Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 30, 2021 | |
Cover [Abstract] | ||
Document type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Entity File Number | 000-54627 | |
Entity registrant name | ATLAS FINANCIAL HOLDINGS, INC. | |
Entity Incorporation, State or Country Code | E9 | |
Entity Tax Identification Number | 27-5466079 | |
Entity Address, Address Line One | 953 American Lane | |
Entity Address, Address Line Two | 3rd Floor | |
Entity Address, City or Town | Schaumburg | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60173 | |
City Area Code | 847 | |
Local Phone Number | 472-6700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 12,047,334 | |
Entity Central Index Key | 0001539894 | |
Current Fiscal Year End Date | --12-31 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Financial Position - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and cash equivalents | $ 2,960 | $ 5,238 |
Restricted cash | 3,879 | 5,287 |
Premiums receivable (net of allowance of $800 and $800) | 12,986 | 13,442 |
Intangible assets, net | 2,137 | 2,235 |
Property and equipment, net | 18,131 | 18,815 |
Right-of-use asset | 728 | 888 |
Notes receivable | 18,017 | 18,017 |
Other assets | 2,278 | 1,895 |
Assets held for sale | 48,101 | 53,885 |
Total assets | 109,217 | 119,702 |
Liabilities | ||
Premiums payable | 17,955 | 19,416 |
Lease liability | 880 | 1,091 |
Due to deconsolidated affiliates | 19,091 | 19,170 |
Notes payable, net | 38,029 | 36,168 |
Other liabilities and accrued expenses | 3,071 | 4,342 |
Liabilities held for sale | 53,794 | 60,407 |
Total liabilities | 132,820 | 140,594 |
Commitments and contingencies (see Note 7) | ||
Shareholders' Deficit | ||
Additional paid-in capital | 81,850 | 81,840 |
Treasury stock, at cost: 255,505 shares of ordinary voting common shares at March 31, 2021 and December 31, 2020, respectively | (3,000) | (3,000) |
Retained deficit | (102,749) | (100,199) |
Accumulated other comprehensive income, net of tax | 259 | 430 |
Total shareholders' deficit | (23,603) | (20,892) |
Total liabilities and shareholders' deficit | 109,217 | 119,702 |
Ordinary Voting Common Shares | ||
Shareholders' Deficit | ||
Ordinary voting common shares, $0.003 par value, 266,666,667 shares authorized, shares issued: March 31, 2021 - 12,302,839 and December 31, 2020 - 12,248,798; shares outstanding: March 31, 2021 - 12,047,334 and December 31, 2020 - 11,993,293 | 37 | 37 |
Restricted voting common shares | ||
Shareholders' Deficit | ||
Restricted voting common shares, $0.003 par value, 33,333,334 shares authorized, shares issued and outstanding: March 31, 2021 and December 31, 2020 - 0 | $ 0 | $ 0 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Financial Position (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Statement [Line Items] | ||
Premiums receivable, allowance | $ 800 | $ 800 |
Shareholders' Deficit | ||
Common stock, shares authorized (in shares) | 300,000,001 | |
Common stock, shares issued (in shares) | 12,302,839 | 12,248,798 |
Common stock, shares outstanding (in shares) | 12,047,334 | 11,993,293 |
Treasury stock, common stock, shares held (in shares) | 255,505 | 255,505 |
Ordinary Voting Common Shares | ||
Shareholders' Deficit | ||
Common stock, par value (USD per share) | $ 0.003 | $ 0.003 |
Common stock, shares authorized (in shares) | 266,666,667 | 266,666,667 |
Common stock, shares issued (in shares) | 12,302,839 | 12,248,798 |
Common stock, shares outstanding (in shares) | 12,047,334 | 11,993,293 |
Restricted Voting Common Shares | ||
Shareholders' Deficit | ||
Common stock, par value (USD per share) | $ 0.003 | $ 0.003 |
Common stock, shares authorized (in shares) | 33,333,334 | 33,333,334 |
Common stock, shares issued (in shares) | 0 | 0 |
Common stock, shares outstanding (in shares) | 0 | 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Commission income | $ 1,693 | $ 2,052 |
Net realized gains | 12 | 0 |
Other income | 636 | 154 |
Total revenue | 2,341 | 2,206 |
Acquisition costs | 894 | 1,409 |
Other underwriting expenses | 3,482 | 3,509 |
Amortization of intangible assets | 98 | 98 |
Interest expense, net | 569 | 320 |
Total expenses | 5,043 | 5,336 |
Loss from operations before income taxes | (2,702) | (3,130) |
Income tax expense | 0 | 104 |
Loss from continuing operations | (2,702) | (3,234) |
Income (loss) from discontinued operations, net of tax | 152 | (57) |
Net loss | $ (2,550) | $ (3,291) |
Basic net (loss) income per share attributable to common shareholders | ||
Continuing operations (in dollars per share) | $ (0.22) | $ (0.27) |
Discontinued operations (in dollars per share) | 0.01 | 0 |
Net loss (in dollars per share) | (0.21) | (0.27) |
Diluted net (loss) income per share attributable to common shareholders | ||
Continuing operations (in dollars per share) | (0.22) | (0.27) |
Discontinued operations (in dollars per share) | 0.01 | 0 |
Net loss (in dollars per share) | $ (0.21) | $ (0.27) |
Basic weighted average common shares outstanding (in shares) | 12,023,655 | 11,914,849 |
Diluted weighted average common shares outstanding (in shares) | 12,023,655 | 11,914,849 |
Condensed Consolidated Statements of Comprehensive Loss | ||
Net loss | $ (2,550) | $ (3,291) |
Other comprehensive loss: | ||
Changes in net unrealized investment losses | (13) | (58) |
Reclassification to net loss | (158) | (91) |
Other comprehensive loss | (171) | (149) |
Total comprehensive loss | $ (2,721) | $ (3,440) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Shareholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Ordinary Voting Common Shares | Restricted Voting Common Shares | Additional Paid-In Capital | Treasury Stock | Retained Deficit | Accumulated Other Comprehensive Income |
Balance at beginning of period at Dec. 31, 2019 | $ (8,461) | $ 36 | $ 0 | $ 81,548 | $ (3,000) | $ (87,469) | $ 424 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (3,291) | (3,291) | |||||
Other comprehensive income (loss) | (149) | (149) | |||||
Share-based compensation | 179 | 179 | |||||
Balance at end of period at Mar. 31, 2020 | (11,722) | 36 | 0 | 81,727 | (3,000) | (90,760) | 275 |
Balance at beginning of period at Dec. 31, 2020 | (20,892) | 37 | 0 | 81,840 | (3,000) | (100,199) | 430 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (2,550) | (2,550) | |||||
Other comprehensive income (loss) | (171) | (171) | |||||
Share-based compensation | 10 | 10 | |||||
Balance at end of period at Mar. 31, 2021 | $ (23,603) | $ 37 | $ 0 | $ 81,850 | $ (3,000) | $ (102,749) | $ 259 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating activities: | ||||
Net loss | $ (2,550) | $ (3,291) | ||
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||||
Income from discontinued operations, net of taxes | (152) | 57 | ||
Depreciation and amortization | 684 | 869 | ||
Share-based compensation expense | 10 | 179 | ||
Amortization of intangible assets | 98 | 98 | ||
Net realized gains | (12) | 0 | ||
Amortization of financing costs | 56 | 56 | ||
Net changes in operating assets and liabilities: | ||||
Premiums receivable, net | (444) | 9,854 | ||
Other assets | (383) | (1,935) | ||
Premiums payable | (1,461) | (12,169) | ||
Due to deconsolidated affiliates | (78) | 902 | ||
Other liabilities and accrued expenses | (1,271) | (1,601) | ||
Net cash flows used in operating activities - continuing operations | (5,503) | (6,981) | ||
Net cash flows used in operating activities - discontinued operations | (494) | (6,602) | ||
Net cash flows used in operating activities | (5,997) | (13,583) | ||
Purchases of: | ||||
Property, equipment and other | 0 | (121) | ||
Proceeds from sale of: | ||||
Property, equipment and other | 12 | 0 | ||
Net cash flows provided by (used in) investing activities - continuing operations | 12 | (121) | ||
Net cash flows provided by investing activities - discontinued operations | 2,705 | 5,933 | ||
Net cash flows provided by investing activities | 2,717 | 5,812 | ||
Financing activities: | ||||
Proceeds from notes payable | 2,000 | 0 | ||
Repayment of notes payable | (195) | (186) | ||
Net cash flows provided by (used in) financing activities - continuing operations | 1,805 | (186) | ||
Net cash flows provided by financing activities - discontinued operations | 0 | 0 | ||
Net cash flows provided by (used in) financing activities | 1,805 | (186) | ||
Net change in cash and cash equivalents and restricted cash - continuing operations | (3,686) | (7,288) | ||
Cash and cash equivalents and restricted cash, beginning of period | $ 13,554 | $ 23,859 | ||
Less: cash and cash equivalents of discontinued operations - beginning of period | 3,029 | $ 7,712 | ||
Cash and cash equivalents and restricted cash of continuing operations, beginning of period | 10,525 | 16,147 | 16,147 | |
Cash and cash equivalents and restricted cash of continuing operations, end of period | 6,839 | 8,859 | $ 10,525 | |
Supplemental disclosure of cash information: | ||||
Cash (recovered) paid for income taxes | 0 | 52 | ||
Cash (recovered) paid for interest | $ 499 | $ 509 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations and Basis of Presentation | Nature of Operations and Basis of Presentation Atlas Financial Holdings, Inc. (“Atlas” or “We” or the “Company”) commenced operations on December 31, 2010. The primary business of Atlas focuses on a managing general agency strategy, primarily through our wholly owned subsidiary, Anchor Group Management, Inc. (“AGMI”). AGMI focuses on a niche market orientation for the “light” commercial automobile sector. This sector includes taxi cabs, non-emergency para-transit, limousine, livery, including certain transportation network companies (“TNC”) drivers/operators, and business autos. Automobile insurance products provide insurance coverage in three major areas: liability, accident benefits and physical damage. Atlas’ business is carried out through its non-insurance company subsidiaries: AGMI, UBI Holdings Inc. (“UBI Holdings”) and UBI Holdings’ wholly-owned subsidiaries, optOn Digital IP Inc. (“OOIP”) and optOn Insurance Agency Inc. (“optOn” and together with OOIP and UBI Holdings, “UBI”). Prior to a strategic transition, our core business was the underwriting of commercial automobile insurance policies, focusing on the “light” commercial automobile sector, through American Country Insurance Company (“American Country”), American Service Insurance Company, Inc. (“American Service”) and Gateway Insurance Company (“Gateway” and together with American Country and American Service, the “ASI Pool Companies”) and Global Liberty Insurance Company of New York (“Global Liberty” and together with the ASI Pool Companies, our “Insurance Subsidiaries”), along with our wholly owned managing general agency, AGMI. The ASI Pool Companies were placed into rehabilitation under the statutory control of the Illinois Department of Insurance during the second half of 2019 and were subsequently placed into liquidation and have been deconsolidated from our consolidated financial statements as of October 1, 2019 as a result of these actions. Other regulatory actions were taken in certain states, including restriction, suspension, or revocation of certain state licenses and certificates of authority held by the ASI Pool Companies preceding and following the initiation of rehabilitation. During the fourth quarter of 2019, the Company began actively pursuing the potential sale of Global Liberty Insurance Company of New York (“Global Liberty”), and as a result, Global Liberty has been classified as a discontinued operation since. Atlas’ ordinary common shares are listed on the OTC Markets system under the symbol “AFHIF”. Basis of Presentation These statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of Atlas and the entities it controls. Equity investments in entities that we do not consolidate, including corporate entities in which we have significant influence and partnership and partnership-like entities in which we have more than minor influence over operating and financial policies, are accounted for under the equity method unless we have elected the fair value option. All significant intercompany accounts and transactions have been eliminated. The results for the three months ended March 31, 2021 are not necessarily indicative of the results expected for the full calendar year. The accompanying unaudited condensed consolidated financial statements, in accordance with Securities and Exchange Commission (“SEC”) rules for interim periods, do not include all of the information and notes required by GAAP for complete financial statements and should be read in conjunction with Atlas’ Annual Report on Form 10-K for the year ended December 31, 2020, which provides a more complete understanding of the Company’s accounting policies, financial position, operating results, business properties, and other matters. Atlas has consistently applied the same accounting policies throughout all periods presented. Estimates and Assumptions The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates and changes in estimates are recorded in the accounting period in which they are determined Significant estimates in the accompanying financial statements include revenue recognition, evaluation of assets for impairment, deferred tax asset valuation, and allowances on premiums receivable. Revenue Recognition Revenues from contracts with customers include both commission and fee income. The recognition and measurement of revenue is based on the assessments of individual contract terms. As a managing general agency (an “MGA”), AGMI has contracts with various insurance carriers which determines AGMI’s commission income revenue. Each contract specifies what our performance obligations are as an MGA and what determines our commission income revenue, generally gross written premiums, net of cancellations and refunds. Under these contracts there are a number of performance obligations; however, it is the bundle of these services and not a single obligation that results in the performance of the MGA under the contracts. The Company considers these performance obligations as a non-bifurcated bundle of services where the performance obligations are satisfied simultaneous to the point in time where the Company issues a policy, or cancels a policy to an insured. The commission rate stated in the individual contract is the standalone selling price of these non-bifurcated services, which is allocated to the service bundle and not to any individual obligation under the various contracts. Seasonality The property and casualty (“P&C”) insurance business is seasonal in nature. Our ability to generate commission income is also impacted by the timing of policy effective periods in the states in which we operate and products provided by our business partners. For example, January 1 st and March 1 st are common taxi cab renewal dates in Illinois and New York, respectively. Operating Segments |
New Accounting Standards
New Accounting Standards | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Standards | New Accounting StandardsThere have been no recent pronouncements or changes in pronouncements during the three months ended March 31, 2021, as compared to those described in our Annual Report on Form 10-K for the twelve months ended December 31, 2020, that are of significance or potential significance to Atlas. Pertinent Accounting Standard Updates (“ASUs”) are issued from time to time by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as they become effective. All recently issued accounting pronouncements with effective dates prior to April 1, 2021 have been adopted by the Company. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets | Intangible Assets Intangible Assets by Major Asset Class ($ in ‘000s) Economic Useful Life Gross Carrying Amount Accumulated Amortization Net As of March 31, 2021 Trade name and trademark 15 years $ 1,800 $ 734 $ 1,066 Customer relationship 10 years 2,700 1,629 1,071 $ 4,500 $ 2,363 $ 2,137 As of December 31, 2020 Trade name and trademark 15 years $ 1,800 $ 703 $ 1,097 Customer relationship 10 years 2,700 1,562 1,138 $ 4,500 $ 2,265 $ 2,235 |
Loss From Continuing Operations
Loss From Continuing Operations per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Loss From Continuing Operations per Share | Loss From Continuing Operations per Share Computations of Basic and Diluted Loss per Common Share from Continuing Operations ($ in ‘000s, except share and per share amounts) Three months ended March 31, 2021 2020 Basic Loss from continuing operations before income taxes $ (2,702) $ (3,130) Income tax expense — 104 Net loss attributable to common shareholders from continuing operations $ (2,702) $ (3,234) Basic weighted average common shares outstanding 12,023,655 11,914,849 Loss per common share basic from continuing operations $ (0.22) $ (0.27) Diluted Basic weighted average common shares outstanding 12,023,655 11,914,849 Dilutive potential ordinary shares: Dilutive stock options outstanding — — Diluted weighted average common shares outstanding 12,023,655 11,914,849 Loss per common share diluted from continuing operations $ (0.22) $ (0.27) Common shares are defined as ordinary voting common shares, restricted voting common shares and participative restricted stock units (“RSUs”). Earnings per common share diluted is computed by dividing net income by the weighted average number of common shares outstanding for each period plus the incremental number of shares added as a result of converting dilutive potential ordinary voting common shares, calculated using the treasury stock method. Atlas’ potential dilutive ordinary voting common shares consists of outstanding stock options to purchase ordinary voting common shares and warrants to purchase 2,387,368 ordinary voting common shares of Atlas for $0.69 per share. |
Contracts with Customers
Contracts with Customers | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Contracts with Customers | Contracts with Customers The revenue included as commission income for three months ended March 31, 2021 and 2020 totaled $1.7 million and $2.1 million, respectively. The balance of receivables related to contracts with customers, which is recorded as part of premiums receivable on the Consolidated Statements of Financial Position as of March 31, 2021 and December 31, 2020: Components of Commission Receivables ($ in ‘000s) Three months ended Twelve months ended Commission receivable, beginning of period $ 2,577 $ 1,428 Commission revenue 1,693 5,195 Net change in cash received (1,904) (4,046) Commission receivable, end of period $ 2,366 $ 2,577 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Continuing Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ (568) 21.0 % $ (657) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) 560 (20.7) 791 (25.2) Nondeductible expenses 1 — — — Stock compensation 7 (0.3) 12 (0.4) Tax rate differential — — (42) 1.3 Provision for income taxes for continuing operations $ — — % $ 104 (3.3) % Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Discontinued Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ 32 21.0 % $ (122) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) (32) (21.0) (202) 34.9 Nondeductible expenses — — 2 (0.1) Tax rate differential — — (200) 34.3 Provision for income taxes for discontinued operations $ — — % $ (522) 90.1 % Components of Income Tax Expense - Continuing Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Current tax expense $ — $ 104 Components of Income Tax Benefit - Discontinued Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Current tax benefit $ — $ (522) During 2013 and 2019, due to shareholder activity, “triggering events” as determined under IRC Section 382 may have occurred. As a result, under IRC Section 382, the use of the Company’s net operating loss and other carryforwards generated prior to the “triggering events” will be subject to a yearly limitation as a result of this “ownership change” for tax purposes, which is defined as a cumulative change of more than 50% during any three-year period by shareholders owning 5% or greater portions of the Company’s shares. Due to the mechanics of the Section 382 calculation when there are multiple triggering events the Company’s losses will generally be limited based on the thresholds of the 2019 triggering event. The Company has established a valuation allowance against the NOLs that will expire unused as a result of the yearly limitation. Components of Deferred Income Tax Assets and Liabilities ($ in ‘000s) March 31, 2021 December 31, 2020 Gross deferred tax assets: Losses carried forward $ 16,844 $ 16,408 Claims liabilities and unearned premium reserves 495 496 Investment in affiliates 23,870 23,870 Bad debts 168 168 Stock compensation 272 279 Other 319 203 Valuation allowance (33,984) (33,420) Total gross deferred tax assets 7,984 8,004 Gross deferred tax liabilities: Deferred policy acquisition costs 55 134 Investments 84 122 Fixed assets 1,224 1,344 Intangible assets 449 469 Other 6,172 5,935 Total gross deferred tax liabilities 7,984 8,004 Net deferred tax assets $ — $ — Net Operating Loss Carryforward as of March 31, 2021 by Expiry ($ in ‘000s) Year of Occurrence Year of Expiration Amount 2011 2031 $ 1 2012 2032 70 2015 2035 1 2017 2037 13,649 2018 2038 8,903 2018 Indefinite 8,245 2019 2039 4,973 2019 Indefinite 6,306 2020 2040 31,300 2020 Indefinite 4,687 2021 2041 533 2021 Indefinite 1,543 Total $ 80,211 Deferred tax assets are recognized to the extent that it is probable that future taxable income will be available against which they can be utilized. When considering the extent of the valuation allowance on Atlas’ deferred tax assets, weight is given by management to both positive and negative evidence. GAAP states that a cumulative loss in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed against deferred tax assets. Based on Atlas’ cumulative loss in recent years and certain deferred tax assets subject to a yearly limitation under Section 382 which will likely result in expiration before utilization, Atlas has recorded a valuation allowance of $34.0 million and $33.4 million for its gross future deferred tax assets as of March 31, 2021 and December 31, 2020, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and ContingenciesIn the ordinary course of its business, Atlas is involved in legal proceedings, including lawsuits, regulatory examinations and inquiries. Atlas is exposed to credit risk on balances receivable from insureds and agents. Credit exposure to any one individual insured is not material. The policies placed with risk taking partners are distributed by agents who may manage cash collection on its behalf pursuant to the terms of their agency agreement. Atlas has procedures to monitor and minimize its exposure to delinquent agent balances, including, but not limited to, reviewing agent account statements, processing policy cancellations for non-payment and other collection efforts deemed appropriate. |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and Equipment Held ($ in ‘000s) March 31, 2021 December 31, 2020 Buildings 1 $ 7,425 $ 7,425 Land 1 1,840 1,840 Building improvements 9,031 9,031 Leasehold improvements 193 193 Internal use software 12,795 12,795 Computer equipment 1,838 1,838 Furniture and other office equipment 1,097 1,121 Total $ 34,219 $ 34,243 Accumulated depreciation and amortization (16,088) (15,428) Total property and equipment, net $ 18,131 $ 18,815 1 Listed for sale Depreciation expense and amortization from continuing operations was $684,000 and $869,000 for the three months ended March 31, 2021 and 2020, respectively. For the year ended December 31, 2020, depreciation expense and amortization from continuing operations was $3.2 million. For the three months ended March 31, 2021 and 2020, the Company capitalized $0 and $110,000, respectively, of costs incurred, consisting primarily of external consultants and internal labor costs incurred during the application development stage for internal-use software. Substantially all of the costs incurred during the period were part of the application development stage. Amortization expense recorded for projects in the post-implementation/operation stage was $302,000 and $402,000 for the three months ended March 31, 2021 and 2020, respectively. During 2016, Atlas purchased a building and land to serve as its new corporate headquarters to replace its former leased office space. Atlas’ Chicago area staff moved into this space in late October 2017 and occupies approximately 70,000 square feet in the building. An unrelated tenant occupies the remaining office space in the building. Rental income related to this lease agreement was $119,000 and $154,000 for the three months ended March 31, 2021 and 2020, respectively. Depreciation expense related to the building and its improvements was $284,000 and $265,000 for the three months ended March 31, 2021 and 2020, respectively. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation On January 6, 2011, Atlas adopted a stock option plan (“Stock Option Plan”) in order to advance the interests of Atlas by providing incentives to eligible persons defined in the plan. In the second quarter of 2013, a new equity incentive plan (“Equity Incentive Plan”) was approved by the Company’s common shareholders at the Annual General Meeting, and Atlas ceased to grant new stock options under the preceding Stock Option Plan. The Equity Incentive Plan is a securities based compensation plan, pursuant to which Atlas may issue restricted stock grants for ordinary voting common shares, restricted stock, stock grants for ordinary voting common shares, stock options and other forms of equity incentives to eligible persons as part of their compensation. The Equity Incentive Plan is considered an amendment and restatement of the Stock Option Plan, although outstanding stock options issued pursuant to the Stock Option Plan will continue to be governed by the terms of the Stock Option Plan. Stock Options Stock Option Activity (prices in Canadian dollars designated with “C$” and U.S. dollars designated with “US$” Three months ended March 31, 2021 2020 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price C$ Denominated: Outstanding, beginning of period — C$— 27,195 C$6.00 Granted — — — — Exercised — — — — Canceled — — — — Outstanding, end of period — C$— 27,195 C$6.00 US$ Denominated: Outstanding, beginning of period 181,500 US$13.51 375,000 US$17.01 Granted — — — — Exercised — — — — Canceled — — (193,500) 18.73 Outstanding, end of period 181,500 US$13.51 181,500 US$13.51 There are no stock options that are exercisable as of March 31, 2021. The stock option grants outstanding have a weighted average remaining life of 2.97 years and have a fair value of $0 as of March 31, 2021. On March 12, 2015, the Board of Directors of Atlas granted equity awards of (i) 200,000 restricted stock grants for ordinary voting common shares of the Company and (ii) 200,000 options to acquire ordinary voting common shares to the executive officers of the Company as part of the Company’s annual compensation process. The awards were made under the Company’s Equity Incentive Plan. The awards vest in five On December 31, 2018, the Company awarded restricted stock unit grants for ordinary voting common shares of the Company to its external directors pursuant to a director equity award agreement dated December 31, 2018. The awards, which were approved by the Company’s Board of Directors in March 2018, were valued at $40,000 per external director (“Aggregate Award”) and were made under the Company’s Equity Incentive Plan. The number of restricted stock units awarded was determined by dividing (A) the Aggregate Award by (B) the closing price of a Company ordinary voting common share at the close of market on April 4, 2018, which was $10.50 per share. For new directors, the Aggregate Award is proportionate to the director’s start date and priced as of that same day. During 2018, the Company awarded 17,524 RSU grants having an aggregate grant date fair value of $179,000. As of March 31, 2021 all of the RSU grants have vested. Restricted Shares Restricted Stock Grants for Ordinary Voting Common Shares and Restricted Share Unit Activity Three months ended March 31, 2021 2020 Number of Shares Weighted Average Fair Value at Grant Date Number of Shares Weighted Average Fair Value at Grant Date Non-vested, beginning of period $ 3,301 $ 10.22 $ 171,682 $ 17.46 Granted — — — — Vested (3,301) 0.12 (5,841) 10.22 Canceled — — (160,000) 9.62 Non-vested, end of period $ — $ — $ 5,841 $ 10.22 During the first quarter of 2020, 140,000 ordinary voting restricted common shares were canceled as a result of not meeting annual performance targets. Also during the first quarter of 2020, an additional 20,000 restricted common shares were canceled due to the departure of a former officer. |
Other Employee Benefit Plans
Other Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2021 | |
Other Employee Benefit Plans [Abstract] | |
Other Employee Benefit Plans | Other Employee Benefit Plans Defined Contribution Plan Atlas has a defined contribution 401(k) plan covering all qualified employees of Atlas and its subsidiaries. Contributions to this plan are limited based on IRS guidelines. Atlas may match up to 100% of the employee contribution up to 2.5% of annual earnings, plus 50% of additional contributions up to 2.5% of annual earnings, for a total maximum expense of 3.75% of annual earnings per participant. Atlas’ matching contributions are discretionary. Employees are 100% vested in their own contributions and vest in Atlas contributions based on years of service equally over 5 years with 100% vested after 5 years. Company contributions were $0 and $10,000 for the three months ended March 31, 2021 and 2020, respectively. The matching portion of this plan was suspended during the third quarter of 2020. Employee Stock Purchase Plan The Atlas Employee Stock Purchase Plan (“ESPP”) encourages employee interest in the operation, growth and development of Atlas and provides an additional investment opportunity to employees. Full time and permanent part time employees working more than 30 hours per week are allowed to invest up to 7.5% of adjusted salary in Atlas ordinary voting common shares. Atlas may match up to 100% of the employee contribution up to 2.5% of annual earnings, plus 50% of additional contributions up to 5% of annual earnings, for a total maximum expense of 5% of annual earnings per participant. Atlas’ matching contributions are discretionary. Atlas also pays all administrative costs related to this plan. Atlas’ costs incurred related to the matching portion of the ESPP were $0 and $3,000 for the three months ended March 31, 2021 and 2020, respectively. The matching portion of this plan was suspended during the third quarter of 2020. |
Share Capital and Mezzanine Equ
Share Capital and Mezzanine Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Share Capital and Mezzanine Equity | Share Capital and Mezzanine Equity Share Capital Share Capital Activity March 31, 2021 December 31, 2020 Shares Authorized Shares Issued Shares Outstanding Amount Shares Issued Shares Outstanding Amount Ordinary voting common shares 266,666,667 12,302,839 12,047,334 $ 37 12,248,798 11,993,293 $ 37 Restricted voting common shares 33,333,334 — — — — — — Total common shares 300,000,001 12,302,839 12,047,334 $ 37 12,248,798 11,993,293 $ 37 There were 0 and 3,301 non-vested RSUs as of March 31, 2021 and December 31, 2020, respectively. These RSUs are participative and are included in the computations of earnings per common share and book value per common share for these periods. During the three months ended March 31, 2021, the Company issued 54,041 ordinary voting common shares of which 50,740 ordinary voting common shares were issued under the near term incentive program while 3,301 ordinary voting common shares were issued as a result of the vesting of RSUs. During the year ended December 31, 2020, the Company issued 210,481 ordinary voting common shares of which 202,100 ordinary voting common shares were issued under the near term incentive program while 8,381 ordinary voting common shares were issued as a result of the vesting of RSUs. Also, during the year ended December 31, 2020, 140,000 ordinary voting restricted common shares were canceled due to not meeting performance targets, and 20,000 ordinary voting restricted common shares were canceled due to the departure of a former officer. Warrants The Schedule 13G/A filed by American Financial Group, Inc. a parent holding company, on February 2, 2021 states that as of December 31, 2020, it has sole voting power to vote and sole power to dispose of 2,387,368 ordinary voting common shares. These shares are represented by warrants to purchase 2,387,368 ordinary voting common shares until June 10, 2024, under a Warrant Agreement dated June 10, 2019 (the “Warrant Agreement”), at an initial exercise price of $0.69 per share, with both the number of ordinary voting common shares subject to the Warrant Agreement and the exercise price subject to adjustment as set forth in the Warrant Agreement. Mezzanine Equity |
Leases
Leases | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Leases | Leases We currently lease real estate space, automobiles, and certain equipment under non-cancelable operating lease agreements. Leases with an initial term of 12 months or less, which are immaterial to the Company, are not recorded in the condensed consolidated statement of financial position. The Company has elected the practical expedient to account for each separate lease component of a contract and its associated non-lease components as a single lease component, thus causing all fixed payments to be capitalized. The Company also elected the package of practical expedients permitted within the new standard, which among other things, allows the Company to carry forward historical lease classification. Variable lease payment amounts that cannot be determined at the commencement of the lease, such as increases to lease payments based on changes in index rates or usage, are not recorded in the condensed consolidated statement of financial position. Certain agreements include an option to extend or renew the lease term at our option. The operating lease liability includes lease payments related to options to extend or renew the lease term if the Company is reasonably certain of exercising those options. Lease payments are discounted using the implicit discount rate in the lease. If the implicit discount rate for the lease cannot be readily determined, the Company uses an estimate of its incremental borrowing rate. The Company did not have any contracts accounted for as finance leases as of March 31, 2021 or 2020. Lease Expense ($ in ‘000s) Three months ended March 31, 2021 2020 Operating leases $ 169 $ 190 Variable lease cost 92 89 Total $ 261 $ 279 Other Operating Lease Information ($ in ‘000s) Three months ended March 31, 2021 2020 Cash paid for amounts included in the measurement of lease liabilities reported in operating cash flows $ 261 $ 279 Right-of-use assets obtained in exchange for new lease liabilities — — Total $ 261 $ 279 The following table presents the undiscounted contractual maturities of the Company’s operating lease liability: Contractual Operating Lease Liabilities ($ in ‘000s) As of March 31, 2021 Remainder of 2021 $ 672 2022 179 2023 23 Total lease payments $ 874 Impact of discounting 6 Operating lease liability $ 880 Supplemental Balance Sheet Disclosures ($ in ‘000s) Lease Component Balance Sheet Classification As of March 31, 2021 Lease right-of-use asset Right-of-use asset $ 728 Weighted-average remaining lease term 1.0 year Weighted-average discount rate 3.6 % |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsDuring the year-ended December 31, 2020, a portion of Global Liberty’s investment portfolio, which is included in “Assets held for sale” on the Condensed Consolidated Statements of Financial Position, included investment vehicles that were considered related-party transactions. As of December 31, 2020, these related-party transactions made up approximately 22.5%, of the Company’s investment portfolio. In these transactions, one or more of the Company’s former directors or entities affiliated with such directors invest in and/or manage these vehicles. These related-party transactions are consistent with the Company’s investment guidelines and have been reviewed and approved by the Investment Committee of the Company’s Board of Directors. With the retirement of these former directors from the Atlas Board of Directors during 2020, these investments are no longer considered related-party transactions. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable | Notes Payable On April 26, 2017, Atlas issued $25 million of five-year 6.625% senior unsecured notes and received net proceeds of approximately $23.9 million after deducting underwriting discounts and commissions and other estimated offering expenses. Interest on the senior unsecured notes is payable quarterly on each January 26, April 26, July 26 and October 26. Atlas may, at its option, beginning with the interest payment date of April 26, 2020, and on any scheduled interest payment date thereafter, redeem the senior unsecured notes, in whole or in part, at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest to, but excluding, the date of redemption. The senior unsecured notes will rank senior in right of payment to any of Atlas’ existing and future indebtedness that is by its terms expressly subordinated or junior in right of payment to the senior unsecured notes. The senior unsecured notes will rank equally in right of payment to all of Atlas’ existing and future senior indebtedness, but will be effectively subordinated to any secured indebtedness to the extent of the value of the collateral securing such secured indebtedness. In addition, the senior unsecured notes will be structurally subordinated to the indebtedness and other obligations of Atlas’ subsidiaries. The senior unsecured notes were issued under an indenture and supplemental indenture that contain covenants that, among other things, limit: (i) the ability of Atlas to merge or consolidate, or lease, sell, assign or transfer all or substantially all of its assets; (ii) the ability of Atlas to sell or otherwise dispose of the equity securities of certain of its subsidiaries; (iii) the ability of certain of Atlas’ subsidiaries to issue equity securities; (iv) the ability of Atlas to permit certain of its subsidiaries to merge or consolidate, or lease, sell, assign or transfer all or substantially all of their respective assets; and (v) the ability of Atlas and its subsidiaries to incur debt secured by equity securities of certain of its subsidiaries. On November 10, 2016, American Insurance Acquisition, Inc. (“AIAI”) entered into a ten-year 5.0% fixed rate mortgage agreement with the Insurance Subsidiaries totaling $10.7 million with principal and interest payments due monthly. The mortgage rate is secured by the Company’s headquarters and was previously eliminated in consolidation. The amounts payable as of March 31, 2021 are due to the ASI Pool Companies. On May 1, 2020, AIAI entered into a Paycheck Protection Program Promissory Note (the "PPP Note") with respect to a loan of $4,600,500 (the "PPP Loan") from Fifth Third Bank, National Association (“Fifth Third”). The PPP Loan was obtained pursuant to the Paycheck Protection Program (the "PPP") of the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") administered by the U.S. Small Business Administration ("SBA"). The PPP Loan matures on May 1, 2022 and bears interest at a rate of 1.0% per annum. The PPP Loan is payable in 18 equal monthly payments of $257,611.48 which was to commence December 1, 2020. The PPP Loan may be prepaid at any time prior to maturity with no prepayment penalties. AIAI has applied for loan forgiveness pursuant to the terms of the PPP as certain of the criteria have been met and is awaiting the results of the forgiveness decision, and as a result, monthly payments will be deferred until final resolution of the forgiveness application process. On February 7, 2021, AIAI entered into a Paycheck Protection Program Promissory Note with respect to a loan of $2,000,000 (the “Second PPP Loan”) from Fifth Third. The Second PPP Loan was obtained pursuant to the SBA’s Paycheck Protection Program Second Draw Loans under the Small Business Act (“SB Act”) and is subject to the terms and conditions of the SB Act, the CARES Act and related legislation and regulations (the “PPP Rules”). The Company was eligible for this Second PPP Loan because our equity securities are not a National Markets System stock traded on a national securities exchange as defined by Section 6 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Second PPP Loan matures on February 7, 2026 and bears interest at a rate of 1.0% per annum. The Company will not be obligated to make any payments of principal or interest if the Company submits a loan forgiveness application to Fifth Third within 10 months after the end of the Company’s covered loan forgiveness period (as defined and interpreted by the PPP Rules) and such loan forgiveness is allowed. If the Company does not submit a loan forgiveness application within 10 months after the end of the Company’s loan forgiveness covered period (or such forgiveness is not allowed), the Company must begin paying principal and interest after that period (or after notice that such forgiveness is not allowed). Interest expense on notes payable was $569,000 and $564,000 for the three months ended March 31, 2021 and 2020, respectively. Notes Payable Outstanding ($ in ‘000s) March 31, 2021 December 31, 2020 6.625% Senior Unsecured Notes due April 26, 2022 $ 25,000 $ 25,000 1.0% PPP Loan due May 1, 2022 4,601 4,601 1.0% Second PPP Loan due February 7, 2026 2,000 — 5.0% Mortgage due November 10, 2026 6,668 6,863 Total outstanding borrowings 38,269 36,464 Unamortized issuance costs (240) (296) Total notes payable $ 38,029 $ 36,168 |
Deconsolidation and Discontinue
Deconsolidation and Discontinued Operations | 3 Months Ended |
Mar. 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Deconsolidation and Discontinued Operations | Deconsolidation and Discontinued Operations Deconsolidation As part of the deconsolidation of the ASI Pool Companies which occurred on October 1, 2019, notes receivable from the ASI Pool Companies with an outstanding principal and accrued interest balances of $18.0 million due to AIAI are resented on the condensed consolidated statements of financial position. On May 1, 2015, AIAI entered into subordinated surplus debentures (“Surplus Notes”) with the ASI Pool Companies that had a maturity date of April 30, 2020 carrying a variable interest equal to the corporate base rate as reported by the largest bank (measured in assets) with its head office located in Chicago, Illinois, in effect on the first business day of each month for the term of the Surplus Notes plus two percent per annum on the unpaid principal balance with a maximum variable interest rate for any month not to exceed the initial rate for the Surplus Notes by more than ten percent per annum. These Surplus Notes are subject to various terms and conditions as set forth by the Illinois Department of Insurance and require prior written approval for the payment of interest and/or a reduction in principal. AIAI stopped accruing the interest receivable on these notes at their maturity date. These Surplus Notes could be used at some point by AIAI to offset future amounts payable due to the ASI Pool Companies related to income tax settlements and various other amounts due to the estates of the ASI Pool Companies that are in liquidation. Discontinued Operations During the fourth quarter of 2019, the Company began actively pursuing the potential sale of Global Liberty, and as a result, Global Liberty has been classified as a discontinued operation and the assets and liabilities are reported as held for sale and results of Global Liberty’s operations are reported separately for all periods presented. Global Liberty has not been sold within the one year guidance as set forth by ASC 205-20 to continue classifying Global Liberty as a discontinued operations. However, due to the confluence of events and circumstances beyond the Company’s control, ASC 205-20 provides for an exception to the one year guidance which the Company believes fits its situation. As a result of the Company applying the exception guidance, Global Liberty remains a discontinued operation as of March 31, 2021. The Company continues to move forward with the plans of selling Global Liberty pending certain regulatory and other matters occur prior to such sale. Summary financial information for Global Liberty included in income (loss) from discontinued operations, net of tax in the condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020 is presented below: Income (Loss) from Discontinued Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Net premiums earned $ 2,598 $ 4,867 Net investment loss (64) (29) Net realized gains (losses) 145 (1,565) Total revenue 2,679 3,273 Net claims incurred 883 596 Acquisition costs 910 2,068 Other underwriting expenses 734 1,188 Total expenses 2,527 3,852 Income (loss) from operations before income taxes 152 (579) Income tax benefit — (522) Net income (loss) $ 152 $ (57) Statements of Comprehensive Loss ($ in ‘000s) Three months ended March 31, 2021 2020 Net income (loss) $ 152 $ (57) Other comprehensive income: Changes in net unrealized investments gains (13) (58) Reclassification to net income (loss) (158) (91) Other comprehensive loss (171) (149) Total comprehensive loss $ (19) $ (206) The assets and liabilities of Global Liberty are presented as discontinued operations and included in assets and liabilities held for sale in the condensed consolidated statements of financial position at March 31, 2021 and December 31, 2020 and are detailed as follows: ($ in ‘000s) March 31, 2021 December 31, 2020 Assets Investments Fixed income securities, available for sale, at fair value (amortized cost $1,795 and $4,315) $ 1,853 $ 4,544 Other investments 1,307 1,319 Total investments 3,160 5,863 Cash and cash equivalents 5,240 3,029 Accrued investment income 13 29 Reinsurance recoverables on amounts paid 1,172 581 Reinsurance recoverables on amounts unpaid 33,443 31,958 Prepaid reinsurance premiums 3,697 9,739 Deferred policy acquisition costs 264 637 Other assets 1,112 2,049 Total assets $ 48,101 $ 53,885 Liabilities Claims liabilities $ 38,037 $ 38,499 Unearned premium reserves 8,588 14,545 Due to reinsurers — 10 Other liabilities and accrued expenses 7,169 7,353 Total liabilities $ 53,794 $ 60,407 |
Going Concern
Going Concern | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Going Concern Under ASC 205-40 (Going Concern), we have the responsibility to evaluate whether conditions and/or events raise substantial doubt about our ability to meet our future financial obligations as they become due within one year after the date that the condensed consolidated financial statements are issued. As required by this standard, our evaluation shall initially not take into consideration the potential mitigating effects of our plans that have not been fully implemented as of the date the condensed consolidated financial statements are issued. In complying with the requirements under ASC 205-40 to complete an evaluation without considering mitigating factors, the Company considered several conditions or events including (1) uncertainty around the continued impact of the COVID-19 pandemic on the Company’s operations and consolidated financial results, (2) the $25 million of Senior Unsecured Notes maturing on April 26, 2022, (3) recurring operating losses for fiscal periods through March 31, 2021, (4) the Company’s negative equity, and (5) the Company’s working capital limitations. The above conditions raise substantial doubt about the Company’s ability to continue as a going concern for the 12-month period following the date of the issuance of the March 31, 2021 interim financial statements. In performing the second step of this assessment, we are required to evaluate whether our plans to mitigate the conditions above alleviate the substantial doubt about our ability to meet our obligations as they become due within one year after the date that the condensed consolidated financial statements are issued. Our future plans may potentially include, without limitation, one or more of the following: (1) securing incremental capital with the objective of potentially repurchasing some or all of the Senior Unsecured Notes at a discount to par, in the open market or otherwise, (2) securing equity or debt capital in private or public transactions, or (3) offering to exchange some or all of the Senior Unsecured Notes for debt, equity and/or other securities or other consideration, through privately negotiated transactions or otherwise. The constraints and requirements related to the Company’s current senior notes coupled with market conditions could create limitations with respect to such alternatives. Management believes that the Company’s capital requirements will depend on many factors including the success of the Company’s business development efforts. Management also believes the Company may need to raise additional capital for working capital purposes. There is no assurance that such financing will be available in the future. The conditions described above raise substantial doubt about our ability to continue as a going concern. The condensed consolidated financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. There is no assurance that sufficient funds required during the next year or thereafter will be generated from operations or that funds will be available through external sources. The lack of additional capital resulting from the inability to generate cash flow from operations or to raise capital from external sources would force the Company to substantially curtail or cease operations and would, therefore, have a material effect on the business. Furthermore, there can be no assurance that any such required funds, if available, will be available on attractive terms or they will not have a significant dilutive effect on the Company’s existing shareholders. In the absence of the successful execution of one or more of the Company’s previously mentioned mitigating actions, we have therefore concluded there is substantial doubt about our ability to continue as a going concern through or beyond 12 months of the issue date of these interim financial statements. The accompanying condensed consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The accompanying condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from our failure to continue as a going concern. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Event On April 22, 2021, the Company granted an aggregate of 1,016,000 options (“Options”) with an exercise price of $0.49 per common share of the Company to directors and managers, and executives. This exercise price is the average of the high bid and low asked prices on the date of the grant quoted on the OTC Bulletin Board Service. The Options granted to management shall vest in three equal installments, with each installment vesting on the 1st, 2nd and 3rd anniversary of the date of the grant. The Options granted to independent directors vested immediately upon the date of the grant. The Options will expire on the 7th anniversary of the date of the grant. In the event of a change of control of the Company, or should a director or employee’s service with the Company be terminated other than for cause or voluntary resignation, any unvested Options will immediately vest. All grants are made pursuant to the Company’s 2013 Equity Incentive Plan (the “Plan”) as previously approved by shareholders, and the description set forth herein is qualified in its entirety by the terms of such Plan. |
Nature of Operations and Basi_2
Nature of Operations and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation These statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of Atlas and the entities it controls. Equity investments in entities that we do not consolidate, including corporate entities in which we have significant influence and partnership and partnership-like entities in which we have more than minor influence over operating and financial policies, are accounted for under the equity method unless we have elected the fair value option. All significant intercompany accounts and transactions have been eliminated. The results for the three months ended March 31, 2021 are not necessarily indicative of the results expected for the full calendar year. |
Estimates and Assumptions | Estimates and Assumptions |
Revenue Recognition | Revenue RecognitionRevenues from contracts with customers include both commission and fee income. The recognition and measurement of revenue is based on the assessments of individual contract terms. As a managing general agency (an “MGA”), AGMI has contracts with various insurance carriers which determines AGMI’s commission income revenue. Each contract specifies what our performance obligations are as an MGA and what determines our commission income revenue, generally gross written premiums, net of cancellations and refunds. Under these contracts there are a number of performance obligations; however, it is the bundle of these services and not a single obligation that results in the performance of the MGA under the contracts. The Company considers these performance obligations as a non-bifurcated bundle of services where the performance obligations are satisfied simultaneous to the point in time where the Company issues a policy, or cancels a policy to an insured. The commission rate stated in the individual contract is the standalone selling price of these non-bifurcated services, which is allocated to the service bundle and not to any individual obligation under the various contracts. |
Operating Segments | Operating Segments |
New Accounting Standards | New Accounting StandardsThere have been no recent pronouncements or changes in pronouncements during the three months ended March 31, 2021, as compared to those described in our Annual Report on Form 10-K for the twelve months ended December 31, 2020, that are of significance or potential significance to Atlas. Pertinent Accounting Standard Updates (“ASUs”) are issued from time to time by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as they become effective. All recently issued accounting pronouncements with effective dates prior to April 1, 2021 have been adopted by the Company. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Finite-Lived Intangible Assets | Intangible Assets by Major Asset Class ($ in ‘000s) Economic Useful Life Gross Carrying Amount Accumulated Amortization Net As of March 31, 2021 Trade name and trademark 15 years $ 1,800 $ 734 $ 1,066 Customer relationship 10 years 2,700 1,629 1,071 $ 4,500 $ 2,363 $ 2,137 As of December 31, 2020 Trade name and trademark 15 years $ 1,800 $ 703 $ 1,097 Customer relationship 10 years 2,700 1,562 1,138 $ 4,500 $ 2,265 $ 2,235 |
Loss From Continuing Operatio_2
Loss From Continuing Operations per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Computations of Basic and Diluted Loss per Common Share from Continuing Operations ($ in ‘000s, except share and per share amounts) Three months ended March 31, 2021 2020 Basic Loss from continuing operations before income taxes $ (2,702) $ (3,130) Income tax expense — 104 Net loss attributable to common shareholders from continuing operations $ (2,702) $ (3,234) Basic weighted average common shares outstanding 12,023,655 11,914,849 Loss per common share basic from continuing operations $ (0.22) $ (0.27) Diluted Basic weighted average common shares outstanding 12,023,655 11,914,849 Dilutive potential ordinary shares: Dilutive stock options outstanding — — Diluted weighted average common shares outstanding 12,023,655 11,914,849 Loss per common share diluted from continuing operations $ (0.22) $ (0.27) |
Contracts with Customers (Table
Contracts with Customers (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable | The balance of receivables related to contracts with customers, which is recorded as part of premiums receivable on the Consolidated Statements of Financial Position as of March 31, 2021 and December 31, 2020: Components of Commission Receivables ($ in ‘000s) Three months ended Twelve months ended Commission receivable, beginning of period $ 2,577 $ 1,428 Commission revenue 1,693 5,195 Net change in cash received (1,904) (4,046) Commission receivable, end of period $ 2,366 $ 2,577 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Continuing Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ (568) 21.0 % $ (657) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) 560 (20.7) 791 (25.2) Nondeductible expenses 1 — — — Stock compensation 7 (0.3) 12 (0.4) Tax rate differential — — (42) 1.3 Provision for income taxes for continuing operations $ — — % $ 104 (3.3) % Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Discontinued Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ 32 21.0 % $ (122) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) (32) (21.0) (202) 34.9 Nondeductible expenses — — 2 (0.1) Tax rate differential — — (200) 34.3 Provision for income taxes for discontinued operations $ — — % $ (522) 90.1 % |
Schedule of Components of Income Tax Expense (Benefit) | Components of Income Tax Expense - Continuing Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Current tax expense $ — $ 104 Components of Income Tax Benefit - Discontinued Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Current tax benefit $ — $ (522) |
Schedule of Deferred Tax Assets and Liabilities | Components of Deferred Income Tax Assets and Liabilities ($ in ‘000s) March 31, 2021 December 31, 2020 Gross deferred tax assets: Losses carried forward $ 16,844 $ 16,408 Claims liabilities and unearned premium reserves 495 496 Investment in affiliates 23,870 23,870 Bad debts 168 168 Stock compensation 272 279 Other 319 203 Valuation allowance (33,984) (33,420) Total gross deferred tax assets 7,984 8,004 Gross deferred tax liabilities: Deferred policy acquisition costs 55 134 Investments 84 122 Fixed assets 1,224 1,344 Intangible assets 449 469 Other 6,172 5,935 Total gross deferred tax liabilities 7,984 8,004 Net deferred tax assets $ — $ — |
Summary of Operating Loss Carryforwards | Net Operating Loss Carryforward as of March 31, 2021 by Expiry ($ in ‘000s) Year of Occurrence Year of Expiration Amount 2011 2031 $ 1 2012 2032 70 2015 2035 1 2017 2037 13,649 2018 2038 8,903 2018 Indefinite 8,245 2019 2039 4,973 2019 Indefinite 6,306 2020 2040 31,300 2020 Indefinite 4,687 2021 2041 533 2021 Indefinite 1,543 Total $ 80,211 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property and Equipment Held ($ in ‘000s) March 31, 2021 December 31, 2020 Buildings 1 $ 7,425 $ 7,425 Land 1 1,840 1,840 Building improvements 9,031 9,031 Leasehold improvements 193 193 Internal use software 12,795 12,795 Computer equipment 1,838 1,838 Furniture and other office equipment 1,097 1,121 Total $ 34,219 $ 34,243 Accumulated depreciation and amortization (16,088) (15,428) Total property and equipment, net $ 18,131 $ 18,815 1 Listed for sale |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Option Activity | Stock Option Activity (prices in Canadian dollars designated with “C$” and U.S. dollars designated with “US$” Three months ended March 31, 2021 2020 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price C$ Denominated: Outstanding, beginning of period — C$— 27,195 C$6.00 Granted — — — — Exercised — — — — Canceled — — — — Outstanding, end of period — C$— 27,195 C$6.00 US$ Denominated: Outstanding, beginning of period 181,500 US$13.51 375,000 US$17.01 Granted — — — — Exercised — — — — Canceled — — (193,500) 18.73 Outstanding, end of period 181,500 US$13.51 181,500 US$13.51 |
Schedule of Restricted Stock and Restricted Stock Units Activity | Restricted Stock Grants for Ordinary Voting Common Shares and Restricted Share Unit Activity Three months ended March 31, 2021 2020 Number of Shares Weighted Average Fair Value at Grant Date Number of Shares Weighted Average Fair Value at Grant Date Non-vested, beginning of period $ 3,301 $ 10.22 $ 171,682 $ 17.46 Granted — — — — Vested (3,301) 0.12 (5,841) 10.22 Canceled — — (160,000) 9.62 Non-vested, end of period $ — $ — $ 5,841 $ 10.22 |
Share Capital and Mezzanine E_2
Share Capital and Mezzanine Equity (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of Stock by Class | Share Capital Activity March 31, 2021 December 31, 2020 Shares Authorized Shares Issued Shares Outstanding Amount Shares Issued Shares Outstanding Amount Ordinary voting common shares 266,666,667 12,302,839 12,047,334 $ 37 12,248,798 11,993,293 $ 37 Restricted voting common shares 33,333,334 — — — — — — Total common shares 300,000,001 12,302,839 12,047,334 $ 37 12,248,798 11,993,293 $ 37 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Lease, Cost | Lease Expense ($ in ‘000s) Three months ended March 31, 2021 2020 Operating leases $ 169 $ 190 Variable lease cost 92 89 Total $ 261 $ 279 Other Operating Lease Information ($ in ‘000s) Three months ended March 31, 2021 2020 Cash paid for amounts included in the measurement of lease liabilities reported in operating cash flows $ 261 $ 279 Right-of-use assets obtained in exchange for new lease liabilities — — Total $ 261 $ 279 |
Lessee, Operating Lease, Liability, Maturity | The following table presents the undiscounted contractual maturities of the Company’s operating lease liability: Contractual Operating Lease Liabilities ($ in ‘000s) As of March 31, 2021 Remainder of 2021 $ 672 2022 179 2023 23 Total lease payments $ 874 Impact of discounting 6 Operating lease liability $ 880 Supplemental Balance Sheet Disclosures ($ in ‘000s) Lease Component Balance Sheet Classification As of March 31, 2021 Lease right-of-use asset Right-of-use asset $ 728 Weighted-average remaining lease term 1.0 year Weighted-average discount rate 3.6 % |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Summary of Outstanding Debt | Notes Payable Outstanding ($ in ‘000s) March 31, 2021 December 31, 2020 6.625% Senior Unsecured Notes due April 26, 2022 $ 25,000 $ 25,000 1.0% PPP Loan due May 1, 2022 4,601 4,601 1.0% Second PPP Loan due February 7, 2026 2,000 — 5.0% Mortgage due November 10, 2026 6,668 6,863 Total outstanding borrowings 38,269 36,464 Unamortized issuance costs (240) (296) Total notes payable $ 38,029 $ 36,168 |
Deconsolidation and Discontin_2
Deconsolidation and Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | Summary financial information for Global Liberty included in income (loss) from discontinued operations, net of tax in the condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020 is presented below: Income (Loss) from Discontinued Operations ($ in ‘000s) Three months ended March 31, 2021 2020 Net premiums earned $ 2,598 $ 4,867 Net investment loss (64) (29) Net realized gains (losses) 145 (1,565) Total revenue 2,679 3,273 Net claims incurred 883 596 Acquisition costs 910 2,068 Other underwriting expenses 734 1,188 Total expenses 2,527 3,852 Income (loss) from operations before income taxes 152 (579) Income tax benefit — (522) Net income (loss) $ 152 $ (57) Statements of Comprehensive Loss ($ in ‘000s) Three months ended March 31, 2021 2020 Net income (loss) $ 152 $ (57) Other comprehensive income: Changes in net unrealized investments gains (13) (58) Reclassification to net income (loss) (158) (91) Other comprehensive loss (171) (149) Total comprehensive loss $ (19) $ (206) The assets and liabilities of Global Liberty are presented as discontinued operations and included in assets and liabilities held for sale in the condensed consolidated statements of financial position at March 31, 2021 and December 31, 2020 and are detailed as follows: ($ in ‘000s) March 31, 2021 December 31, 2020 Assets Investments Fixed income securities, available for sale, at fair value (amortized cost $1,795 and $4,315) $ 1,853 $ 4,544 Other investments 1,307 1,319 Total investments 3,160 5,863 Cash and cash equivalents 5,240 3,029 Accrued investment income 13 29 Reinsurance recoverables on amounts paid 1,172 581 Reinsurance recoverables on amounts unpaid 33,443 31,958 Prepaid reinsurance premiums 3,697 9,739 Deferred policy acquisition costs 264 637 Other assets 1,112 2,049 Total assets $ 48,101 $ 53,885 Liabilities Claims liabilities $ 38,037 $ 38,499 Unearned premium reserves 8,588 14,545 Due to reinsurers — 10 Other liabilities and accrued expenses 7,169 7,353 Total liabilities $ 53,794 $ 60,407 |
Nature of Operations and Basi_3
Nature of Operations and Basis of Presentation (Details) | 3 Months Ended |
Mar. 31, 2021numberOfSegment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of business segments (segment) | 1 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Schedule of Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 4,500 | $ 4,500 | |
Accumulated Amortization | 2,363 | 2,265 | |
Net | $ 2,137 | 2,235 | |
Trade name and trademark | |||
Schedule of Intangible Assets [Line Items] | |||
Economic Useful Life | 15 years | 15 years | |
Gross Carrying Amount | $ 1,800 | 1,800 | |
Accumulated Amortization | 734 | 703 | |
Net | $ 1,066 | 1,097 | |
Customer relationship | |||
Schedule of Intangible Assets [Line Items] | |||
Economic Useful Life | 10 years | 10 years | |
Gross Carrying Amount | $ 2,700 | 2,700 | |
Accumulated Amortization | 1,629 | 1,562 | |
Net | $ 1,071 | $ 1,138 |
Loss From Continuing Operatio_3
Loss From Continuing Operations per Share - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Basic | ||
Loss from continuing operations before income taxes | $ (2,702) | $ (3,130) |
Income tax expense | 0 | 104 |
Net loss attributable to common shareholders from continuing operations | $ (2,702) | $ (3,234) |
Basic weighted average common shares outstanding (in shares) | 12,023,655 | 11,914,849 |
(Loss) income per common share basic from continuing operations (in dollars per share) | $ (0.22) | $ (0.27) |
Diluted | ||
Basic weighted average common shares outstanding (in shares) | 12,023,655 | 11,914,849 |
Dilutive stock options outstanding (in shares) | 0 | 0 |
Diluted weighted average common shares outstanding (includes RSUs) (in shares) | 12,023,655 | 11,914,849 |
Loss per common share diluted from continuing operations (in dollars per share) | $ (0.22) | $ (0.27) |
Loss From Continuing Operatio_4
Loss From Continuing Operations per Share - Narrative (Details) - $ / shares | Mar. 31, 2021 | Jun. 10, 2019 |
Class of Warrant or Right [Line Items] | ||
Exercise price of warrants or rights (in dollars per share) | $ 0.69 | $ 0.69 |
Ordinary Voting Common Shares Warrants to Purchase | ||
Class of Warrant or Right [Line Items] | ||
Class of warrant or right, outstanding (in shares) | 2,387,368 |
Contracts with Customers (Detai
Contracts with Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |||
Commission income | $ 1,693 | $ 2,052 | $ 5,195 |
Contracts with Customers - Comm
Contracts with Customers - Commissions Revenue Roll Forward (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Commissions Receivable [Roll Forward] | |||
Commission receivable, beginning of year | $ 2,577 | $ 1,428 | $ 1,428 |
Commission income | 1,693 | $ 2,052 | 5,195 |
Net change in cash received | (1,904) | (4,046) | |
Commission receivable, end of year | $ 2,366 | $ 2,577 |
Income Taxes - Rate Reconciliat
Income Taxes - Rate Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate | $ (568) | $ (657) |
Provision for deferred tax assets deemed unrealizable (valuation allowance) | 560 | 791 |
Nondeductible expenses | 1 | 0 |
Stock compensation | 7 | 12 |
Tax rate differential | 0 | (42) |
Income tax expense | $ 0 | $ 104 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate, percent | 21.00% | 21.00% |
Provision for deferred tax assets deemed unrealizable (valuation allowance), percent | (20.70%) | (25.20%) |
Nondeductible expenses, percent | 0.00% | 0.00% |
Stock compensation, percent | (0.30%) | (0.40%) |
Other, percent | 0.00% | 1.30% |
Effective income tax rate | 0.00% | (3.30%) |
Discontinued Operations | ||
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate | $ 32 | $ (122) |
Provision for deferred tax assets deemed unrealizable (valuation allowance) | (32) | (202) |
Nondeductible expenses | 0 | 2 |
Tax rate differential | 0 | (200) |
Income tax expense | $ 0 | $ (522) |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate, percent | 21.00% | 21.00% |
Provision for deferred tax assets deemed unrealizable (valuation allowance), percent | (21.00%) | 34.90% |
Nondeductible expenses, percent | 0.00% | (0.10%) |
Other, percent | 0.00% | 34.30% |
Effective income tax rate | 0.00% | 90.10% |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | ||
Current tax expense | $ 0 | $ 104 |
Discontinued Operations | ||
Operating Loss Carryforwards [Line Items] | ||
Current tax expense | $ 0 | $ (522) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Gross deferred tax assets: | ||
Losses carried forward | $ 16,844 | $ 16,408 |
Claims liabilities and unearned premium reserves | 495 | 496 |
Investment in affiliates | 23,870 | 23,870 |
Bad debts | 168 | 168 |
Stock compensation | 272 | 279 |
Other | 319 | 203 |
Valuation allowance | (33,984) | (33,420) |
Total gross deferred tax assets | 7,984 | 8,004 |
Gross deferred tax liabilities: | ||
Deferred policy acquisition costs | 55 | 134 |
Investments | 84 | 122 |
Fixed assets | 1,224 | 1,344 |
Intangible assets | 449 | 469 |
Other | 6,172 | 5,935 |
Total gross deferred tax liabilities | 7,984 | 8,004 |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes - Schedule of Tax
Income Taxes - Schedule of Tax Carryforwards (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | $ 80,211 |
Carryforward Expiring in 2031 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 1 |
Carryforward Expiring in 2032 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 70 |
Carryforward Expiring in 2035 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 1 |
Carryforward Expiring in 2037 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 13,649 |
Carryforward Expiring in 2038 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 8,903 |
Carryforward Expiring Indefinite Originated In 2018 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 8,245 |
Carryforward Expiring in 2039 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 4,973 |
Carryforward Expiring Indefinite Originated In 2019 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 6,306 |
Carryforward Expiring in 2040 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 31,300 |
Carryforward Expiring Indefinite Originated In 2020 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 4,687 |
Carryforward Expiring in 2041 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | 533 |
Carryforward Expiring Indefinite Originated In 2021 | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, subject to expiration | $ 1,543 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Text Block [Abstract] | ||
Valuation allowance | $ 33,984 | $ 33,420 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 34,219 | $ 34,243 |
Accumulated depreciation and amortization | (16,088) | (15,428) |
Total property and equipment, net | 18,131 | 18,815 |
Buildings1 | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 7,425 | 7,425 |
Land1 | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 1,840 | 1,840 |
Building improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 9,031 | 9,031 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 193 | 193 |
Internal use software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 12,795 | 12,795 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 1,838 | 1,838 |
Furniture and other office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 1,097 | $ 1,121 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) ft² in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021USD ($)ft² | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization of property and equipment | $ 684 | $ 869 | |
Capitalized costs | 0 | 110 | |
Amortization of capitalized costs | $ 302 | 402 | |
Occupied area of corporate headquarters building | ft² | 70 | ||
Rental income | $ 119 | 154 | |
Gain (loss) on disposition of fixed assets | 12 | 0 | |
Building and building improvements | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization of property and equipment | $ 284 | $ 265 | |
Continuing Operations | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization of property and equipment | $ 3,200 |
Share-Based Compensation - Sche
Share-Based Compensation - Schedule of Outstanding Options and Restricted Shares (Details) | 3 Months Ended | |||
Mar. 31, 2021$ / sharesshares | Mar. 31, 2021$ / sharesshares | Mar. 31, 2020$ / sharesshares | Mar. 31, 2020$ / sharesshares | |
Prior to December 31, 2013 | ||||
Number of Options | ||||
Outstanding, beginning of period (in shares) | shares | 0 | 0 | 27,195 | 27,195 |
Granted in period (in shares) | shares | 0 | 0 | 0 | 0 |
Exercised in period (in shares) | shares | 0 | 0 | 0 | 0 |
Canceled in period (in shares) | shares | 0 | 0 | 0 | 0 |
Outstanding, end of period (in shares) | shares | 0 | 0 | 27,195 | 27,195 |
Weighted Average Exercise Price | ||||
Outstanding, beginning balance (in US or Canadian dollars per share) | $ / shares | $ 0 | $ 6 | ||
Granted in period (in US or Canadian dollars per share) | $ / shares | 0 | 0 | ||
Exercises in period (in US or Canadian dollars per share) | $ / shares | 0 | 0 | ||
Canceled in period (in US or Canadian dollars per share) | $ / shares | 0 | 0 | ||
Outstanding, ending balance (in US or Canadian dollars per share) | $ / shares | $ 0 | $ 6 | ||
After December 31, 2013 | ||||
Number of Options | ||||
Outstanding, beginning of period (in shares) | shares | 181,500 | 181,500 | 375,000 | 375,000 |
Granted in period (in shares) | shares | 0 | 0 | 0 | 0 |
Exercised in period (in shares) | shares | 0 | 0 | 0 | 0 |
Canceled in period (in shares) | shares | 0 | 0 | (193,500) | (193,500) |
Outstanding, end of period (in shares) | shares | 181,500 | 181,500 | 181,500 | 181,500 |
Weighted Average Exercise Price | ||||
Outstanding, beginning balance (in US or Canadian dollars per share) | $ / shares | $ 13.51 | $ 17.01 | ||
Granted in period (in US or Canadian dollars per share) | $ / shares | 0 | 0 | ||
Exercises in period (in US or Canadian dollars per share) | $ / shares | 0 | 0 | ||
Canceled in period (in US or Canadian dollars per share) | $ / shares | 0 | 18.73 | ||
Outstanding, ending balance (in US or Canadian dollars per share) | $ / shares | $ 13.51 | $ 13.51 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) | Mar. 12, 2015 | Mar. 31, 2018 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2018 | Apr. 04, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock options, exercisable (in shares) | 0 | |||||
Grants, weighted average remaining life | 2 years 11 months 19 days | |||||
Options outstanding, intrinsic value | $ 0 | |||||
Option awards canceled during period (shares) | 140,000 | |||||
Share-based compensation expense | $ 10,000 | $ 179,000 | ||||
Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Option awards canceled during period (shares) | 53,500 | |||||
March 12, 2015 | Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 5 years | |||||
Award vesting rights, percentage | 20.00% | |||||
December 31, 2018 | Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share price (in dollars per share) | $ 10.50 | |||||
Prior to December 31, 2013 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Canceled in period (in shares) | 0 | 0 | ||||
Granted in period (in shares) | 0 | 0 | ||||
Restricted Stock Grants | March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted share awards, non-vested, fair value | $ 1,900,000 | |||||
Restricted Stock Grants | March 12, 2015 | Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares granted during period (in shares) | 200,000 | |||||
Restricted shares vested during period (shares) | 0 | 0 | ||||
Stock Option | March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options, non-vested, fair value | $ 1,500,000 | |||||
Stock Option | March 12, 2015 | Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted in period (in shares) | 200,000 | |||||
Restricted Stock Units (RSUs) | December 31, 2018 | Director | Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares granted during period (in shares) | 17,524 | |||||
Deferred compensation arrangement with individual, fair value (in shares) | $ 40,000 | |||||
Share-based compensation arrangement by share-based payment award, aggregate grant date fair value | $ 179,000 | |||||
Restricted share and restricted share units grants | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares canceled during period (shares) | 140,000 | 140,000 | ||||
Unearned share-based compensation expense | $ 0 | |||||
Restricted share and restricted share units grants | Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares canceled during period (shares) | 20,000 | 20,000 |
Share-Based Compensation - Sc_2
Share-Based Compensation - Schedule of Restricted Shares and Restricted Share Units (Details) - Restricted stock and restricted stock units (RSUs) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Number of Shares | ||
Non-vested, beginning of period (shares) | 3,301 | 171,682 |
Granted during period (shares) | 0 | 0 |
Vested during period (shares) | (3,301) | (5,841) |
Canceled during period (shares) | 0 | (160,000) |
Non-vested, end of period (shares) | 0 | 5,841 |
Weighted Average Fair Value at Grant Date | ||
Non-vested, beginning of period (USD per share) | $ 10.22 | $ 17.46 |
Granted during period (USD per share) | 0 | 0 |
Vested during period (USD per share) | 0.12 | 10.22 |
Canceled during period (USD per share) | 0 | 9.62 |
Non-vested, end of period (USD per share) | $ 0 | $ 10.22 |
Other Employee Benefit Plans -
Other Employee Benefit Plans - Defined Contribution Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Other Employee Benefit Plans [Abstract] | ||
Defined contribution plan, percent of employee contribution matched by employer, up to 2.5% annual earnings | 100.00% | |
Defined contribution plan, percent of additional employees annual earnings employer will match 50% | 2.50% | |
Defined contribution plan, percent of employer match on additional employee contributions, up to 2.5% annual earnings | 50.00% | |
Defined contribution plan employer additional contribution matching percent of employees gross pay | 2.50% | |
Defined contribution plan, employer matching contribution, maximum percent of employees' gross pay | 3.75% | |
Defined contribution plan, employee contribution vesting percentage | 100.00% | |
Defined contribution plan, employers matching contribution, vesting period | 5 years | |
Defined contribution plan, company contributions | $ 0 | $ 10 |
Other Employee Benefit Plans _2
Other Employee Benefit Plans - Employee Stock Purchase Plan (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | |
Other Employee Benefit Plans [Abstract] | ||
Employee stock purchase plan, hours of week threshold for investing in ordinary voting common shares | 30 hours | |
Employee stock purchase plan, maximum annual contribution percent of annual earnings per employee | 0.075 | |
Employee stock purchase plan, percent of employee contribution matched by employer, up to 2.5% annual earnings | 1 | |
Employee stock purchase plan, percent of employees annual earnings employer will match 100% | 2.50% | |
Employee stock purchase plan employer additional matching contribution on percent of employees gross pay | 50.00% | |
Employee stock purchase plan, percent of additional employees annual earnings employer will match 50% | 5.00% | |
Employee stock purchase plan, employer matching contribution, maximum percent of employee's gross pay | 5.00% | |
Employee stock purchase plan, company cost | $ 0 | $ 3 |
Share Capital and Mezzanine E_3
Share Capital and Mezzanine Equity - Schedule of Stock by Class (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | ||
Common stock, shares authorized (in shares) | 300,000,001 | |
Common stock, shares issued (in shares) | 12,302,839 | 12,248,798 |
Common stock, shares outstanding (in shares) | 12,047,334 | 11,993,293 |
Common stock, value, outstanding | $ 37 | $ 37 |
Ordinary Voting Common Shares | ||
Class of Stock [Line Items] | ||
Common stock, shares authorized (in shares) | 266,666,667 | 266,666,667 |
Common stock, shares issued (in shares) | 12,302,839 | 12,248,798 |
Common stock, shares outstanding (in shares) | 12,047,334 | 11,993,293 |
Common stock, value, outstanding | $ 37 | $ 37 |
Restricted Voting Common Shares | ||
Class of Stock [Line Items] | ||
Common stock, shares authorized (in shares) | 33,333,334 | 33,333,334 |
Common stock, shares issued (in shares) | 0 | 0 |
Common stock, shares outstanding (in shares) | 0 | 0 |
Common stock, value, outstanding | $ 0 | $ 0 |
Share Capital and Mezzanine E_4
Share Capital and Mezzanine Equity - Narrative (Details) - $ / shares | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Jun. 10, 2019 | |
Class of Stock [Line Items] | ||||
Exercise price of warrants or rights (in dollars per share) | $ 0.69 | $ 0.69 | ||
Preferred stock, shares outstanding (in shares) | 0 | 0 | ||
Ordinary Voting Common Shares | ||||
Class of Stock [Line Items] | ||||
Ordinary voting common shares issued, RSU vesting (in shares) | 54,041 | 210,481 | ||
Ordinary Voting Common Shares, Sole Power to Dispose of | ||||
Class of Stock [Line Items] | ||||
Class of warrant or right, outstanding (in shares) | 2,387,368 | |||
Ordinary Voting Common Shares, Warrants to Purchase | ||||
Class of Stock [Line Items] | ||||
Class of warrant or right, outstanding (in shares) | 2,387,368 | |||
Incentive Program | Ordinary Voting Common Shares | ||||
Class of Stock [Line Items] | ||||
Ordinary voting common shares issued, RSU vesting (in shares) | 50,740 | |||
Restricted Stock Units (RSUs) | ||||
Class of Stock [Line Items] | ||||
Nonvested restricted stock units (RSUs) (shares) | 0 | 3,301 | ||
Ordinary voting common shares issued, RSU vesting (in shares) | 3,301 | 8,381 | ||
Restricted Stock Units (RSUs) | Incentive Program | ||||
Class of Stock [Line Items] | ||||
Ordinary voting common shares issued, RSU vesting (in shares) | 202,100 | |||
Restricted share and restricted share units grants | ||||
Class of Stock [Line Items] | ||||
Restricted shares canceled during period (shares) | 140,000 | 140,000 | ||
Restricted share and restricted share units grants | Officer | ||||
Class of Stock [Line Items] | ||||
Restricted shares canceled during period (shares) | 20,000 | 20,000 |
Leases - Lease Expenses (Detail
Leases - Lease Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating leases | $ 169 | $ 190 |
Variable lease cost | 92 | 89 |
Total lease expense | $ 261 | $ 279 |
Leases - Other Operating Lease
Leases - Other Operating Lease Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities reported in operating cash flows | $ 261 | $ 279 |
Right-of-use assets obtained in exchange for new lease liabilities | 0 | 0 |
Total | $ 261 | $ 279 |
Leases - Contractual Operating
Leases - Contractual Operating Lease Liability (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Remainder of 2021 | $ 672 | |
2022 | 179 | |
2023 | 23 | |
Total lease payments | 874 | |
Impact of discounting | 6 | |
Operating lease liability | $ 880 | $ 1,091 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Disclosures (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Right-of-use asset | $ 728 | $ 888 |
Weighted-average remaining lease term | 1 year | |
Weighted-average discount rate | 3.60% |
Related Party Transactions (Det
Related Party Transactions (Details) | Dec. 31, 2020 |
Director or Director Affiliated Entity | |
Related Party Transaction [Line Items] | |
Percent of invested assets considered related party transactions | 22.50% |
Notes Payable - Narrative (Deta
Notes Payable - Narrative (Details) | May 01, 2020USD ($)payment | Apr. 26, 2017USD ($) | Nov. 10, 2016USD ($) | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Feb. 07, 2021USD ($) |
1.0% PPP Loan due May 1, 2022 | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, face amount | $ 4,600,500 | |||||
Debt instrument, interest rate, stated percentage | 1.00% | |||||
Number of equal monthly payments | payment | 18 | |||||
Debt instrument, periodic payment | $ 257,611.48 | |||||
Second PPP Loan | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, face amount | $ 2,000,000 | |||||
Debt instrument, interest rate, stated percentage | 1.00% | |||||
Loan Agreement | American Insurance Acquisition | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest expense, including non-utilization fees | $ 569,000 | $ 564,000 | ||||
Line of Credit | Loan Agreement | American Insurance Acquisition | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, face amount | $ 10,700,000 | |||||
Debt instrument, term | 10 years | |||||
Debt instrument, interest rate, stated percentage | 5.00% | |||||
Senior unsecured notes | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, face amount | $ 25,000,000 | |||||
Debt instrument, term | 5 years | |||||
Debt instrument, interest rate, stated percentage | 6.625% | |||||
Amounts of funds accessed in period | $ 23,900,000 | |||||
Redemption price | 100.00% |
Notes Payable - Debt Outstandin
Notes Payable - Debt Outstanding (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Feb. 07, 2021 | Dec. 31, 2020 | May 01, 2020 | Apr. 26, 2017 |
Line of Credit Facility [Line Items] | |||||
Total outstanding borrowings | $ 38,269 | $ 36,464 | |||
Unamortized issuance costs | (240) | (296) | |||
Notes payable, net | 38,029 | 36,168 | |||
1.0% PPP Loan due May 1, 2022 | |||||
Line of Credit Facility [Line Items] | |||||
Total outstanding borrowings | 4,601 | 4,601 | |||
Debt instrument, interest rate, stated percentage | 1.00% | ||||
Second PPP Loan | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, interest rate, stated percentage | 1.00% | ||||
Second PPP Loan | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Total outstanding borrowings | 2,000 | 0 | |||
6.625% Senior Unsecured Notes due April 26, 2022 | |||||
Line of Credit Facility [Line Items] | |||||
Total outstanding borrowings | 25,000 | 25,000 | |||
Debt instrument, interest rate, stated percentage | 6.625% | ||||
5.0% Mortgage due November 10, 2026 | |||||
Line of Credit Facility [Line Items] | |||||
Total outstanding borrowings | $ 6,668 | $ 6,863 |
Deconsolidation and Discontin_3
Deconsolidation and Discontinued Operations - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Notes receivable | $ 18,017 | $ 18,017 |
Interest Rate, increase on unpaid principal balance | 0.02 | |
Maximum variable interest rate | 0.10 |
Deconsolidation and Discontin_4
Deconsolidation and Discontinued Operations - Loss From Discontinued Operations, Net of Tax (Details) - Global Liberty - Discontinued operations, held-for-sale - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | ||
Net premiums earned | $ 2,598 | $ 4,867 |
Net investment loss | (64) | (29) |
Net realized gains (losses) | 145 | (1,565) |
Total revenue | 2,679 | 3,273 |
Net claims incurred | 883 | 596 |
Acquisition costs | 910 | 2,068 |
Other underwriting expenses | 734 | 1,188 |
Total expenses | 2,527 | 3,852 |
Income (loss) from operations before income taxes | 152 | (579) |
Income tax benefit | 0 | (522) |
Net income (loss) | 152 | (57) |
Changes in net unrealized investments gains | (13) | (58) |
Reclassification to net income (loss) | (158) | (91) |
Other comprehensive loss | (171) | (149) |
Total comprehensive loss | $ (19) | $ (206) |
Deconsolidation and Discontin_5
Deconsolidation and Discontinued Operations - Consolidated Statements of Financial Position (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Liabilities | ||
Total liabilities | $ 53,794 | $ 60,407 |
Fixed income securities at fair value, amortized cost | 1,795 | 4,315 |
Global Liberty | Discontinued operations, held-for-sale | ||
Assets | ||
Fixed income securities, available for sale, at fair value (amortized cost $1,795 and $4,315) | 1,853 | 4,544 |
Other investments | 1,307 | 1,319 |
Total investments | 3,160 | 5,863 |
Cash and cash equivalents | 5,240 | 3,029 |
Accrued investment income | 13 | 29 |
Reinsurance recoverables on amounts paid | 1,172 | 581 |
Reinsurance recoverables on amounts unpaid | 33,443 | 31,958 |
Prepaid reinsurance premiums | 3,697 | 9,739 |
Deferred policy acquisition costs | 264 | 637 |
Other assets | 1,112 | 2,049 |
Total assets | 48,101 | 53,885 |
Liabilities | ||
Claims liabilities | 38,037 | 38,499 |
Unearned premium reserves | 8,588 | 14,545 |
Due to reinsurers | 0 | 10 |
Other liabilities and accrued expenses | 7,169 | 7,353 |
Total liabilities | $ 53,794 | $ 60,407 |
Going Concern (Details)
Going Concern (Details) | Apr. 26, 2017USD ($) |
Senior unsecured notes | |
Debt Instrument [Line Items] | |
Debt instrument, face amount | $ 25,000,000 |
Subsequent Events - Narrative (
Subsequent Events - Narrative (Details) - Subsequent Event | Apr. 22, 2021$ / sharesshares |
Subsequent Event [Line Items] | |
Options granted (in shares) | shares | 1,016,000 |
Weighted average exercise price (in dollars per share) | $ / shares | $ 0.49 |