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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2023
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                     to                    
Commission File No. 001-37986
INTERNATIONAL MONEY EXPRESS, INC.
(Exact name of registrant as specified in its charter)
Delaware47-4219082
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
9480 South Dixie Highway
Miami, Florida
33156
(Address of Principal Executive Offices)(Zip Code)
(305) 671-8000
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock ($0.0001 par value)IMXI
Nasdaq Capital Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filerAccelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes   No ☒
As of April 28, 2023, there were 36,418,273 shares of the registrant’s common stock, $0.0001 par value per share, outstanding. The registrant has no other class of common stock outstanding.



Index
INTERNATIONAL MONEY EXPRESS, INC.
INDEX TO FINANCIAL STATEMENTS
Page
PART 1 - FINANCIAL INFORMATION
Item 1.
Item 2.
Item 3.
Item 4.
PART II - OTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.



Index

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q may contain certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act, as amended, which reflect our current views with respect to certain events that are not historical facts but could have an effect on our future performance, including but without limitation, statements regarding our plans, objectives, financial performance, business strategies, projected results of operations, and expectations for the business of the Company.
These statements may include and be identified by words or phrases such as, without limitation, “would,” “will,” “should,” “expects,” “believes,” “anticipates,” “continues,” “could,” “may,” “might,” “plans,” “possible,” “potential,” “predicts,” “projects,” “forecasts,” “intends,” “assumes,” “estimates,” “approximately,” “shall,” “our planning assumptions,” “future outlook,” “currently,” “target,” “guidance,” and similar expressions (including the negative and plural forms of such words and phrases). These forward-looking statements are based largely on information currently available to our management and on our current expectations, assumptions, plans, estimates, judgments, projections about our business and our industry, and macroeconomic conditions, and are subject to various risks, uncertainties, estimates, contingencies and other factors, many of which are outside our control, that could cause actual results to differ materially from those expected or implied by such forward-looking statements and could materially adversely affect our business, financial condition, results of operations, cash flows and liquidity. Factors that could cause or contribute to such differences include, but are not limited to, the following:
changes in applicable laws or regulations;
factors relating to our business, operations and financial performance, including:
the Company’s ability to successfully execute, manage, integrate and obtain the anticipated financial benefits of key acquisitions and mergers, including the acquisitions of Envios de Valores La Nacional Corp. (“La Nacional”) and LAN Holdings, Corp. (“LAN Holdings”);
economic factors such as inflation, the level of economic activity, recession risks and labor market conditions, as well as rising interest rates;
public health conditions, responses thereto and the economic and market effects thereof;
competition in the markets in which we operate;
volatility in foreign exchange rates that could affect the volume of consumer remittance activity and/or affect our foreign exchange related gains and losses;
our ability to maintain favorable banking and agent relationships necessary to conduct our business;
credit risks from our agents and the financial institutions with which we do business;
bank failures, sustained financial illiquidity, or illiquidity at our clearing, cash management or custodial financial institutions;
new technology or competitors that disrupt the current ecosystem, including the introduction of new digital platforms;
cyber-attacks or disruptions to our information technology, computer network systems, data centers and mobile devices apps;
our ability to satisfy our debt obligations and remain in compliance with our credit facility requirements;
our success in developing and introducing new products, services and infrastructure;
consumer confidence in our brands and in consumer money transfers generally;
our ability to maintain compliance with applicable regulatory requirements;
international political factors, political stability, tariffs, border taxes or restrictions on remittances or transfers out of the United States and Canada;
currency restrictions and volatility in countries in which we operate or plan to operate;
consumer fraud and other risks relating to the authenticity of customers’ orders;
changes in immigration laws and their enforcement;
our ability to protect our brands and intellectual property rights;
weakness in U.S. or international economic conditions;
changes in tax laws in the countries in which we operate;
our ability to recruit and retain key personnel; and
other economic, business and/or competitive factors, risks and uncertainties, including those described in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections in our Annual Report on Form 10-K for the year ended December 31, 2022.
All forward-looking statements that are made or attributable to us are expressly qualified in their entirety by this cautionary notice. The forward-looking statements included herein are only made as of the date of this Quarterly Report on Form 10-Q. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
3

Index
PART 1 – FINANCIAL INFORMATION
ITEM 1.    FINANCIAL STATEMENTS
INTERNATIONAL MONEY EXPRESS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except for share data)
March 31, 2023December 31, 2022
ASSETS(unaudited)
Current assets:
Cash and cash equivalents$85,453 $149,493 
Accounts receivable, net102,596 129,808 
Prepaid wires, net106,878 90,386 
Prepaid expenses and other current assets9,482 12,749 
Total current assets304,409 382,436 
Property and equipment, net28,173 28,160 
Goodwill48,640 49,774 
Intangible assets, net18,666 19,826 
Other assets30,910 31,876 
Total assets$430,798 $512,072 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt, net$5,522 $4,975 
Accounts payable21,281 25,686 
Wire transfers and money orders payable, net91,923 112,251 
Accrued and other liabilities37,698 41,855 
Total current liabilities156,424 184,767 
Long-term liabilities:
Debt, net93,718 150,235 
Lease liabilities, net21,872 23,272 
Deferred tax liability, net2,931 3,892 
Total long-term liabilities118,521 177,399 
Commitments and contingencies, see Note 16
Stockholders’ equity:
Common stock $0.0001 par value; 230,000,000 shares authorized, 39,556,217 and 39,453,236 shares issued and 36,417,492 and 36,630,970 shares outstanding as of March 31, 2023 and December 31, 2022, respectively.
4 4 
Additional paid-in capital71,797 70,210 
Retained earnings150,896 139,134 
Accumulated other comprehensive income (loss)40 (142)
Treasury stock, at cost; 3,138,725 and 2,822,266 shares as of March 31, 2023 and December 31, 2022, respectively.
(66,884)(59,300)
Total stockholders’ equity155,853 149,906 
Total liabilities and stockholders’ equity$430,798 $512,072 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4

Index
INTERNATIONAL MONEY EXPRESS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(in thousands, except for share data, unaudited)
Three Months Ended March 31,
20232022
Revenues:
Wire transfer and money order fees, net$124,450 $98,000 
Foreign exchange gain, net19,168 15,674 
Other income1,746 992 
Total revenues145,364 114,666 
Operating expenses:
Service charges from agents and banks96,117 76,993 
Salaries and benefits16,168 11,310 
Other selling, general and administrative expenses
11,337 7,069 
Depreciation and amortization2,903 2,183 
Total operating expenses126,525 97,555 
Operating income18,839 17,111 
Interest expense2,192 952 
Income before income taxes16,647 16,159 
Income tax provision4,885 4,505 
Net income11,762 11,654 
Other comprehensive income182 112 
Comprehensive income$11,944 $11,766 
Earnings per common share:
Basic$0.32 $0.30 
Diluted$0.31 $0.30 
Weighted-average common shares outstanding:
Basic36,480,972 38,362,014 
Diluted37,361,953 39,077,665 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5

Index
INTERNATIONAL MONEY EXPRESS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(in thousands, except for share data, unaudited)
Three Months Ended March 31, 2023
Common StockTreasury StockAdditional
Paid-in Capital
Retained EarningsAccumulated Other
Comprehensive
Income (Loss)
Total
Stockholders’
Equity
SharesAmountSharesAmount
Balance, December 31, 202239,453,236$4 (2,822,266)$(59,300)$70,210 $139,134 $(142)$149,906 
Net income— — — 11,762 — 11,762 
Issuance of common stock:
Exercise of stock options, net of shares withheld for taxes57,250— — 723 — — 723 
Restricted stock units and awards, net of shares withheld for taxes44,905— — (834)— — (834)
Fully vested shares826— — — — — — 
Share-based compensation— — 1,698 — — 1,698 
Adjustment from foreign currency translation, net
— — — — 182 182 
Acquisition of treasury stock, at cost— (316,459)(7,584)— — — (7,584)
Balance, March 31, 202339,556,217$4 (3,138,725)$(66,884)$71,797 $150,896 $40 $155,853 
Three Months Ended March 31, 2022
Common StockTreasury StockAdditional
Paid-in Capital
Retained EarningsAccumulated Other
Comprehensive
Income (Loss)
Total
Stockholders’
Equity
SharesAmountSharesAmount
Balance, December 31, 202138,820,222$4 (341,522)$(5,566)$66,875 $81,803 $(76)$143,040 
Net income— — — 11,654 — 11,654 
Issuance of common stock:
Exercise of stock options, net of shares withheld for taxes43,725— — 561 — — 561 
Restricted stock units and awards, net of shares withheld for taxes20,787— — (273)— — (273)
Fully vested shares1,002— — — — — — 
Share-based compensation— — 1,268 — — 1,268 
Adjustment from foreign currency translation, net
— — — — 112 112 
Acquisition of treasury stock, at cost— (224,388)(3,628)— — — (3,628)
Balance, March 31, 202238,885,736$4 (565,910)$(9,194)$68,431 $93,457 $36 $152,734 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6

Index

INTERNATIONAL MONEY EXPRESS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, unaudited)
Three Months Ended March 31,
20232022
Cash flows from operating activities:
Net income$11,762 $11,654 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization2,903 2,183 
Share-based compensation1,698 1,268 
Provision for credit losses785 442 
Debt origination costs amortization246 253 
Deferred income tax (benefit) provision, net(623)51 
Non-cash lease expense2,064 468 
Loss on disposal of property and equipment398 140 
Total adjustments7,471 4,805 
Changes in operating assets and liabilities:
Accounts receivable, net26,432 (19,546)
Prepaid wires, net(15,433)41,879 
Prepaid expenses and other assets3,217 360 
Wire transfers and money orders payable, net(21,593)3,232 
Lease liabilities(2,473)(580)
Accounts payable and accrued and other liabilities(8,225)(8,520)
Net cash provided by operating activities1,158 33,284 
Cash flows from investing activities:
Purchases of property and equipment(2,119)(4,316)
Net cash used in investing activities(2,119)(4,316)
Cash flows from financing activities:
Repayments of term loan facility(1,094)(1,094)
Repayments under revolving credit facility, net(55,000) 
Proceeds from exercises of stock options723 561 
Payments for stock awards(834)(273)
Repurchases of common stock(7,584)(3,628)
Net cash used in financing activities(63,789)(4,434)
Effect of exchange rate changes on cash and cash equivalents710 229 
Net (decrease) increase in cash and cash equivalents(64,040)24,763 
Cash and cash equivalents, beginning of period149,493 132,474 
Cash and cash equivalents, end of period$85,453 $157,237 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
7

Index
INTERNATIONAL MONEY EXPRESS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(in thousands, unaudited)
Three Months Ended March 31,
20232022
Supplemental disclosure of cash flow information:
Cash paid for interest$2,001 $698 
Cash paid for income taxes$145 $2,804 
Supplemental disclosures of non-cash investing and financing activities:
Non-cash lease liabilities arising from obtaining right-of-use assets
$552 $5,613 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
8

Index
INTERNATIONAL MONEY EXPRESS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 1 – BUSINESS AND ACCOUNTING POLICIES
International Money Express, Inc. (the “Company” or “us” or “we”) operates as a money transmitter between the United States of America (“United States” or “U.S.”) and Canada to Mexico, Guatemala and other countries in Latin America, Africa and Asia through a network of authorized agents located in various unaffiliated retail establishments and 117 Company-operated stores throughout the United States and Canada.

The condensed consolidated financial statements of the Company include International Money Express, Inc. and its majority-owned subsidiaries. The condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). All significant inter-company balances and transactions have been eliminated from the condensed consolidated financial statements.

The Company’s interim condensed consolidated financial statements and related notes are unaudited. In the opinion of management, all adjustments (including normal recurring adjustments) and disclosures necessary for a fair presentation of these interim condensed consolidated financial statements have been included. The results reported in these interim condensed consolidated financial statements are not necessarily indicative of the results that may be reported for the entire year. Certain information and footnote disclosures required by GAAP have been condensed or omitted. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

In March 2022, the Company entered into a definitive purchase agreement to acquire Envios de Valores La Nacional Corp. (“La Nacional”) and LAN Holdings, Corp. (“LAN Holdings”), which either directly or indirectly operate as money remittance companies in the United States, Canada and certain countries in Europe. The acquisition of La Nacional was closed effective November 1, 2022 and the acquisition of LAN Holdings was closed effective April 5, 2023. Refer to Note 3 and Note 17 for additional information on the closings of the acquisitions of La Nacional and LAN Holdings, respectively.

Concentrations

The Company maintains certain of its cash balances in various U.S. banks, which at times, may exceed federally insured limits. The Company has not incurred any losses on these accounts. In addition, the Company maintains various bank accounts in Mexico, Guatemala and Canada, which are not insured. During the three months ended March 31, 2023, the Company has not incurred any losses on these uninsured foreign bank accounts.

In addition, a substantial portion of our paying agents are concentrated in a few large banks and financial institutions and large retail chains in Latin American countries.

Accounting Pronouncements

The FASB issued guidance, ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires entities to apply Topic 606: Revenue from Contracts with Customers to recognize and measure contract assets and contract liabilities in a business combination. This guidance improves comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The Company adopted this guidance on January 1, 2023 prospectively for business combinations that occur after the adoption date. The adoption of this accounting standard is not expected to have a material impact on the Company’s condensed consolidated financial statements.


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NOTE 2 – REVENUES
The Company recognized revenues from contracts with customers for the three months ended March 31, 2023 and 2022, as follows (in thousands):
Three Months Ended March 31,
20232022
Wire transfer and money order fees$125,007 $98,404 
Discounts and promotions(557)(404)
Wire transfer and money order fees, net124,450 98,000 
Foreign exchange gain, net19,168 15,674 
Other income1,746 992 
Total revenues$145,364 $114,666 

There are no significant initial costs incurred to obtain contracts with customers, although the Company has a loyalty program under which customers earn one point for each wire transfer completed. Points can be redeemed for a discounted wire transaction fee or a foreign exchange rate that is more favorable to the customer. The customer benefits vary by country, and the earned points expire if the customer has not initiated and completed an eligible wire transfer transaction within the immediately preceding 180-day period. In addition, earned points will expire 30 days after the end of the program. Because the loyalty program benefits represent a future performance obligation, a portion of the initial consideration is recorded as deferred revenue loyalty program (see Note 9) and a corresponding loyalty program expense is recorded as contra revenue. Revenue from this performance obligation is recognized upon customers redeeming points or upon expiration of any points outstanding.
Except for the loyalty program discussed above, our revenues include only one performance obligation, which is to collect the customer’s money and make funds available for payment, generally on the same day, to a designated recipient in the currency requested.

The Company also offers several other services, including money orders, and check cashing through our sending agents, for which revenue is derived from a fee per transaction. For substantially all of the Company’s revenues, the Company acts as principal in the transactions and reports revenue on a gross basis, because the Company controls the service at all times prior to transfer to the customer, is primarily responsible for fulfilling the customer contracts, has the risk of loss and has the ability to establish transaction prices.

Wire transfers and money order fees include money order fees of $0.6 million and $0.4 million for the three months ended March 31, 2023 and 2022, respectively.

NOTE 3 – ACQUISITIONS
Envios de Valores La Nacional Corp.

On November 1, 2022, the Company completed the acquisition of 100% of the voting interest of La Nacional (the “La Nacional Acquisition”) and on April 5, 2023, the Company completed the acquisition of 100% of the voting interest of LAN Holdings (the “LAN Acquisition”) (the “LAN Acquisition,” and together with the La Nacional Acquisition, the “Acquisitions”). See “LAN Holdings, Corp.” section below.

The Company paid cash consideration of $39.7 million upon consummation of the La Nacional Acquisition (subject to customary purchase price adjustments) and anticipates up to an additional $2.4 million in contingent consideration to be paid in cash in 2023 as a result of La Nacional achieving certain transaction volume and financial targets during 2023. The contingent consideration fair value as of both March 31, 2023 and December 31, 2022 was approximately $1.3 million.

The following table summarizes the estimated fair values of consideration paid and identifiable net assets acquired in the La Nacional Acquisition on November 1, 2022, the measurement period adjustments in the three months ended March 31, 2023 and the estimated fair values of consideration transferred and identifiable net assets acquired as of March 31, 2023. The measurement period of the La Nacional Acquisition extends to one year from November 1, 2022.
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November 1, 2022
(As initially reported)
Measurement Period Adjustments
March 31, 2023
(As Adjusted)
Assets acquired:
Cash and cash equivalents$39,569 $— $39,569 
Accounts receivable16,504 — 16,504 
Prepaid wires571 — 571 
Prepaid expenses and other current assets1,219 430 1,649 
Property and Equipment4,077 — 4,077 
Intangible assets8,450 — 8,450 
Other assets13,659 — 13,659 
Total identifiable assets acquired84,049 430 84,479 
Liabilities assumed:
Accounts payable(1,260)— (1,260)
Wire transfers and money orders payable(35,595)— (35,595)
Accrued and other liabilities(3,651)366 (3,285)
Lease liabilities(13,067)— (13,067)
Deferred tax liability(2,969)338 (2,631)
Total liabilities assumed(56,542)704 (55,838)
Net identifiable assets acquired27,507 1,134 28,641 
Consideration transferred41,021 — 41,021 
Goodwill$13,514 $(1,134)$12,380 

LAN Holdings, Corp.

On April 5, 2023, the Company completed the previously announced acquisition of 100% of the issued and outstanding stock of LAN Holdings. LAN Holdings provides the Company the opportunity to enter into markets in which it did not have a presence previously, such as the ability to provide outbound remittances from Spain, Italy, and Germany.

The consideration paid by the Company in connection with the LAN Acquisition was $8.0 million in cash, subject to customary purchase price adjustments. The Company will also pay an additional $0.6 million in cash related to LAN Holdings’ achievement of certain operational milestones during 2023, which the parties have agreed have been achieved; accordingly, the earn-out will be paid under the terms of the definitive purchase agreement.

As of the date of these condensed consolidated financial statements, due to the recent closing of the LAN Acquisition, the initial accounting for the LAN Acquisition is incomplete, including a preliminary allocation of the consideration transferred to the fair value of the assets acquired and liabilities assumed. In addition, due to the timing of the LAN Acquisition, the potential income tax consequences of this transaction have not been fully determined.

Transaction Costs

Transaction costs include all internal and external costs directly related to the Company’s acquisition activity, consisting primarily of legal, consulting, accounting and financial advisory fees. Transaction costs for the three months ended March 31, 2023 amounted to $0.1 million and related to the LAN Acquisition, and are included in other selling, general and administrative expenses on the condensed consolidated statement of income and comprehensive income. There were no transaction costs for the three months ended March 31, 2022.


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NOTE 4 – ACCOUNTS RECEIVABLE AND AGENT ADVANCES RECEIVABLE, NET OF ALLOWANCE
Accounts Receivable

Accounts receivable represents outstanding balances from sending agents for pending wire transfers or money orders from consumers. The outstanding balance of accounts receivable, net of allowance for credit losses, consists of the following (in thousands):

March 31, 2023December 31, 2022
Accounts receivable$105,160 $132,363 
Allowance for credit losses(2,564)(2,555)
Accounts receivable, net$102,596 $129,808 

Agent Advances Receivable

Agent advances receivable, net of allowance for credit losses, from sending agents is as follows (in thousands):

March 31, 2023December 31, 2022
Agent advances receivable, current$1,666 $1,373 
Allowance for credit losses(60)(62)
Net current$1,606 $1,311 
Agent advances receivable, long-term$1,533 $1,423 
Allowance for credit losses(33)(31)
Net long-term$1,500 $1,392 

The net current portion of agent advances receivable is included in prepaid expenses and other current assets (see Note 5), and the net long-term portion is included in other assets (see Note 5) in the condensed consolidated balance sheets. Certain agent advances receivable bear interest and have interest rates ranging from 0% to 14.5% per annum. The Company had an immaterial amount of accrued interest receivable as of March 31, 2023 and December 31, 2022, which was included in the allowance for credit losses calculation. As of March 31, 2023 and December 31, 2022, there were $3.2 million and $2.8 million, respectively, of agent advances receivable collateralized by personal guarantees from sending agents and assets from their businesses in case of a default by the agent.

The maturities of agent advances receivable at March 31, 2023 are as follows (in thousands):
Unpaid Advance Balance
Under 1 year$1,666 
Between 1 and 2 years1,420 
More than 2 years113 
Total$3,199 

Allowance for Credit Losses

The changes in the allowance for credit losses related to accounts receivable and agent advances receivable are as follows (in thousands):

Three Months Ended March 31,
20232022
Beginning balance$2,648 $2,249 
Provision785 442 
Charge-offs(1,008)(532)
Recoveries232 97 
Ending Balance$2,657 $2,256 


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The allowance for credit losses allocated by financial instrument category is as follows (in thousands):

March 31, 2023December 31, 2022
Accounts receivable$2,564 $2,555 
Agent advances receivable93 93 
Allowance for credit losses$2,657 $2,648 

NOTE 5 – PREPAID EXPENSES AND OTHER ASSETS
Prepaid expenses and other current assets consisted of the following (in thousands):

March 31, 2023December 31, 2022
Prepaid insurance$787 $1,578 
Prepaid fees and services1,822 1,986 
Agent incentives advances955 1,014 
Agent advances receivable, net of allowance1,606 1,311 
Assets pending settlement66 211 
Tenant allowance2,815 3,753 
Prepaid income taxes123 2,130 
Prepaid expenses and current assets - other1,308 766 
$9,482 $12,749 

Other assets consisted of the following (in thousands):

March 31, 2023December 31, 2022
Revolving line origination fees$1,455 $1,578 
Agent incentives advances1,091 1,062 
Agent advances receivable, net of allowance1,500 1,392 
Right-of-use assets, net23,279 24,768 
Funds held by seized banking entities, net of allowance1,766 1,646 
Other assets1,819 1,430 
$30,910 $31,876 

During September 2021, local banking regulators in Mexico resolved to close and liquidate a local financial institution, citing a lack of compliance with minimum capital requirements. The Company has approximately $5.2 million of exposure from deposits it held with this bank when it was closed. In accordance with the banking regulations in Mexico, large depositors such as the Company will be paid once the assets of the financial institution are liquidated. Currently, it is difficult to predict the length of the liquidation process or if the proceeds from the asset liquidation will be sufficient to recover a portion or all of its funds on deposit. The Company maintains a valuation allowance of approximately $3.6 million in connection with the balance of deposits held by the financial institution as a result of its closure.

NOTE 6 – GOODWILL AND INTANGIBLE ASSETS
Goodwill and the majority of intangible assets on the condensed consolidated balance sheets of the Company were recognized from business acquisitions. Intangible assets on the condensed consolidated balance sheets of the Company consist of agent relationships, trade names, developed technology and other intangible assets. Agent relationships, trade names and developed technology are all amortized over 15 years using an accelerated method that correlates with the projected realization of the benefit. The agent relationships intangible represents the network of independent sending agents; trade names refers to the Intermex and La Nacional names, branded on all agent locations and well recognized in the market; and developed technology includes the state-of-the-art system that the Company has continued to develop and improve over the past 20 years. Other intangible assets relate to the acquisition of Company-operated stores, which are amortized on a straight line basis over 10 years. The determination of our intangible fair values includes several assumptions that are subject to various risks and uncertainties. Management believes it has made reasonable estimates and judgments concerning these risks and uncertainties, and no impairment charges were determined necessary to be recognized during the three months ended March 31, 2023.

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The following table presents the changes in goodwill and intangible assets (in thousands):

GoodwillIntangibles
Balance at December 31, 2022$49,774 $19,826 
Measurement period adjustment (Refer to Note 3)
(1,134) 
Amortization expense (1,160)
Balance at March 31, 2023$48,640 $18,666 


Amortization expense related to intangible assets for the remainder of 2023 and thereafter is as follows (in thousands):

2023$3,344 
20243,512 
20252,768 
20262,187 
20271,736 
Thereafter5,119 
$18,666 

NOTE 7 – LEASES
To conduct certain of our operations, the Company is a party to leases for office space, warehouses and Company-operated store locations. In December 2022, the Company entered into a lease agreement, which expires in 2033, for its new headquarters to accommodate its growing workforce. The Company expects to complete the move to the new headquarters in the second half of 2023 following the completion of leasehold improvements. The new lease agreement provides for the Company to receive a tenant allowance amounting to approximately $3.8 million through the third quarter of 2023 and the Company will commence making monthly lease payments on November 1, 2024. Such tenant allowance has been recorded within prepaid expenses and other current assets in the condensed consolidated balance sheet.

The presentation of right-of-use assets and lease liabilities in the condensed consolidated balance sheet is as follows (in thousands):

LeasesClassification
March 31, 2023
December 31, 2022
Assets
Right-of-use assets
Other assets(1)
$23,279 $24,768 
Total leased assets$23,279 $24,768 
Liabilities
Current
OperatingAccrued and other liabilities$4,787 $5,258 
Noncurrent
OperatingLease liabilities21,872 23,272 
Total Lease liabilities$26,659 $28,530 
(1) Operating right of-use assets are recorded net of accumulated amortization of $7.1 million and $5.6 million as of March 31, 2023 and December 31, 2022, respectively.

Lease expense for the three months ended March 31, 2023 and 2022, was as follows (in thousands):

Three Months Ended March 31,
Lease CostClassification20232022
Operating lease costOther selling, general and administrative expenses$2,064 $468 

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For the three months ended March 31, 2023 and 2022, the Company’s weighted-average remaining lease terms on its operating leases was 6.8 years and 4.0 years, respectively, and the Company’s weighted-average discount rate was 5.77% and 2.59%, respectively, which is the Company’s incremental borrowing rate. The Company used its incremental borrowing rate for all leases, as none of the Company’s lease agreements provide a readily determinable implicit rate.

Lease Payments

Future minimum lease payments for assets under non-cancelable operating lease agreements with original terms of more than one year for the remainder of 2023 and thereafter are as follows (in thousands):

2023$3,835 
20244,938 
20255,681 
20264,274 
20273,167 
Thereafter14,658 
Total lease payments36,553 
Less: Imputed interest(9,894)
Present value of lease liabilities$26,659 

NOTE 8 – WIRE TRANSFERS AND MONEY ORDERS PAYABLE, NET
Wire transfers and money orders payable, net consisted of the following (in thousands):

March 31, 2023December 31, 2022
Wire transfers payable, net$36,539 $55,572 
Customer voided wires payable25,976 27,236 
Money orders payable29,408 29,443 
$91,923 $112,251 

Customer voided wires payable consist primarily of wire transfers that were not completed because the recipient did not collect the funds within 30 days and the sender has not claimed the funds and, therefore, are considered unclaimed property. Unclaimed property laws of each state in the United States in which we operate, the District of Columbia, and Puerto Rico require us to track certain information for all of our money remittances and payment instruments and, if the funds underlying such remittances and instruments are unclaimed at the end of an applicable statutory abandonment period, require us to remit the proceeds of the unclaimed property to the appropriate jurisdiction. Applicable statutory abandonment periods range from three to seven years.

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NOTE 9 – ACCRUED AND OTHER LIABILITIES
Accrued and other liabilities consisted of the following (in thousands):

March 31, 2023December 31, 2022
Commissions payable to sending agents$13,715 $19,141 
Accrued salaries and benefits4,057 5,578 
Accrued bank charges1,867 1,644 
Accrued other professional fees1,437 1,169 
Accrued taxes4,211 1,329 
Lease liabilities, current portion4,787 5,258 
Contingent consideration liability1,321 1,321 
Deferred revenue loyalty program4,299 4,212 
Accrued transaction costs89 134 
Other1,915 2,069 
$37,698 $41,855 

The following table shows the changes in the deferred revenue loyalty program liability (in thousands):

Balance, December 31, 2022$4,212 
Revenue deferred during the period669 
Revenue recognized during the period(582)
Balance, March 31, 2023$4,299 

NOTE 10 – DEBT
Debt consisted of the following (in thousands):

March 31, 2023December 31, 2022
Revolving credit facility$21,000 $76,000 
Term loan facility79,844 80,938 
100,844 156,938 
Less: Current portion of long-term debt (1)
(5,522)(4,975)
Less: Debt origination costs(1,604)(1,728)
$93,718 $150,235 
(1)Current portion of long-term debt is net of debt origination costs of approximately $0.5 million both at March 31, 2023 and December 31, 2022.

The Company and certain of its domestic subsidiaries as borrowers and the other guarantors from time to time party thereto (collectively, the “Loan Parties”) entered into an Amended and Restated Credit Agreement (the “A&R Credit Agreement”) with a group of banking institutions. The A&R Credit Agreement amended and restated in its entirety the Company’s previous credit agreement. The A&R Credit Agreement provides for a $150.0 million revolving credit facility, an $87.5 million term loan facility and an uncommitted incremental facility, which may be utilized for additional revolving or term loans, of up to $70.0 million. The A&R Credit Agreement also provides for the issuance of letters of credit, which would reduce availability under the revolving credit facility. The proceeds of the term loan were used to refinance the existing term loan facility under the Company’s previous credit agreement, and the revolving credit facility is available for working capital, general corporate purposes and to pay fees and expenses in connection with this transaction. The maturity date of the A&R Credit Agreement is June 24, 2026.

On November 11, 2022, the Loan Parties entered into a First Amendment Agreement (the “First Amendment”) to the A&R Credit Agreement. The Amendment replaces LIBOR as a benchmark interest rate for loans under the A&R Credit Agreement with the secured overnight financing rate as administered by the Federal Reserve Bank of New York (“SOFR”), and amends all applicable provisions of the A&R Credit Agreement with respect to such replacement of LIBOR as the benchmark interest rate. Except as amended by the First Amendment, the A&R Credit Agreement remains in full force and effect.

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Effective as of April 18, 2023, the Company amended its A&R Credit Agreement to increase the revolving credit commitments available thereunder by $70.0 million to an aggregate of $220.0 million. The credit commitments are available for general corporate purposes to support the Company’s growth and to fund working capital needs and will be subject to the same interest rate and other terms applicable to the outstanding revolving credit commitments under the A&R Credit Agreement. In addition, as amended, the A&R Credit Agreement provides the Company with a refreshed uncommitted incremental facility which may be utilized for new revolving credit facilities or term loans in an aggregate amount of up to $70.0 million.

The unamortized portion of debt origination costs totaled approximately $3.1 million and $3.3 million at March 31, 2023 and December 31, 2022, respectively. Amortization of debt origination costs is included as a component of interest expense in the condensed consolidated statements of income and comprehensive income and amounted to approximately $0.2 million and $0.3 million for the three months ended March 31, 2023 and 2022, respectively.

At the election of the Company, interest on the term loan facility and revolving loans under the A&R Credit Agreement, as amended, may be determined by reference to SOFR plus an index adjustment of 0.10% and an applicable margin ranging between 2.50% and 3.00% based upon the Company’s consolidated leverage ratio, as calculated pursuant to the terms of the A&R Credit Agreement. Loans (other than Term Loans, as defined in the A&R Credit Agreement), may also bear interest at the Base Rate, plus an applicable margin ranging between 1.50% and 2.00% based upon the Company’s consolidated leverage ratio, as so calculated. The Company is also required to pay a fee on the unused portion of the revolving credit facility equal to 0.35% per annum. The effective interest rates for the three months ended March 31, 2023 for the term loan facility and revolving credit facility were 7.75% and 1.74%, respectively, and 3.26% and 0.72% for the three months ended March 31, 2022, respectively.

Interest is payable (x)(i) generally on the last day of each interest period selected for SOFR loans, but in any event, not less frequently than every three months, and (ii) on the last business day of each quarter for base rate loans and (y) at final maturity. The principal amount of the term loan facility under the A&R Credit Agreement must be repaid in consecutive quarterly installments of 5.0% in years 1 and 2, 7.5% in year 3, and 10.0% in years 4 and 5, in each case on the last day of each quarter, which commenced in September 2021 with a final balloon payment at maturity. The term loans under the A&R Credit Agreement may be prepaid at any time without premium or penalty. Revolving loans may be borrowed, repaid and reborrowed from time to time in accordance with the terms and conditions of the A&R Credit Agreement. The Company is also required to repay the loans upon receipt of net proceeds from certain casualty events, upon the disposition of certain property and upon incurrence of indebtedness not permitted by the A&R Credit Agreement. In addition, the Company is required to make mandatory prepayments annually from excess cash flow if the Company’s consolidated leverage ratio (as calculated under the A&R Credit Agreement) is greater than or equal to 3.0, and the remainder of any such excess cash flow is contributed to the available amount which may be used for a variety of purposes, including investments and distributions.

The A&R Credit Agreement, as amended, contains financial covenants that require the Company to maintain a quarterly minimum fixed charge coverage ratio of 1.25:1.00 and a quarterly maximum consolidated leverage ratio of 3.25:1.00 and generally restricts the ability of the Company to make certain restricted payments, including the repurchase of shares of its common stock, provided that the Company may make restricted payments, among others, (i) without limitation so long as the Consolidated Leverage Ratio (as defined in the A&R Credit Agreement), as of the then most recently completed four fiscal quarters of the Company, after giving pro forma effect to such restricted payments, is 2.25:1.00 or less, (ii) that do not exceed, in the aggregate during any fiscal year, the greater of (x) $23.8 million and (y) 25.00% of Consolidated EBITDA (as defined in the A&R Credit Agreement) for the then most recently completed four fiscal quarters of the Company and (iii) to repurchase Company common stock from current or former employees in an aggregate amount of up to $10.0 million per calendar year. The A&R Agreement also contains covenants that limit the Company’s and its subsidiaries’ ability to, among other things, grant liens, incur additional indebtedness, make acquisitions or investments, dispose of certain assets, change the nature of their businesses, enter into certain transactions with affiliates or amend the terms of material indebtedness.

The obligations under the A&R Credit Agreement are guaranteed by the Company and certain domestic subsidiaries of the Company and secured by liens on substantially all of the assets of the Loan Parties, subject to certain exclusions and limitations.

NOTE 11 – FAIR VALUE MEASUREMENTS
The Company determines fair value in accordance with the provisions of FASB guidance, Fair Value Measurements and Disclosures, which defines fair value as an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a three-level fair value hierarchy that prioritizes the inputs used to measure fair value was established. There are three levels of inputs used to measure fair value and for disclosure purposes. Level 1 relates to quoted market prices for identical assets or liabilities in active markets. Level 2 relates to observable inputs other than quoted prices included in Level 1. Level 3 relates to unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s non-financial assets measured at fair value on a nonrecurring basis include goodwill and intangible assets. The determination of our intangible fair values includes several assumptions and inputs (Level 3) that are subject to various risks and
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uncertainties. Management believes it has made reasonable estimates and judgments concerning these risks and uncertainties. All other financial assets and liabilities are carried at amortized cost.

The Company’s cash and cash equivalents balances are representative of their fair values as these balances are comprised of deposits available on demand or overnight. The carrying amounts of accounts receivable, prepaid wires, accounts payable and wire transfers and money orders payable are representative of their fair values because of the short turnover of these instruments.

The Company’s financial liabilities include its revolving credit facility and term loan facility. The fair value of the term loan facility, which approximates book value, is estimated by discounting the future cash flows using a current market interest rate. The estimated fair value of the revolving credit facility would approximate face value given the payment schedule and interest rate structure, which approximates current market interest rates.

NOTE 12 – SHARE-BASED COMPENSATION
International Money Express, Inc. Omnibus Equity Compensation Plans

The International Money Express, Inc. 2020 Omnibus Equity Compensation Plan (the “2020 Plan”) provides for the granting of stock-based incentive awards, including stock options, restricted stock units (“RSUs”), restricted stock awards (“RSAs”) and performance stock units (“PSUs”) to employees, certain other service providers and independent directors of the Company. There are approximately 3.7 million shares of the Company’s common stock approved for issuance under the 2020 Plan, which includes 0.4 million shares that were previously subject to awards granted under the International Money Express, Inc. 2018 Omnibus Equity Compensation Plan (the “2018 Plan” and together with the 2020 Plan, the “Plans”). Although awards remain outstanding under the 2018 Plan, which was terminated effective June 26, 2020, no additional awards may be granted under the 2018 Plan. As of March 31, 2023, 2.1 million shares remained available for future awards under the 2020 Plan.

Stock Options

Share-based compensation is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period. The stock options issued under the Plans have 10-year terms and generally vest in four equal annual installments beginning one year after the date of the grant. The Company recognized compensation expense for stock options of approximately $0.1 million and $0.6 million for the three months ended March 31, 2023 and 2022, respectively, which are included in salaries and benefits in the condensed consolidated statements of income and comprehensive income. As of March 31, 2023, unrecognized compensation expense related to stock options of approximately $0.4 million is expected to be recognized over a weighted-average period of 0.9 years.

A summary of stock option activity under the Plans during the three months ended March 31, 2023 is presented below:

Number of
Options
Weighted-Average
Exercise Price
Weighted-Average
Remaining Contractual
Term (Years)
Weighted-Average
Grant Date
Fair Value
Outstanding at December 31, 2022711,050 $11.56 6.26$4.28 
Granted $ $ 
Exercised(57,250)$12.63 $5.22 
Forfeited(7,500)$15.15 $7.08 
Outstanding at March 31, 2023646,300 $11.42 5.97$4.17 
Exercisable at March 31, 2023506,300 $10.91 5.71$3.86 

Restricted Stock Units

The RSUs granted under the Plans to the Company’s employees generally vest in four equal annual installments beginning one year after the applicable date set forth in the applicable grant agreement, while RSUs issued to the Company’s independent directors vest on the one-year anniversary from the grant date. The Company recognized compensation expense for RSUs of approximately $0.5 million and $0.4 million for the three months ended March 31, 2023 and 2022, which are included in salaries and benefits in the condensed consolidated
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statements of income and comprehensive income. As of March 31, 2023, unrecognized compensation expense related to RSUs of approximately $6.7 million is expected to be recognized over a weighted-average period of 2.1 years.

A summary of RSU activity during the three months ended March 31, 2023 is presented below:
Number of RSUsWeighted-Average
Grant Price
Outstanding (nonvested) at December 31, 2022316,902 $16.58 
Granted(1)
134,425 $25.70 
Vested(63,127)$15.23 
Forfeited(8,409)$17.69 
Outstanding (nonvested) at March 31, 2023379,791 $20.01 
(1) The aggregate fair value of all RSUs granted during the three months ended March 31, 2023 was approximately $3.5 million.

Share Awards

The Lead Independent Director and Chairs of the Committees of the Board of Directors are granted, in aggregate, $80.5 thousand in awards of fully vested shares of the Company’s common stock, payable on a quarterly basis at the end of each quarter in payment of fees earned in such capacities. During the three months ended March 31, 2023 and 2022, 826 and 1,002 fully vested shares, respectively, were granted to the Lead Independent Director and Chairs of the Committees of the Board of Directors resulting in compensation expense of $20.1 thousand and $16.0 thousand, respectively, recorded and included in salaries and benefits in the condensed consolidated statements of income and comprehensive income.

Restricted Stock Awards

The RSAs issued under the Plans to the Company’s employees generally vest in four equal annual installments beginning one year after the applicable date set forth in the applicable grant agreement. The Company recognized compensation expense for RSAs granted of $0.2 million and $0.1 million for the three months ended March 31, 2023 and 2022, respectively, which are included in salaries and benefits in the condensed consolidated statements of income and comprehensive income. As of March 31, 2023, there was $3.7 million of unrecognized compensation expense related to RSAs, which is expected to be recognized over a weighted-average period of 2.1 years.

A summary of RSA activity during the three months ended March 31, 2023 is presented below:
Number of RSAsWeighted-Average
Grant Price
Outstanding (nonvested) at December 31, 2022159,562 $15.28 
Granted(1)
77,822 $25.70 
Vested(45,404)$15.14 
Forfeited $ 
Outstanding (nonvested) at March 31, 2023191,980 $19.53 
(1) The aggregate fair value of all RSAs granted during the three months ended March 31, 2023 was approximately $2.0 million.

Performance Stock Units

PSUs granted to the Company’s employees generally vest subject to attainment of performance criteria during the service period established by the Compensation Committee. Each PSU represents the right to receive one share of common stock, and the actual number of shares issuable upon vesting is determined based upon performance compared to financial performance targets. The PSUs vest based on the achievement of certain revenue or adjusted earnings per share parameters for a period of two years combined with a service period of three years. Compensation cost is recognized over the requisite service period when it is probable that the performance condition will be satisfied. During the third quarter of 2022, the Company reassessed the probability of vesting for PSU awards and determined that it was probable that a higher performance target will be achieved; therefore, the Company recognized a cumulative catch-up adjustment of approximately $1.1 million as additional compensation expense for the three months ended September 30, 2022. On February 28, 2023, the Compensation Committee determined that the higher performance target was achieved and approved the incremental grant of PSUs.

The Company recognized compensation expense for PSUs of $0.8 million and $0.2 million for the three months ended March 31, 2023 and 2022, respectively, which are included in salaries and benefits in the condensed consolidated statements of income and comprehensive
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income. As of March 31, 2023, there was $6.7 million of unrecognized compensation expense related to PSUs, which is expected to be recognized over a weighted-average period of 2.1 years.

A summary of PSU activity during the three months ended March 31, 2023 is presented below:
Number of PSUsWeighted-Average
Remaining Contractual
Term (Years)
Weighted-Average
Grant Price
Outstanding (nonvested) at December 31, 2022300,871 8.63$17.30 
Granted(1)
318,386 $19.49 
Vested $ 
Forfeited $ 
Outstanding (nonvested) at March 31, 2023619,257 8.62$18.43 
(1) The aggregate fair value of all PSUs granted during the three months ended March 31, 2023 was approximately $6.2 million.

NOTE 13 – EQUITY
In August 2021, the Company’s Board of Directors approved a stock repurchase program (the “Repurchase Program”) that authorizes the Company to purchase up to $40.0 million of its outstanding shares of the Company’s common stock. On March 3, 2023 the Board of Directors approved an increase to the Repurchase Program that authorizes the Company to purchase an additional $100.0 million of its outstanding shares. Under the Repurchase Program, the Company is authorized to repurchase shares from time to time in accordance with applicable laws, both on the open market and in privately negotiated transactions and may include the use of derivative contracts or structured share repurchase agreements. The timing and amount of repurchases depends on several factors, including market and business conditions, the trading price of the Company’s common stock and the nature of other investment opportunities. The Repurchase Program may be limited, suspended or discontinued at any time without prior notice. The Repurchase Program does not have an expiration date. The A&R Credit Agreement, as amended, permits the Company to make restricted payments (including share repurchases, among others), (i) without limitation so long as the Consolidated Leverage Ratio (as defined in the A&R Credit Agreement, as amended), as of the then most recently completed four fiscal quarters of the Company, after giving pro forma effect to such restricted payments, is 2.25:1.00 or less, (ii) that do not exceed, in the aggregate during any fiscal year, the greater of (x) $23.8 million and (y) 25.00% of Consolidated EBITDA (as defined in the A&R Credit Agreement) for the then most recently completed four fiscal quarters of the Company and (iii) to repurchase Company common stock from current or former employees in an aggregate amount of up to $10.0 million per calendar year.

The Company accounts for purchases of treasury stock under the cost method. Any direct costs incurred to acquire treasury stock are considered stock issue costs and added to the cost of the treasury stock. During the three months ended March 31, 2023, the Company purchased 316,459 shares for an aggregate purchase price of $7.6 million. During the three months ended March 31, 2022, the Company purchased 224,388 shares for an aggregate purchase price of $3.6 million. As of March 31, 2023, there was $100.7 million available for future share repurchases under the Repurchase Program.


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NOTE 14 – EARNINGS PER SHARE
Basic earnings per share is calculated by dividing net income for the period by the weighted-average number of common shares outstanding for the period. In computing dilutive earnings per share, basic earnings per share is adjusted for the assumed issuance of all applicable potentially dilutive share-based awards, including common stock options, RSUs, RSAs and PSUs.

Below are basic and diluted earnings per share for the periods indicated (in thousands, except for share data):

Three Months Ended March 31,
20232022
Net income for basic and diluted earnings per common share$11,762 $11,654 
Shares:
Weighted-average common shares outstanding – basic36,480,972 38,362,014 
Effect of dilutive securities:
RSUs140,639 62,058 
Stock options335,866 549,941 
RSAs71,206 25,935 
PSUs333,270 77,717 
Weighted-average common shares outstanding – diluted37,361,953