Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 17, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-819881 | ||
Entity Registrant Name | Paya Holdings Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 85-2199433 | ||
Entity Address, Address Line One | 303 Perimeter Center N | ||
Entity Address, Address Line Two | Suite 600 | ||
Entity Address, City or Town | Atlanta | ||
Entity Address, State or Province | GA | ||
Entity Address, Postal Zip Code | 30346 | ||
City Area Code | 800 | ||
Local Phone Number | 261-0240 | ||
Title of 12(b) Security | Common stock, par value $0.001 per share | ||
Trading Symbol | PAYA | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 571 | ||
Entity Common Stock, Shares Outstanding | 132,424,929 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2022 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001819881 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Name | Ernst & Young LLP |
Auditor Location | Tysons, VA |
Auditor Firm ID | 42 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | |||
Revenue | $ 282,743 | $ 249,356 | $ 206,048 |
Cost of services exclusive of depreciation & amortization | (138,752) | (119,245) | (102,119) |
Selling, general & administrative expenses | (87,028) | (77,450) | (63,035) |
Depreciation & amortization | (31,756) | (30,033) | (24,562) |
Income from operations | 25,207 | 22,628 | 16,332 |
Interest expense | (14,311) | (14,142) | (17,637) |
Other income (expense) | 2,702 | (8,040) | 1,214 |
Total other income (expense) | (11,609) | (22,182) | (16,423) |
Income (loss) before income taxes | 13,598 | 446 | (91) |
Income tax (expense) benefit | (5,336) | (1,257) | (433) |
Net income (loss) | 8,262 | (811) | (524) |
Other comprehensive income | 0 | 0 | 0 |
Comprehensive income (loss) | $ 8,262 | $ (811) | $ (524) |
Weighted average shares outstanding of common stock (in shares) | 126,429,766 | 126,417,145 | 66,294,576 |
Basic net loss per share (in dollars per share) | $ 0.07 | $ (0.01) | $ (0.01) |
Weighted average diluted shares outstanding of common stock (in shares) | 126,918,416 | 126,417,145 | 66,294,576 |
Diluted net loss per share (in dollars per share) | $ 0.07 | $ (0.01) | $ (0.01) |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 168,833 | $ 146,799 |
Trade receivables, net | 24,973 | 23,163 |
Prepaid expenses | 3,527 | 2,407 |
Income taxes receivable | 542 | 460 |
Other current assets | 2,779 | 922 |
Total current assets before funds held for clients | 200,654 | 173,751 |
Funds held for clients | 179,612 | 99,815 |
Total current assets | 380,266 | 273,566 |
Non-current assets: | ||
Property and equipment, net | 15,831 | 14,011 |
Goodwill | 223,181 | 221,117 |
Intangible assets, net | 121,288 | 136,708 |
Operating lease ROU assets, net of amortization | 2,844 | 4,495 |
Other non-current assets | 850 | 1,149 |
Total assets | 744,260 | 651,046 |
Current liabilities: | ||
Trade payables | 5,464 | 3,127 |
Accrued liabilities | 16,950 | 13,686 |
Accrued revenue share | 12,488 | 11,002 |
Current tax receivable agreement liability | 2,860 | 0 |
Income taxes payable | 2,651 | 0 |
Current operating lease liabilities | 1,164 | 1,302 |
Other current liabilities | 2,997 | 3,422 |
Total current liabilities before client funds obligations | 44,574 | 32,539 |
Client funds obligations | 178,373 | 99,125 |
Total current liabilities | 222,947 | 131,664 |
Non-current liabilities: | ||
Deferred tax liability, net | 5,664 | 11,723 |
Non-current debt | 240,130 | 241,872 |
Tax receivable agreement liability | 15,644 | 19,502 |
Non-current lease liabilities | 2,561 | 3,941 |
Other non-current liabilities | 420 | 419 |
Total liabilities | 487,366 | 409,121 |
Stockholders' equity: | ||
Common stock, $0.001 par value; 500,000,000 authorized; 132,230,837 and 132,059,879 issued and outstanding as of December 31, 2022 and 2021, respectively | 132 | 132 |
Additional paid-in capital | 262,693 | 255,986 |
Accumulated deficit | (5,931) | (14,193) |
Total stockholders' equity | 256,894 | 241,925 |
Total liabilities and stockholders' equity | $ 744,260 | $ 651,046 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, issued (in shares) | 132,230,837 | 132,059,879 |
Common stock, outstanding (in shares) | 132,230,837 | 132,059,879 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative effect of adoption of new accounting standard | Par value of common stock adjustment | Warrant exchange | Warrant exercise | Class C incentive units | Common stock | Common stock | Common stock Par value of common stock adjustment | Common stock Warrant exchange | Common stock Warrant exercise | Additional paid-in capital | Additional paid-in capital Par value of common stock adjustment | Additional paid-in capital Warrant exchange | Additional paid-in capital Warrant exercise | Additional paid-in capital Class C incentive units | Additional paid-in capital Common stock | Retained earnings | Retained earnings Cumulative effect of adoption of new accounting standard |
Beginning balance (in shares) at Dec. 31, 2019 | 54,534,022 | ||||||||||||||||||
Beginning balance at Dec. 31, 2019 | $ 134,364 | $ 5 | $ 147,268 | $ (12,909) | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||
Net loss | (524) | ||||||||||||||||||
Recapitalization transaction, net (in shares) | 62,163,419 | ||||||||||||||||||
Recapitalization transaction, net | $ (19,686) | $ 7 | (19,693) | ||||||||||||||||
Stock based compensation | $ 1,850 | $ 28 | $ 1,850 | $ 28 | |||||||||||||||
Equity offering (in shares) | 25,000,000 | ||||||||||||||||||
Shares issued for acquisition (in shares) | 31,481,607 | ||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 116,697,441 | 116,697,441 | |||||||||||||||||
Ending balance at Dec. 31, 2020 | $ 116,032 | $ 12 | 129,453 | (13,433) | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||
Net loss | (811) | ||||||||||||||||||
Recapitalization transaction, net | 841 | 841 | |||||||||||||||||
Stock based compensation | 821 | 2,842 | 821 | 2,842 | |||||||||||||||
Equity offering (in shares) | 10,000,000 | ||||||||||||||||||
Equity offering | 116,765 | $ 1 | 116,764 | ||||||||||||||||
Shares issued for acquisition (in shares) | 682,892 | ||||||||||||||||||
Shares issued for acquisition | 7,500 | $ 1 | 7,499 | ||||||||||||||||
Warrant (in shares) | 4,597,848 | 2,501 | |||||||||||||||||
Warrant | $ (1,750) | $ 28 | $ 5 | $ (1,755) | $ 28 | ||||||||||||||
RSU vesting (in shares) | 79,197 | ||||||||||||||||||
RSU vesting | $ (394) | (394) | |||||||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 132,059,879 | 132,059,879 | |||||||||||||||||
Ending balance at Dec. 31, 2021 | $ 241,925 | $ 51 | $ 0 | $ 132 | $ 113 | 255,986 | $ (113) | (14,193) | $ 51 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||
Net loss | 8,262 | 8,262 | |||||||||||||||||
Stock based compensation | $ 778 | $ 6,466 | $ 778 | $ 6,466 | |||||||||||||||
RSU vesting (in shares) | 170,958 | ||||||||||||||||||
RSU vesting | $ (537) | (537) | |||||||||||||||||
Ending balance (in shares) at Dec. 31, 2022 | 132,230,837 | 132,230,837 | |||||||||||||||||
Ending balance at Dec. 31, 2022 | $ 256,894 | $ 132 | $ 262,693 | $ (5,931) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net income (loss) | $ 8,262 | $ (811) | $ (524) |
Depreciation & amortization expense | 31,756 | 30,033 | 24,562 |
Loss on disposal of property and equipment | 0 | 0 | 285 |
Deferred tax benefit | (6,059) | (2,855) | (1,777) |
Bad debt expense | 1,714 | 1,408 | 1,574 |
Stock-based compensation | 7,244 | 3,663 | 1,878 |
Non-cash change in tax receivable agreement liability | (406) | 285 | (1,218) |
Change in fair value of derivative | (1,404) | (127) | 1 |
Non-cash lease expense | 1,624 | 1,297 | 0 |
Gain on contingent consideration | 0 | (600) | 0 |
Amortization of debt issuance costs | 969 | 930 | 1,072 |
Loss on debt extinguishment | 0 | 6,187 | 0 |
Changes in assets and liabilities, net of impact of business acquisitions: | |||
Trade receivables | (3,438) | (4,425) | (3,531) |
Prepaid expenses | (1,092) | (15) | (643) |
Other current assets | (454) | 34 | 321 |
Other non-current assets | 106 | (60) | 362 |
Trade payables | 2,337 | (2,246) | 1,291 |
Accrued liabilities | 2,243 | 1,584 | (2,971) |
Accrued revenue share | 1,464 | 3,389 | (47) |
Income tax payable/receivable, net | 2,568 | 110 | 651 |
Other current liabilities | (470) | 174 | 44 |
Lease liabilities | (1,462) | (1,288) | 0 |
Other non-current liabilities | (3) | (20) | 31 |
Net cash provided by operating activities | 45,499 | 36,647 | 21,361 |
Cash flows from investing activities: | |||
Purchases of property and equipment, net of impact of business acquisitions | (6,973) | (5,723) | (6,603) |
Purchases of customer lists | (6,283) | (17,098) | (6,602) |
Acquisition of business, net of cash received | (6,034) | (14,462) | (19,940) |
Net cash (used in) investing activities | (19,290) | (37,283) | (33,145) |
Cash flows from financing activities: | |||
Payments on non-current debt | (2,500) | (229,302) | (2,364) |
Payment of debt issuance costs | 0 | (6,390) | (2,882) |
Proceeds from issuance of long-term debt | 0 | 250,000 | 0 |
Distribution to Ultra | 0 | 0 | (661) |
Capital contributions from Ultra | 0 | 0 | 12,211 |
Recapitalization | 0 | 0 | 3,148 |
Proceeds from equity offering | 0 | 116,764 | 0 |
Movements in client fund obligations, net | 13,693 | 6,690 | (5,683) |
Repurchase of restricted stock to satisfy tax withholding obligations | (537) | (394) | 0 |
Warrant exchange | 0 | (1,750) | 0 |
Payment on tax receivable agreement liability | (592) | 0 | 0 |
Net cash provided by financing activities: | 10,064 | 135,618 | 3,769 |
Net change in cash, cash equivalents, and restricted cash | 36,273 | 134,982 | (8,015) |
Cash, cash equivalents, and restricted cash, beginning of period | 198,391 | 63,409 | 71,424 |
Cash, cash equivalents, and restricted cash, end of period | 234,664 | 198,391 | 63,409 |
Reconciliation of cash, cash equivalents, and restricted cash | |||
Cash and cash equivalents | 168,833 | 146,799 | 23,617 |
Restricted cash included in funds held for clients | 65,831 | 51,592 | 39,792 |
Total cash, cash equivalents, and restricted cash | 234,664 | 198,391 | 63,409 |
Supplemental disclosures: | |||
Cash interest paid | 13,966 | 12,926 | 16,362 |
Cash taxes paid, including estimated payments | 8,846 | 3,743 | 1,559 |
Non-cash investing activity | |||
Non-cash stock issuance related to Paragon acquisition | $ 0 | $ 7,500 | $ 0 |
Organization, basis of presenta
Organization, basis of presentation and summary of accounting policies | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, basis of presentation and summary of accounting policies | Organization, basis of presentation and summary of accounting policies Organization Paya Holdings, Inc., a Delaware corporation, conducts operations through its wholly-owned subsidiaries. These operating subsidiaries are comprised of Paya, Inc., Paya EFT, Inc., Stewardship Technology, Inc., First Mobile Trust, LLC, The Payment Group, LLC ("TPG" or "The Payment Group"), Blue Parasol Group, LLC ("Paragon Payment Solutions" or "Paragon"), and JS Innovations LLC ("VelocIT"). On October 16, 2020, Paya Holdings Inc. (f/k/a FinTech Acquisition Corp. III Parent Corp.) (“we,” “us,” “Paya” or the “Company”), consummated the merger with FinTech Acquisition Corp. III (“FinTech”), FinTech III Merger Sub Corp. (“Merger Sub”), GTCR-Ultra Holdings, LLC (“Ultra”), Paya Holdings II, LLC (“Holdings”), GTCR/Ultra Blocker, Inc. and GTCR Fund XI/C LP ("Seller") (the “Fintech Transaction”) contemplated by the Agreement and Plan of Merger, dated as of August 3, 2020 (“Fintech Merger Agreement”). See Note 3 Fintech Transaction for more information. The Company is an independent integrated payments platform providing card, Automated Clearing House ("ACH"), and check payment processing solutions via software to middle-market businesses in the United States. Paya’s solutions integrate with customers’ core business software to enable payments acceptance, reconcile invoice detail, and post payment information to their core accounting system. The Company is headquartered in Atlanta, Georgia and, as of December 31, 2022, also had operations in Reston, VA, Fort Walton Beach, FL, Mt. Vernon, OH and Dallas, TX. Basis of presentation These financial statements reflect the consolidated results of operations, financial position and cash flows of the Company, in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain amounts in prior years have been reclassified to conform to the current year presentation. Use of estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. These estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future. The more significant estimates made by management relate to the determination of the fair value of intangible assets acquired in a business combination, allowance for credit losses, income taxes, tax receivable agreement liability, and impairment of intangibles and long-lived assets. Principles of Consolidation These consolidated financial statements include the accounts of the Company and its subsidiary companies. All significant intercompany accounts and transactions have been eliminated in consolidation. Cash and cash equivalents Cash and/or cash equivalents are short-term, highly liquid investments with a maturity of ninety days or less at the time of purchase. The fair value of our cash and cash equivalents approximates carrying value. At times, cash and cash equivalents exceed the amount insured by the Federal Deposit Insurance Corporation. Concentration of credit risk Our cash, cash equivalents, trade receivables, funds receivable and customer accounts are potentially subject to concentration of credit risk. Deposits held with banks may exceed the amount of governmental insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and therefore, these bear minimal default risk. The Company performs ongoing credit evaluations of its customers’ financial condition and generally requires no collateral from its customers. No individual customers represented more than 10% of the Company’s revenue. Trade receivables, net Trade receivables are recorded at net realizable value, which includes allowances for credit losses. The Company estimates an allowance for credit losses related to balances that it estimates it cannot collect from merchants. These uncollectible amounts relate to chargebacks, uncollectible merchant fees, and ACH transactions that have been rejected subsequent to the payout date. The Company uses a loss-rate method, which utilizes historical write-off data, to estimate expected credit losses relating to uncollectible accounts. The allowance for credit losses was $1.5 million and $1.4 million at December 31, 2022 and 2021, respectively. Prepaid expenses Prepaid expenses primarily consist of insurance, software licenses, rent, and supplier invoices. Other current assets Other current assets primarily consist of current deferred debt issuance costs related to the line of credit, the interest rate cap agreement, other receivables and equipment inventory. Funds held for clients and client funds obligation Funds held for clients and client funds obligations result from the Company’s processing services and associated settlement activities, including settlement of payment transactions. Funds held for clients represent assets that are restricted for use solely for the purposes of satisfying the obligations to remit funds relating to the Company’s processing services, which are classified as client funds obligations on our consolidated balance sheets. Funds held for clients are generated principally from merchant services transactions and are comprised of both settlements’ receivable and cash as of period end. Certain merchant settlement assets that relate to settlement obligations accrued by the Company are held by partner banks. The Company classified funds held for clients as a current asset since these funds are held solely for the purpose of satisfying the client funds obligations. The Company records corresponding settlement obligations for amounts payable to merchants and for payment instruments not yet presented for settlement as client funds obligations. Client funds obligations represent the Company's contractual obligations to remit funds to satisfy clients' settlement obligations. The client funds obligations represent liabilities that will be repaid within one year of the balance sheet date. Differences in the funds held for clients and client funds obligation are due to timing differences between when transactions are settled and when payment instruments are presented for settlement and are considered to be immaterial. The changes in settlement assets and obligations are presented on a net basis within financing activities in the consolidated statements of cash flows. The composition of our funds held for clients balance consisted of the following: December 31, 2022 2021 Funds held for clients Cash held to satisfy client funds obligations $ 65,831 $ 51,592 Receivables held to satisfy client funds obligations 113,781 48,223 Total $ 179,612 $ 99,815 Property and equipment, net Property and equipment, is stated at cost less accumulated depreciation. Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets. These lives are 3 years for computers and equipment, 5 years for furniture, fixtures, and office equipment, and the lesser of the asset useful life or remaining lease term for leasehold improvements. Also, the Company capitalizes software development costs and website development costs incurred in accordance with ASC 350-40, Internal Use Software. The useful lives are 3 to 5 years for internal-use software. Repair and maintenance costs are expensed as incurred and included in selling, general and administrative expenses on the consolidated statements of income and comprehensive income. Leases On January 1, 2021, the Company adopted Accounting Standards Update ("ASU") No. 2016-02, Leases ("Topic 842") using the modified retrospective transition approach. We applied the new standard to all leases existing at the date of initial application. Refer to the discussion under Note 13 Commitments and Contingencies. We determine if a contract is a leasing arrangement at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Right-of-use ("ROU") assets and lease liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The Company calculates the present value of future payments by using an estimated incremental borrowing rate, which approximates the rate at which the Company would borrow, on a secured basis and over a similar term. ROU assets represent our right to control the use of an identified asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. We use the incremental borrowing rate on the commencement date in determining the present value of our lease payments. We recognize operating lease expense for our operating leases on a straight-line basis over the lease term. The Company’s lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes, or other costs. Variable lease costs are expensed as incurred on the consolidated statements of income. Impairment of long-lived assets The Company evaluates the recoverability of its long-lived assets in accordance with the provisions of ASC 360, Property, Plant and Equipment (“ASC 360”). ASC 360 requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets is measured by comparing the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. There was no impairment of long-lived assets recognized in any period presented in the consolidated financial statements. Goodwill and other intangible assets, net Goodwill represents the premium paid over the fair value of the net tangible and identifiable intangible assets acquired in the Company’s business combinations. The Company evaluates goodwill and intangible assets in accordance with ASC 350, Goodwill and Other Intangible Assets (“ASC 350”). ASC 350 requires goodwill to be either qualitatively or quantitatively assessed for impairment annually (or more frequently if impairment indicators arise) for each reporting unit. The Company tests goodwill and intangible assets annually for impairment as of September 30 of each year, and at interim periods, using a qualitative approach. Our annual evaluation assesses qualitative factors to determine whether it is more likely than not the fair value is less than the carrying value of the asset. If the Company is unable to conclude that goodwill and intangible assets, net are not impaired during its qualitative assessment, the Company will perform a quantitative assessment by estimating the fair value of the assets and comparing the fair value to the carrying value. As of December 31, 2022 and 2021, it was more likely than not that the fair value of goodwill and intangible assets, net exceeded their carrying value and as such, there was no goodwill impairment recognized in any period presented in the consolidated financial statements. Intangible assets with finite lives consist of internal use software, trade names, customer lists and customer relationships and are amortized on a straight-line basis over their estimated useful lives. From time to time, the Company acquires customer lists from sales agents in exchange for an upfront cash payment. The purchase of customer lists are treated as asset acquisition, resulting in recording an intangible asset at cost on the date of acquisition. The acquired customer lists intangible assets have a useful life of 5 years. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the manner of our use of the acquired assets or the strategy for our overall business or significant negative industry or economic trends. If this evaluation indicates that the value of the intangible asset may be impaired, the Company makes an assessment of the recoverability of the net book value of the asset over its remaining useful life. If this assessment indicates that the intangible asset is not recoverable, based on the estimated undiscounted future cash flows of the asset over the remaining amortization period, the Company reduces the net book value of the related intangible asset to fair value and may adjust the remaining amortization period. The Company evaluates its intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the net book value may not be recoverable. There were no indicators of impairment identified nor was impairment recognized in intangible assets in any period presented in the consolidated financial statements. Long-term debt and issuance costs Eligible debt issuance costs associated with the Company's credit facilities are deferred and amortized to interest expense over the term of the related debt using the effective interest method. Debt issuance costs associated with Company's term debt are presented on the Company's consolidated balance sheets as a direct reduction in the carrying value of the associated debt liability. Revenue The Company’s business model provides payment services, card processing, and ACH, to merchants through enterprise or vertically focused software partners, direct sales, reseller partners, other referral partners, and a limited number of financial institutions. The Company recognizes processing revenues on bankcard merchant accounts and ACH merchant accounts at the time merchant transactions are processed and periodic fees over the period the service is performed. See Note 2, Revenue recognition for more information on the Company's revenue recognition policy. Cost of services exclusive of depreciation and amortization Cost of services includes card processing costs, ACH costs, and other fees paid to card networks, and equipment expenses directly attributable to payment processing and related services to merchants. These costs are recognized as incurred. Cost of services also includes revenue share amounts paid to reseller and referral partners and are calculated based on monthly merchant activity. These expenses are recognized as transactions are processed. Accrued revenue share represent amounts earned during the period but not yet paid at the end of the period. Selling, general and administrative expenses Selling, general and administrative expenses consist primarily of salaries, wages, commissions, marketing costs, professional services costs, technology costs, occupancy costs of leased space, and bad debt expense. Stock based compensation expense is also included in this category. Depreciation & Amortization Depreciation and amortization consist primarily of amortization of intangible assets, mainly including customer relationships, internal use software, customer lists, trade names and to a lesser extent depreciation on our investments in property, equipment, and software. We depreciate and amortize our assets on a straight-line basis in accordance with our accounting policies. These lives are 3 years for computers and equipment and acquired internal-use software, 5 years for furniture, fixtures, and office equipment, and the lesser of the asset useful life or remaining lease term for leasehold improvements. Repair and maintenance costs are expensed as incurred and included in selling, general and administrative expenses on the consolidated statements of income and comprehensive income. The acquired customer lists are amortized over Customer lists are amortized over a period of 5-15 years depending on the intangible, developed technology 5-10 years, and trade names over 25 years. Derivative Financial Instruments The Company accounts for its derivative instruments in accordance with ASC 815, Derivatives and Hedging ("ASC 815") . ASC 815 establishes accounting and reporting standards for derivative instruments requiring the recognition of all derivative instruments as assets or liabilities in the Company’s consolidated balance sheets at fair value. The Company records its derivative instruments as assets or liabilities, depending on its rights or obligations under the applicable derivative contract. Changes in fair value are recognized in earnings in the affected period. The Company uses an interest rate cap contract to manage risk from fluctuations in interest rates on its Term Loan credit agreement. Interest rate caps involve the receipt of variable-rate amounts beyond a specified strike price over the life of the agreement without exchange of the underlying principal amount. The interest rate cap is not designated as a hedging instrument. Changes in the fair value of the interest rate cap are recorded through other income (expense) in the consolidated statement of income and comprehensive income, other current assets on the consolidated balance sheets, and in changes in other current assets in the consolidated statement of cash flows. Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized principally for the expected tax consequences of temporary differences between the tax basis of assets and liabilities and their reported amounts, using currently enacted tax rates. The measurement of a deferred tax asset is reduced, if necessary, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. The Company recognizes a tax benefit for uncertain tax positions if the Company believes it is more likely than not that the position will be upheld on audit based solely on the technical merits of the tax position. The Company evaluates uncertain tax positions after the consideration of all available information. Such tax positions must initially and subsequently be estimated as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authorities, assuming full knowledge of the position and relevant facts. The Company's policy is to recognize any interest and penalties related to income taxes as income tax expense in the relevant period. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") was signed into law. The CARES Act featured significant tax provisions and other measures to assist businesses impacted by the economic effects of the COVID-19 pandemic, a number of which impacted the Company. In particular, the CARES Act increased the 30% adjusted taxable income limitation to 50% for tax years beginning in 2019 and 2020 related to the Section 163(j) interest expense limitation provisions. Additionally, the CARES Act permitted for a delay of payment of applicable 2020 employer payroll taxes and also made a technical correction to the 2017 Tax Cuts and Jobs Act ("TCJA") to provide a 15-year recovery period for qualified improvement property, thus making qualified improvement property eligible for bonus depreciation. See Note 11, Income taxes, for the impact on the consolidated financial statements as a result of the TCJA. Business Combinations Upon acquisition of a company, we determine if the transaction is a business combination defined by ASC 805, Business Combinations ("ASC 805"), which is accounted for using the acquisition method of accounting. Under the acquisition method, once control is obtained of a business, the assets acquired, and liabilities assumed, including amounts attributed to noncontrolling interests, are recorded at fair value. We use our best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. One of the most significant estimates relates to the determination of the fair value of these assets and liabilities, specifically intangible assets such as internal use software, trade names and trademarks, and customer relationships. The determination of the fair values is based on estimates and judgments made by management with the assistance of a third-party valuation firm. Significant assumptions for intangible assets include the discount rate, projected revenue growth rates and margin, customer retention factors, obsolescence rates and royalty rate used to calculate the expected future cash flows. Our estimates of fair value are based upon assumptions we believe to be reasonable, but which are inherently uncertain and unpredictable. Measurement period adjustments are reflected at the time identified, up through the conclusion of the measurement period, which is the time at which all information for determination of the values of assets acquired and liabilities assumed is received and is not to exceed one year from the acquisition date. We may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill. Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate identifiable intangible assets. Additionally, uncertain tax positions and tax-related valuation allowances are initially recorded in connection with a business combination as of the acquisition date. We continue to collect information and reevaluate these estimates and assumptions periodically and record any adjustments to preliminary estimates to goodwill, provided we are within the measurement period. If outside of the measurement period, any subsequent adjustments are recorded to the consolidated statement of income and comprehensive income. Fair-Value Measurements The Company follows ASC 820, Fair Value Measurements ("ASC 820"), which defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The determination of fair value is based on the principal or most advantageous market in which the Company could participate and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. Also, determination of fair value assumes that market participants will consider the highest and best use of the asset. The Company uses the hierarchy prescribed in ASC 820 for fair value measurements, based on the available inputs to the valuation and the degree to which they are observable or not observable in the market. The three levels of the hierarchy are as follows: Level 1 Inputs—Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date; Level 2 Inputs—Inputs are quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; inputs other than quoted prices, but that are observable for the asset or liability (e.g., interest rates; yield curves); and inputs that are derived principally from or corroborated by observable market data by correlation or by other means (i.e., market corroborated inputs); and Level 3 Inputs—Unobservable inputs for the asset or liability used to measure fair value. These inputs reflect the Company’s own assumptions about what other market participants would use in pricing the asset or liability. These are based on the best information available and can include the Company's own data. Emerging Growth Company Prior to December 31, 2021, the Company was an “emerging growth company” (“EGC”) as defined in the Jumpstart Our Business Startups Act, (JOBS Act), and elected to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including using the extended transition period for complying with new or revised accounting standards. As of December 31, 2021, the Company became a large accelerated filer under the rules of the U.S. Securities and Exchange Commission ("SEC") and is no longer classified as an EGC. Recently Issued Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU were effective for all entities as of March 12, 2020 through December 31, 2022, however, in December 2022 the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 which extended the sunset date from December 31, 2022 to December 31, 2024. An entity may elect to apply the amendments for contract modifications by Topic or Industry Subtopic as of any date from the beginning an interim period that includes or is subsequent to March 12, 2020, or prospectively from the date that the financial statements are available to be issued. Once elected for a Topic or an Industry Subtopic, the amendments must be applied prospectively for all eligible contract modifications for that Topic or Industry Subtopic. The Company may apply ASU 2020-04 as its contracts referenced in London Interbank Offered Rate (“LIBOR”) are impacted by reference rate reform. The Company is currently evaluating the effect of ASU 2020-04 on its consolidated financial statements. Par Value of Common Stock During 2021, the Company identified an immaterial error in the par value of its Common stock impacting the balance of Common stock and Additional Paid-in-Capital in the Company’s interim and annual financial statements beginning as of and for the year ended December 31, 2020. The Company corrected the error, which resulted in an increase of $113 to Common stock and a corresponding decrease to Additional Paid-in-Capital as of December 31, 2021. Recapitalization Transaction During 2021, the Company identified an immaterial error related to the capitalization of a deferred tax asset impacting the balances of the Tax Receivable Agreement liability, Deferred Tax Liability, Net, and Additional Paid-in-Capital in the Company’s interim and annual financial statements beginning as of and for the year ended December 31, 2020. The Company corrected the error which resulted in an increase of $841 to Additional Paid-in-Capital and a corresponding decrease to the Tax Receivable Agreement liability of $410 and Deferred Tax Liability, net of $431 as of December 31, 2021. Cash Flow Classification During 2021, the Company identified an immaterial error in its interim and annual financial statements for the year ended December 31, 2020, whereby the restricted cash within Funds Held for Clients was not appropriately included in the statement of cash flows. These amounts are now shown in the accompanying reconciliation of cash, cash equivalents and restricted cash to amounts shown on the Company's consolidated balance sheets. The original and as adjusted amounts are shown below along with the errors. As Filed As Adjusted Change December 31, December 31, December 31, 2020 2020 2020 CASH FLOW FROM OPERATING ACTIVITIES Movements in cash held on behalf of customers, net $ (8) $ — $ 8 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 21,353 21,361 8 CASH FLOWS FROM FINANCING ACTIVITIES Movements in client fund obligations, net — (5,683) (5,683) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 9,452 3,769 (5,683) Net change in cash and cash equivalents $ (2,340) $ (8,015) $ (5,675) Cash and cash equivalents, beginning of period 25,957 71,424 45,467 Cash and cash equivalents, end of period $ 23,617 $ 63,409 $ 39,792 Reconciliation of cash, cash equivalents, and restricted cash Cash and cash equivalents $ 23,617 $ 23,617 $ — Restricted cash included in funds held for clients — 39,792 39,792 Total cash, cash equivalents, and restricted cash $ 23,617 $ 63,409 $ 39,792 |
Revenue recognition
Revenue recognition | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue recognition | Revenue recognition The Company follows ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASC 606”) and performs a five-step analysis of transactions to determine when and how revenue is recognized, based upon the core principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services At contract inception, the Company assesses the goods and services promised in its contracts with customers and identifies performance obligations for each promise to transfer to the customer a good or service that is distinct. The Company’s performance obligation relating to its payment processing services revenue is to provide continuous access to the Company’s system to process as much as its customers require. Since the number or volume of transactions to be processed is not determinable at contract inception, the Company’s payment processing services consist of variable consideration under a stand-ready service of distinct days of service that are substantially the same with the same pattern of transfer to the customer. As such, the stand-ready obligation is accounted for as a single-series performance obligation whereby the variability of the transaction value is satisfied daily as the performance obligation is performed. In addition, the Company applies the right to invoice practical expedient to payment processing services as each performance obligation is recognized over time and the amounts invoiced are reflective of the value transferred to the customer. The Company uses each day as a time-based measure of progress toward satisfaction of the single performance obligation of each contract. This method most accurately depicts the pattern by which services are transferred to the merchant, as performance depends on the extent of transactions processed for that merchant on a given day. Likewise, consideration to which the Company expects to be entitled is determined according to our efforts to provide service each day. ASC 606 requires disclosure of the aggregate amount of the transaction price allocated to unsatisfied performance obligations; however, as permitted by the standard, the Company has elected to exclude from this disclosure any contracts with an original duration of one year or less and any variable consideration that meets specified criteria. As discussed above, the Company’s core performance obligation is a stand-ready obligation comprised of a series of distinct days of service, and revenue related to this performance obligation is generally billed and recognized as the services are performed. The variable consideration allocated to this performance obligation meets the specified criteria for disclosure exclusion. The aggregate fixed consideration portion of customer contracts with an initial contract duration greater than one year is not material. The Company’s customers are all small to medium size businesses and municipalities who are underwritten to the credit standards of the Company and who each have merchant processing agreements. The Company, through its risk informed bad debt and allowance accounting, appropriately reserves for any potential risk to its revenue and cash flows. Since the cash is collected for the majority of transactions within a month, there is not a significant time lag or risk of uncollectibility in the recognition of revenue. We do not have any material contract assets or liabilities for any period presented and we did not recognize any impairments of any contract assets or liabilities for the years ended December 31, 2022, 2021 or 2020. The Company generates its revenue from three revenue sources which include Transaction based revenue, Service based fee revenue and Equipment revenue and are defined below: Transaction based revenue Transaction based revenue represents revenue generated from transaction fees based on volume, including interchange fees and convenience based fees. The Company generates transaction based revenue from fees charged to merchants for card-based processing volume and ACH transactions. Transaction based revenues are recognized on a net basis equal to the full amount billed to the bankcard merchant, net of interchange fees and assessments. Interchange fees are fees paid to card-issuing banks and assessments paid to payment card networks. Interchange fees are set by credit card networks based on various factors, including the type of bank card, card brand, merchant transaction processing volume, the merchant’s industry and the merchant’s risk profile and are recognized at the time merchant transactions are processed. Transaction based revenue was recorded net of interchange fees and assessments of $519,519, $477,273 and $416,043 in the years ending December 31, 2022, 2021 and 2020, respectively. Service based fee revenue Service based fee revenue represents revenue generated from recurring and periodic service fees. The Company generates service based fee revenue from charging a service fee, a fee charged to the client for facilitating bankcard processing, which is recognized on a gross basis. The Company also generates service based fees related to ACH inclusive of monthly support fees and monthly statement fees. Equipment revenue Equipment revenue comprises sales of equipment which primarily consists of payment terminals. The Company generates its revenue from two segments which include Integrated Solutions and Payment Services and are defined below: Integrated Solutions Our Integrated Solutions segment represents the delivery of our credit and debit card payment solutions, and to a lesser extent, ACH processing solutions to customers via integrations with software partners across our strategic vertical markets. Our Integrated Solutions partners include vertical focused front-end Customer Relationship Management software providers as well as back-end Enterprise Resource Planning and accounting solutions. Payment Services Our Payment Services segment represents the delivery of card payment processing solutions to our customers through resellers, as well as ACH, check, and gift card processing. Card payment processing solutions in this segment do not originate via a software integration but still utilize Paya’s core technology infrastructure. ACH, check, and gift card processing may or may not be integrated with third-party software. The following table presents the Company's revenue disaggregated by segment and by source as follows: Integrated Solutions Year Ended December 31, 2022 2021 2020 Revenue from contracts with customers Transaction based revenue $ 169,617 $ 143,868 $ 111,494 Service based fee revenue 11,543 11,025 10,676 Equipment revenue 313 310 154 Total revenue $ 181,473 $ 155,203 $ 122,324 Payment Services Year Ended December 31, 2022 2021 2020 Revenue from contracts with customers Transaction based revenue $ 83,199 $ 76,927 $ 68,219 Service based fee revenue 17,952 17,096 15,435 Equipment revenue 119 130 70 Total revenue $ 101,270 $ 94,153 $ 83,724 |
Fintech transaction
Fintech transaction | 12 Months Ended |
Dec. 31, 2022 | |
Reverse Recapitalization [Abstract] | |
Fintech transaction | Fintech transaction On October 16, 2020, FinTech consummated the Fintech Transaction pursuant to the terms of the Fintech Merger Agreements and acquired all of the issued and outstanding equity interests in Paya from the Seller. Pursuant to the Fintech Merger Agreements, Fintech purchased from the Seller all of the issued and outstanding equity interests of Paya for $1.045 billion, of which $500 million was paid in cash and the remaining $545 million was paid to the Seller in the form of 54,534,022 shares of Common Stock and up to an additional 14,018,188 shares of Paya’s common stock, which we refer to as the Earnout Shares, in the event that the closing sale price of Paya’s common stock exceeds certain price thresholds for 20 out of any 30 consecutive trading days during the first five years following the closing of the Fintech Transaction. None of these thresholds have been achieved as of December 31, 2022. The number of shares of the equity consideration was based on a $10.00 per share value for Paya’s common stock. The Fintech Transaction was accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with U.S. GAAP. This determination was primarily based on post Fintech Transaction relative voting rights, composition of the governing board, management and intent of the Fintech Transaction. Under this method of accounting, Fintech was treated as the acquired company for financial reporting purposes. Accordingly, for accounting purposes, the Fintech Transaction was accounted for as the equivalent of Paya issuing stock for the net assets of FinTech, accompanied by a recapitalization. The net assets of the Company were stated at historical cost, with no goodwill or other intangible assets recorded. Reported amounts from operations included herein prior to the Fintech Transaction are those of Paya. The following tables reconcile the elements of the Fintech Transaction to the consolidated statement of cash flows for the year ended December 31, 2020. Recapitalization Cash proceeds from FinTech $ 277,630 Cash proceeds from sale of equity securities 250,000 Gross cash received by Paya from Fintech Transaction 527,630 Less: company transaction expenses (24,822) Net cash received from Recapitalization 502,808 Less: cash paid to Seller (499,660) Net contributions from Recapitalization Transaction $ 3,148 The cash paid to Seller was funded from the proceeds from net cash received from Recapitalization (described above), offset by certain other transaction costs incurred in connection with the Fintech Transaction. Prior to the Fintech Transaction, FinTech had 2,258,765 shares of Class A common stock, par value $0.001 per share (the “Class A Shares”) outstanding and 8,857,500 shares of Class B common stock, par value $0.001 per share (the “Class B Shares”) outstanding, which comprised of Founder Shares held by the Founders and Former FinTech Director Shares held by individuals who are not founders but were directors of FinTech. On October 22, 2020, FinTech was renamed Paya Holdings, Inc. and each currently issued and outstanding share of FinTech Class B Shares automatically converted on a one-for-one basis, into shares of Class A common stock. Immediately thereafter, each currently issued and outstanding share of FinTech Class A Shares automatically converted on a one-for-one basis, into shares of the common stock of Paya Holdings. In connection with the Fintech Transaction, 5,681,812 Class A Shares were redeemed. The number of shares of Common Stock of Paya Holdings issued immediately following the consummation of the Fintech Transaction is summarized as follows: Shares by Type Number of shares by type as of December 31, 2020 FinTech total shares outstanding prior to the Fintech Transaction 37,163,419 Less: Redemption of FinTech shares (5,681,812) Class A Shares of FinTech 31,481,607 Shares issued to PIPE investors 25,000,000 Shares issued to FinTech and PIPE investors 56,481,607 Shares issued to the Sellers 54,534,022 Total Shares of Common Stock outstanding for earnings per share computation 111,015,629 Plus: Contingent shares subject to forfeiture 5,681,812 Total Shares of Common Stock outstanding 116,697,441 |
Business combinations
Business combinations | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business combinations | Business combinations JS Innovations LLC transaction overview On January 19, 2022, the Company closed on the acquisition of VelocIT which provides fully integrated, omnichannel payment solutions to accounting and ERP partners. The acquisition was accounted for as a business combination as defined by ASC 805, and the aggregate purchase price was $7,079 consisting of $6,079 cash paid at closing and $1,000 cash paid in January 2023, which is recorded in accrued liabilities on the Consolidated Balance Sheets. Transaction costs related to the acquisition of VelocIT totaled $397 and are recorded in selling, general and administrative expenses on the consolidated statement of income and comprehensive income for 2022. Goodwill of $2,064 resulted from the acquisition and is deductible for tax purposes. As of December 31, 2022, the measurement period for goodwill has closed. The following table summarizes the fair value of the assets acquired and liabilities assumed by the Company and resulting goodwill as of December 31, 2022: Assets Current Assets: Cash and cash equivalents $ 45 Trade receivables, net 85 Prepaid expenses 28 Total current assets $ 158 Other assets: Goodwill 2,064 Intangible assets 4,900 Total assets $ 7,122 Liabilities Current liabilities: Accrued liabilities $ 21 Accrued revenue share 22 Total current liabilities $ 43 Total liabilities $ 43 Net assets $ 7,079 Paragon Payment Solutions transaction overview On April 23, 2021, the Company closed the acquisition of Paragon, which was accounted for as a business combination as defined by ASC 805. The aggregate purchase price paid at closing was $26,624, consisting of $19,124 in cash and $7,500 of the Company's common stock. Goodwill of $14,780 resulted from the acquisition and is partially deductible for tax purposes. Intangible assets not recognized apart from goodwill consist primarily of the expected revenue synergies. As of December 31, 2022, the measurement period for goodwill has closed. Transaction costs related to the acquisition of Paragon totaled $983 and are recorded in selling, general and administrative expenses on the consolidated statement of income and comprehensive income for the year ended December 31, 2021. The following table summarizes the acquisition date fair value of the assets acquired and liabilities assumed by the Company and resulting goodwill as of December 31, 2021: Assets Current Assets: Cash and cash equivalents $ 816 Trade receivables, net 2,653 Prepaid expenses 174 Other current assets 199 Funds held for clients 3,846 Total current assets $ 7,688 Other assets: Property and equipment, net 52 Goodwill 14,780 Intangible assets 12,510 Other non-current assets 60 Total assets $ 35,090 Liabilities Current liabilities: Trade payables $ 1,407 Accrued liabilities 2,118 Accrued revenue share 80 Other current liabilities 58 Client funds obligations 4,266 Total current liabilities $ 7,929 Non-current liabilities: Deferred tax liability, net 390 Other non-current liabilities 147 Total liabilities $ 8,466 Net assets $ 26,624 The Payment Group transaction overview Paya purchased TPG. on October 1, 2020 for total cash consideration of $22,270, which was accounted for as a business combination as defined by ASC 805. The following table summarizes the fair values of the assets acquired and liabilities assumed by the Company and resulting goodwill at October 1, 2020: Assets Current Assets: Cash and cash equivalents $ 2,330 Funds held for clients 585 Prepaid expenses 57 Total current assets $ 2,972 Other assets: Goodwill 12,452 Intangible assets 10,100 Other assets 185 Total assets $ 25,709 Liabilities Current liabilities: Other accrued expenses $ 1,001 Client fund obligation 709 Total current liabilities $ 1,710 Deferred tax liability – non-current 1,729 Total liabilities $ 3,439 Net assets $ 22,270 Intangible assets acquired consist of customer relationships of $4,100 and developed technology of $6,000. All intangible assets are amortized on a straight-line basis in line with Company policy. Goodwill of $12,452 resulted from the acquisition and is partially deductible for tax purposes. Intangible assets not recognized apart from goodwill consist primarily of the expected revenue synergies. As of December 31, 2022, the measurement period for goodwill has closed. Transaction costs related to the transaction totaled $561 and are recorded in selling, general & administrative expenses on the consolidated statement of income and comprehensive income for the year ended December 31, 2020. |
Property and equipment, net
Property and equipment, net | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Property and equipment, net Property and equipment, net consists of the following: December 31, 2022 December 31, 2021 Computers and equipment $ 9,372 $ 8,528 Internal-use software 20,859 14,949 Office equipment 103 141 Furniture and fixtures 1,190 1,357 Leasehold improvements 1,135 1,396 Other equipment 26 26 Total property and equipment 32,685 26,397 Less: accumulated depreciation (16,854) (12,386) Total property and equipment, net $ 15,831 $ 14,011 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases The Company adopted Topic 842, Leases, using a modified retrospective transition approach as of January 1, 2021. The Company has elected to adopt the package of transition practical expedients and, therefore, has not reassessed (1) whether existing or expired contracts contain a lease, (2) lease classification for existing or expired leases or (3) the accounting for initial direct costs that were previously capitalized. The Company also elected the practical expedient to use hindsight for leases existing as of January 1, 2021. The Company evaluates each of its lease and service arrangements at inception to determine if the arrangement is, or contains, a lease and the appropriate classification of each identified lease. A lease exists if the Company obtains substantially all of the economic benefits of, and has the right to control the use of, an asset for a period of time. The Company has operating leases for real estate and IT equipment. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate to calculate the present value of lease payments. Lease terms consider options to extend or terminate based on the determination of whether such renewal or termination options are deemed reasonably certain. Lease agreements that contain non-lease components are generally accounted for as a single lease component. Operating lease costs are recorded in Selling, general and administrative expenses in the consolidated statements of operations based on the underlying asset. Variable costs, such as maintenance expenses, property and sales taxes, association dues and index-based rate increases, are expensed as they are incurred. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented as operating expenses in Selling, general and administrative expenses in the consolidated statements of operations. The Company has elected not to recognize ROU assets and lease liabilities for short-term leases of all applicable class of underlying assets that have a lease term of twelve months or less. The Company recognizes the lease payments associated with its short-term leases as an expense on a straight-line basis over the lease term. Variable lease payments associated with these leases are recognized and presented in the same manner as for all other Company leases. The Company monitors for events or changes in circumstances that require a reassessment of a lease. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in gain or loss in the consolidated statements of operations. During the year ended December 31, 2022, the Company terminated one of its lease agreements and recorded an immaterial impairment charge, of approximately $149, in selling, general, and administrative expenses, to derecognize the corresponding ROU asset. As of December 31, 2022 and 2021, the Company's total lease cost was $1,626 and $1,672, respectively, which consisted of $1,216 and $1,287, respectively, in operating lease cost and $410 and $386, respectively, in variable lease cost. Rental expense was $1,699 for the year ended December 31, 2020. As of December 31, 2022, amounts reported in the consolidated balance sheets were as follows: Operating Leases: December 31, 2022 December 31, 2021 Right-of-use assets $ 2,844 $ 4,495 Lease liability, current 1,164 1,302 Lease liability, noncurrent 2,561 3,941 Total lease liabilities $ 3,725 $ 5,243 Weighted-average remaining lease term (in years) 3.18 4.73 Weighted-average discount rate (annual) 4.0 % 4.0 % Other information related to leases are as follows: Year Ended December 31, 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases (1,462) (1,288) — Right-of-use assets obtained in exchange for lease liabilities Operating leases — 5,571 — The following table presents a maturity analysis of the Company's operating lease liabilities as of December 31, 2022: Future Minimum Lease Payments 2023 $ 1,279 2024 1,018 2025 990 2026 587 2027 114 Thereafter — Total Lease payments $ 3,988 Less Imputed Interest 263 Total lease obligations $ 3,725 |
Goodwill and other intangible a
Goodwill and other intangible assets, net | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangible assets, net | Goodwill and other intangible assets, net Goodwill recorded in the consolidated financial statements was $223,181 and $221,117 at December 31, 2022 and 2021, respectively. There were no indicators of impairment noted in the periods presented. The following table presents changes to goodwill for the years ended December 31, 2022 and 2021 for each reporting unit: Integrated Solutions Payment Services Total Balance as of December 31, 2020 $ 152,408 $ 53,900 $ 206,308 Measurement period adjustment 29 — 29 Acquisition - Paragon purchase accounting 10,346 4,434 14,780 Balance as of December 31, 2021 $ 162,783 $ 58,334 $ 221,117 Acquisition - VelocIT purchase accounting 2,064 — 2,064 Balance as of December 31, 2022 $ 164,847 $ 58,334 $ 223,181 Intangible assets other than goodwill at December 31, 2022 included the following: Weighted Average Useful Life (Years) Useful Lives Gross Carrying Amount at Accumulated Amortization Net Carrying Value as of December 31, December 31, 2022 2022 Customer Relationships 8.8 5-15 years $ 190,826 $ (91,794) $ 99,032 Developed Technology 6.4 5-10 years 41,520 (23,492) 18,028 Trade name 13.8 5-25 years 5,260 (1,032) 4,228 8.5 $ 237,606 $ (116,318) $ 121,288 Intangible assets other than goodwill at December 31, 2021 included the following: Weighted Average Useful Life (Years) Useful Lives Gross Carrying Amount at Accumulated Amortization Net Carrying Value as of December 31, December 31, 2021 2021 Customer Relationships 10.4 5-16 years $ 184,544 $ (70,222) $ 114,322 Developed Technology 5.1 3-7 years 36,620 (18,843) 17,777 Trade name 15.8 5-25 years 5,260 (651) 4,609 8.4 $ 226,424 $ (89,716) $ 136,708 Amortization expense totaled $26,602, $25,464 and $20,709 for the years ended December 31, 2022, 2021 and 2020, respectively. The following table shows the expected future amortization expense for intangible assets at December 31, 2022: Expected Future Amortization Expense 2023 $ 26,613 2024 24,993 2025 24,030 2026 19,223 2027 11,605 Thereafter 14,824 Total expected future amortization expense $ 121,288 |
Long-term debt
Long-term debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Long-term debt | Long-term debt On June 25, 2021, Paya Holdings III, LLC, as Parent borrower, Paya, Inc., as borrower (together, the “Borrowers”), and Holdings, each a wholly-owned subsidiary of the Company, entered into a new senior secured credit agreement (the “Credit Agreement”) with Credit Suisse AG, Cayman Islands Branch, as administrative agent, collateral agent and letter of credit ("L/C") issuer (the “Agent”), and the other lenders and L/C issuers party thereto. The Credit Agreement governs new senior secured credit facilities (the “Senior Secured Credit Facilities”), consisting of a $250 million senior secured term loan facility (the “Term Loan”) and a $45 million senior secured revolving credit facility (the “Revolver”). The Revolver includes borrowing capacity available for letters of credit. Any issuance of letters of credit will reduce the amount available under the Revolver. The proceeds from the Term Loan were used (1) to repay, in full, the outstanding loans under the prior credit agreement, dated as of August 1, 2017, among Holdings, the Borrowers, the financial institutions from time to time party thereto as lenders, and Antares Capital LP, as administrative agent (as amended from time to time, the “Prior Credit Agreement”), permanently terminate all commitments thereunder, release and terminate all liens securing such Prior Credit Agreement, and discharge all guarantees thereunder, (2) to pay certain fees and expenses incurred in connection with the Credit Agreement and the repayment of the Prior Credit Agreement, and (3) for working capital and general corporate purposes (including capital expenditures and acquisitions permitted thereunder). At closing of the Credit Agreement, the Revolver was undrawn. The Term Loan has a seven-year maturity and the Revolver has a five-year maturity. The Credit Agreement provides that the Company may make one or more offers to the lenders, and consummate transactions with individual lenders that accept the terms contained in such offers, to extend the maturity date of the lender’s term loans and/or revolving commitments, subject to certain conditions, and any extended term loans or revolving commitments will constitute a separate class of term loans or revolving commitments. All of the Borrowers’ obligations under the Senior Secured Credit Facilities are guaranteed by the subsidiary guarantors named therein. In addition, the obligations under the Senior Secured Credit Facilities are secured by a pledge of 100% of the capital stock of certain domestic subsidiaries owned by Holdings and a security interest in substantially all of the Borrowers’ and the guarantors’ tangible and intangible assets. At the Borrowers’ option, the Borrowers may request an increase of the commitments under the Revolver or the Term Loan or may add one or more new term loan facilities or revolving credit facilities in an aggregate amount not to exceed the sum of (x) the greater of $61 million and 100% of consolidated EBITDA (as defined in the Credit Agreement) plus (y) unused amounts under the Credit Agreement’s general indebtedness basket, so long as certain conditions, including a consolidated first lien net leverage ratio (as defined in the Credit Agreement) of not more than 4.25 to 1.00 (on a pari passu basis) or 5.00 to 1.00 (on a junior basis), in each case on a pro forma basis, is satisfied. Borrowings under the Senior Secured Credit Facilities bear interest, equal to (i) an alternative base rate equal to the greater of (a) the prime rate announced by the Agent or the highest interest rate published by the Federal Reserve Board as the “bank prime loan” rate, (b) the Federal Reserve Bank of New York rate plus 0.5% per annum, and (c) the Eurodollar rate for an interest period of one-month beginning on such day plus 100 basis points, plus 2.25% (provided that the Eurodollar rate applicable to the Term Loan shall not be less than 0.75% per annum); or (ii) the Eurodollar rate (provided that the Eurodollar rate applicable to the Term Loan shall not be less than 0.75% per annum), plus 3.25%. The Borrowers are also required to pay an unused commitment fee to the lenders under the Revolver equal to 0.50% with step-downs to 0.375% and 0.25% when the Borrowers’ consolidated first lien net leverage ratio is less than or equal to 3.75 to 1.00 and 3.25 to 1.00, respectively. The Borrowers must also pay customary letter of credit fees, including a fronting fee as well as administration fees. Commencing December 31, 2021, the Borrowers are required to repay the Term Loan portion of the Senior Secured Credit Facilities in quarterly principal installments equal to 0.25% of the aggregate principal amount outstanding thereunder, with the balance payable at maturity. The Credit Agreement contains a financial covenant that requires Holdings to maintain at the end of each fiscal quarter, commencing with the quarter ending December 31, 2021, a consolidated first lien net leverage ratio of not more than 6.50 to 1.00 but solely to the extent that the aggregate amount under letters of credit and loans outstanding under the Revolver exceeds 35% of the aggregate amount of all revolving commitments. The Credit Agreement also contains a number of covenants that, among other things, restrict, subject to certain exceptions, the ability of Holdings and its subsidiaries to: (i) incur additional indebtedness; (ii) create liens on assets; (iii) engage in mergers or consolidations; (iv) sell assets; (v) pay dividends and distributions or repurchase the Company’s capital stock; and (vi) change their fiscal year. The Credit Agreement contains customary affirmative covenants and events of default. As of December 31, 2022 the Company was in compliance with all financial covenants and ratios. Net proceeds from the issuance of the Term Loan in 2021 totaled $243.6 million, which includes a debt discount of $1.3 million and related debt issuance costs of $5.1 million. The debt discount and related debt issuance costs are capitalized and amortized over the life of the agreement. Proceeds used to repay the Prior Credit Agreement totaled $233.8 million, which includes principal payment of $228.1 million, interest payment of $3.4 million and a prepayment penalty of $2.3 million. The prepayment penalty and a write-off of debt issuance costs of $6.2 million are included in other income (expense) in the consolidated statement of income and comprehensive income. The Company’s long-term debt consisted of the following as of December 31, 2022 and 2021: December 31, 2022 December 31, 2021 Term loan credit agreement $ 246,875 $ 249,375 Debt issuance costs, net (4,245) (5,018) Total debt 242,630 244,357 Less: current portion of debt (2,500) (2,485) Total long-term debt $ 240,130 $ 241,872 There were no borrowings outstanding under the Revolver as of December 31, 2022 and 2021, respectively. The current portion of debt was included within other current liabilities on the consolidated balance sheet. The Company had $4,245 and $5,018 of unamortized Term Loan debt issuance costs that were netted against the outstanding loan balance and $680 and $875 of unamortized costs associated with the Revolver as of December 31, 2022 and 2021, respectively. The Revolver debt issuance costs are recorded in other current and other long term assets and are amortized over the life of the Revolver. Amortization of the debt issuance costs are included in interest expense in the consolidated statement of income and comprehensive income. Total interest expense was $14,311, $14,142, and $17,637 for the years ended December 31, 2022, 2021 and 2020, respectively. This included the long-term debt interest expense of $12,936, $12,229 and $15,671 for the years ended December 31, 2022, 2021 and 2020, respectively, and amortization of debt issuance costs of $969, $930 and $1,072 for the years ended December 31, 2022, 2021 and 2020, respectively. Annual principal payments on the Term Loan for the following years is as follows: Future Principal Payments 2023 $ 2,500 2024 2,500 2025 2,500 2026 2,500 2027 2,500 Thereafter 234,375 Total future principal payments $ 246,875 |
Derivatives
Derivatives | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | DerivativesThe Company has historically utilized derivative instruments to manage risk from fluctuations in interest rates on its term loan and intends to continue to do so in connection with the new Term Loan. On February 3, 2021, the Company entered into an interest rate cap agreement with a notional amount of $171,525 (the "interest rate cap agreement"). The effective date was March 31, 2021 and terminates on March 31, 2023. The Company paid a premium of $67 for the right to receive payments if LIBOR rises above the cap rate of 1.00%. The premium is recorded in other long-term assets on the condensed consolidated balance sheet. The interest rate cap agreement was a derivative not designated as a hedging instrument for accounting purposes. There were no changes to the interest rate cap agreement in connection with the entry into the new Credit Agreement. The fair value of the interest rate cap agreement was $1,599 at December 31, 2022. On November 16, 2017 the Company entered into an interest rate cap agreement (the "prior agreement") with a notional amount of $125,000 for the initial period, reducing consistent with the required quarterly debt payments, and an effective date of December 29, 2017. The prior agreement terminated on December 31, 2020. The Company paid a premium of $169 for the right to receive payments if the LIBOR rises above the cap percentage, thus effectively ensuring interest expense is capped at a maximum rate of the cap plus 6% for the duration of the prior agreement. The premium is recorded in other long-term assets on the consolidated balance sheet. The prior agreement was a derivative not designated as a hedging instrument for accounting purposes. The interest rate cap rate was as follows: Period rate is applicable Date From Date To Notional Amount Cap Rate (%) December 29, 2017 March 29, 2018 125,000 2.25% March 30, 2018 June 28, 2018 124,688 2.50% June 29, 2018 September 28, 2018 124,375 2.75% September 29, 2018 December 31, 2018 124,063 2.75% December 31, 2018 March 29, 2019 123,750 3.00% March 30, 2019 June 28, 2019 123,438 3.00% June 29, 2019 September 29, 2019 123,125 3.00% September 30, 2019 December 31, 2019 122,813 3.00% December 31, 2019 March 30, 2020 122,500 3.00% March 31, 2020 June 29, 2020 122,188 3.00% June 30, 2020 September 29, 2020 121,875 3.00% September 30, 2020 December 31, 2020 121,562 3.00% March 31, 2021 March 31, 2023 171,525 1.00% The fair value of the prior agreement was $0 at December 31, 2020. The fair values of the prior agreement and the interest rate cap agreement are included in other current assets on the consolidated balance sheet. Changes in fair value are recorded in earnings in other income (expense). The Company recognized non-cash gains (losses) of $1,404, $127 and $(1) in other income (expense) for the years ended December 31, 2022, 2021 and 2020, respectively, related to the interest rate cap agreements. The Company received cash payments of $1,710, $0 and $0 for the years ended December 31, 2022, 2021 and 2020, respectively, from the interest rate cap agreement. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Equity | Equity Common Stock The holders of the Company's common stock are entitled to one vote for each share of common stock held. Of the 132,230,837 shares of common stock outstanding, a total of 5,681,812 are considered contingently issuable as they require the trading price of our stock to exceed $15.00 per share for 20 out of any 30 consecutive trading days through October 16, 2025. In addition, should our share price exceed $17.50 per share for 20 out of any 30 consecutive trading days through October 16, 2025, the Company is required to issue up to an additional 14,018,188 shares of common stock, for total contingently issuable shares of 19,700,000. See Note 3, Fintech Transaction, for more information regarding the earnout shares. On March 17, 2021, the Company priced an offering of 20,000,000 shares of its common stock. The Company and the selling stockholder each agreed to sell 10,000,000 shares of common stock to the underwriters at a price of $12.25 per share. The offering closed and the shares were delivered on March 22, 2021. As a result of the offering, the Company received cash proceeds of $122,500, net of transaction costs of $5,736. Paya Holdings Inc. Omnibus Incentive Plan On December 22, 2020, the Company adopted the Paya Holdings Inc. Omnibus Incentive Plan, which originally allowed for issuance of up to 8,800,000 shares of its common stock. During 2022, an additional 10,000,000 shares were approved for issuance under the Omnibus Incentive Plan by the stockholders. The purpose of the plan is to enhance the profitability and value of the Company for the benefit of its stockholders by enabling the Company to offer eligible individual stock and cash-based incentives in order to attract, retain, and reward such individuals and strengthen the mutuality of interest between such individuals and the stockholders. Under the Omnibus Incentive Plan, the Company may grant stock options, stock appreciation rights, restricted shares, performance awards, and other stock-based and cash-based awards to eligible employees, consultants or non-employee directors of the Company. The Company recognized $6,466, $2,842 and $28 of share-based compensation for the years ended December 31, 2022, 2021 and 2020, respectively, in selling, general & administrative expenses on the consolidated statement of income and comprehensive income on a straight-line basis over the vesting periods. As of December 31, 2022, the Company had two stock-based compensation award types granted and outstanding: restricted stock units ("RSUs") and stock options. RSUs represent the right to receive shares of the Company's common stock at a specified date in the future. RSUs issued under the Omnibus Incentive Plan vest over 3 or 5 year periods. RSUs granted under the Omnibus Incentive Plan were as follows: Year Ended December 31, 2022 2021 2020 RSUs granted 2,256,545 673,266 230,000 Fair value of common stock $5.12 - $8.36 $6.34 - $13.87 $13.73 The fair value of each option award is estimated on the date of the grant, using the Black-Scholes option-pricing model and the assumptions in the following table: Year Ended December 31, 2022 2021 2020 Stock options granted 1,480,398 509,000 185,000 Fair value of stock options $2.76 - $4.64 $4.41 - $6.11 $4.25 Expected volatility 51.14% - 53.47% 52.12% - 53.42% 29.87% Dividend yield 0% 0% 0% Expected term 6.45 years - 6.5 years 6.42 years - 6.5 years 6.5 years Risk-free interest rate 2.20% - 3.83% 0.96% - 1.38% 0.57% The risk-free interest rate is based on the yield of a zero coupon United States Treasury Security with a maturity equal to the expected life of the stock option from the date of the grant. The assumption for expected volatility is based on the historical volatility of a peer group of market participants as the Company has limited historical volatility. It is the Company's intent to retain all profits for the operations of the business for the foreseeable future, as such the dividend yield assumption is zero. The Company applied the simplified method (as described in Staff Accounting Bulletin 110), which is the mid-point between the vesting date and the end of the contract term in determining the expected term of the stock options as the Company has limited historical basis upon which to determine historical exercise periods. Forfeitures are accounted for as incurred, and all stock options exercised will be settled in common stock. The following table summarizes stock option activities: Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Weighted-Average Fair Value Outstanding, December 31, 2020 185,000 $ 13.73 9.87 $ 4.25 Granted 509,000 9.85 $ 4.94 Exercised — — Forfeited (12,000) 11.65 Outstanding, December 31, 2021 682,000 $ 10.87 9.49 $ 4.74 Granted 1,480,398 5.25 $ 2.81 Exercised — — Forfeited (484,066) 9.19 Outstanding, December 31, 2022 1,678,332 $ 6.40 9.09 $ 3.21 As of December 31, 2021 Vested and Expected to vest 682,000 $ 10.87 9.49 $ 4.74 Exercisable 37,000 $ 13.73 8.87 $ 4.25 As of December 31, 2022 Vested and Expected to vest 1,678,332 $ 6.40 9.09 $ 3.21 Exercisable 124,900 $ 10.75 8.52 $ 4.76 The following table summarizes RSU activities Number of Shares Weighted-Average Fair Value Outstanding, December 31, 2020 230,000 $ 13.73 Granted 673,266 10.48 Vested (127,621) 13.79 Forfeited (12,000) 11.65 Outstanding, December 31, 2021 763,645 $ 10.89 Granted 2,256,545 5.68 Vested (253,068) 10.93 Forfeited (497,703) 8.47 Outstanding, December 31, 2022 2,269,419 $ 6.24 Class C Incentive Units Ultra provides Class C Incentive Units as part of their incentive plan. As certain employees of the Company were recipients of the Class C Incentive Units, the related share-based compensation was recorded by the Company. The total number of units associated with share-based compensation granted and forfeited during the period from inception to December 31, 2022 is as follows: Time Vesting December 31, 2020 balance 42,881,437 Granted — Forfeited (3,806,844) December 31, 2021 balance 39,074,593 Granted — Forfeited (40,982) Exercised (654,976) December 31, 2022 balance 38,378,635 As of December 31, 2022, 32,349,025 of the units had vested. The units vest on a straight-line basis over the terms of the agreement as described below. Year Ended December 31, 2022 2021 2020 Time vesting units 5 year vesting period 38,080,635 38,776,593 42,583,437 1 year vesting period 298,000 298,000 298,000 Outstanding Incentive Units 38,378,635 39,074,593 42,881,437 There were no performance vesting units outstanding as of December 31, 2022, 2021 and 2020. During 2022, 2021 and 2020, 40,982, 3,806,844 and 1,592,674, respectively, of Class C units were forfeited due to departures of employees from the Company. The Company recognized $778, $821 and $1,850 of share-based compensation related to the Class C incentive units, for the years ended December 31, 2022, 2021 and 2020, respectively, in selling, general & administrative expenses on the consolidated statement of income and comprehensive income. The Company used the fair value of the awards on the grant date to determine the share-based compensation expense. The Company did not issue any Class C incentive units in 2022 or 2021. For units issued in 2020, Ultra evaluated the value of units based on the distribution waterfall specified in the respective agreements. Ultra engaged a third-party valuation firm to estimate its enterprise value (“EV”) as determined by discounted cash flow, guideline public company, and merger and acquisition valuation methodologies. Warrants On September 15, 2021, the Company completed a registered exchange offer of the Company's 17,714,945 outstanding warrants. In connection therewith, the Company exchanged an aggregate 17,428,489 warrants tendered for shares of the Company’s common stock at an exchange ratio of 0.26 shares for each warrant. As a result, at closing, the Company issued an aggregate of 4,531,407 shares of common stock and separate from the exchange, 2,450 warrants were exercised. Additionally, on the same date, the Company and Continental Stock Transfer & Trust Company, entered into Amendment No. 1 (the “Warrant Amendment”) to the Warrant Agreement, dated as of November 15, 2018, by and between FinTech Acquisition Corp. III and the warrant agent, governing the warrants. The Warrant Amendment provided the Company with the right to mandatorily exchange the Company’s remaining outstanding warrants for shares of the Company’s common stock, at an exchange ratio of 0.234 shares for each warrant. Simultaneously with the closing of the warrant exchange offer, the Company notified holders of the remaining warrants that it would exercise its right to exchange the warrants for shares of common stock and, consequently, the 284,006 outstanding warrants that were not tendered in the exchange were converted into an aggregate 66,457 shares of common stock. As a result of these transactions, there were no warrants outstanding as of December 31, 2022. Earnings per Share Earnings per share has been computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the respective period. Potentially dilutive securities consist of shares issuable upon the exercise of stock options, issuance of earnout shares, exercise of warrants, and vesting of restricted stock awards. The following table provides the computation of basic and diluted earnings per share: Year Ended December 31, 2022 2021 2020 Numerator: Net income (loss) $ 8,262 $ (811) $ (524) Denominator: Weighted average common shares - basic 126,429,766 126,417,145 66,294,576 Add effect of dilutive securities: Stock-based awards 488,650 — — Weighted average common shares assuming dilution 126,918,416 126,417,145 66,294,576 Earnings per share: Basic $ 0.07 $ (0.01) $ (0.01) Diluted $ 0.07 $ (0.01) $ (0.01) Anti-dilutive shares excluded from calculation of diluted EPS: Restricted stock units - granted 386,209 329,437 230,000 Stock options - granted 1,678,332 298,096 185,000 Warrants - outstanding — — 17,715,000 Earnout shares 19,700,000 19,700,000 19,700,000 Total anti-dilutive shares 21,764,541 20,327,533 37,830,000 |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes The income tax benefits (expenses) from continuing operations were as follows: Year Ended December 31, 2022 2021 2020 Current: Federal $ (8,680) $ (2,980) $ (1,346) State (2,715) (1,132) (864) Total current provision (11,395) (4,112) (2,210) Deferred: Federal $ 5,148 $ 2,439 $ (510) State 911 416 2,287 Total deferred (expense) benefit 6,059 2,855 1,777 Total (expense) benefit for income taxes $ (5,336) $ (1,257) $ (433) The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The rate reconciliation for continuing operations presented below is based on the U.S. federal statutory tax rate of 21% for the years ended December 31, 2022, 2021, and 2020. Year Ended December 31, 2022 2021 2020 Tax computed at federal statutory rate 21.00 % 21.00 % 21.00 % State Taxes (net of federal benefit) 8.51 118.13 1767.39 State rate change 1.61 51.41 — Nondeductible Expenses (0.43) (0.40) (0.38) Meals and Entertainment — 2.60 (5.28) TRA (0.40) 0.44 222.07 Pass-through Income — — (531.33) Stock compensation 4.07 65.24 (424.39) Transaction cost — 40.46 — Deferred Financing Cost — 151.16 — Deferred write-off and Other — 19.27 — Uncertain Tax Positions - Liability — 51.29 — Uncertain Tax Positions - Interest 0.10 12.94 — Change in entity type — — (574.83) Valuation allowance 8.19 (318.50) (1159.80) Return to Provision Adjustments (3.40) 94.64 209.18 Contingent consideration — (28.21) — Income tax (expense) benefit 39.25 % 281.47 % (476.37) % The Company’s income tax provision was computed based on the federal statutory rate and the average state statutory rates, net of the related federal benefit. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows: December 31, 2022 December 31, 2021 Deferred tax assets Accrued expenses $ 1,538 $ 1,538 Bad debt reserve 400 395 Deferred rent — 1 Fixed Assets 1,704 — Net operating loss carryforward - federal and state 2,016 3,561 Interest expense limitation 319 637 Goodwill amortization 14,449 15,677 Lease liability 927 1,332 Stock compensation 1,095 287 Other 5 — Total net deferred tax assets 22,453 23,428 Deferred tax liabilities Deferred rent (1) — Fixed assets — (3,364) Intangible amortization (15,552) (20,043) California 338(g) amortization (789) (798) Right of use asset (757) (1,192) Other (372) (14) Total deferred tax liabilities (17,471) (25,411) Valuation allowance (10,646) (9,740) Net deferred tax liability $ (5,664) $ (11,723) The Company had a $8,399 and $8,975 federal operating loss carryforward as of December 31, 2022 and 2021, respectively, which can be carried forward indefinitely. The Company had a $6,243 and $29,897 net operating loss carryforward for various state jurisdictions as of December 31, 2022 and 2021, respectively. ASC 740, Income Tax ("ASC 740") requires deferred tax assets to be reduced by a valuation allowance, if, based on the weight of available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. In accordance with this requirement, the Company regularly reviews the recoverability of its deferred tax assets and establishes a valuation allowance if appropriate. In determining the amount of any required valuation allowance, the Company considers the history of profitability, projections of future profitability, the reversal of future taxable temporary differences, the overall amount of deferred tax assets, and the timeframe necessary to utilize the deferred tax assets prior to their expiration. Based on the weight of all positive and negative quantitative and qualitative evidence available as outlined above, management has concluded that it is more likely than not that the Company will be able to realize a portion of its federal and state deferred tax assets in the foreseeable future and has recorded a valuation allowance of $10,646 and $9,740 against these assets as of December 31, 2022 and 2021, respectively. As of December 31, 2022, the earliest tax year open to federal and state examinations is 2019 and no years are currently under examination in any jurisdiction. The Company believes based on the recognition and measurement principles of ASC 740 that the unrecognized tax benefits recorded for all remaining open years in all jurisdictions, including those currently under audit, is appropriate. The Company does not expect its unrecognized tax benefits to significantly change in the next 12 months. The ending amount of all unrecognized tax benefits was $229 as of December 31, 2022 and 2021, respectively. The amount of unrecognized tax benefits that would impact the effective tax rate if recognized was $229. The Company accrued interest and penalties associated with uncertain tax positions as part of the tax provision and resulted in an ending amount of interest and penalties as of December 31, 2022 of $23 and $48, respectively. The aggregate change in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for 2022, 2021 and 2020 is as follows: Year Ended December 31, 2022 2021 2020 Beginning balance $ 229 $ — $ — Additions based on tax positions related to prior years — 229 — Additions based on tax positions related to current years — — — Reductions for tax positions due to lapse of statute — — — Other changes — — — Ending balance $ 229 $ 229 $ — CARES Act On March 27, 2020, the CARES Act was signed into law. Intended to provide economic relief to those impacted by the COVID-19 pandemic, the CARES Act includes provisions, among others, addressing the carryback of net operating losses ("NOLs") for specific periods, refunds of alternative minimum tax credits, temporary modifications to the limitations placed on the tax deductibility of net interest expenses, and technical amendments for qualified improvement property (“QIP”). Additionally, the CARES Act, in efforts to enhance business’ liquidity, provides for refundable employee retention tax credits and the deferral of the employer-paid portion of social security taxes. |
Fair value
Fair value | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair value | Fair value The Company made recurring fair value measurements of contingent liabilities arising from the Paragon acquisition using Level 3 unobservable inputs. These liabilities were related to potential earnout payments in connection with certain growth metrics related to the financial performance of Paragon in the 12 months from April 23, 2021 through April 22, 2022 as laid out in the acquisition agreement. The contingent liability no longer exists as of December 31, 2022. There were no transfers into or out of Level 3 during the years ended December 31, 2022 and 2021. The Company makes recurring fair value measurements for derivative instruments. Refer to Note 9 . Derivatives for additional information. The Company has determined that the significant inputs used to value the interest rate cap fall within Level 2 of the fair value hierarchy. As a result, the Company has determined that its interest rate cap valuation is classified in Level 2 of the fair value hierarchy as shown in the table below. Level 1 Level 2 Level 3 December 31, 2021 Interest rate cap agreement (a) $ — $ 194 $ — Total $ — $ 194 $ — December 31, 2022 Interest rate cap agreement (a) $ — $ 1,599 $ — Total $ — $ 1,599 $ — (a) Interest rate cap asset value is included in Other current assets Other financial instruments not measured at fair value on the Company’s consolidated balance sheets at December 31, 2022 and 2021 include cash, trade receivable, prepaid expenses and other current assets, accounts payable, and accrued expenses and other current liabilities as their estimated fair values reasonably approximate their carrying value as reported on the consolidated balance sheets. The Company’s debt obligations are carried at amortized cost less debt issuance costs. Amortized cost approximates fair value. Fair value has been estimated based on actual trading information, and quoted prices, provided by bond traders and would be classified as Level 2. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies Liabilities under Tax Receivable Agreement Pursuant to the Tax Receivable Agreement ("TRA"), the Company is obligated to make payments to Ultra equal to 85% of the realized tax benefits that Holdings realizes or is deemed to realize as a result of the Designated Tax Attributes. Designated Tax Attributes include (i) the tax basis increases resulting from the exchange of Holdings and GTCR/Ultra Blocker, Inc. equity interests in exchange for shares of the Company’s common stock and cash pursuant to the Fintech Merger Agreement, (ii) imputed interest deemed to be paid by the Company as a result of, and additional tax basis arising from, any payments the Company makes under the TRA, (iii) tax basis of assets immediately prior to the Fintech Transaction that are held by Holdings and its subsidiaries or GTCR/Ultra Blocker, Inc., and (iv) net operating losses and other section 163(j) carryforwards of Holdings’ subsidiaries or GTCR/Ultra Blocker, Inc. The Company is not obligated to make any payments under the TRA until the tax benefits associated the transaction that gave rise to the payment are realized. Amounts payable under the TRA are contingent upon, among other things, generation of future taxable income over the term of the TRA. If the Company does not generate sufficient taxable income in the aggregate over the term of the TRA to utilize the tax benefits, then the Company would not be required to make the related TRA payments. As of December 31, 2022, the TRA liability is $18,504 based on the amount deemed probable under ASC 450. As of December 31, 2021, the amount of the TRA liability was $19,502. The total TRA payment obligation assuming sufficient taxable income to recognize 100% of the Designated Tax Attributes was $32,147 and $32,245 as of December 31, 2022 and 2021, respectively. Payments were made of $592 pursuant to the TRA during the year ended December 31, 2022 and recorded in payment on tax receivable liability in the consolidated statement of cash flows. Both the TRA-related deferred tax assets and the Company’s obligation are estimates that are subject to change. Any changes in the fair value of the TRA liability are recorded in other income (expense) on the consolidated statements of income and comprehensive income. The Company recorded a gain of $406 for the year ended December 31, 2022 associated with the change in the TRA liability. Legal matters From time to time the Company is a party to legal proceedings arising in the ordinary course of business. In accordance with U.S. GAAP, the Company records a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed regularly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular case. |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related party transactions | Related party transactions Contributions from Ultra In connection with the acquisition of First Billing Services ("FBS") in 2019, Ultra contributed all of its shares in Stewardship valued at $4,000 as of the acquisition date of FBS to the Company as a capital contribution. Subsequent to the acquisition of FBS, Ultra also contributed all of its acquired membership interest in FBS valued at $4,500 as of the acquisition date of FBS to the Company as a capital contribution. The Company also received cash contributions from Ultra in the amounts of $0, $0 and $12,211 for the years ended December 31, 2022, 2021 and 2020, respectively. Receivable from affiliate The Company, previously as a wholly-owned subsidiary of Ultra, funded certain transactions on behalf of its parent company that result in a receivable from affiliate between the two entities. In the year ended December 31, 2020, Holdings settled its receivable from affiliate balance in connection with the Fintech Transaction, which resulted in a distribution of $24,943 to Ultra. The Company had a related party receivable from affiliate balance of $0 for the years ended December 31, 2022 and December 31, 2021. Advisory Agreement The Company entered into an Advisory Agreement with GTCR Management XI LP, an affiliate of GTCR, on August 1, 2017 for business consulting services. In exchange for those services the Company paid GTCR Management XI LP an annual advisory fee of $1,000 payable in advance in quarterly installments. The Company recorded total charges of $0, $0, and $750 related to the Advisory Agreement in selling, general & administrative expenses on the consolidated statement of income and comprehensive income for the years ended December 31, 2022, 2021, and 2020, respectively. The Company recorded no related party payable to GTCR on the consolidated balance sheet as of December 31, 2022, 2021, and 2020, respectively. The Company reimburses GTCR for expenses incurred as a result of the Acquisition and for services related to the Advisory Agreement. The Company recorded no charges for expenses incurred for the years ended December 31, 2022, 2021, and 2020. The Company recorded no related party payable to GTCR on the consolidated balance sheet as of December 31, 2022, 2021, and 2020, respectively. The Advisory Agreement was terminated on October 16, 2020 in connection with the consummation of the Fintech Transaction. Related party transactions – Antares Antares Capital LP is an investor in GTCR, LLC and was the administrative agent and a lender under the Prior Credit Agreement. As such, Antares is considered a related party. The Company recorded interest expense of $0, $6,841, and $15,671 in expense on the consolidated statement of income and comprehensive income for the years ended December 31, 2022, 2021, and 2020 respectively, related to the Prior Credit Agreement. On June 25, 2021, the Company repaid the remaining principal and interest on the Prior Credit agreement and as such, Antares is no longer the administrative agent or a lender under the Company's current Credit Agreement. See Note 8 for further details. |
Defined contribution plan
Defined contribution plan | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Defined contribution plan | Defined contribution plan The Company maintains a 401(k) Plan as a defined contribution retirement plan for all eligible employees. The 401(k) Plan provides for tax-deferred contributions of employees’ salaries, limited to a maximum annual amount as established by the IRS. The plan enrolls employees immediately with no age or service requirement. The Company matches 50% of employees’ contributions up to the first 7% contributed. Matching contributions made to an employee’s account are 100% vested as of the date of contribution. The 401(k) Plan employer match was $888, $819 and $721 in the years ended December 31, 2022, 2021 and 2020, respectively. |
Segments
Segments | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segments | Segments The Company determines its operating segments based on ASC 280, Segment Reporting . The Company reorganized its segments in 2020. Based on the manner in which the chief operating decision making group (“CODM”) manages and monitors the performance of the business in 2022, the Company currently has two operating and reportable segments: Integrated Solutions and Payment Services. All prior periods, are presented based on the current segment structure. More information about our two reportable segments: • Integrated Solutions - Our Integrated Solutions segment represents the delivery of our credit and debit card payment solutions, and to a lesser extent, ACH processing solutions to customers via integrations with software partners across our strategic vertical markets. Our Integrated Solutions partners include vertical focused front-end Customer Relationship Management software providers as well as back-end Enterprise Resource Planning and accounting solutions. • Payment Services - Our Payment Services segment represents the delivery of card payment processing solutions to our customers through resellers, as well as ACH, check, and gift card processing. Card payment processing solutions in this segment do not originate via a software integration but still utilize Paya’s core technology infrastructure. ACH, check, and gift card processing may or may not be integrated with third-party software. All segment revenue is from external customers. The following tables present total revenues and segment gross profit, excluding depreciation and amortization, for each reportable segment and includes a reconciliation of segment gross profit to total U.S. GAAP operating profit, excluding depreciation and amortization, by including certain corporate-level expenses. Year Ended December 31, 2022 2021 2020 Integrated Solutions $ 181,473 $ 155,203 $ 122,324 Payment Services 101,270 94,153 83,724 Total Revenue 282,743 249,356 206,048 Integrated Solutions gross profit 90,047 81,683 65,266 Payment Services gross profit 53,944 48,428 38,663 Total segment gross profit 143,991 130,111 103,929 Selling, general & administrative expenses (87,028) (77,450) (63,035) Depreciation and amortization (31,756) (30,033) (24,562) Interest expense (14,311) (14,142) (17,637) Other income (expense) 2,702 (8,040) 1,214 Income (loss) before income taxes $ 13,598 $ 446 $ (91) |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent events Merger with Nuvei Corporation On January 9, 2023, the Company announced the execution of an Agreement and Plan of Merger (the “Merger Agreement”) with Nuvei Corporation, a corporation incorporated pursuant to the laws of Canada (“Parent”), and Pinnacle Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Purchaser”). Pursuant to the Merger Agreement, and upon the terms and subject to the conditions thereof, Purchaser agreed to commence a tender offer (the “Offer”), to purchase all of the shares of common stock of the Company issued and outstanding at a price of $9.75 per share (the “Offer Price”), in cash, without interest thereon (but subject to applicable withholding). Pursuant to the Merger Agreement, and upon the terms and subject to the conditions thereof, we will merge with and into the Purchaser, with the Company continuing as the surviving corporation and a wholly owned subsidiary of Parent (the “Merger”). If the Merger is consummated, the Company’s common stock will be delisted from the Nasdaq Capital Market and the duty to file reports will be suspended under Section 13 and 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act"). On January 24, 2023, Purchaser commenced the Offer by filing with the SEC and mailing to the Company’s stockholders a Tender Offer Statement on Schedule TO. The Company concurrently filed with the SEC and mailed to stockholders a Solicitation/Recommendation Statement on Schedule 14D-9, which recommended that the Company’s stockholders tender their shares to Purchaser pursuant to the Offer. The Offer will initially remain open for a minimum of 20 business days from the date of commencement of the Offer. The Merger Agreement includes customary termination provisions for both the Company and Parent, and provides that, in connection with the termination of the Merger Agreement under specified circumstances, including termination by the Company to accept and enter into an agreement with respect to a Superior Proposal (as defined in the Merger Agreement), the Company will pay Parent a termination fee of approximately $38 million. The parties to the Merger Agreement are also entitled to specifically enforce the terms and provisions of the Merger Agreement. The Merger Agreement provides, among other things, that upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Merger, each share of the Company’s common stock that is not (a) validly tendered and irrevocably accepted for purchase pursuant to the Offer, (b) held by a stockholder who is entitled to demand appraisal and who has properly and validly exercised appraisal rights in accordance with, and who has complied with, applicable law, or (c) held by Parent, Purchaser, or any other direct or indirect wholly owned subsidiary of Parent, will be thereupon converted into the right to receive cash in an amount equal to the Offer Price, on the terms and subject to the conditions set forth in the Merger Agreement. The proposed Merger is expected to close during the first quarter of 2023. Termination Agreement with Respect to TRA On January 8, 2023, in connection with the execution and delivery of the Merger Agreement, the Company and Ultra entered into an agreement (the “Termination Agreement”) with respect to the termination of the TRA. The Termination Agreement implements certain provisions of the TRA in connection with the occurrence of the transactions contemplated by the Merger Agreement, including the acceleration of all obligations under the TRA pursuant to its terms resulting in the payment of an early termination fee of approximately $19.5 million to Ultra. Legal Proceedings Relating to the Offer and the Merger Agreement In connection with the Offer and Merger Agreement, five complaints have been filed as individual actions in United States District Courts and one complaint has been filed in New York Supreme Court. Certain demand letters have also been sent to the Company by purported stockholders making similar allegations. On January 25, 2023, Ryan O’Dell, a purported stockholder of the Company, filed a complaint in the United States District Court for the Southern District of New York, captioned O’Dell v. Paya Holdings Inc., et al., Case No. 1:23-cv-659 (the “O’Dell Complaint”). On January 31, 2023, Jordan Wilson, a purported stockholder of the Company, filed a complaint in the United States District Court for the Southern District of New York, captioned Jordan Wilson v. Paya Holdings Inc., et al. , Case No. 1:23-cv-790 (the “Wilson Complaint”). On January 31, 2023, Robert Wilhelm, a purported stockholder of the Company, filed a complaint in the United States District Court for the Southern District of New York, captioned Wilhelm v. Paya Holdings Inc., et. al. , Case No. 1:23-cv-119 (the “Wilhelm Complaint”). On February 1, 2023, Dustin Asbury, a purported stockholder of the Company, filed a complaint in the United States District Court for the Southern District of New York, captioned Asbury v. Paya Holdings Inc., et. al. , Case No. 1-23-cv-861 (the “Asbury Complaint”). On February 2, 2023, Jacob Wheeler, a purported stockholder of the Company, filed a complaint in the United States District Court for the Southern District of New York, captioned Wheeler v. Paya Holdings Inc., et. al ., Case No. 1:23-cv-892 (the “Wheeler Complaint” and together with the O’Dell Complaint, the Wilson Complaint, the Wilhelm Complaint and the Asbury Complaint, the “Complaints”). The Complaints allege, among other things, that the defendants (the Company and the Company’s Board of Directors) violated Sections 14(d), 14(e) and 20(a) of the Exchange Act and Rule 14d-9 promulgated thereunder by omitting and/or misrepresenting certain material facts relating to the transactions contemplated by the Merger Agreement from the Schedule 14D-9 filed by the Company on January 24, 2023. The Complaints seek, among other relief, (i) injunctive relief preventing the consummation of the Merger, (ii) recission of the Merger Agreement or rescissory damages, (iii) other damages purportedly incurred on account of the alleged omissions or misstatements, and (iv) an award of plaintiff’s costs and disbursements of the action, including attorneys’ and expert fees and expenses. On January 31, 2023, Brian Levy, a purported stockholder of the Company, filed a complaint in the Supreme Court of the State of New York for Nassau County, captioned Brian Levy v. Debora Boyda, et al. , Index No. 601850/2023 (the “Levy Complaint”). The Levy Complaint alleges, among other things, that the defendants (the Company, the Company’s Board of Directors, and Nuvei Corporation) violated Section 10-5-50 of the Georgia Uniform Securities Act of 2008 and/or negligently and fraudulently misrepresented and concealed certain material facts related to the transactions contemplated by the Merger Agreement under New York common law. The Levy Complaint seeks, among other relief, (i) a declaration that the Company and the Company’s Board of Directors violated Section 10-5-50 of the Georgia Uniform Securities Act of 2008, (ii) a declaration that defendants negligently and fraudulently misrepresented, concealed and omitted material facts related to the Merger, (iii) injunctive relief preventing the consummation of the Merger, and (iv) an award of interest, attorney’s fees, expert fees and other costs. |
Organization, basis of presen_2
Organization, basis of presentation and summary of accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation These financial statements reflect the consolidated results of operations, financial position and cash flows of the Company, in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain amounts in prior years have been reclassified to conform to the current year presentation. |
Use of estimates | Use of estimatesThe preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. These estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future. The more significant estimates made by management relate to the determination of the fair value of intangible assets acquired in a business combination, allowance for credit losses, income taxes, tax receivable agreement liability, and impairment of intangibles and long-lived assets. |
Principles of Consolidation | Principles of Consolidation These consolidated financial statements include the accounts of the Company and its subsidiary companies. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Cash and cash equivalents | Cash and cash equivalents Cash and/or cash equivalents are short-term, highly liquid investments with a maturity of ninety days or less at the time of purchase. The fair value of our cash and cash equivalents approximates carrying value. At times, cash and cash equivalents exceed the amount insured by the Federal Deposit Insurance Corporation. |
Concentration of credit risk | Concentration of credit risk Our cash, cash equivalents, trade receivables, funds receivable and customer accounts are potentially subject to concentration of credit risk. Deposits held with banks may exceed the amount of governmental insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and therefore, these bear minimal default risk. The Company performs ongoing credit evaluations of its customers’ financial condition and generally requires no collateral from its customers. No individual customers represented more than 10% of the Company’s revenue. |
Trade receivables, net | Trade receivables, netTrade receivables are recorded at net realizable value, which includes allowances for credit losses. The Company estimates an allowance for credit losses related to balances that it estimates it cannot collect from merchants. These uncollectible amounts relate to chargebacks, uncollectible merchant fees, and ACH transactions that have been rejected subsequent to the payout date. The Company uses a loss-rate method, which utilizes historical write-off data, to estimate expected credit losses relating to uncollectible accounts. |
Prepaid expenses | Prepaid expenses Prepaid expenses primarily consist of insurance, software licenses, rent, and supplier invoices. |
Other current assets | Other current assets Other current assets primarily consist of current deferred debt issuance costs related to the line of credit, the interest rate cap agreement, other receivables and equipment inventory. |
Funds held for clients and client funds obligation | Funds held for clients and client funds obligation Funds held for clients and client funds obligations result from the Company’s processing services and associated settlement activities, including settlement of payment transactions. Funds held for clients represent assets that are restricted for use solely for the purposes of satisfying the obligations to remit funds relating to the Company’s processing services, which are classified as client funds obligations on our consolidated balance sheets. Funds held for clients are generated principally from merchant services transactions and are comprised of both settlements’ receivable and cash as of period end. Certain merchant settlement assets that relate to settlement obligations accrued by the Company are held by partner banks. The Company classified funds held for clients as a current asset since these funds are held solely for the purpose of satisfying the client funds obligations. The Company records corresponding settlement obligations for amounts payable to merchants and for payment instruments not yet presented for settlement as client funds obligations. Client funds obligations represent the Company's contractual obligations to remit funds to satisfy clients' settlement obligations. The client funds obligations represent liabilities that will be repaid within one year of the balance sheet date. Differences in the funds held for clients and client funds obligation are due to timing differences between when transactions are settled and when payment instruments are presented for settlement and are considered to be immaterial. The changes in settlement assets and obligations are presented on a net basis within financing activities in the consolidated statements of cash flows. |
Property and equipment, net | Property and equipment, net Property and equipment, is stated at cost less accumulated depreciation. Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets. These lives are 3 years for computers and equipment, 5 years for furniture, fixtures, and office equipment, and the lesser of the asset useful life or remaining lease term for leasehold improvements. Also, the Company capitalizes software development costs and website development costs incurred in accordance with ASC 350-40, Internal Use Software. The useful lives are 3 to 5 years for internal-use software. Repair and maintenance costs are expensed as incurred and included in selling, general and administrative expenses on the consolidated statements of income and comprehensive income. |
Leases | Leases On January 1, 2021, the Company adopted Accounting Standards Update ("ASU") No. 2016-02, Leases ("Topic 842") using the modified retrospective transition approach. We applied the new standard to all leases existing at the date of initial application. Refer to the discussion under Note 13 Commitments and Contingencies. We determine if a contract is a leasing arrangement at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Right-of-use ("ROU") assets and lease liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The Company calculates the present value of future payments by using an estimated incremental borrowing rate, which approximates the rate at which the Company would borrow, on a secured basis and over a similar term. ROU assets represent our right to control the use of an identified asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. We use the incremental borrowing rate on the commencement date in determining the present value of our lease payments. We recognize operating lease expense for our operating leases on a straight-line basis over the lease term. The Company’s lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes, or other costs. Variable lease costs are expensed as incurred on the consolidated statements of income. |
Impairment of long-lived assets | Impairment of long-lived assets The Company evaluates the recoverability of its long-lived assets in accordance with the provisions of ASC 360, Property, Plant and Equipment (“ASC 360”). ASC 360 requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets is measured by comparing the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. There was no impairment of long-lived assets recognized in any period presented in the consolidated financial statements. |
Goodwill and other intangible assets, net | Goodwill and other intangible assets, net Goodwill represents the premium paid over the fair value of the net tangible and identifiable intangible assets acquired in the Company’s business combinations. The Company evaluates goodwill and intangible assets in accordance with ASC 350, Goodwill and Other Intangible Assets (“ASC 350”). ASC 350 requires goodwill to be either qualitatively or quantitatively assessed for impairment annually (or more frequently if impairment indicators arise) for each reporting unit. The Company tests goodwill and intangible assets annually for impairment as of September 30 of each year, and at interim periods, using a qualitative approach. Our annual evaluation assesses qualitative factors to determine whether it is more likely than not the fair value is less than the carrying value of the asset. If the Company is unable to conclude that goodwill and intangible assets, net are not impaired during its qualitative assessment, the Company will perform a quantitative assessment by estimating the fair value of the assets and comparing the fair value to the carrying value. As of December 31, 2022 and 2021, it was more likely than not that the fair value of goodwill and intangible assets, net exceeded their carrying value and as such, there was no goodwill impairment recognized in any period presented in the consolidated financial statements. Intangible assets with finite lives consist of internal use software, trade names, customer lists and customer relationships and are amortized on a straight-line basis over their estimated useful lives. From time to time, the Company acquires customer lists from sales agents in exchange for an upfront cash payment. The purchase of customer lists are treated as asset acquisition, resulting in recording an intangible asset at cost on the date of acquisition. The acquired customer lists intangible assets have a useful life of 5 years. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the manner of our use of the acquired assets or the strategy for our overall business or significant negative industry or economic trends. If this evaluation indicates that the value of the intangible asset may be impaired, the Company makes an assessment of the recoverability of the net book value of the asset over its remaining useful life. If this assessment indicates that the intangible asset is not recoverable, based on the estimated undiscounted future cash flows of the asset over the remaining amortization period, the Company reduces the net book value of the related intangible asset to fair value and may adjust the remaining amortization period. The Company evaluates its intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the net book value may not be recoverable. There were no indicators of impairment identified nor was impairment recognized in intangible assets in any period presented in the consolidated financial statements. |
Long-term debt and issuance costs | Long-term debt and issuance costs Eligible debt issuance costs associated with the Company's credit facilities are deferred and amortized to interest expense over the term of the related debt using the effective interest method. Debt issuance costs associated with Company's term debt are presented on the Company's consolidated balance sheets as a direct reduction in the carrying value of the associated debt liability. |
Revenue | RevenueThe Company’s business model provides payment services, card processing, and ACH, to merchants through enterprise or vertically focused software partners, direct sales, reseller partners, other referral partners, and a limited number of financial institutions. The Company recognizes processing revenues on bankcard merchant accounts and ACH merchant accounts at the time merchant transactions are processed and periodic fees over the period the service is performed.Revenue recognition The Company follows ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASC 606”) and performs a five-step analysis of transactions to determine when and how revenue is recognized, based upon the core principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services At contract inception, the Company assesses the goods and services promised in its contracts with customers and identifies performance obligations for each promise to transfer to the customer a good or service that is distinct. The Company’s performance obligation relating to its payment processing services revenue is to provide continuous access to the Company’s system to process as much as its customers require. Since the number or volume of transactions to be processed is not determinable at contract inception, the Company’s payment processing services consist of variable consideration under a stand-ready service of distinct days of service that are substantially the same with the same pattern of transfer to the customer. As such, the stand-ready obligation is accounted for as a single-series performance obligation whereby the variability of the transaction value is satisfied daily as the performance obligation is performed. In addition, the Company applies the right to invoice practical expedient to payment processing services as each performance obligation is recognized over time and the amounts invoiced are reflective of the value transferred to the customer. The Company uses each day as a time-based measure of progress toward satisfaction of the single performance obligation of each contract. This method most accurately depicts the pattern by which services are transferred to the merchant, as performance depends on the extent of transactions processed for that merchant on a given day. Likewise, consideration to which the Company expects to be entitled is determined according to our efforts to provide service each day. ASC 606 requires disclosure of the aggregate amount of the transaction price allocated to unsatisfied performance obligations; however, as permitted by the standard, the Company has elected to exclude from this disclosure any contracts with an original duration of one year or less and any variable consideration that meets specified criteria. As discussed above, the Company’s core performance obligation is a stand-ready obligation comprised of a series of distinct days of service, and revenue related to this performance obligation is generally billed and recognized as the services are performed. The variable consideration allocated to this performance obligation meets the specified criteria for disclosure exclusion. The aggregate fixed consideration portion of customer contracts with an initial contract duration greater than one year is not material. The Company’s customers are all small to medium size businesses and municipalities who are underwritten to the credit standards of the Company and who each have merchant processing agreements. The Company, through its risk informed bad debt and allowance accounting, appropriately reserves for any potential risk to its revenue and cash flows. Since the cash is collected for the majority of transactions within a month, there is not a significant time lag or risk of uncollectibility in the recognition of revenue. |
Cost of services exclusive of depreciation and amortization | Cost of services exclusive of depreciation and amortization Cost of services includes card processing costs, ACH costs, and other fees paid to card networks, and equipment expenses directly attributable to payment processing and related services to merchants. These costs are recognized as |
Selling, general and administrative expenses | Selling, general and administrative expenses Selling, general and administrative expenses consist primarily of salaries, wages, commissions, marketing costs, professional services costs, technology costs, occupancy costs of leased space, and bad debt expense. Stock based compensation expense is also included in this category. |
Depreciation & Amortization | Depreciation & Amortization Depreciation and amortization consist primarily of amortization of intangible assets, mainly including customer relationships, internal use software, customer lists, trade names and to a lesser extent depreciation on our investments in property, equipment, and software. We depreciate and amortize our assets on a straight-line basis in accordance with our accounting policies. These lives are 3 years for computers and equipment and acquired internal-use software, 5 years for furniture, fixtures, and office equipment, and the lesser of the asset useful life or remaining lease term for leasehold improvements. Repair and maintenance costs are expensed as incurred and included in selling, general and administrative expenses on the consolidated statements of income and comprehensive income. The acquired customer lists are amortized over Customer lists are amortized over a period of 5-15 years depending on the intangible, developed technology 5-10 years, and trade names over 25 years. |
Derivative Financial Instruments | Derivative Financial Instruments The Company accounts for its derivative instruments in accordance with ASC 815, Derivatives and Hedging ("ASC 815") . ASC 815 establishes accounting and reporting standards for derivative instruments requiring the recognition of all derivative instruments as assets or liabilities in the Company’s consolidated balance sheets at fair value. The Company records its derivative instruments as assets or liabilities, depending on its rights or obligations under the applicable derivative contract. Changes in fair value are recognized in earnings in the affected period. The Company uses an interest rate cap contract to manage risk from fluctuations in interest rates on its Term Loan credit agreement. Interest rate caps involve the receipt of variable-rate amounts beyond a specified strike price over the life of the agreement without exchange of the underlying principal amount. The interest rate cap is not designated as a hedging instrument. Changes in the fair value of the interest rate cap are recorded through other income (expense) in the consolidated statement of income and comprehensive income, other current assets on the consolidated balance sheets, and in changes in other current assets in the consolidated statement of cash flows. |
Income Taxes | Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized principally for the expected tax consequences of temporary differences between the tax basis of assets and liabilities and their reported amounts, using currently enacted tax rates. The measurement of a deferred tax asset is reduced, if necessary, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. The Company recognizes a tax benefit for uncertain tax positions if the Company believes it is more likely than not that the position will be upheld on audit based solely on the technical merits of the tax position. The Company evaluates uncertain tax positions after the consideration of all available information. Such tax positions must initially and subsequently be estimated as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authorities, assuming full knowledge of the position and relevant facts. The Company's policy is to recognize any interest and penalties related to income taxes as income tax expense in the relevant period. |
Business Combinations | Business Combinations Upon acquisition of a company, we determine if the transaction is a business combination defined by ASC 805, Business Combinations ("ASC 805"), which is accounted for using the acquisition method of accounting. Under the acquisition method, once control is obtained of a business, the assets acquired, and liabilities assumed, including amounts attributed to noncontrolling interests, are recorded at fair value. We use our best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. One of the most significant estimates relates to the determination of the fair value of these assets and liabilities, specifically intangible assets such as internal use software, trade names and trademarks, and customer relationships. The determination of the fair values is based on estimates and judgments made by management with the assistance of a third-party valuation firm. Significant assumptions for intangible assets include the discount rate, projected revenue growth rates and margin, customer retention factors, obsolescence rates and royalty rate used to calculate the expected future cash flows. Our estimates of fair value are based upon assumptions we believe to be reasonable, but which are inherently uncertain and unpredictable. Measurement period adjustments are reflected at the time identified, up through the conclusion of the measurement period, which is the time at which all information for determination of the values of assets acquired and liabilities assumed is received and is not to exceed one year from the acquisition date. We may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill. Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate identifiable intangible assets. |
Fair-Value Measurements | Fair-Value Measurements The Company follows ASC 820, Fair Value Measurements ("ASC 820"), which defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The determination of fair value is based on the principal or most advantageous market in which the Company could participate and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. Also, determination of fair value assumes that market participants will consider the highest and best use of the asset. The Company uses the hierarchy prescribed in ASC 820 for fair value measurements, based on the available inputs to the valuation and the degree to which they are observable or not observable in the market. The three levels of the hierarchy are as follows: Level 1 Inputs—Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date; Level 2 Inputs—Inputs are quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; inputs other than quoted prices, but that are observable for the asset or liability (e.g., interest rates; yield curves); and inputs that are derived principally from or corroborated by observable market data by correlation or by other means (i.e., market corroborated inputs); and Level 3 Inputs—Unobservable inputs for the asset or liability used to measure fair value. These inputs reflect the Company’s own assumptions about what other market participants would use in pricing the asset or liability. These are based on the best information available and can include the Company's own data. |
Recently Issued Pronouncements Not Yet Adopted | Recently Issued Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU were effective for all entities as of March 12, 2020 through December 31, 2022, however, in December 2022 the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 which extended the sunset date from December 31, 2022 to December 31, 2024. An entity may elect to apply the amendments for contract modifications by Topic or Industry Subtopic as of any date from the beginning an interim period that includes or is subsequent to March 12, 2020, or prospectively from the date that the financial statements are available to be issued. Once elected for a Topic or an Industry Subtopic, the amendments must be applied prospectively for all eligible contract modifications for that Topic or Industry Subtopic. The Company may apply ASU 2020-04 as its contracts referenced in London Interbank Offered Rate (“LIBOR”) are impacted by reference rate reform. The Company is currently evaluating the effect of ASU 2020-04 on its consolidated financial statements. |
Par Value of Common Stock, Recapitalization Transaction, and Cash Flow Classification | Par Value of Common Stock During 2021, the Company identified an immaterial error in the par value of its Common stock impacting the balance of Common stock and Additional Paid-in-Capital in the Company’s interim and annual financial statements beginning as of and for the year ended December 31, 2020. The Company corrected the error, which resulted in an increase of $113 to Common stock and a corresponding decrease to Additional Paid-in-Capital as of December 31, 2021. Recapitalization Transaction During 2021, the Company identified an immaterial error related to the capitalization of a deferred tax asset impacting the balances of the Tax Receivable Agreement liability, Deferred Tax Liability, Net, and Additional Paid-in-Capital in the Company’s interim and annual financial statements beginning as of and for the year ended December 31, 2020. The Company corrected the error which resulted in an increase of $841 to Additional Paid-in-Capital and a corresponding decrease to the Tax Receivable Agreement liability of $410 and Deferred Tax Liability, net of $431 as of December 31, 2021. Cash Flow Classification During 2021, the Company identified an immaterial error in its interim and annual financial statements for the year ended December 31, 2020, whereby the restricted cash within Funds Held for Clients was not appropriately included in the statement of cash flows. These amounts are now shown in the accompanying reconciliation of cash, cash equivalents and restricted cash to amounts shown on the Company's consolidated balance sheets. The original and as adjusted amounts are shown below along with the errors. As Filed As Adjusted Change December 31, December 31, December 31, 2020 2020 2020 CASH FLOW FROM OPERATING ACTIVITIES Movements in cash held on behalf of customers, net $ (8) $ — $ 8 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 21,353 21,361 8 CASH FLOWS FROM FINANCING ACTIVITIES Movements in client fund obligations, net — (5,683) (5,683) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 9,452 3,769 (5,683) Net change in cash and cash equivalents $ (2,340) $ (8,015) $ (5,675) Cash and cash equivalents, beginning of period 25,957 71,424 45,467 Cash and cash equivalents, end of period $ 23,617 $ 63,409 $ 39,792 Reconciliation of cash, cash equivalents, and restricted cash Cash and cash equivalents $ 23,617 $ 23,617 $ — Restricted cash included in funds held for clients — 39,792 39,792 Total cash, cash equivalents, and restricted cash $ 23,617 $ 63,409 $ 39,792 |
Organization, Consolidation and
Organization, Consolidation and Presentation of Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule Of Funds Held For Clients | The composition of our funds held for clients balance consisted of the following: December 31, 2022 2021 Funds held for clients Cash held to satisfy client funds obligations $ 65,831 $ 51,592 Receivables held to satisfy client funds obligations 113,781 48,223 Total $ 179,612 $ 99,815 |
Schedule of Error Corrections and Prior Period Adjustments | As Filed As Adjusted Change December 31, December 31, December 31, 2020 2020 2020 CASH FLOW FROM OPERATING ACTIVITIES Movements in cash held on behalf of customers, net $ (8) $ — $ 8 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 21,353 21,361 8 CASH FLOWS FROM FINANCING ACTIVITIES Movements in client fund obligations, net — (5,683) (5,683) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 9,452 3,769 (5,683) Net change in cash and cash equivalents $ (2,340) $ (8,015) $ (5,675) Cash and cash equivalents, beginning of period 25,957 71,424 45,467 Cash and cash equivalents, end of period $ 23,617 $ 63,409 $ 39,792 Reconciliation of cash, cash equivalents, and restricted cash Cash and cash equivalents $ 23,617 $ 23,617 $ — Restricted cash included in funds held for clients — 39,792 39,792 Total cash, cash equivalents, and restricted cash $ 23,617 $ 63,409 $ 39,792 |
Revenue recognition (Tables)
Revenue recognition (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents the Company's revenue disaggregated by segment and by source as follows: Integrated Solutions Year Ended December 31, 2022 2021 2020 Revenue from contracts with customers Transaction based revenue $ 169,617 $ 143,868 $ 111,494 Service based fee revenue 11,543 11,025 10,676 Equipment revenue 313 310 154 Total revenue $ 181,473 $ 155,203 $ 122,324 Payment Services Year Ended December 31, 2022 2021 2020 Revenue from contracts with customers Transaction based revenue $ 83,199 $ 76,927 $ 68,219 Service based fee revenue 17,952 17,096 15,435 Equipment revenue 119 130 70 Total revenue $ 101,270 $ 94,153 $ 83,724 |
Fintech transaction (Tables)
Fintech transaction (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Reverse Recapitalization [Abstract] | |
Schedule Of Reverse Recapitalization | The following tables reconcile the elements of the Fintech Transaction to the consolidated statement of cash flows for the year ended December 31, 2020. Recapitalization Cash proceeds from FinTech $ 277,630 Cash proceeds from sale of equity securities 250,000 Gross cash received by Paya from Fintech Transaction 527,630 Less: company transaction expenses (24,822) Net cash received from Recapitalization 502,808 Less: cash paid to Seller (499,660) Net contributions from Recapitalization Transaction $ 3,148 The number of shares of Common Stock of Paya Holdings issued immediately following the consummation of the Fintech Transaction is summarized as follows: Shares by Type Number of shares by type as of December 31, 2020 FinTech total shares outstanding prior to the Fintech Transaction 37,163,419 Less: Redemption of FinTech shares (5,681,812) Class A Shares of FinTech 31,481,607 Shares issued to PIPE investors 25,000,000 Shares issued to FinTech and PIPE investors 56,481,607 Shares issued to the Sellers 54,534,022 Total Shares of Common Stock outstanding for earnings per share computation 111,015,629 Plus: Contingent shares subject to forfeiture 5,681,812 Total Shares of Common Stock outstanding 116,697,441 |
Business combinations (Tables)
Business combinations (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the fair value of the assets acquired and liabilities assumed by the Company and resulting goodwill as of December 31, 2022: Assets Current Assets: Cash and cash equivalents $ 45 Trade receivables, net 85 Prepaid expenses 28 Total current assets $ 158 Other assets: Goodwill 2,064 Intangible assets 4,900 Total assets $ 7,122 Liabilities Current liabilities: Accrued liabilities $ 21 Accrued revenue share 22 Total current liabilities $ 43 Total liabilities $ 43 Net assets $ 7,079 The following table summarizes the acquisition date fair value of the assets acquired and liabilities assumed by the Company and resulting goodwill as of December 31, 2021: Assets Current Assets: Cash and cash equivalents $ 816 Trade receivables, net 2,653 Prepaid expenses 174 Other current assets 199 Funds held for clients 3,846 Total current assets $ 7,688 Other assets: Property and equipment, net 52 Goodwill 14,780 Intangible assets 12,510 Other non-current assets 60 Total assets $ 35,090 Liabilities Current liabilities: Trade payables $ 1,407 Accrued liabilities 2,118 Accrued revenue share 80 Other current liabilities 58 Client funds obligations 4,266 Total current liabilities $ 7,929 Non-current liabilities: Deferred tax liability, net 390 Other non-current liabilities 147 Total liabilities $ 8,466 Net assets $ 26,624 The following table summarizes the fair values of the assets acquired and liabilities assumed by the Company and resulting goodwill at October 1, 2020: Assets Current Assets: Cash and cash equivalents $ 2,330 Funds held for clients 585 Prepaid expenses 57 Total current assets $ 2,972 Other assets: Goodwill 12,452 Intangible assets 10,100 Other assets 185 Total assets $ 25,709 Liabilities Current liabilities: Other accrued expenses $ 1,001 Client fund obligation 709 Total current liabilities $ 1,710 Deferred tax liability – non-current 1,729 Total liabilities $ 3,439 Net assets $ 22,270 |
Property and equipment, net (Ta
Property and equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Property and equipment, net consists of the following: December 31, 2022 December 31, 2021 Computers and equipment $ 9,372 $ 8,528 Internal-use software 20,859 14,949 Office equipment 103 141 Furniture and fixtures 1,190 1,357 Leasehold improvements 1,135 1,396 Other equipment 26 26 Total property and equipment 32,685 26,397 Less: accumulated depreciation (16,854) (12,386) Total property and equipment, net $ 15,831 $ 14,011 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Lease Cost | As of December 31, 2022, amounts reported in the consolidated balance sheets were as follows: Operating Leases: December 31, 2022 December 31, 2021 Right-of-use assets $ 2,844 $ 4,495 Lease liability, current 1,164 1,302 Lease liability, noncurrent 2,561 3,941 Total lease liabilities $ 3,725 $ 5,243 Weighted-average remaining lease term (in years) 3.18 4.73 Weighted-average discount rate (annual) 4.0 % 4.0 % Other information related to leases are as follows: Year Ended December 31, 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases (1,462) (1,288) — Right-of-use assets obtained in exchange for lease liabilities Operating leases — 5,571 — |
Operating Lease Liabilities Maturity Analysis | The following table presents a maturity analysis of the Company's operating lease liabilities as of December 31, 2022: Future Minimum Lease Payments 2023 $ 1,279 2024 1,018 2025 990 2026 587 2027 114 Thereafter — Total Lease payments $ 3,988 Less Imputed Interest 263 Total lease obligations $ 3,725 |
Goodwill and other intangible_2
Goodwill and other intangible assets, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes Goodwill | The following table presents changes to goodwill for the years ended December 31, 2022 and 2021 for each reporting unit: Integrated Solutions Payment Services Total Balance as of December 31, 2020 $ 152,408 $ 53,900 $ 206,308 Measurement period adjustment 29 — 29 Acquisition - Paragon purchase accounting 10,346 4,434 14,780 Balance as of December 31, 2021 $ 162,783 $ 58,334 $ 221,117 Acquisition - VelocIT purchase accounting 2,064 — 2,064 Balance as of December 31, 2022 $ 164,847 $ 58,334 $ 223,181 |
Schedule of Intangibles Assets Other Than Goodwill | Intangible assets other than goodwill at December 31, 2022 included the following: Weighted Average Useful Life (Years) Useful Lives Gross Carrying Amount at Accumulated Amortization Net Carrying Value as of December 31, December 31, 2022 2022 Customer Relationships 8.8 5-15 years $ 190,826 $ (91,794) $ 99,032 Developed Technology 6.4 5-10 years 41,520 (23,492) 18,028 Trade name 13.8 5-25 years 5,260 (1,032) 4,228 8.5 $ 237,606 $ (116,318) $ 121,288 Intangible assets other than goodwill at December 31, 2021 included the following: Weighted Average Useful Life (Years) Useful Lives Gross Carrying Amount at Accumulated Amortization Net Carrying Value as of December 31, December 31, 2021 2021 Customer Relationships 10.4 5-16 years $ 184,544 $ (70,222) $ 114,322 Developed Technology 5.1 3-7 years 36,620 (18,843) 17,777 Trade name 15.8 5-25 years 5,260 (651) 4,609 8.4 $ 226,424 $ (89,716) $ 136,708 |
Summary of Expected Future Amortization Expense for Intangible Assets | The following table shows the expected future amortization expense for intangible assets at December 31, 2022: Expected Future Amortization Expense 2023 $ 26,613 2024 24,993 2025 24,030 2026 19,223 2027 11,605 Thereafter 14,824 Total expected future amortization expense $ 121,288 |
Long-term debt (Tables)
Long-term debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Long-term Debt | The Company’s long-term debt consisted of the following as of December 31, 2022 and 2021: December 31, 2022 December 31, 2021 Term loan credit agreement $ 246,875 $ 249,375 Debt issuance costs, net (4,245) (5,018) Total debt 242,630 244,357 Less: current portion of debt (2,500) (2,485) Total long-term debt $ 240,130 $ 241,872 |
Schedule of Annual Principal Payments | Annual principal payments on the Term Loan for the following years is as follows: Future Principal Payments 2023 $ 2,500 2024 2,500 2025 2,500 2026 2,500 2027 2,500 Thereafter 234,375 Total future principal payments $ 246,875 |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Interest Rate Derivatives | The interest rate cap rate was as follows: Period rate is applicable Date From Date To Notional Amount Cap Rate (%) December 29, 2017 March 29, 2018 125,000 2.25% March 30, 2018 June 28, 2018 124,688 2.50% June 29, 2018 September 28, 2018 124,375 2.75% September 29, 2018 December 31, 2018 124,063 2.75% December 31, 2018 March 29, 2019 123,750 3.00% March 30, 2019 June 28, 2019 123,438 3.00% June 29, 2019 September 29, 2019 123,125 3.00% September 30, 2019 December 31, 2019 122,813 3.00% December 31, 2019 March 30, 2020 122,500 3.00% March 31, 2020 June 29, 2020 122,188 3.00% June 30, 2020 September 29, 2020 121,875 3.00% September 30, 2020 December 31, 2020 121,562 3.00% March 31, 2021 March 31, 2023 171,525 1.00% Level 1 Level 2 Level 3 December 31, 2021 Interest rate cap agreement (a) $ — $ 194 $ — Total $ — $ 194 $ — December 31, 2022 Interest rate cap agreement (a) $ — $ 1,599 $ — Total $ — $ 1,599 $ — (a) Interest rate cap asset value is included in Other current assets |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of RSUs Granted | RSUs granted under the Omnibus Incentive Plan were as follows: Year Ended December 31, 2022 2021 2020 RSUs granted 2,256,545 673,266 230,000 Fair value of common stock $5.12 - $8.36 $6.34 - $13.87 $13.73 |
Fair Value Measurement Inputs and Valuation Techniques | The fair value of each option award is estimated on the date of the grant, using the Black-Scholes option-pricing model and the assumptions in the following table: Year Ended December 31, 2022 2021 2020 Stock options granted 1,480,398 509,000 185,000 Fair value of stock options $2.76 - $4.64 $4.41 - $6.11 $4.25 Expected volatility 51.14% - 53.47% 52.12% - 53.42% 29.87% Dividend yield 0% 0% 0% Expected term 6.45 years - 6.5 years 6.42 years - 6.5 years 6.5 years Risk-free interest rate 2.20% - 3.83% 0.96% - 1.38% 0.57% |
Schedule of Stock Options Roll Forward | The following table summarizes stock option activities: Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Weighted-Average Fair Value Outstanding, December 31, 2020 185,000 $ 13.73 9.87 $ 4.25 Granted 509,000 9.85 $ 4.94 Exercised — — Forfeited (12,000) 11.65 Outstanding, December 31, 2021 682,000 $ 10.87 9.49 $ 4.74 Granted 1,480,398 5.25 $ 2.81 Exercised — — Forfeited (484,066) 9.19 Outstanding, December 31, 2022 1,678,332 $ 6.40 9.09 $ 3.21 As of December 31, 2021 Vested and Expected to vest 682,000 $ 10.87 9.49 $ 4.74 Exercisable 37,000 $ 13.73 8.87 $ 4.25 As of December 31, 2022 Vested and Expected to vest 1,678,332 $ 6.40 9.09 $ 3.21 Exercisable 124,900 $ 10.75 8.52 $ 4.76 |
Schedule of RSUs Roll Forward | The following table summarizes RSU activities Number of Shares Weighted-Average Fair Value Outstanding, December 31, 2020 230,000 $ 13.73 Granted 673,266 10.48 Vested (127,621) 13.79 Forfeited (12,000) 11.65 Outstanding, December 31, 2021 763,645 $ 10.89 Granted 2,256,545 5.68 Vested (253,068) 10.93 Forfeited (497,703) 8.47 Outstanding, December 31, 2022 2,269,419 $ 6.24 |
Schedule of Units Associated with Share-based Compensation | The total number of units associated with share-based compensation granted and forfeited during the period from inception to December 31, 2022 is as follows: Time Vesting December 31, 2020 balance 42,881,437 Granted — Forfeited (3,806,844) December 31, 2021 balance 39,074,593 Granted — Forfeited (40,982) Exercised (654,976) December 31, 2022 balance 38,378,635 Year Ended December 31, 2022 2021 2020 Time vesting units 5 year vesting period 38,080,635 38,776,593 42,583,437 1 year vesting period 298,000 298,000 298,000 Outstanding Incentive Units 38,378,635 39,074,593 42,881,437 |
Summary of Computation of Basic and Diluted Earnings Per Share | The following table provides the computation of basic and diluted earnings per share: Year Ended December 31, 2022 2021 2020 Numerator: Net income (loss) $ 8,262 $ (811) $ (524) Denominator: Weighted average common shares - basic 126,429,766 126,417,145 66,294,576 Add effect of dilutive securities: Stock-based awards 488,650 — — Weighted average common shares assuming dilution 126,918,416 126,417,145 66,294,576 Earnings per share: Basic $ 0.07 $ (0.01) $ (0.01) Diluted $ 0.07 $ (0.01) $ (0.01) Anti-dilutive shares excluded from calculation of diluted EPS: Restricted stock units - granted 386,209 329,437 230,000 Stock options - granted 1,678,332 298,096 185,000 Warrants - outstanding — — 17,715,000 Earnout shares 19,700,000 19,700,000 19,700,000 Total anti-dilutive shares 21,764,541 20,327,533 37,830,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The income tax benefits (expenses) from continuing operations were as follows: Year Ended December 31, 2022 2021 2020 Current: Federal $ (8,680) $ (2,980) $ (1,346) State (2,715) (1,132) (864) Total current provision (11,395) (4,112) (2,210) Deferred: Federal $ 5,148 $ 2,439 $ (510) State 911 416 2,287 Total deferred (expense) benefit 6,059 2,855 1,777 Total (expense) benefit for income taxes $ (5,336) $ (1,257) $ (433) |
Schedule of Effective Income Tax Rate Reconciliation | The rate reconciliation for continuing operations presented below is based on the U.S. federal statutory tax rate of 21% for the years ended December 31, 2022, 2021, and 2020. Year Ended December 31, 2022 2021 2020 Tax computed at federal statutory rate 21.00 % 21.00 % 21.00 % State Taxes (net of federal benefit) 8.51 118.13 1767.39 State rate change 1.61 51.41 — Nondeductible Expenses (0.43) (0.40) (0.38) Meals and Entertainment — 2.60 (5.28) TRA (0.40) 0.44 222.07 Pass-through Income — — (531.33) Stock compensation 4.07 65.24 (424.39) Transaction cost — 40.46 — Deferred Financing Cost — 151.16 — Deferred write-off and Other — 19.27 — Uncertain Tax Positions - Liability — 51.29 — Uncertain Tax Positions - Interest 0.10 12.94 — Change in entity type — — (574.83) Valuation allowance 8.19 (318.50) (1159.80) Return to Provision Adjustments (3.40) 94.64 209.18 Contingent consideration — (28.21) — Income tax (expense) benefit 39.25 % 281.47 % (476.37) % |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities are as follows: December 31, 2022 December 31, 2021 Deferred tax assets Accrued expenses $ 1,538 $ 1,538 Bad debt reserve 400 395 Deferred rent — 1 Fixed Assets 1,704 — Net operating loss carryforward - federal and state 2,016 3,561 Interest expense limitation 319 637 Goodwill amortization 14,449 15,677 Lease liability 927 1,332 Stock compensation 1,095 287 Other 5 — Total net deferred tax assets 22,453 23,428 Deferred tax liabilities Deferred rent (1) — Fixed assets — (3,364) Intangible amortization (15,552) (20,043) California 338(g) amortization (789) (798) Right of use asset (757) (1,192) Other (372) (14) Total deferred tax liabilities (17,471) (25,411) Valuation allowance (10,646) (9,740) Net deferred tax liability $ (5,664) $ (11,723) |
Schedule of Unrecognized Tax Benefits Roll Forward | The aggregate change in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for 2022, 2021 and 2020 is as follows: Year Ended December 31, 2022 2021 2020 Beginning balance $ 229 $ — $ — Additions based on tax positions related to prior years — 229 — Additions based on tax positions related to current years — — — Reductions for tax positions due to lapse of statute — — — Other changes — — — Ending balance $ 229 $ 229 $ — |
Fair value (Tables)
Fair value (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Interest Rate Cap Agreement | The interest rate cap rate was as follows: Period rate is applicable Date From Date To Notional Amount Cap Rate (%) December 29, 2017 March 29, 2018 125,000 2.25% March 30, 2018 June 28, 2018 124,688 2.50% June 29, 2018 September 28, 2018 124,375 2.75% September 29, 2018 December 31, 2018 124,063 2.75% December 31, 2018 March 29, 2019 123,750 3.00% March 30, 2019 June 28, 2019 123,438 3.00% June 29, 2019 September 29, 2019 123,125 3.00% September 30, 2019 December 31, 2019 122,813 3.00% December 31, 2019 March 30, 2020 122,500 3.00% March 31, 2020 June 29, 2020 122,188 3.00% June 30, 2020 September 29, 2020 121,875 3.00% September 30, 2020 December 31, 2020 121,562 3.00% March 31, 2021 March 31, 2023 171,525 1.00% Level 1 Level 2 Level 3 December 31, 2021 Interest rate cap agreement (a) $ — $ 194 $ — Total $ — $ 194 $ — December 31, 2022 Interest rate cap agreement (a) $ — $ 1,599 $ — Total $ — $ 1,599 $ — (a) Interest rate cap asset value is included in Other current assets |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Reconciliation of Segment Gross Profit | The following tables present total revenues and segment gross profit, excluding depreciation and amortization, for each reportable segment and includes a reconciliation of segment gross profit to total U.S. GAAP operating profit, excluding depreciation and amortization, by including certain corporate-level expenses. Year Ended December 31, 2022 2021 2020 Integrated Solutions $ 181,473 $ 155,203 $ 122,324 Payment Services 101,270 94,153 83,724 Total Revenue 282,743 249,356 206,048 Integrated Solutions gross profit 90,047 81,683 65,266 Payment Services gross profit 53,944 48,428 38,663 Total segment gross profit 143,991 130,111 103,929 Selling, general & administrative expenses (87,028) (77,450) (63,035) Depreciation and amortization (31,756) (30,033) (24,562) Interest expense (14,311) (14,142) (17,637) Other income (expense) 2,702 (8,040) 1,214 Income (loss) before income taxes $ 13,598 $ 446 $ (91) |
Organization, basis of presen_3
Organization, basis of presentation and summary of accounting policies - Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||||
Allowance for credit losses | $ 1,500,000 | $ 1,400,000 | ||
Goodwill impairment | 0 | 0 | $ 0 | |
Impairment of intangible assets | 0 | 0 | 0 | |
Operating lease ROU assets, net of amortization | 2,844,000 | 4,495,000 | ||
Stockholders' equity adjustment | 256,894,000 | 241,925,000 | 116,032,000 | $ 134,364,000 |
Recapitalization transaction, net | 841,000 | (19,686,000) | ||
Decrease in Tax Receivable Agreement liability | 410,000 | |||
Decrease in deferred tax liability | 431,000 | |||
Cumulative effect of adoption of new accounting standard | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | 51,000 | |||
Additional paid-in capital | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | 262,693,000 | 255,986,000 | 129,453,000 | 147,268,000 |
Recapitalization transaction, net | 841,000 | (19,693,000) | ||
Common Stock | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | 132,000 | 132,000 | 12,000 | 5,000 |
Recapitalization transaction, net | 7,000 | |||
Retained earnings | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | $ (5,931,000) | (14,193,000) | $ (13,433,000) | $ (12,909,000) |
Retained earnings | Cumulative effect of adoption of new accounting standard | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | 51,000 | |||
Par value of common stock adjustment | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | 0 | |||
Par value of common stock adjustment | Additional paid-in capital | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | (113,000) | |||
Par value of common stock adjustment | Common Stock | ||||
Property, Plant and Equipment [Line Items] | ||||
Stockholders' equity adjustment | $ 113,000 | |||
Trade name | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 25 years | 25 years | ||
Furniture and fixtures | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 5 years | |||
Computers and equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 3 years | |||
Computers and equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, useful life | 3 years | |||
Furniture and fixtures | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, useful life | 5 years | |||
Minimum | Developed Technology | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 5 years | 3 years | ||
Minimum | Customer Relationships | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 5 years | 5 years | ||
Minimum | Trade name | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 5 years | |||
Minimum | Internal-use software | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, useful life | 3 years | |||
Maximum | Developed Technology | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 10 years | 7 years | ||
Maximum | Customer Relationships | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 15 years | 16 years | ||
Maximum | Trade name | ||||
Property, Plant and Equipment [Line Items] | ||||
Intangible assets, useful life | 25 years | |||
Maximum | Internal-use software | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, useful life | 5 years |
Organization, basis of presen_4
Organization, basis of presentation and summary of accounting policies - Schedule of Funds Held for Clients (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Cash and Cash Equivalents [Line Items] | ||
Funds held for clients | $ 179,612 | $ 99,815 |
Cash held to satisfy client funds obligations | ||
Cash and Cash Equivalents [Line Items] | ||
Funds held for clients | 65,831 | 51,592 |
Receivables held to satisfy client funds obligations | ||
Cash and Cash Equivalents [Line Items] | ||
Funds held for clients | $ 113,781 | $ 48,223 |
Organization, basis of presen_5
Organization, basis of presentation and summary of accounting policies - Cash Flow Classification (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Movements in cash held on behalf of customers, net | $ 0 | ||
Net cash provided by operating activities | $ 45,499 | $ 36,647 | 21,361 |
Cash flows from financing activities: | |||
Movements in client fund obligations, net | 13,693 | 6,690 | (5,683) |
Net cash provided by financing activities: | 10,064 | 135,618 | 3,769 |
Net change in cash and cash equivalents | 36,273 | 134,982 | (8,015) |
Cash, cash equivalents, and restricted cash, beginning of period | 198,391 | 63,409 | 71,424 |
Cash, cash equivalents, and restricted cash, end of period | 234,664 | 198,391 | 63,409 |
Reconciliation of cash, cash equivalents, and restricted cash | |||
Cash and cash equivalents | 168,833 | 146,799 | 23,617 |
Restricted cash included in funds held for clients | 65,831 | 51,592 | 39,792 |
Total cash, cash equivalents, and restricted cash | $ 234,664 | 198,391 | 63,409 |
Previously Reported | |||
Cash flows from operating activities: | |||
Movements in cash held on behalf of customers, net | (8) | ||
Net cash provided by operating activities | 21,353 | ||
Cash flows from financing activities: | |||
Movements in client fund obligations, net | 0 | ||
Net cash provided by financing activities: | 9,452 | ||
Net change in cash and cash equivalents | (2,340) | ||
Cash, cash equivalents, and restricted cash, beginning of period | 23,617 | 25,957 | |
Cash, cash equivalents, and restricted cash, end of period | 23,617 | ||
Reconciliation of cash, cash equivalents, and restricted cash | |||
Cash and cash equivalents | 23,617 | ||
Restricted cash included in funds held for clients | 0 | ||
Total cash, cash equivalents, and restricted cash | 23,617 | ||
Revision of Prior Period, Adjustment | |||
Cash flows from operating activities: | |||
Movements in cash held on behalf of customers, net | 8 | ||
Net cash provided by operating activities | 8 | ||
Cash flows from financing activities: | |||
Movements in client fund obligations, net | (5,683) | ||
Net cash provided by financing activities: | (5,683) | ||
Net change in cash and cash equivalents | (5,675) | ||
Cash, cash equivalents, and restricted cash, beginning of period | $ 39,792 | 45,467 | |
Cash, cash equivalents, and restricted cash, end of period | 39,792 | ||
Reconciliation of cash, cash equivalents, and restricted cash | |||
Cash and cash equivalents | 0 | ||
Restricted cash included in funds held for clients | 39,792 | ||
Total cash, cash equivalents, and restricted cash | $ 39,792 |
Revenue recognition - Disaggreg
Revenue recognition - Disaggregation of Revenue (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 282,743 | $ 249,356 | $ 206,048 |
Number of operating segments | segment | 2 | ||
Number of reportable segments | segment | 2 | ||
Integrated Solutions | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 181,473 | 155,203 | 122,324 |
Payment Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 101,270 | 94,153 | 83,724 |
Transaction based revenue | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 519,519 | 477,273 | 416,043 |
Transaction based revenue | Integrated Solutions | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 169,617 | 143,868 | 111,494 |
Transaction based revenue | Payment Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 83,199 | 76,927 | 68,219 |
Service based fee revenue | Integrated Solutions | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 11,543 | 11,025 | 10,676 |
Service based fee revenue | Payment Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 17,952 | 17,096 | 15,435 |
Equipment revenue | Integrated Solutions | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 313 | 310 | 154 |
Equipment revenue | Payment Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 119 | $ 130 | $ 70 |
Fintech transaction - Narrative
Fintech transaction - Narrative (Details) $ / shares in Units, $ in Millions | Oct. 22, 2020 shares | Oct. 16, 2020 USD ($) tradingDay $ / shares shares | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) shares | Oct. 15, 2020 $ / shares shares |
Reverse Recapitalization [Line Items] | ||||||
Contingent consideration equity (in shares) | 14,018,188 | |||||
Common stock threshold trading days | tradingDay | 20 | |||||
Common stock threshold consecutive trading days | tradingDay | 30 | |||||
Common stock earnout period | 5 years | |||||
Stock price trigger (in dollars per share) | $ / shares | $ 10 | |||||
Common stock outstanding (in shares) | 132,230,837 | 132,059,879 | 116,697,441 | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||||
GTCR | ||||||
Reverse Recapitalization [Line Items] | ||||||
Business acquisition, transaction costs | $ | $ 28 | |||||
GTCR | Additional paid-in capital | ||||||
Reverse Recapitalization [Line Items] | ||||||
Business acquisition, transaction costs | $ | $ 24.9 | |||||
GTCR | Selling, General and Administrative Expenses | ||||||
Reverse Recapitalization [Line Items] | ||||||
Business acquisition, transaction costs | $ | $ 3.1 | |||||
Common Class A | ||||||
Reverse Recapitalization [Line Items] | ||||||
Common stock outstanding (in shares) | 2,258,765 | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | |||||
Reverse recapitalization exchange ratio | 1 | |||||
Stock redeemed during period (in shares) | 5,681,812 | |||||
Common Class B | ||||||
Reverse Recapitalization [Line Items] | ||||||
Common stock outstanding (in shares) | 8,857,500 | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | |||||
Reverse recapitalization exchange ratio | 1 | |||||
FinTech | ||||||
Reverse Recapitalization [Line Items] | ||||||
Consideration received from sale of stock | $ | $ 1,045 | |||||
Cash consideration received from sale of stock | $ | 500 | |||||
Share value consideration received from sale of stock | $ | $ 545 | |||||
Shares sold in offering (in shares) | 54,534,022 | |||||
Common stock outstanding (in shares) | 37,163,419 |
Fintech transaction - Schedule
Fintech transaction - Schedule of Reverse Recapitalization (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020 USD ($) | |
Reverse Recapitalization [Abstract] | |
Cash proceeds from FinTech | $ 277,630 |
Cash proceeds from sale of equity securities | 250,000 |
Gross cash received by Paya from Fintech Transaction | 527,630 |
Less: company transaction expenses | (24,822) |
Net cash received from Recapitalization | 502,808 |
Less: cash paid to Seller | (499,660) |
Net contributions from Recapitalization Transaction | $ 3,148 |
Fintech transaction - Shares Ou
Fintech transaction - Shares Outstanding Schedule (Details) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | |
Reverse Recapitalization [Line Items] | |||
Common stock outstanding (in shares) | 116,697,441 | 132,230,837 | 132,059,879 |
Shares issued for acquisition (in shares) | 31,481,607 | ||
Shares issued to PIPE investors (in shares) | 25,000,000 | ||
Shares issued to FinTech and PIPE investors (in shares) | 56,481,607 | ||
Shares issued to the Sellers (in shares) | 54,534,022 | ||
Total Shares of Common Stock outstanding for earnings per share computation (in shares) | 111,015,629 | ||
Plus: Contingent shares subject to forfeiture (in shares) | 5,681,812 | ||
FinTech | |||
Reverse Recapitalization [Line Items] | |||
Common stock outstanding (in shares) | 37,163,419 | ||
Redemption of FinTech Shares (in shares) | (5,681,812) |
Business combinations - Narrati
Business combinations - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Jan. 19, 2022 | Apr. 23, 2021 | Oct. 01, 2020 | Jan. 31, 2023 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||||
Goodwill from acquisition | $ 14,780 | ||||||
Goodwill | 221,117 | $ 223,181 | $ 206,308 | ||||
The Payment Group, LLC | |||||||
Business Acquisition [Line Items] | |||||||
Purchase price | $ 22,270 | ||||||
Business acquisition, transaction costs | $ 561 | ||||||
Goodwill | 12,452 | ||||||
Intangible assets | 10,100 | ||||||
Paragon Payment Solutions Acquisition | |||||||
Business Acquisition [Line Items] | |||||||
Aggregate purchase price | $ 26,624 | ||||||
Purchase price | 19,124 | ||||||
Common stock | 7,500 | ||||||
Goodwill from acquisition | $ 14,780 | ||||||
Business acquisition, transaction costs | 983 | ||||||
Goodwill | 14,780 | ||||||
Intangible assets | $ 12,510 | ||||||
JS Innovations LLC | |||||||
Business Acquisition [Line Items] | |||||||
Aggregate purchase price | $ 7,079 | ||||||
Purchase price | 6,079 | ||||||
Business acquisition, transaction costs | $ 397 | ||||||
Goodwill | 2,064 | ||||||
Intangible assets | $ 4,900 | ||||||
JS Innovations LLC | Forecast | |||||||
Business Acquisition [Line Items] | |||||||
Purchase price | $ 1,000 | ||||||
Customer Relationships | The Payment Group, LLC | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets | 4,100 | ||||||
Technology-Based Intangible Assets | The Payment Group, LLC | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets | $ 6,000 |
Business combinations - Fair Va
Business combinations - Fair Value of Assets and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Oct. 01, 2020 |
Other assets: | ||||
Goodwill | $ 223,181 | $ 221,117 | $ 206,308 | |
JS Innovations LLC | ||||
Current Assets: | ||||
Cash and cash equivalents | 45 | |||
Trade receivables, net | 85 | |||
Prepaid expenses | 28 | |||
Total current assets | 158 | |||
Other assets: | ||||
Goodwill | 2,064 | |||
Intangible assets | 4,900 | |||
Total assets | 7,122 | |||
Current liabilities: | ||||
Accrued liabilities | 21 | |||
Accrued revenue share | 22 | |||
Total current liabilities | 43 | |||
Non-current liabilities: | ||||
Total liabilities | 43 | |||
Net assets | $ 7,079 | |||
Paragon Payment Solutions Acquisition | ||||
Current Assets: | ||||
Cash and cash equivalents | 816 | |||
Trade receivables, net | 2,653 | |||
Prepaid expenses | 174 | |||
Other current assets | 199 | |||
Funds held for clients | 3,846 | |||
Total current assets | 7,688 | |||
Other assets: | ||||
Property and equipment, net | 52 | |||
Goodwill | 14,780 | |||
Intangible assets | 12,510 | |||
Other non-current assets | 60 | |||
Total assets | 35,090 | |||
Current liabilities: | ||||
Trade payables | 1,407 | |||
Accrued liabilities | 2,118 | |||
Accrued revenue share | 80 | |||
Other current liabilities | 58 | |||
Client funds obligations | 4,266 | |||
Total current liabilities | 7,929 | |||
Non-current liabilities: | ||||
Deferred tax liability, net | 390 | |||
Other non-current liabilities | 147 | |||
Total liabilities | 8,466 | |||
Net assets | $ 26,624 | |||
The Payment Group, LLC | ||||
Current Assets: | ||||
Cash and cash equivalents | $ 2,330 | |||
Prepaid expenses | 57 | |||
Funds held for clients | 585 | |||
Total current assets | 2,972 | |||
Other assets: | ||||
Goodwill | 12,452 | |||
Intangible assets | 10,100 | |||
Other non-current assets | 185 | |||
Total assets | 25,709 | |||
Current liabilities: | ||||
Other current liabilities | 1,001 | |||
Client funds obligations | 709 | |||
Total current liabilities | 1,710 | |||
Non-current liabilities: | ||||
Deferred tax liability, net | 1,729 | |||
Total liabilities | 3,439 | |||
Net assets | $ 22,270 |
Property and equipment, net - (
Property and equipment, net - (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 32,685 | $ 26,397 | |
Less: accumulated depreciation | (16,854) | (12,386) | |
Total property and equipment, net | 15,831 | 14,011 | |
Depreciation | 5,154 | 4,569 | $ 3,853 |
Computers and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 9,372 | 8,528 | |
Internal-use software | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 20,859 | 14,949 | |
Office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 103 | 141 | |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 1,190 | 1,357 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 1,135 | 1,396 | |
Other equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 26 | $ 26 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Impairment charge | $ 149 | ||
Total lease cost | 1,626 | $ 1,672 | |
Operating lease cost | 1,216 | 1,287 | |
Variable lease cost | $ 410 | $ 386 | |
Rental expense | $ 1,699 |
Leases - Lease Information (Det
Leases - Lease Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Right-of-use assets | $ 2,844 | $ 4,495 | |
Lease liability, current | 1,164 | 1,302 | |
Lease liability, noncurrent | 2,561 | 3,941 | |
Total lease liabilities | $ 3,725 | $ 5,243 | |
Weighted-average remaining lease term (in years) | 3 years 2 months 4 days | 4 years 8 months 23 days | |
Weighted-average discount rate (annual) | 4% | 4% | |
Cash paid for amounts included in the measurement of lease liabilities | |||
Operating cash flows from operating leases | $ (1,462) | $ (1,288) | $ 0 |
Right-of-use assets obtained in exchange for lease liabilities | |||
Operating leases | $ 0 | $ 5,571 | $ 0 |
Leases - Operating Leases Matur
Leases - Operating Leases Maturity Schedule (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2023 | $ 1,279 | |
2024 | 1,018 | |
2025 | 990 | |
2026 | 587 | |
2027 | 114 | |
Thereafter | 0 | |
Total Lease payments | 3,988 | |
Less Imputed Interest | 263 | |
Total lease obligations | $ 3,725 | $ 5,243 |
Goodwill and other intangible_3
Goodwill and other intangible assets, net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 223,181 | $ 221,117 | $ 206,308 |
Amortization expense | $ 26,602 | $ 25,464 | $ 20,709 |
Goodwill and other intangible_4
Goodwill and other intangible assets, net - Schedule of Changes in Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 221,117 | $ 206,308 |
Measurement period adjustment | 29 | |
Acquisition - Paragon purchase accounting | 14,780 | |
Acquisition - VelocIT purchase accounting | 2,064 | |
Ending balance | 223,181 | 221,117 |
Integrated Solutions | ||
Goodwill [Roll Forward] | ||
Beginning balance | 162,783 | 152,408 |
Measurement period adjustment | 29 | |
Acquisition - Paragon purchase accounting | 10,346 | |
Acquisition - VelocIT purchase accounting | 2,064 | |
Ending balance | 164,847 | 162,783 |
Payment Services | ||
Goodwill [Roll Forward] | ||
Beginning balance | 58,334 | 53,900 |
Measurement period adjustment | 0 | |
Acquisition - Paragon purchase accounting | 4,434 | |
Acquisition - VelocIT purchase accounting | 0 | |
Ending balance | $ 58,334 | $ 58,334 |
Goodwill and other intangible_5
Goodwill and other intangible assets, net - Schedule of Intangible Assets Other Than Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 237,606 | $ 226,424 |
Accumulated Amortization | (116,318) | (89,716) |
Total expected future amortization expense | $ 121,288 | $ 136,708 |
Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 8 years 6 months | 8 years 4 months 24 days |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 190,826 | $ 184,544 |
Accumulated Amortization | (91,794) | (70,222) |
Total expected future amortization expense | $ 99,032 | $ 114,322 |
Customer Relationships | Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 8 years 9 months 18 days | 10 years 4 months 24 days |
Customer Relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 5 years | 5 years |
Customer Relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 15 years | 16 years |
Developed Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 41,520 | $ 36,620 |
Accumulated Amortization | (23,492) | (18,843) |
Total expected future amortization expense | $ 18,028 | $ 17,777 |
Developed Technology | Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 6 years 4 months 24 days | 5 years 1 month 6 days |
Developed Technology | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 5 years | 3 years |
Developed Technology | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 10 years | 7 years |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 25 years | 25 years |
Gross Carrying Amount | $ 5,260 | $ 5,260 |
Accumulated Amortization | (1,032) | (651) |
Total expected future amortization expense | $ 4,228 | $ 4,609 |
Trade name | Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 13 years 9 months 18 days | 15 years 9 months 18 days |
Trade name | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 5 years | |
Trade name | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Lives | 25 years |
Goodwill and other intangible_6
Goodwill and other intangible assets, net - Summary of Expected Future Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2023 | $ 26,613 | |
2024 | 24,993 | |
2025 | 24,030 | |
2026 | 19,223 | |
2027 | 11,605 | |
Thereafter | 14,824 | |
Total expected future amortization expense | $ 121,288 | $ 136,708 |
Long-term debt - Narrative (Det
Long-term debt - Narrative (Details) - USD ($) | 12 Months Ended | |||
Jun. 25, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Line of Credit Facility [Line Items] | ||||
Pledge of common stock, percentage | 100% | |||
Line of credit facility additional borrowings, percentage of EBITDA | 100% | |||
Proceeds from issuance of long-term debt | $ 0 | $ 250,000,000 | $ 0 | |
Debt issuance costs, net | 4,245,000 | 5,018,000 | ||
Payments on long-term debt | 2,500,000 | 229,302,000 | 2,364,000 | |
Term loan credit agreements | 246,875,000 | 249,375,000 | ||
Interest expense | 14,311,000 | 14,142,000 | 17,637,000 | |
Interest expense, long-term debt | 12,936,000 | 12,229,000 | 15,671,000 | |
Amortization of debt issuance costs | 969,000 | 930,000 | $ 1,072,000 | |
Credit Agreement | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility additional borrowings | $ 61,000,000 | |||
Leverage ratio | 6.50 | |||
Minimum percentage of total commitments | 35% | |||
Credit Agreement | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Leverage ratio | 4.25 | |||
Credit Agreement | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Leverage ratio | 5 | |||
Term Loan | Credit Agreement | ||||
Line of Credit Facility [Line Items] | ||||
Available under credit agreement | $ 250,000,000 | |||
Debt instrument, term | 5 years | |||
Principal payment, percentage | 0.25% | |||
Proceeds from issuance of long-term debt | $ 243,600,000 | |||
Debt discounts | 1,300,000 | |||
Debt issuance costs, net | 5,100,000 | |||
Payments on long-term debt | 233,800,000 | |||
Extinguishment of debt amount | 228,100,000 | |||
Payment for accrued interest | 3,400,000 | |||
Extinguishment of debt, prepayment penalty | 2,300,000 | |||
Write off of debt issuance costs | $ 6,200,000 | |||
Term Loan | Credit Agreement | Eurodollar | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 0.75% | |||
Line of Credit | Credit Agreement | Revolver | ||||
Line of Credit Facility [Line Items] | ||||
Credit agreement amount | $ 45,000,000 | |||
Debt instrument, term | 7 years | |||
Interest rate basis points | 100% | |||
Administrative fees, percent | 0.50% | |||
Term loan credit agreements | 0 | 0 | ||
Unamortized debt issuance costs | $ 680,000 | $ 875,000 | ||
Line of Credit | Credit Agreement | Revolver | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Leverage ratio | 3.25 | |||
Administrative fees, percent step-down | 0.25% | |||
Line of Credit | Credit Agreement | Revolver | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Leverage ratio | 3.75 | |||
Administrative fees, percent step-down | 0.375% | |||
Line of Credit | Credit Agreement | Revolver | Base Rate | Debt Instrument, Interest Rate Period One | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 0.50% | |||
Line of Credit | Credit Agreement | Revolver | Base Rate | Debt Instrument, Interest Rate Period Two | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.25% | |||
Line of Credit | Credit Agreement | Revolver | Base Rate | Debt Instrument, Interest Rate Period Three | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 3.25% |
Long-term debt - Summary of Lon
Long-term debt - Summary of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | ||
Term loan credit agreement | $ 246,875 | $ 249,375 |
Debt issuance costs, net | (4,245) | (5,018) |
Total debt | 242,630 | 244,357 |
Less: current portion of debt | (2,500) | (2,485) |
Total long-term debt | $ 240,130 | $ 241,872 |
Long-term debt - Annual Princip
Long-term debt - Annual Principal Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | ||
2023 | $ 2,500 | |
2024 | 2,500 | |
2025 | 2,500 | |
2026 | 2,500 | |
2027 | 2,500 | |
Thereafter | 234,375 | |
Total future principal payments | $ 246,875 | $ 249,375 |
Derivatives - Narrative (Detail
Derivatives - Narrative (Details) - USD ($) | 12 Months Ended | |||||||||||||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Feb. 03, 2021 | Sep. 29, 2020 | Jun. 29, 2020 | Mar. 30, 2020 | Dec. 31, 2019 | Sep. 29, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 31, 2018 | Sep. 28, 2018 | Jun. 28, 2018 | Mar. 29, 2018 | Nov. 16, 2017 | |
Derivative [Line Items] | ||||||||||||||||
Proceeds from Derivative Instrument, Financing Activities | $ 1,710,000 | $ 0 | $ 0 | |||||||||||||
Interest Rate Cap | ||||||||||||||||
Derivative [Line Items] | ||||||||||||||||
Gain (loss) recognized in other income (expense) | 1,404,000 | $ 127,000 | (1,000) | |||||||||||||
Interest Rate Cap | Not Designated as Hedging Instrument | ||||||||||||||||
Derivative [Line Items] | ||||||||||||||||
Notional Amount | 121,562,000 | $ 171,525,000 | $ 121,875,000 | $ 122,188,000 | $ 122,500,000 | $ 122,813,000 | $ 123,125,000 | $ 123,438,000 | $ 123,750,000 | $ 124,063,000 | $ 124,375,000 | $ 124,688,000 | $ 125,000,000 | $ 125,000,000 | ||
Premium paid for right to receive payments | $ 169,000 | $ 67,000 | ||||||||||||||
Cap rate | 3% | 1% | 3% | 3% | 3% | 3% | 3% | 3% | 3% | 2.75% | 2.75% | 2.50% | 2.25% | |||
Fair value of derivative instrument | $ 1,599,000 | $ 0 | ||||||||||||||
Interest Rate Cap | Not Designated as Hedging Instrument | Maximum | ||||||||||||||||
Derivative [Line Items] | ||||||||||||||||
Cap rate | 6% |
Derivatives - Interest Rate Cap
Derivatives - Interest Rate Cap Rates (Details) - Interest Rate Cap - Not Designated as Hedging Instrument - USD ($) $ in Thousands | Mar. 31, 2023 | Feb. 03, 2021 | Dec. 31, 2020 | Sep. 29, 2020 | Jun. 29, 2020 | Mar. 30, 2020 | Dec. 31, 2019 | Sep. 29, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 31, 2018 | Sep. 28, 2018 | Jun. 28, 2018 | Mar. 29, 2018 | Nov. 16, 2017 |
Derivative [Line Items] | |||||||||||||||
Notional Amount | $ 171,525 | $ 121,562 | $ 121,875 | $ 122,188 | $ 122,500 | $ 122,813 | $ 123,125 | $ 123,438 | $ 123,750 | $ 124,063 | $ 124,375 | $ 124,688 | $ 125,000 | $ 125,000 | |
Cap rate | 1% | 3% | 3% | 3% | 3% | 3% | 3% | 3% | 3% | 2.75% | 2.75% | 2.50% | 2.25% | ||
Subsequent Event | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Notional Amount | $ 171,525 | ||||||||||||||
Cap rate | 1% | ||||||||||||||
Maximum | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Cap rate | 6% |
Equity - Narrative (Details)
Equity - Narrative (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||||
Sep. 15, 2021 shares | Mar. 22, 2021 USD ($) | Mar. 17, 2021 $ / shares shares | Oct. 16, 2020 tradingDay $ / shares | Dec. 31, 2022 USD ($) tradingDay awardType $ / shares shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 USD ($) shares | Dec. 22, 2020 shares | |
Class of Stock [Line Items] | ||||||||
Common stock outstanding (in shares) | 132,230,837 | 132,059,879 | 116,697,441 | |||||
Common stock, contingently issuable (in shares) | 5,681,812 | |||||||
Stock price trigger (in dollars per share) | $ / shares | $ 10 | |||||||
Common stock threshold trading days | tradingDay | 20 | |||||||
Common stock threshold consecutive trading days | tradingDay | 30 | |||||||
Common stock, additional shares to be issued (in shares) | 14,018,188 | |||||||
Common stock, additional contingently issuable (in shares) | 19,700,000 | |||||||
Proceeds from equity offering | $ | $ 122,500 | $ 0 | $ 116,764 | $ 0 | ||||
Stock offering, transaction costs | $ | $ 5,736 | |||||||
Number of awards | awardType | 2 | |||||||
Warrants outstanding (in shares) | 17,714,945 | 0 | ||||||
Number of warrants exchanged (in shares) | 17,428,489 | |||||||
Warrant exchange ratio (in shares) | 0.26 | |||||||
Conversion of stock, shares converted (in shares) | 4,531,407 | |||||||
Equity offering (in shares) | 25,000,000 | |||||||
Warrant Exercise | ||||||||
Class of Stock [Line Items] | ||||||||
Warrant (in shares) | 2,450 | |||||||
Warrant Amendment | ||||||||
Class of Stock [Line Items] | ||||||||
Warrants outstanding (in shares) | 284,006 | |||||||
Warrant exchange ratio (in shares) | 0.234 | |||||||
Equity offering (in shares) | 66,457 | |||||||
Public Stock Offering | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold in offering (in shares) | 20,000,000 | |||||||
Public Stock Offering - Underwriters | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold in offering (in shares) | 10,000,000 | |||||||
Share price (in dollars per share) | $ / shares | $ 12.25 | |||||||
Reverse Recapitalization, Period, One | ||||||||
Class of Stock [Line Items] | ||||||||
Stock price trigger (in dollars per share) | $ / shares | $ 15 | |||||||
Common stock threshold trading days | tradingDay | 20 | |||||||
Common stock threshold consecutive trading days | tradingDay | 30 | |||||||
Reverse Recapitalization, Period, Two | ||||||||
Class of Stock [Line Items] | ||||||||
Stock price trigger (in dollars per share) | $ / shares | $ 17.50 | |||||||
Common stock threshold trading days | tradingDay | 20 | |||||||
Common stock threshold consecutive trading days | tradingDay | 30 | |||||||
Stock option | ||||||||
Class of Stock [Line Items] | ||||||||
Dividend yield | 0% | 0% | 0% | |||||
Class C incentive units | ||||||||
Class of Stock [Line Items] | ||||||||
Share-based compensation expense | $ | $ 778 | $ 821 | $ 1,850 | |||||
Units vested in period (in shares) | 32,349,025 | |||||||
Class C incentive units issued (in shares) | 38,378,635 | 39,074,593 | 42,881,437 | |||||
Forfeited (in shares) | 40,982 | 3,806,844 | ||||||
Class C incentive units | 5 year vesting period | ||||||||
Class of Stock [Line Items] | ||||||||
Class C incentive units issued (in shares) | 38,080,635 | 38,776,593 | 42,583,437 | |||||
Class C incentive units | 1 year vesting period | ||||||||
Class of Stock [Line Items] | ||||||||
Class C incentive units issued (in shares) | 298,000 | 298,000 | 298,000 | |||||
RSUs | ||||||||
Class of Stock [Line Items] | ||||||||
Units vested in period (in shares) | 253,068 | 127,621 | ||||||
Class C incentive units issued (in shares) | 2,269,419 | 763,645 | 230,000 | |||||
Forfeited (in shares) | 497,703 | 12,000 | ||||||
RSUs | Minimum | ||||||||
Class of Stock [Line Items] | ||||||||
Vesting period | 3 years | |||||||
RSUs | Maximum | ||||||||
Class of Stock [Line Items] | ||||||||
Vesting period | 5 years | |||||||
Time Vesting | ||||||||
Class of Stock [Line Items] | ||||||||
Class C incentive units issued (in shares) | 38,378,635 | 39,074,593 | 42,881,437 | |||||
Forfeited (in shares) | 40,982 | 3,806,844 | 1,592,674 | |||||
Performance Vesting | ||||||||
Class of Stock [Line Items] | ||||||||
Class C incentive units issued (in shares) | 0 | 0 | 0 | |||||
Omnibus Incentive Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Maximum shares allowed for issuance (in shares) | 8,800,000 | |||||||
Additional shares authorized (in shares) | 10,000,000 | |||||||
Share-based compensation expense | $ | $ 6,466 | $ 2,842 | $ 28 | |||||
Omnibus Incentive Plan | Stock option | ||||||||
Class of Stock [Line Items] | ||||||||
Dividend yield | 0% |
Equity - Summary of RSUs Grante
Equity - Summary of RSUs Granted under Omnibus Incentive Plan (Details) - RSUs - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
RSUs granted (in shares) | 2,256,545 | 673,266 | |
Fair value of common stock (in dollars per share) | $ 5.68 | $ 10.48 | |
Omnibus Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
RSUs granted (in shares) | 2,256,545 | 673,266 | 230,000 |
Fair value of common stock (in dollars per share) | $ 13.73 | ||
Omnibus Incentive Plan | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of common stock (in dollars per share) | $ 5.12 | $ 6.34 | |
Omnibus Incentive Plan | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of common stock (in dollars per share) | $ 8.36 | $ 13.87 |
Equity - Fair Value Assumptions
Equity - Fair Value Assumptions for Option Awards (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options granted (in shares) | 1,480,398 | 509,000 | |
Fair value of common stock (in dollars per share) | $ 2.81 | $ 4.94 | |
Stock option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options granted (in shares) | 1,480,398 | 509,000 | 185,000 |
Fair value of common stock (in dollars per share) | $ 4.25 | ||
Expected volatility | 29.87% | ||
Dividend yield | 0% | 0% | 0% |
Expected term | 6 years 6 months | ||
Risk-free interest rate | 0.57% | ||
Stock option | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of common stock (in dollars per share) | $ 2.76 | $ 4.41 | |
Expected volatility | 51.14% | 52.12% | |
Expected term | 6 years 5 months 12 days | 6 years 5 months 1 day | |
Risk-free interest rate | 2.20% | 0.96% | |
Stock option | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of common stock (in dollars per share) | $ 4.64 | $ 6.11 | |
Expected volatility | 53.47% | 53.42% | |
Expected term | 6 years 6 months | 6 years 6 months | |
Risk-free interest rate | 3.83% | 1.38% |
Equity - Schedule of Stock Opti
Equity - Schedule of Stock Options (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Options | |||
Beginning balance (in shares) | 682,000 | 185,000 | |
Granted (in shares) | 1,480,398 | 509,000 | |
Exercised (in shares) | 0 | 0 | |
Forfeited (in shares) | (484,066) | (12,000) | |
Ending balance (in shares) | 1,678,332 | 682,000 | 185,000 |
Weighted-Average Exercise Price | |||
Beginning balance (in dollars per share) | $ 10.87 | $ 13.73 | |
Granted (in dollars per share) | 5.25 | 9.85 | |
Exercised (in dollars per share) | 0 | 0 | |
Forfeited (in dollars per share) | 9.19 | 11.65 | |
Ending balance (in dollars per share) | $ 6.40 | $ 10.87 | $ 13.73 |
Stock Option Additional Disclosures | |||
Weighted-Average Remaining Contractual Term (in years) | 9 years 1 month 2 days | 9 years 5 months 26 days | 9 years 10 months 13 days |
Weighted-Average Fair Value, beginning balance (in dollars per share) | $ 4.74 | $ 4.25 | |
Granted, Weighted-Average Fair Value (in dollars per share) | 2.81 | 4.94 | |
Weighted-Average Fair Value, ending balance (in dollars per share) | $ 3.21 | $ 4.74 | $ 4.25 |
Options vested and expected to vest, Number of options (in shares) | 1,678,332 | 682,000 | |
Options vested and expected to vest, Weighted-average exercise price (in dollars per share) | $ 6.40 | $ 10.87 | |
Options vested and expected to vest, Weighted-average remaining contractual term | 9 years 1 month 2 days | 9 years 5 months 26 days | |
Options vested and expected to vest, Weighted-average fair value (in dollars per share) | $ 3.21 | $ 4.74 | |
Options exercisable, Number of options (in shares) | 124,900 | 37,000 | |
Options exercisable, Weighted-average exercise price (in dollars per share) | $ 10.75 | $ 13.73 | |
Options exercisable, Weighted-average remaining contractual term | 8 years 6 months 7 days | 8 years 10 months 13 days | |
Options exercisable, Weighted-average fair value (in dollars per share) | $ 4.76 | $ 4.25 |
Equity - Summary of RSUs Activi
Equity - Summary of RSUs Activity (Details) - RSUs - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Shares | ||
Beginning balance (in shares) | 763,645 | 230,000 |
Granted (in shares) | 2,256,545 | 673,266 |
Vested (in shares) | (253,068) | (127,621) |
Forfeited (in shares) | (497,703) | (12,000) |
Ending balance (in shares) | 2,269,419 | 763,645 |
Weighted-Average Fair Value | ||
Beginning balance (in dollars per share) | $ 10.89 | $ 13.73 |
Granted (in dollars per share) | 5.68 | 10.48 |
Vested (in dollars per share) | 10.93 | 13.79 |
Forfeited (in dollars per share) | 8.47 | 11.65 |
Ending balance (in dollars per share) | $ 6.24 | $ 10.89 |
Equity - Schedule of Units Asso
Equity - Schedule of Units Associated with Share-based Compensation (Details) - Time Vesting - shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Total Units | |||
Beginning balance (in shares) | 39,074,593 | 42,881,437 | |
Granted (in shares) | 0 | 0 | |
Forfeited (in shares) | (40,982) | (3,806,844) | (1,592,674) |
Exercised (in shares) | (654,976) | ||
Ending balance (in shares) | 38,378,635 | 39,074,593 | 42,881,437 |
Equity - Schedule of Incentive
Equity - Schedule of Incentive Units (Details) - Class C incentive units - shares | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Class C incentive units issued (in shares) | 38,378,635 | 39,074,593 | 42,881,437 |
5 year vesting period | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Class C incentive units issued (in shares) | 38,080,635 | 38,776,593 | 42,583,437 |
1 year vesting period | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Class C incentive units issued (in shares) | 298,000 | 298,000 | 298,000 |
Equity - Basic and Diluted Earn
Equity - Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | |||
Net loss | $ 8,262 | $ (811) | $ (524) |
Denominator: | |||
Weighted average common shares - basic (in shares) | 126,429,766 | 126,417,145 | 66,294,576 |
Stock-based awards (in shares) | 488,650 | 0 | 0 |
Weighted average common shares assuming dilution (in shares) | 126,918,416 | 126,417,145 | 66,294,576 |
Earnings per share: | |||
Basic (in dollars per share) | $ 0.07 | $ (0.01) | $ (0.01) |
Diluted (in dollar per share) | $ 0.07 | $ (0.01) | $ (0.01) |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total anti-dilutive shares (in shares) | 21,764,541 | 20,327,533 | 37,830,000 |
Restricted stock units - granted | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total anti-dilutive shares (in shares) | 386,209 | 329,437 | 230,000 |
Stock options - granted | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total anti-dilutive shares (in shares) | 1,678,332 | 298,096 | 185,000 |
Warrant exercise | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total anti-dilutive shares (in shares) | 0 | 0 | 17,715,000 |
Earnout shares | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total anti-dilutive shares (in shares) | 19,700,000 | 19,700,000 | 19,700,000 |
Income taxes - Schedule of Inco
Income taxes - Schedule of Income Tax (Expense) Benefit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ (8,680) | $ (2,980) | $ (1,346) |
State | (2,715) | (1,132) | (864) |
Total current provision | (11,395) | (4,112) | (2,210) |
Deferred: | |||
Federal | 5,148 | 2,439 | (510) |
State | 911 | 416 | 2,287 |
Total deferred (expense) benefit | 6,059 | 2,855 | 1,777 |
Total (expense) benefit for income taxes | $ (5,336) | $ (1,257) | $ (433) |
Income taxes - Rate Reconciliat
Income taxes - Rate Reconciliation for Continuing Operations (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Tax computed at federal statutory rate | 21% | 21% | 21% |
State Taxes (net of federal benefit) | 8.51% | 118.13% | 1,767.39% |
State rate change | 1.61% | 51.41% | 0% |
Nondeductible Expenses | (0.43%) | (0.40%) | (0.38%) |
Meals and Entertainment | 0% | 2.60% | (5.28%) |
TRA | (0.40%) | 0.44% | 222.07% |
Pass-through Income | 0% | 0% | (531.33%) |
Stock compensation | 4.07% | 65.24% | (424.39%) |
Transaction cost | 0% | 40.46% | 0% |
Deferred Financing Cost | 0% | 151.16% | 0% |
Deferred write-off and Other | 0% | 19.27% | 0% |
Uncertain Tax Positions - Liability | 0% | 51.29% | 0% |
Uncertain Tax Positions - Interest | 0.10% | 12.94% | 0% |
Change in entity type | 0% | 0% | (574.83%) |
Valuation allowance | 8.19% | (318.50%) | (1159.80%) |
Return to Provision Adjustments | (3.40%) | 94.64% | 209.18% |
Contingent consideration | 0% | (28.21%) | 0% |
Income tax (expense) benefit | 39.25% | 281.47% | (476.37%) |
Income taxes - Schedule of Defe
Income taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets | ||
Accrued expenses | $ 1,538 | $ 1,538 |
Bad debt reserve | 400 | 395 |
Deferred rent | 0 | 1 |
Fixed Assets | 1,704 | 0 |
Net operating loss carryforward - federal and state | 2,016 | 3,561 |
Interest expense limitation | 319 | 637 |
Goodwill amortization | 14,449 | 15,677 |
Lease liability | 927 | 1,332 |
Stock compensation | 1,095 | 287 |
Other | 5 | 0 |
Total net deferred tax assets | 22,453 | 23,428 |
Deferred tax liabilities | ||
Deferred rent | (1) | 0 |
Fixed assets | 0 | (3,364) |
Intangible amortization | (15,552) | (20,043) |
California 338(g) amortization | (789) | (798) |
Right of use asset | (757) | (1,192) |
Other | (372) | (14) |
Total deferred tax liabilities | (17,471) | (25,411) |
Valuation allowance | (10,646) | (9,740) |
Net deferred tax liability | $ (5,664) | $ (11,723) |
Income taxes - Narrative (Detai
Income taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Contingency [Line Items] | ||||
Valuation allowance | $ 9,740 | $ 10,646 | ||
Unrecognized tax benefits | 229 | 229 | $ 0 | $ 0 |
Unrecognized tax benefits that would impact effective tax rate | 229 | |||
Unrecognized tax benefits, income tax penalties and interest accrued | 48 | 23 | ||
Social security deferred payroll taxes | $ 900 | |||
Social security deferred payroll taxes, percentage due year one | 50% | |||
Social security deferred payroll taxes, percentage due year two | 50% | |||
Domestic Tax Authority | ||||
Income Tax Contingency [Line Items] | ||||
Operating loss carryforwards | $ 8,975 | 8,399 | ||
State and Local Jurisdiction | ||||
Income Tax Contingency [Line Items] | ||||
Operating loss carryforwards | $ 29,897 | $ 6,243 |
Income taxes - Unrecognized Tax
Income taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 229 | $ 0 | $ 0 |
Additions based on tax positions related to prior years | 0 | 229 | 0 |
Additions based on tax positions related to current years | 0 | 0 | 0 |
Reductions for tax positions due to lapse of statute | 0 | 0 | 0 |
Other changes | 0 | 0 | 0 |
Ending balance | $ 229 | $ 229 | $ 0 |
Fair value (Details)
Fair value (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other current assets | Other current assets |
Level 1 | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Interest rate cap agreement | $ 0 | $ 0 |
Level 2 | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Interest rate cap agreement | 1,599 | 194 |
Level 3 | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Interest rate cap agreement | 0 | 0 |
Interest Rate Cap | Level 1 | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Interest rate cap agreement | 0 | 0 |
Interest Rate Cap | Level 2 | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Interest rate cap agreement | 1,599 | 194 |
Interest Rate Cap | Level 3 | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Interest rate cap agreement | $ 0 | $ 0 |
Commitments and contingencies (
Commitments and contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Tax receivable obligation, percent | 85% | ||
Tax receivable agreement liability | $ 18,504 | $ 19,502 | |
Tax receivable agreement, total potential payments percentage | 100% | ||
Tax receivable agreement, total potential payments | $ 32,147 | 32,245 | |
Payment on tax receivable agreement liability | 592 | 0 | $ 0 |
Gain on tax receivable agreement liability | $ 406 | $ (285) | $ 1,218 |
Related party transactions (Det
Related party transactions (Details) - USD ($) | 12 Months Ended | ||||
Aug. 01, 2017 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||
Cash contributions | $ 0 | $ 0 | $ 12,211,000 | ||
Investor | |||||
Related Party Transaction [Line Items] | |||||
Interest expense | 0 | 6,841,000 | 15,671,000 | ||
Ultra | |||||
Related Party Transaction [Line Items] | |||||
Contribution by Ultra | $ 4,000,000 | ||||
Ultra | First Billing Services | |||||
Related Party Transaction [Line Items] | |||||
Common stock | $ 4,500,000 | ||||
Affiliated Entity | |||||
Related Party Transaction [Line Items] | |||||
Cash contributions | 24,943,000 | ||||
Due from related parties | 0 | 0 | |||
GTCR | |||||
Related Party Transaction [Line Items] | |||||
Annual advisory fee | $ 1,000,000 | ||||
Due to related parties | 0 | 0 | 0 | ||
GTCR | Selling, General and Administrative Expenses | Related Party Advisory Fees | |||||
Related Party Transaction [Line Items] | |||||
Advisory fee | $ 0 | $ 0 | $ 750,000 |
Defined contribution plan (Deta
Defined contribution plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Employer matching contribution, percent of match | 50% | ||
Employer matching contribution, percent of employees' gross pay | 7% | ||
Vesting percentage of matching contributions | 100% | ||
Employer match | $ 888 | $ 819 | $ 721 |
Segments - Narrative (Details)
Segments - Narrative (Details) | 12 Months Ended |
Dec. 31, 2022 segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Number of reportable segments | 2 |
Segments - Total Revenues and S
Segments - Total Revenues and Segment Gross Profit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue, Major Customer [Line Items] | |||
Total Revenue | $ 282,743 | $ 249,356 | $ 206,048 |
Total segment gross profit | 143,991 | 130,111 | 103,929 |
Selling, general & administrative expenses | (87,028) | (77,450) | (63,035) |
Depreciation and amortization | (31,756) | (30,033) | (24,562) |
Interest expense | (14,311) | (14,142) | (17,637) |
Other income (expense) | 2,702 | (8,040) | 1,214 |
Income (loss) before income taxes | 13,598 | 446 | (91) |
Integrated Solutions | |||
Revenue, Major Customer [Line Items] | |||
Total Revenue | 181,473 | 155,203 | 122,324 |
Total segment gross profit | 90,047 | 81,683 | 65,266 |
Payment Services | |||
Revenue, Major Customer [Line Items] | |||
Total Revenue | 101,270 | 94,153 | 83,724 |
Total segment gross profit | $ 53,944 | $ 48,428 | $ 38,663 |
Subsequent events (Details)
Subsequent events (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 2 Months Ended | |||
Jan. 24, 2023 d | Jan. 08, 2023 USD ($) | Feb. 21, 2023 complaint | Mar. 31, 2023 USD ($) | Jan. 09, 2023 $ / shares | |
Merger Agreement | Forecast | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Termination fee | $ | $ 38 | ||||
Subsequent Event | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Tax receivable agreement early termination fee | $ | $ 19.5 | ||||
Subsequent Event | Merger Agreement | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Share price (in dollars per share) | $ / shares | $ 9.75 | ||||
Offering period (in business days) | d | 20 | ||||
Subsequent Event | Merger Agreement | District Courts | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of complaints filed | complaint | 5 | ||||
Subsequent Event | Merger Agreement | Supreme Court | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of complaints filed | complaint | 1 |