Affinity Acquisition

3 Months Ended

Mar. 31, 2013

Business Combinations [Abstract]

Affinity Acquisition

Affinity Acquisition

On October 1, 2012, the Company completed the acquisition of 100% of the stock of Affinity, accounted for as a business combination, and paid an aggregate purchase price of $15,901,000. The purchase price consisted of (i) approximately $8.0 million in cash (obtained through debt financing as discussed in Note 4), (ii) a $2.33 million promissory note payable to the Affinity shareholders, subject to adjustment, and (iii) 2,650,000 shares of the Company's common stock valued at approximately $5,512,000 based on the closing price of the Company's stock on October 1, 2012, subject to adjustment.

The accompanying condensed consolidated financial statements for the three months ended March 31, 2012 do not include any revenues or expenses related to the Affinity business since the closing date of the acquisition was October 1, 2012. The Company's unaudited pro-forma results for the three months ended March 31, 2012 are summarized in the following table, assuming the acquisition had occurred on January 1, 2012 (in thousands):

	Three Months Ended March 31, 2012
Revenue	$	9,442
Net income	1,936
Earnings per share:
Basic	$	0.07
Diluted	$	0.07
Weighted average number of common shares:
Basic	27,395
Diluted	28,759

These unaudited pro-forma results have been prepared for comparative purposes only and do not purport to be indicative of the results of operations which would have actually resulted had the acquisition occurred on January 1, 2012, nor to be indicative of future results of operations.

Below is a summary of goodwill activity for the three months ended March 31, 2013 (in thousands):

Goodwill, December 31, 2012	$	9,900
Settlements	(11		)
Reduction of Note (see Note 4)	(240		)
Goodwill, March 31, 2013	$	9,649