non-vested period | 3 years 9 months 18 days | ||||
Number of Options [Roll Forward] | |||||
Outstanding, beginning balance (in shares) | 0 | ||||
Granted (in shares) | 2,771,719 | ||||
Exercised (in shares) | 0 | ||||
Forfeited (in shares) | (7,500) | ||||
Expired (in shares) | 0 | ||||
Outstanding, ending balance (in shares) | 2,764,219 | 2,764,219 | |||
Weighted Average Exercise Price [Roll Forward] | |||||
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 0 | ||||
Granted (in dollars per share) | $ / shares | 9.91 | ||||
Exercised (in dollars per share) | $ / shares | 0 | ||||
Forfeited (in dollars per share) | $ / shares | 9.91 | ||||
Expired (in dollars per share) | $ / shares | 0 | ||||
Outstanding, beginning ending (in dollars per share) | $ / shares | $ 9.91 | $ 9.91 | |||
Weighted Average Remaining Contractual Term [Abstract] | |||||
Weighted average remaining contractual term | 9 years 9 months 29 days | ||||
2018 Equity Compensation Plan [Member] | Restricted Stock Units [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Restricted stock units granted (in shares) | 21,189 | ||||
Options vesting period | 1 year | ||||
Share-based compensation expense | $ | $ 35,000 | $ 35,000 | |||
Unrecognized compensation expense | $ | $ 175,000 | 175,000 | |||
Restricted stock units, forfeited (in shares) | 0 | ||||
Restricted stock units, vested (in shares) | 0 | ||||
Annual cash retainer paid to directors | $ | $ 40,000 |
STOCKHOLDER'S EQUITY AND SHARE-BASED COMPENSATION, Incentive Units (Details) - USD ($) |
1 Months Ended | 3 Months Ended | 8 Months Ended | 9 Months Ended | |
---|---|---|---|---|---|
Jan. 31, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
|
Share-based Compensation Arrangement [Abstract] | |||||
Share-based compensation expense | $ 4,022,738 | $ 287,440 | $ 1,534,655 | $ 4,735,336 | |
Predecessor Company [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Share-based compensation expense | $ 2,916,324 | ||||
Class B [Member] | |||||
Number of Units [Roll Forward] | |||||
Outstanding, beginning balance (in shares) | 7,472,000 | ||||
Granted (in shares) | 410,000 | ||||
Vested (in shares) | (7,882,000) | ||||
Outstanding, ending balance (in shares) | 0 | 0 | |||
Weighted Average Grant Date Fair Value [Abstract] | |||||
Outstanding beginning balance (in dollars per share) | $ 0.4879 | ||||
Granted (in dollars per share) | 0.4948 | ||||
Vested (in dollars per share) | $ 0.4883 | ||||
Class C [Member] | |||||
Number of Units [Roll Forward] | |||||
Outstanding, beginning balance (in shares) | 4,670,000 | ||||
Granted (in shares) | 205,000 | ||||
Vested (in shares) | (4,875,000) | ||||
Outstanding, ending balance (in shares) | 0 | 0 | |||
Weighted Average Grant Date Fair Value [Abstract] | |||||
Outstanding beginning balance (in dollars per share) | $ 0.2080 | ||||
Granted (in dollars per share) | 0.2126 | ||||
Vested (in dollars per share) | $ 0.2082 | ||||
Class D [Member] | |||||
Number of Units [Roll Forward] | |||||
Outstanding, beginning balance (in shares) | 4,670,000 | ||||
Granted (in shares) | 205,000 | ||||
Vested (in shares) | (4,875,000) | ||||
Outstanding, ending balance (in shares) | 0 | 0 | |||
Weighted Average Grant Date Fair Value [Abstract] | |||||
Outstanding beginning balance (in dollars per share) | $ 0.1489 | ||||
Granted (in dollars per share) | 0.1535 | ||||
Vested (in dollars per share) | $ 0.1491 |
LOSS PER SHARE (Details) - USD ($) |
3 Months Ended | 8 Months Ended | 9 Months Ended | |
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
|
Loss Per Share, Basic and Diluted [Abstract] | ||||
Net loss for basic and diluted loss per common shares | $ (13,412,996) | $ (573,681) | $ (7,061,465) | $ (12,108,413) |
Shares [Abstract] | ||||
Weighted-average common shares outstanding - basic and diluted (in shares) | 30,975,338 | 17,227,682 | 17,227,682 | 21,827,082 |
Net loss per common share - basic and diluted (in dollars per share) | $ (0.43) | $ (0.03) | $ (0.41) | $ (0.55) |
Restricted Stock Units [Member] | ||||
Shares [Abstract] | ||||
Securities excluded from computation of diluted loss per share (in shares) | 1,587 | 531 |
INCOME TAXES (Details) - USD ($) |
1 Months Ended | 3 Months Ended | 8 Months Ended | 9 Months Ended | ||
---|---|---|---|---|---|---|
Jan. 31, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Dec. 31, 2017 |
|
Reconciliation of Income Tax Expense (Benefit) [Abstract] | ||||||
Loss before income taxes | $ (5,843,822) | $ (765,408) | $ (6,008,986) | $ (3,922,867) | ||
US statutory tax rate | 21.00% | 34.00% | 34.00% | 21.00% | ||
Income tax expense (benefit) at statutory rate | $ (1,227,203) | $ (260,239) | $ (2,043,055) | $ (823,802) | ||
State tax expense (benefit), net of federal | 1,354,628 | (19,203) | (10,628) | 1,470,870 | ||
Foreign tax rates different from US statutory rate | 113,891 | 3,155 | 93,158 | 147,154 | ||
Non-deductible expenses | 7,411,475 | 153,319 | 3,081,763 | 7,483,530 | ||
Change in tax rate | 0 | (51,994) | (51,994) | 0 | ||
Credits | (86,275) | 0 | 0 | (94,864) | ||
Other | 2,658 | (16,765) | (16,765) | 2,658 | ||
Total tax provision (benefit) | 7,569,174 | $ (191,727) | $ 1,052,479 | 8,185,546 | ||
Decrease in deferred tax asset | $ 656,000 | |||||
Accrued interest and penalties | 0 | 0 | ||||
Uncertain tax positions | $ 0 | $ 0 | ||||
Predecessor Company [Member] | ||||||
Reconciliation of Income Tax Expense (Benefit) [Abstract] | ||||||
Loss before income taxes | $ (5,521,794) | |||||
US statutory tax rate | 34.00% | |||||
Income tax expense (benefit) at statutory rate | $ (1,877,410) | |||||
State tax expense (benefit), net of federal | (278,657) | |||||
Foreign tax rates different from US statutory rate | (45,631) | |||||
Non-deductible expenses | 409 | |||||
Change in tax rate | 0 | |||||
Credits | 0 | |||||
Other | (2,084) | |||||
Total tax provision (benefit) | $ (2,203,373) |
COMMITMENTS AND CONTINGENCIES (Details) |
1 Months Ended | 3 Months Ended | 8 Months Ended | 9 Months Ended | |
---|---|---|---|---|---|
Jan. 31, 2017
USD ($)
|
Sep. 30, 2018
USD ($)
State
Territory
|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2018
USD ($)
State
Territory
|
|
Leases [Abstract] | |||||
Rent expense | $ 491,212 | $ 440,511 | $ 1,155,440 | $ 1,418,350 | |
Future Minimum Rental Payments [Abstract] | |||||
2018 | 378,224 | 378,224 | |||
2019 | 1,263,467 | 1,263,467 | |||
2020 | 981,139 | 981,139 | |||
2021 | 846,364 | 846,364 | |||
2022 | 738,385 | 738,385 | |||
2023 | 753,692 | 753,692 | |||
Thereafter | 1,438,239 | 1,438,239 | |||
Total | $ 6,399,510 | $ 6,399,510 | |||
Contingencies [Abstract] | |||||
Number of states in which entity operates | State | 50 | 50 | |||
Number of territories in which entity operates | Territory | 2 | 2 | |||
Predecessor Company [Member] | |||||
Leases [Abstract] | |||||
Rent expense | $ 135,636 |
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