Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Jul. 25, 2014 | |
Document Information [Line Items] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Jun-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Trading Symbol | 'PAYC | ' |
Entity Registrant Name | 'Paycom Software, Inc. | ' |
Entity Central Index Key | '0001590955 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Non-accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 51,041,157 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $13,968 | $13,362 |
Restricted cash | 370 | 369 |
Accounts receivable | 906 | 1,705 |
Prepaid expenses | 1,615 | 2,133 |
Inventory | 519 | 578 |
Income tax receivable | 15 | 150 |
Deferred tax assets | 3,470 | 3,672 |
Current assets before funds held for clients | 20,863 | 21,969 |
Funds held for clients | 315,629 | 455,779 |
Total current assets | 336,492 | 477,748 |
Property, plant and equipment, net of accumulated depreciation of $14.1 million and $11.5 million, respectively | 45,358 | 38,671 |
Deposits and other assets | 554 | 461 |
Goodwill | 51,889 | 51,889 |
Intangible assets, net of accumulated amortization of $11.3 million and $10.5 million, respectively | 5,902 | 6,709 |
Total assets | 440,195 | 575,478 |
Current liabilities: | ' | ' |
Accounts payable | 2,620 | 5,020 |
Accrued commissions and bonuses | 1,579 | 3,598 |
Accrued payroll and vacation | 3,492 | 3,087 |
Deferred revenue | 1,941 | 1,582 |
Current portion of long-term debt | 893 | 9,545 |
Accrued expenses and other current liabilities | 3,244 | 4,372 |
Current liabilities before client funds obligation | 13,769 | 27,204 |
Client funds obligation | 315,629 | 455,779 |
Total current liabilities | 329,398 | 482,983 |
Deferred tax liabilities | 3,081 | 2,895 |
Long-term deferred revenue | 13,350 | 10,990 |
Long-term debt, less current portion | 26,528 | 11,545 |
Long-term debt to related parties | ' | 60,875 |
Derivative liability | ' | 1,107 |
Total long-term liabilities | 42,959 | 87,412 |
Commitments and contingencies | ' | ' |
Stockholders' equity: | ' | ' |
Common stock, $0.01 par value (100,000,000 shares authorized, 51,041,157 and 45,708,573 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively) | 510 | 457 |
Additional paid in capital | 66,861 | 33,978 |
Retained earnings (accumulated deficit) | 467 | -29,349 |
Total parent's stockholders' equity | 67,838 | 5,086 |
Noncontrolling interest | ' | -3 |
Total stockholders' equity | 67,838 | 5,083 |
Total liabilities and stockholders' equity | $440,195 | $575,478 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Accumulated depreciation | $14,130 | $11,540 |
Accumulated amortization | $11,289 | $10,482 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 51,041,157 | 45,708,573 |
Common stock, shares outstanding | 51,041,157 | 45,708,573 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Income (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Revenues | ' | ' | ' | ' |
Recurring | $32,666 | $23,394 | $69,120 | $50,598 |
Implementation and other | 640 | 520 | 1,171 | 893 |
Total revenues | 33,306 | 23,914 | 70,291 | 51,491 |
Cost of revenues | ' | ' | ' | ' |
Operating expenses | 5,757 | 4,353 | 12,049 | 8,787 |
Depreciation | 608 | 415 | 1,238 | 826 |
Total cost of revenues | 6,365 | 4,768 | 13,287 | 9,613 |
Administrative expenses | ' | ' | ' | ' |
Sales and marketing | 13,700 | 8,716 | 29,381 | 18,574 |
Research and development | 937 | 324 | 1,819 | 779 |
General and administrative | 8,138 | 6,040 | 17,406 | 12,036 |
Depreciation and amortization | 1,072 | 873 | 2,163 | 1,757 |
Total administrative expenses | 23,847 | 15,953 | 50,769 | 33,146 |
Total operating expenses | 30,212 | 20,721 | 64,056 | 42,759 |
Operating income | 3,094 | 3,193 | 6,235 | 8,732 |
Interest expense | -674 | -2,326 | -2,741 | -4,600 |
Net loss on early repayment of debt | -4,044 | ' | -4,044 | ' |
Other income (expense), net | 587 | -338 | 1,356 | 273 |
Income (loss) before income taxes | -1,037 | 529 | 806 | 4,405 |
Provision (benefit) for income taxes | -444 | 169 | 339 | 1,410 |
Net income (loss) | -593 | 360 | 467 | 2,995 |
Net income attributable to the noncontrolling interest | 0 | 3 | 0 | 22 |
Net income (loss) attributable to Paycom | -593 | 357 | 467 | 2,973 |
Pro forma additional income tax expense | ' | 79 | ' | 656 |
Pro forma net income (loss) | ($593) | $278 | $467 | $2,317 |
Net income (loss) per share, basic | ($0.01) | $0.01 | $0.01 | $0.07 |
Net income (loss) per share, diluted | ($0.01) | $0.01 | $0.01 | $0.06 |
Pro forma net income (loss) per share, basic | ($0.01) | $0.01 | $0.01 | $0.05 |
Pro forma net income (loss) per share, diluted | ($0.01) | $0.01 | $0.01 | $0.05 |
Weighted average shares outstanding: | ' | ' | ' | ' |
Basic | 50,284,362 | 45,621,868 | 48,015,577 | 45,241,939 |
Diluted | 50,284,362 | 47,998,224 | 50,331,002 | 47,958,339 |
Pro forma weighted average shares outstanding: | ' | ' | ' | ' |
Basic | 50,284,362 | 45,621,868 | 48,015,577 | 45,241,939 |
Diluted | 50,284,362 | 47,998,224 | 50,331,002 | 47,958,339 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 |
Operating activities | ' | ' |
Net income | $467 | $2,995 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 3,401 | 2,583 |
Amortization of debt discount | 74 | 116 |
Write off of debt issuance costs | 4,051 | ' |
Stock-based compensation | 274 | 844 |
Change in fair value of derivative liability | -1,107 | -1 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 799 | 63 |
Prepaid expenses | -132 | -467 |
Inventory | 59 | 87 |
Deposits and other assets | -93 | -73 |
Income tax receivable, net | 135 | ' |
Deferred tax assets | 202 | 1,411 |
Deferred tax liabilities | 186 | ' |
Accounts payable | -2,400 | -635 |
Accrued commissions and bonuses | -2,019 | -1,403 |
Accrued payroll and vacation | 405 | 262 |
Deferred revenue | 2,719 | 1,644 |
Accrued expenses and other liabilities | -1,128 | 1,480 |
Net cash provided by operating activities | 5,893 | 8,906 |
Investing activities | ' | ' |
Decrease in funds held for clients | 140,150 | 38,768 |
Increase (decrease) in restricted cash | 1 | -1 |
Additions to property, plant and equipment | -9,278 | -2,839 |
Net cash provided by investing activities | 130,873 | 35,928 |
Financing activities | ' | ' |
Proceeds from issuance of long-term debt | 6,539 | ' |
Proceeds from Initial Public Offering | 62,196 | ' |
Payments on long-term debt | -65,207 | -197 |
Decrease in client funds obligation | -140,150 | -38,768 |
Incentive awards redeemed | ' | -1,008 |
Payments of deferred offering costs | 645 | ' |
Capital impact of reorganization | -183 | ' |
Distributions received from members | ' | -520 |
Net cash used in financing activities | -136,160 | -40,493 |
Change in cash and cash equivalents | 606 | 4,341 |
Cash and cash equivalents | ' | ' |
Beginning of period | 13,362 | 13,435 |
End of period | $13,968 | $17,776 |
CONSOLIDATION_AND_BASIS_OF_PRE
CONSOLIDATION AND BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2014 | |
CONSOLIDATION AND BASIS OF PRESENTATION | ' |
1. CONSOLIDATION AND BASIS OF PRESENTATION | |
The Reorganization | |
Paycom Software, Inc. (“Software”) and its wholly-owned subsidiary, Payroll Software Merger Sub, LLC (“Merger Sub”) were formed as Delaware entities on October 31, 2013, and December 23, 2013, respectively, in anticipation of an initial public offering (“IPO”) and were wholly-owned subsidiaries of Paycom Payroll, LLC (“Paycom”) prior to December 31, 2013. | |
On January 1, 2014, we consummated a reorganization pursuant to which: (i) affiliates of Welsh, Carson, Anderson & Stowe, L.P. contributed WCAS Paycom Holdings, Inc. (“WCAS Holdings”) and WCAS CP IV Blocker, Inc. (“CP IV Blocker”), which collectively own all of the Series A Preferred Units of Paycom Payroll Holdings, LLC (“Holdings”), to Software in exchange for shares of common stock of Software and (ii) the owners of outstanding Series B Preferred Units of Holdings contributed their Series B Preferred Units of Holdings to Software in exchange for shares of common stock of Software. Immediately after these contributions, Merger Sub merged with and into Holdings with Holdings surviving the merger. Upon consummation of the merger, the remaining holders of outstanding common and incentive units of Holdings received shares of common stock of Software for their common and incentive units by operation of Delaware law and Holdings’ ownership interest in Software was cancelled. Outstanding common units, Series B Preferred Units and WCAS Holdings and CP IV Blocker were contributed to Software in exchange for, or converted into, 45,708,573 shares of common stock and 8,121,101 shares of restricted stock of Software. Following these transactions, all outstanding Series C Preferred Units were eliminated in an intercompany transaction between Holdings and WCAS Holdings, and we assumed the 14% Note due 2017 issued by WCAS Holdings (the “2017 Note”). Following the reorganization, Software became a holding company with its principal asset being the Series A Preferred Units of Holdings (collectively, the “2014 Reorganization”). | |
Software’s acquisition of WCAS Holdings and Holdings in the 2014 Reorganization represented transactions under common control and were required to be retrospectively applied to the financial statements for all prior periods when the financial statements were issued for a period that included the date the transactions occurred. Therefore, our consolidated financial statements are presented as if WCAS Holdings and Holdings were wholly-owned subsidiaries in periods prior to the 2014 Reorganization. The acquisition of CP IV Blocker was not deemed to be a reorganization under common control and therefore our historical consolidated financial statements for periods prior to January 1, 2014 include the ownership of a minority equity interest in CP IV Blocker, which was eliminated upon the acquisition of CP IV Blocker on January 1, 2014. | |
Our unaudited interim condensed consolidated financial statements include the financial results of Software, WCAS Holdings, CP IV Blocker and Holdings, effective January 1, 2014. Intercompany balances and transactions were eliminated in consolidation. | |
Unless we state otherwise or the context otherwise requires, the terms “we,” “us,” “our” and the “Company” refer, prior to the 2014 Reorganization, to Holdings, Holdings’ consolidated subsidiaries and WCAS Holdings collectively and, after the 2014 Reorganization, to Software and its consolidated subsidiaries. | |
Basis of Presentation | |
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial statements that permit reduced disclosure for interim periods. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments necessary to fairly present our condensed consolidated financial position as of June 30, 2014 and December 31, 2013, our condensed consolidated results of operations for the three and six months ended June 30, 2014 and 2013 and our condensed consolidated cash flows for the six months ended June 30, 2014 and 2013. Such adjustments are of a normal recurring nature. The information in this Quarterly Report on Form 10-Q should be read in in conjunction with our final prospectus filed pursuant to Rule 424(b) (the “Prospectus”) with the SEC on April 15, 2014. | |
Use of Estimates | |
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include the useful life for long-lived and intangible assets, the life of our client relationships, the fair market value of our equity incentive awards and the fair value of our financial instruments. These estimates are based on historical experience where applicable and other assumptions that management believes are reasonable under circumstances. As such, actual results could materially differ from these estimates. | |
Segment Information | |
We operate in a single operating segment and a single reporting segment and all required financial segment information is presented in the condensed consolidated financial statements. | |
Anti-Dilutive Securities | |
We excluded 1,984,938 shares of restricted stock from the diluted earnings per share calculation for the three months ended June 30, 2014 because they were anti-dilutive. | |
Subsequent Events | |
We have evaluated subsequent events for recognition or disclosure in our condensed consolidated financial statements and determined that no subsequent events would require adjustment to the condensed consolidated financial statements or additional disclosure other than the information disclosed herein. See “Note 13-Subsequent Events.” | |
Summary of Significant Accounting Policies | |
Software’s significant accounting policies discussed in Note 2 to its audited consolidated financial statements for the fiscal year December 31, 2013 included in the Prospectus filed with the SEC on April 15, 2014, have not changed. | |
Recently Issued and Adopted Accounting Pronouncements | |
In February 2013, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which added new disclosure requirements to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date and disclose the arrangements and the total outstanding amount of obligation for all parties. We adopted this new guidance for the six months ended June 30, 2014, which did not have a material impact on our condensed consolidated financial statements. | |
In July 2013, the FASB issued authoritative guidance which requires entities to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. We adopted this new guidance for the six months ended June 30, 2014, which did not have a material impact on our condensed consolidated financial statements. | |
In May 2014, the FASB issued authoritative guidance which included a comprehensive new revenue recognition model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is not permitted. Accordingly, the standard is effective for us on January 1, 2017. We are currently evaluating the impact that the standard will have on our condensed consolidated financial statements. | |
In June 2014, the FASB issued authoritative guidance for share-based payments which requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. This update further clarifies that compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. |
PROPERTY_PLANT_AND_EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
PROPERTY, PLANT AND EQUIPMENT | ' | ||||||||
2. PROPERTY, PLANT AND EQUIPMENT | |||||||||
Property, plant and equipment and accumulated depreciation were as follows: | |||||||||
June 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Property, plant and equipment | |||||||||
Buildings | $ | 27,190 | $ | 14,828 | |||||
Software and capitalized software costs | 6,689 | 5,578 | |||||||
Computer equipment | 6,241 | 4,832 | |||||||
Rental clocks | 5,743 | 4,865 | |||||||
Furniture, fixtures and equipment | 4,052 | 3,189 | |||||||
Vehicles | 421 | 421 | |||||||
Leasehold improvements | 159 | 135 | |||||||
50,495 | 33,848 | ||||||||
Less: accumulated depreciation | (14,130 | ) | (11,540 | ) | |||||
36,365 | 22,308 | ||||||||
Land | 8,993 | 8,993 | |||||||
Construction in process | — | 7,370 | |||||||
Property, plant and equipment, net | $ | 45,358 | $ | 38,671 | |||||
Rental clocks included in property, plant and equipment, net represent time clocks issued to clients under month-to-month operating leases. These items are transferred upon issuance from inventory to fixed assets and depreciated over their estimated useful lives. | |||||||||
Depreciation expense for property, plant and equipment, net was $1.3 million and $2.6 million for the three and six months ended June 30, 2014, respectively. Depreciation expense for property, plant and equipment, net was $0.9 million and $1.8 million for the three and six months ended June 30, 2013, respectively. | |||||||||
We capitalize interest incurred under our indebtedness related to construction of our principal executive offices. For the three months ended June 30, 2014, we paid interest costs of $0.3 million of which $0.1 million was capitalized. For the six months ended June 30, 2014, we paid interest costs of $0.6 million of which $0.4 million was capitalized. For the three and six months ended June 30, 2013, we paid interest costs of $0.2 million and $0.4 million, respectively, of which $18 thousand and $35 thousand, respectively, was capitalized. |
GOODWILL_AND_INTANGIBLE_ASSETS
GOODWILL AND INTANGIBLE ASSETS, NET | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
GOODWILL AND INTANGIBLE ASSETS, NET | ' | ||||||||||||||||
3. GOODWILL AND INTANGIBLE ASSETS, NET | |||||||||||||||||
We had goodwill of $51.9 million as of June 30, 2014 and December 31, 2013. We have selected June 30 as our annual goodwill impairment testing date and determined there was no impairment as of June 30, 2014. For the year ended December 31, 2013, there were no indicators of impairment. | |||||||||||||||||
All of our intangible assets are considered to have finite lives and, as such, are subject to amortization. The components of intangible assets were as follows: | |||||||||||||||||
June 30, 2014 | |||||||||||||||||
Weighted Avg. | Gross | Accumulated | Net | ||||||||||||||
Remaining | Amortization | ||||||||||||||||
Useful Life | |||||||||||||||||
(Years) | |||||||||||||||||
Intangibles: | |||||||||||||||||
Customer relationships | 3 | $ | 13,997 | $ | (9,798 | ) | $ | 4,199 | |||||||||
Trade name | 8 | 3,194 | (1,491 | ) | 1,703 | ||||||||||||
Total | $ | 17,191 | $ | (11,289 | ) | $ | 5,902 | ||||||||||
December 31, 2013 | |||||||||||||||||
Weighted Avg. | Gross | Accumulated | Net | ||||||||||||||
Remaining | Amortization | ||||||||||||||||
Useful Life | |||||||||||||||||
(Years) | |||||||||||||||||
Intangibles: | |||||||||||||||||
Customer relationships | 3.5 | $ | 13,997 | $ | (9,098 | ) | $ | 4,899 | |||||||||
Trade name | 8.5 | 3,194 | (1,384 | ) | 1,810 | ||||||||||||
Total | $ | 17,191 | $ | (10,482 | ) | $ | 6,709 | ||||||||||
The weighted average remaining useful life of our intangible assets was 4.45 years as of June 30, 2014. Amortization of intangible assets for the three and six months ended June 30, 2014 was $0.4 million and $0.8 million, respectively. Amortization of intangible assets for the three and six months ended June 30, 2013 was $0.4 million and $0.8 million, respectively. Estimated amortization expense as of June 30, 2014 for our existing intangible assets for the next five years and thereafter was as follows: | |||||||||||||||||
Year Ending December 31, | Amortization | ||||||||||||||||
Expense | |||||||||||||||||
2014 | $ | 806 | |||||||||||||||
2015 | 1,613 | ||||||||||||||||
2016 | 1,613 | ||||||||||||||||
2017 | 913 | ||||||||||||||||
2018 | 213 | ||||||||||||||||
Thereafter | 744 | ||||||||||||||||
$ | 5,902 | ||||||||||||||||
FUNDS_HELD_FOR_CLIENTS_AND_CLI
FUNDS HELD FOR CLIENTS AND CLIENT FUNDS OBLIGATION | 6 Months Ended |
Jun. 30, 2014 | |
FUNDS HELD FOR CLIENTS AND CLIENT FUNDS OBLIGATION | ' |
4. FUNDS HELD FOR CLIENTS AND CLIENT FUNDS OBLIGATION | |
As part of our payroll and tax filing application, we collect funds for federal, state and local employment taxes from clients, handle applicable regulatory tax filings, correspondence and amendments, remit the funds to appropriate tax agencies, and handle other employer-related services. Amounts collected by us from clients for their federal, state and local employment taxes earn interest during the interval between receipt and disbursement, as we invest these funds in money market funds and certificates of deposit. These collections from clients are typically disbursed from one to 30 days after receipt, with some funds being held for up to 120 days. These investments are shown in the Condensed Consolidated Balance Sheets as “Funds held for clients”, and the offsetting liability for the tax filings is shown as “Client funds obligation.” As of June 30, 2014 and December 31, 2013, the funds held for clients were invested in demand deposits, short-term certificates of deposit and money market funds. The interest earned on these funds is included in “Other income (expense), net”, on the Condensed Consolidated Statements of Income. |
LONGTERM_DEBT
LONG-TERM DEBT | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
LONG-TERM DEBT | ' | ||||||||
5. LONG-TERM DEBT | |||||||||
Our long-term debt consisted of the following: | |||||||||
June 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Term note to bank due December 15, 2018 (1) (3) | $ | — | $ | 11,963 | |||||
Construction note to bank (2)(3) | — | 9,127 | |||||||
$27,421 term note to bank due June 1, 2021 (3) | 27,421 | — | |||||||
Note to related party due April 3, 2017 (4) | — | 46,193 | |||||||
Note to related party due April 3, 2022 (5) | — | 18,807 | |||||||
Less: Unamortized debt discounts | — | (4,125 | ) | ||||||
Total long-term debt (including current portion) | 27,421 | 81,965 | |||||||
Less: Current portion | (893 | ) | (9,545 | ) | |||||
Total long-term debt, net | $ | 26,528 | $ | 72,420 | |||||
-1 | In December 2011, we consolidated pre-existing construction loans for the construction of a new corporate headquarters, processing center and gymnasium into a term note (the “2011 Consolidated Loan”). Under the 2011 Consolidated Loan, principal and interest was payable monthly based on a 20 year amortization rate of 5.0%. The 2011 Consolidated Loan was collateralized by a first mortgage covering our original corporate headquarters building and was secured by a first lien security interest in certain personal property relating to our original corporate headquarters building. As of June 30, 2014, the 2011 Consolidated Loan was consolidated into the 2021 Consolidated Loan. See note (3) below for more information on, and the definition of, the 2021 Consolidated Loan. | ||||||||
-2 | In March 2013, we entered into a construction loan agreement for the construction of a second building at our corporate headquarters with Kirkpatrick Bank due May 1, 2015, which allowed for a maximum principal amount of $12.3 million (the “2013 Construction Loan”). The 2013 Construction Loan was secured by a first mortgage covering the second headquarters building and a first lien security interest in certain personal property relating to the second headquarters building. Under the 2013 Construction Loan, interest accrued monthly at the Wall Street Journal U.S. Prime Rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. Interest on the 2013 Construction Loan was payable monthly on the first day of each month. This loan, along with the 2011 Consolidated Loan, was converted into a term loan in July 2013. | ||||||||
In November 2013, we entered into a loan agreement for the purchase of approximately 18.3 acres for future expansion at our headquarters with Kirkpatrick Bank, which allowed for a maximum principal amount of $3.0 million (“2013 Land Loan”). Under the 2013 Land Loan, interest accrued monthly at the Wall Street Journal U.S. Prime Rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. | |||||||||
In December 2013, we consolidated the 2013 Construction Loan and the 2013 Land Loan (“2013 Consolidated Loan”) under a modification agreement that increased the combined maximum principal amount of the 2013 Consolidated Loan to $14.6 million. The 2013 Consolidated Loan was secured by a first mortgage covering all of the second headquarters building and a first lien security interest in certain personal property relating to the second headquarters building. Under the 2013 Consolidated Loan, interest accrued monthly at the Wall Street Journal U.S. Prime rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. As of June 30, 2014, the 2013 Consolidated Loan was consolidated into the 2021 Consolidated Loan. See note (3) below for more information on, and the definition of, the 2021 Consolidated Loan. | |||||||||
The 2011 Consolidated Loan and the 2013 Consolidated Loan were subject to certain financial covenants, as defined in the applicable agreement, including maintaining a debt coverage ratio of indebtedness (defined as current maturities of long-term debt, interest expense and distributions) to EBITDA of less than 1.5 to 1.0. As of December 31, 2013, we were not in compliance with the financial covenant related to the debt coverage ratio. We obtained a letter of waiver from the lender that excluded this item from the calculation as of December 31, 2013 and which remains in effect through April 30, 2015. We were in compliance with the financial covenant related to the debt coverage ratio as of June 30, 2014. | |||||||||
-3 | In June 2014, our only outstanding indebtedness consisted of a term note under a Loan Agreement (the “2021 Consolidated Loan”) with an outstanding principal balance of $27.4 million as of June 30, 2014. The 2021 Consolidated Loan is due to Kirkpatrick Bank and matures on May 30, 2021. Under the 2021 Consolidated Loan, interest is payable monthly and accrues at a fixed rate of 4.75% per annum. The 2021 Consolidated Loan is secured by a mortgage covering our headquarters buildings and certain personal property relating to our headquarters buildings. | ||||||||
-4 | In April 2014, we paid off the balance of the 2017 Note that was issued by WCAS Holdings and was payable to Welsh, Carson, Anderson & Stowe X, L.P., a related party (“WCAS X”) with proceeds from our IPO. The 2017 Note accrued interest at a rate of 14% per annum. As of December 31, 2013, the outstanding principal balance of the 2017 Note was $46.2 million. | ||||||||
-5 | In April 2014, we paid off the balance of the 10% Senior Note due 2022 (the “2022 Note”) with WCAS Capital Partners IV, L.P., a related party (“WCAS CP IV”) with proceeds from our IPO and from existing cash. The 2022 Note accrued interest at a rate of 10% per annum. As of December 31, 2013, the outstanding principal amount of the 2022 Note was $18.8 million. | ||||||||
The 2022 Note was issued at a discount of $2.4 million. In conjunction with the payoff of this note, we wrote off the remaining, unamortized discount of $0.5 million. The total unamortized discount related to this note was $4.1 million as of December 31, 2013. | |||||||||
As of June 30, 2014, the carrying value and fair value of our total long-term debt, including the current portion were $27.4 million. As of December 31, 2013, the carrying value and fair value of our total long-term debt, including the current portion, were $82.0 million and $84.9 million, respectively. The fair value of variable rate long-term debt approximates its market value because the cost of borrowing fluctuates based upon market conditions. The fair value of fixed rate long-term debt is estimated based on the borrowing rates currently available to us for bank loans with similar terms and maturities. |
EMPLOYEE_SAVINGS_PLAN
EMPLOYEE SAVINGS PLAN | 6 Months Ended |
Jun. 30, 2014 | |
EMPLOYEE SAVINGS PLAN | ' |
6. EMPLOYEE SAVINGS PLAN | |
Our employees that are over the age of 21 and have completed 90 days of service are eligible to participate in our 401(k) plan. We have made a Qualified Automatic Contribution Arrangement (“QACA”) election, whereby we make a matching contribution equal to 100% of the first 1% of salary deferrals and 50% of salary deferrals between 2% and 6%, up to a maximum matching contribution of 3.5% of salary each plan year for our employees. We are allowed to make additional discretionary matching contributions and discretionary profit sharing contributions. Employees are 100% vested in amounts attributable to salary deferrals and rollover contributions. The QACA matching contributions will be 100% vested after two years of employment from the date of hire. If an employee terminates service prior to completing two years of employment, the employee will not be vested in these contributions. The discretionary contributions are vested over a six year period. Matching contributions amounted to $0.4 million and $0.9 million for the three and six months ended June 30, 2014, respectively. Matching contributions amounted to $0.2 million and $0.6 million for the three and six months ended June 30, 2013, respectively. |
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ' | ||||||||||||||||
7. FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||||||
Our financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, funds held for clients, client funds obligation, long-term debt and derivative liability. The carrying amount of cash and cash equivalents, accounts receivable, accounts payable, funds held for clients and client fund obligations approximates fair value because of the short-term nature of the instruments. | |||||||||||||||||
We measure certain financial assets and liabilities at fair value at each reporting period. 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. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value are as follow: | |||||||||||||||||
Level 1—Unadjusted observable inputs that reflect quoted prices in active markets | |||||||||||||||||
Level 2—Input other than quoted prices in active markets that are directly or indirectly observable | |||||||||||||||||
Level 3—Unobservable inputs that are supported by little or no market activity | |||||||||||||||||
We use observable data, when available. During the three and six months ended June 30, 2014 and 2013, we did not have any transfers between Levels 1, 2 or 3 in the three-tier fair value hierarchy. | |||||||||||||||||
We had no financial assets or liabilities measured at fair value on a recurring basis as of June 30, 2014. The following tables provide a summary of the fair value of financial instruments that are measured on a recurring basis using the above input categories as of December 31, 2013: | |||||||||||||||||
December 31, 2013 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Liabilities | |||||||||||||||||
Derivative liability | $ | — | $ | — | $ | 1,107 | $ | 1,107 | |||||||||
$ | — | $ | — | $ | 1,107 | $ | 1,107 | ||||||||||
The derivative liability related to the 2022 Note was classified as a Level 3 financial instrument due to valuation being based upon significant unobservable inputs. See “Note 5 Long-Term Debt” for additional information. | |||||||||||||||||
The key inputs used to calculate the fair value of the embedded derivative are: probability of exit, remaining term, yield volatility, credit spread, and risk-free rate. In general, increases in the probability of exit, credit spread, and risk-free rate would increase the value of the embedded derivative. Conversely, increases in the remaining term and yield volatility would decrease the value of the embedded derivative. | |||||||||||||||||
Quantitative information regarding significant unobservable inputs used for recurring Level 3 fair value measurements of financial instruments were as follows as of December 31, 2013: | |||||||||||||||||
Significant unobservable input(s) / sensitivity of the fair value to the | |||||||||||||||||
changes in the unobservable inputs | |||||||||||||||||
December 31, 2013 | |||||||||||||||||
Valuation Technique | Key Inputs | Range | |||||||||||||||
Derivative Liability | Lattice Model | Probability of exit | 90% | ||||||||||||||
Remaining term | 0.8 years - 8.3 years | ||||||||||||||||
Yield Volatility | 21.4% - 31.1% | ||||||||||||||||
Credit Spread | 8.90% | ||||||||||||||||
Risk-free rate | 0.13% - 2.45% | ||||||||||||||||
The following table summarizes the changes in fair value of our Level 3 financial instruments for the three and six months ended June 30, 2013 and 2014: | |||||||||||||||||
Three Months | Six Months | ||||||||||||||||
Ended June 30, 2013 | Ended June 30, 2013 | ||||||||||||||||
Beginning Balance | $ | 1,421 | $ | 1,767 | |||||||||||||
Issuances | — | — | |||||||||||||||
Change in fair value of derivative liability | 345 | (1 | ) | ||||||||||||||
Ending Balance | $ | 1,766 | $ | 1,766 | |||||||||||||
Three Months | Six Months | ||||||||||||||||
Ended June 30, 2014 | Ended June 30, 2014 | ||||||||||||||||
Beginning Balance | $ | 472 | $ | 1,107 | |||||||||||||
Issuances | — | — | |||||||||||||||
Change in fair value of derivative liability | — | (635 | ) | ||||||||||||||
Write-off to Other income (expense) | (472 | ) | (472 | ) | |||||||||||||
Ending Balance | $ | — | $ | — | |||||||||||||
Total change in fair value of derivative liability recognized as “Other income (expense), net” in the Condensed Consolidated Statements of Income was $0.3 million and less than $(0.1 million) for the three and six months ended June 30, 2013, respectively. Total change in fair value of derivative liability, including write-off of the balance due to payoff of the associated loan, recognized as “Other income (expense), net” in the Condensed Consolidated Statements of Income, was $(0.5 million) and $(1.1 million) for the three and six months ended June 30, 2014, respectively. |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
EARNINGS PER SHARE | ' | ||||||||||||||||
8. EARNINGS PER SHARE | |||||||||||||||||
Basic earnings per share (“EPS”) is based on the weighted average number of shares of common stock outstanding for the period. Diluted EPS is computed in a similar manner to basic EPS after assuming the issuance of shares of common stock for all potentially dilutive shares of restricted stock whether or not they are vested. | |||||||||||||||||
Under the 2014 Reorganization, all the outstanding common units, Series B Preferred Units and incentive units of Holdings were exchanged for, or converted into, 45,708,573 shares of our common stock and 8,121,101 shares of our restricted stock as of January 1, 2014. | |||||||||||||||||
The following is a reconciliation of net income and the shares of common stock used in the computation of basic and diluted net earnings per share: | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||||||||||||
Numerator: | |||||||||||||||||
Net income | $ | (593 | ) | $ | 360 | $ | 467 | $ | 2,995 | ||||||||
Net income attributable to non-controlling interest | — | (3 | ) | — | (22 | ) | |||||||||||
Net income attributable to Paycom | $ | (593 | ) | $ | 357 | $ | 467 | $ | 2,973 | ||||||||
Denominator: | |||||||||||||||||
Weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 | |||||||||||||
Adjustment for vested restricted stock | — | 1,061,815 | — | 681,886 | |||||||||||||
Shares for calculating basic EPS | 50,284,362 | 45,621,868 | 48,015,577 | 45,241,939 | |||||||||||||
Weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 | |||||||||||||
Dilutive effect of unvested restricted stock | — | 3,438,171 | 2,315,425 | 3,398,286 | |||||||||||||
Shares for calculating diluted EPS | 50,284,362 | 47,998,224 | 50,331,002 | 47,958,339 | |||||||||||||
Net income (loss) per share: | |||||||||||||||||
Basic | $ | (0.01 | ) | $ | 0.01 | $ | 0.01 | $ | 0.07 | ||||||||
Diluted | $ | (0.01 | ) | $ | 0.01 | $ | 0.01 | $ | 0.06 | ||||||||
We excluded 1,984,938 shares of restricted stock from the diluted earnings per share calculation for the three months ended June 30, 2014 because they were anti-dilutive. | |||||||||||||||||
There is no difference in net income and pro forma net income for either the three or six months ended June 30, 2014. The following is a reconciliation of pro forma net income for the three and six months ended June 30, 2013 and the shares of stock used in the computation of pro forma basic and diluted net income per share: | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, 2013 | June 30, 2013 | ||||||||||||||||
Pro forma numerator: | |||||||||||||||||
Net income attributable to Paycom | $ | 357 | $ | 2,973 | |||||||||||||
Pro forma additional income tax expense (Note 12) | 79 | 656 | |||||||||||||||
Pro forma net income attributable to Paycom (Note 12) | $ | 278 | $ | 2,317 | |||||||||||||
Pro forma denominator: | |||||||||||||||||
Pro forma weighted average shares outstanding | 44,560,053 | 44,560,053 | |||||||||||||||
Adjustment for vested restricted stock | 1,061,815 | 681,886 | |||||||||||||||
Pro forma shares for calculating basic EPS | 45,621,868 | 45,241,939 | |||||||||||||||
Pro forma weighted average shares outstanding | 44,560,053 | 44,560,053 | |||||||||||||||
Effect of dilutive restricted stock | 3,438,171 | 3,398,286 | |||||||||||||||
Pro forma shares for calculating diluted EPS | 47,998,224 | 47,958,339 | |||||||||||||||
Pro forma net income per share: | |||||||||||||||||
Basic | $ | 0.01 | $ | 0.05 | |||||||||||||
Diluted | $ | 0.01 | $ | 0.05 | |||||||||||||
For the three and six months ended June 30, 2014, there was no difference between net income and pro forma net income. See “Note 12 Income Taxes” for additional information regarding pro forma income tax expense. |
STOCKHOLDERS_EQUITY_AND_INCENT
STOCKHOLDERS' EQUITY AND INCENTIVE COMPENSATION | 6 Months Ended |
Jun. 30, 2014 | |
STOCKHOLDERS' EQUITY AND INCENTIVE COMPENSATION | ' |
9. STOCKHOLDERS’ EQUITY AND INCENTIVE COMPENSATION | |
Prior to the 2014 Reorganization, Holdings had four authorized classes of limited liability company interests (each a “unit”). Series A Preferred Units were voting units with first priority of distribution, entitled to a preferred yield (as defined within our limited liability company agreement) of 9% with regard to certain future asset distributions and conversion features. Series B Preferred Units were non-voting units, entitled to receive distributions only after certain conditions were met. Common units were voting units. Incentive units were non-voting units reserved for issuance to our employees, officers, directors and other service providers. | |
On January 1, 2014, we consummated the 2014 Reorganization, pursuant to which: (i) affiliates of Welsh, Carson, Anderson & Stowe, L.P., contributed WCAS Holdings and CP IV Blocker, which collectively own all of the Series A Preferred Units of Holdings, to Software in exchange for shares of common stock of Software and (ii) the owners of outstanding Series B Preferred Units of Holdings contributed their Series B Preferred Units of Holdings to Software in exchange for shares of common stock of Software. Immediately after these contributions, Merger Sub merged with and into Holdings with Holdings surviving the merger. Upon consummation of the merger, the remaining holders of outstanding common and incentive units of Holdings received shares of common stock of Software for their common and incentive units by operation of Delaware law and Holdings’ ownership interest in Software was cancelled. Outstanding common units, Series B Preferred Units and WCAS Holdings and CP IV Blocker were contributed to Software in exchange for, or converted into, 45,708,573 shares of common stock and 8,121,101 shares of restricted common stock of Software. | |
The shares of restricted stock were issued subject to various vesting conditions. A portion of the restricted stock is subject to time-based vesting conditions, while the remaining portion is subject to performance-based vesting conditions. The performance-based vesting conditions are based on our total enterprise value exceeding certain specified thresholds. For additional information concerning the vesting conditions of the restricted stock, see “Executive Compensation—Narrative Discussion Regarding Summary Compensation Table—Equity Incentive Units and Restricted Stock Awards” included in the Prospectus filed with the SEC on April 15, 2014. | |
Following these transactions, all outstanding Series C Preferred Units were eliminated in an intercompany transaction between Holdings and WCAS Holdings, and we assumed the 2017 Note. As a result of the 2014 Reorganization, we recorded a one-time reclassification of $29.6 million of historical accumulated deficit to additional paid in capital on January 1, 2014. Following the 2014 Reorganization, Software became a holding company with its principal asset being the Series A Preferred Units of Holdings. | |
As of June 30, 2014 and December 31, 2013, there was $1.1 million and $1.3 million, respectively, of total unrecognized compensation cost related to unvested restricted stock issued to employees. The unrecognized compensation cost is expected to be recognized over a weighted average period of 2.9 years. On April 21, 2014, 217,378 shares of restricted stock automatically vested and converted into shares of common stock. |
RELATEDPARTY_TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2014 | |
RELATED-PARTY TRANSACTIONS | ' |
10. RELATED-PARTY TRANSACTIONS | |
During the three months ended June 30, 2014 and 2013, we paid Advantage Benefits Plus (“Advantage”) a total of $5 thousand and $3 thousand, respectively, for administering our employee cafeteria plan. During the six months ended June 30, 2014 and 2013, we paid Advantage a total of $8 thousand and $5 thousand, respectively, for administering our employee cafeteria plan. Employee payroll deductions are sent to Advantage and we are billed monthly for an administrative fee. Advantage is owned by the spouse of Craig E. Boelte, our Chief Financial Officer. | |
Our Dallas office building is owned by 417 Oakbend, LP, a Texas limited partnership. Jeff York, our Chief Sales Officer, owns a .01% general partnership interest and a 10.49% limited partnership interest in 417 Oakbend, LP. During the three months ended June 30, 2014 and 2013, we paid rent on our Dallas office space in the amounts of $71 thousand and $64 thousand, respectively. During the six months ended June 30, 2014 and 2013, we paid rent on our Dallas office space in the amounts of $133 thousand and $131 thousand, respectively. | |
In connection with the corporate reorganization in April 2012, we entered into the 2022 Note with WCAS CP IV, a related party. We paid off the balance of this note in April 2014 with proceeds from our IPO and with existing cash on hand. | |
In connection with the 2014 Reorganization, we assumed the 2017 Note that was issued by WCAS Holdings and was payable to WCAS X. We paid off the balance of this note in April 2014 with proceeds from our IPO. | |
We entered into a Limited Liability Company Unit Redemption Agreement, effective as of January 26, 2013, pursuant to which we purchased 2,605 incentive units from a former employee at a purchase price of $260.21 per unit, which price was based on a third party appraisal and an internal appraisal. The incentive units were purchased from the former employee for an aggregate purchase price of approximately $0.7 million. The former employee is the brother of William X. Kerber III, our Chief Information Officer. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended | ||||
Jun. 30, 2014 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
11. COMMITMENTS AND CONTINGENCIES | |||||
Funding Agreement | |||||
In March 2010, we entered into a funding agreement with the Oklahoma City Economic Development Trust (the “Trust”) and the city of Oklahoma City. The Trust provided $2.0 million as an up-front job creation payment for the construction of certain public infrastructure improvements related to our new principal executive offices in northwest Oklahoma City. In exchange for the funding, we agreed to create at least 492 jobs over a five year period, with an average first year salary in excess of $37 thousand and make a minimum capital investment in the project of at least $15.0 million. We further agreed that we would be responsible for repayment of any amount that was not offset by earned job creation payments. As of June 30, 2014 and December 31, 2013, we had earned $1.8 million and $1.5 million of job creation payments, respectively. We believe that we will fulfill the obligations under this agreement within the time frame specified. | |||||
Legal Proceedings | |||||
In July 2013, Dr. Lakshmi Arunachalam filed a complaint against Paycom Payroll, LLC (“Paycom”) in the U.S. District Court for the District of Delaware alleging that Paycom infringes on U.S. Patent No. 8,244,833 assigned to her. Paycom denied all claims made against it by Dr. Arunachalam in her complaint, asserted various defenses and counterclaims for non-infringement and challenged the validity and enforceability of U.S. Patent No. 8,244,833. The initial lawsuit was dismissed and a complaint was filed by Pi-Net International, Inc. on April 18, 2014, along with the claims of infringement of two additional patents, U.S. Patent No. 5,987,500 and U.S. Patent No. 8,108,492. | |||||
On July 1, 2014, Paycom, Webexchange, Inc., Dr. Arunachalam, and Pi-Net International, Inc. entered into a confidential settlement agreement. As part of this settlement agreement, Pi-Net International, Inc. and Paycom entered a stipulation of dismissal with prejudice on July 1, 2014. | |||||
We are involved in various other legal proceedings in the ordinary course of business. Although we cannot predict the outcome of these proceedings, legal matters are subject to inherent uncertainties and there exists the possibility that the ultimate resolution of these matters could have a material adverse effect on our business, financial condition, results of operations or cash flows. | |||||
Operating Leases | |||||
We lease office space under several noncancellable operating leases with contractual terms expiring from 2014 to 2019. Minimum rent expenses are recognized over the lease term. The lease term is defined as the fixed noncancellable term of the lease plus all periods, if any, for which failure to renew the lease imposes a penalty on us in an amount that a renewal appears, at the inception of the lease, to be reasonably assured. When a lease contains a predetermined fixed escalation of the minimum rent, we recognize the related rent expense on a straight-line basis and record the difference between the recognized rent expense and the amount payable under the lease as a liability. | |||||
Future annual minimum lease payments under noncancellable operating leases with initial or remaining terms of one year or more at June 30, 2014 were as follows: | |||||
Year Ending December 31, | Operating | ||||
2014 | $ | 1,566 | |||
2015 | 3,281 | ||||
2016 | 3,000 | ||||
2017 | 2,606 | ||||
2018 | 2,015 | ||||
Thereafter | 1,192 | ||||
Total minimum lease payments | $ | 13,660 | |||
On July 3, 2014, we entered into a new lease for our Boston sales office. This new lease replaces the lease that had previously been in place. The new lease increases total future minimum lease payments by $1.3 million and is not included in the table above. | |||||
Rent expense under operating leases for the three and six months ended June 30, 2014 was $0.8 million and $1.4 million, respectively. Rent expense under operating leases for the three and six months ended June 30, 2013 was $0.5 million and $0.9 million, respectively. |
INCOME_TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2014 | |
INCOME TAXES | ' |
12. INCOME TAXES | |
The provision for income taxes is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items. Significant management judgment is required in estimating operating income in order to determine our estimated effective income tax rate. The effective income tax rate was 42.82% and 31.95% for the three months ended June 30, 2014 and 2013, respectively. The effective income tax rate was 42.06% and 32.01% for the six months ended June 30, 2014 and 2013, respectively. The higher effective income tax rate for the three and six months ended June 30, 2014 is primarily a result of our 2014 Reorganization, as the 2013 effective income tax rate only includes WCAS Holdings which has historically been treated as a consolidated corporation that is taxed under Subchapter C of the United States Internal Revenue Code of 1986, as amended (a “Subchapter C Corporation”). | |
As a result of the 2014 Reorganization, we are treated as a Subchapter C Corporation and, therefore, subject to both federal and state income taxes. Holdings continues to be recognized as a wholly-owned partnership for income tax purposes. Accordingly, we recorded a one-time non-cash charge to equity of $0.2 million during the six months ended June 30, 2014, respectively, for the amount of the deferred tax liability resulting from the exchange of common units, incentive units and Series B Preferred Units of Holdings for common stock and restricted stock of Software as part of the 2014 Reorganization. | |
Pro Forma Income Tax Expense | |
In connection with the 2014 Reorganization, we became taxed as a Subchapter C Corporation effective January 1, 2014.The pro forma net income applied in computing the pro forma EPS for the three and six months ended June 30, 2013 is based on our historical net income as adjusted to reflect our conversion to a Subchapter C Corporation as if it had occurred as of January 1, 2013. The pro forma net income includes an adjustment to income tax expense, the amount of which was determined at an effective tax rate of 46.9%, which resulted in an incremental pro forma income tax expense of $0.1 million and $0.7 million for the three and six months ended June 30, 2013, respectively. |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2014 | |
SUBSEQUENT EVENTS | ' |
13. SUBSEQUENT EVENTS | |
We had no material subsequent events that have not already been disclosed in the notes to these condensed consolidated financial statements. |
CONSOLIDATION_AND_BASIS_OF_PRE1
CONSOLIDATION AND BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2014 | |
The Reorganization | ' |
The Reorganization | |
Paycom Software, Inc. (“Software”) and its wholly-owned subsidiary, Payroll Software Merger Sub, LLC (“Merger Sub”) were formed as Delaware entities on October 31, 2013, and December 23, 2013, respectively, in anticipation of an initial public offering (“IPO”) and were wholly-owned subsidiaries of Paycom Payroll, LLC (“Paycom”) prior to December 31, 2013. | |
On January 1, 2014, we consummated a reorganization pursuant to which: (i) affiliates of Welsh, Carson, Anderson & Stowe, L.P. contributed WCAS Paycom Holdings, Inc. (“WCAS Holdings”) and WCAS CP IV Blocker, Inc. (“CP IV Blocker”), which collectively own all of the Series A Preferred Units of Paycom Payroll Holdings, LLC (“Holdings”), to Software in exchange for shares of common stock of Software and (ii) the owners of outstanding Series B Preferred Units of Holdings contributed their Series B Preferred Units of Holdings to Software in exchange for shares of common stock of Software. Immediately after these contributions, Merger Sub merged with and into Holdings with Holdings surviving the merger. Upon consummation of the merger, the remaining holders of outstanding common and incentive units of Holdings received shares of common stock of Software for their common and incentive units by operation of Delaware law and Holdings’ ownership interest in Software was cancelled. Outstanding common units, Series B Preferred Units and WCAS Holdings and CP IV Blocker were contributed to Software in exchange for, or converted into, 45,708,573 shares of common stock and 8,121,101 shares of restricted stock of Software. Following these transactions, all outstanding Series C Preferred Units were eliminated in an intercompany transaction between Holdings and WCAS Holdings, and we assumed the 14% Note due 2017 issued by WCAS Holdings (the “2017 Note”). Following the reorganization, Software became a holding company with its principal asset being the Series A Preferred Units of Holdings (collectively, the “2014 Reorganization”). | |
Software’s acquisition of WCAS Holdings and Holdings in the 2014 Reorganization represented transactions under common control and were required to be retrospectively applied to the financial statements for all prior periods when the financial statements were issued for a period that included the date the transactions occurred. Therefore, our consolidated financial statements are presented as if WCAS Holdings and Holdings were wholly-owned subsidiaries in periods prior to the 2014 Reorganization. The acquisition of CP IV Blocker was not deemed to be a reorganization under common control and therefore our historical consolidated financial statements for periods prior to January 1, 2014 include the ownership of a minority equity interest in CP IV Blocker, which was eliminated upon the acquisition of CP IV Blocker on January 1, 2014. | |
Our unaudited interim condensed consolidated financial statements include the financial results of Software, WCAS Holdings, CP IV Blocker and Holdings, effective January 1, 2014. Intercompany balances and transactions were eliminated in consolidation. | |
Unless we state otherwise or the context otherwise requires, the terms “we,” “us,” “our” and the “Company” refer, prior to the 2014 Reorganization, to Holdings, Holdings’ consolidated subsidiaries and WCAS Holdings collectively and, after the 2014 Reorganization, to Software and its consolidated subsidiaries. | |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial statements that permit reduced disclosure for interim periods. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments necessary to fairly present our condensed consolidated financial position as of June 30, 2014 and December 31, 2013, our condensed consolidated results of operations for the three and six months ended June 30, 2014 and 2013 and our condensed consolidated cash flows for the six months ended June 30, 2014 and 2013. Such adjustments are of a normal recurring nature. The information in this Quarterly Report on Form 10-Q should be read in in conjunction with our final prospectus filed pursuant to Rule 424(b) (the “Prospectus”) with the SEC on April 15, 2014. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include the useful life for long-lived and intangible assets, the life of our client relationships, the fair market value of our equity incentive awards and the fair value of our financial instruments. These estimates are based on historical experience where applicable and other assumptions that management believes are reasonable under circumstances. As such, actual results could materially differ from these estimates. | |
Segment Information | ' |
Segment Information | |
We operate in a single operating segment and a single reporting segment and all required financial segment information is presented in the condensed consolidated financial statements. | |
Subsequent Events | ' |
Subsequent Events | |
We have evaluated subsequent events for recognition or disclosure in our condensed consolidated financial statements and determined that no subsequent events would require adjustment to the condensed consolidated financial statements or additional disclosure other than the information disclosed herein. See “Note 13-Subsequent Events.” | |
Summary of Significant Accounting Policies | ' |
Summary of Significant Accounting Policies | |
Software’s significant accounting policies discussed in Note 2 to its audited consolidated financial statements for the fiscal year December 31, 2013 included in the Prospectus filed with the SEC on April 15, 2014, have not changed. | |
Recently Issued and Adopted Accounting Pronouncements | ' |
Recently Issued and Adopted Accounting Pronouncements | |
In February 2013, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which added new disclosure requirements to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date and disclose the arrangements and the total outstanding amount of obligation for all parties. We adopted this new guidance for the six months ended June 30, 2014, which did not have a material impact on our condensed consolidated financial statements. | |
In July 2013, the FASB issued authoritative guidance which requires entities to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. We adopted this new guidance for the six months ended June 30, 2014, which did not have a material impact on our condensed consolidated financial statements. | |
In May 2014, the FASB issued authoritative guidance which included a comprehensive new revenue recognition model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is not permitted. Accordingly, the standard is effective for us on January 1, 2017. We are currently evaluating the impact that the standard will have on our condensed consolidated financial statements. | |
In June 2014, the FASB issued authoritative guidance for share-based payments which requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. This update further clarifies that compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. | |
Anti-Dilutive Securities | ' |
Anti-Dilutive Securities | |
We excluded 1,984,938 shares of restricted stock from the diluted earnings per share calculation for the three months ended June 30, 2014 because they were anti-dilutive. |
PROPERTY_PLANT_AND_EQUIPMENT_T
PROPERTY, PLANT AND EQUIPMENT (Tables) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Schedule of Property, Plant and Equipment and Accumulated Depreciation | ' | ||||||||
Property, plant and equipment and accumulated depreciation were as follows: | |||||||||
June 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Property, plant and equipment | |||||||||
Buildings | $ | 27,190 | $ | 14,828 | |||||
Software and capitalized software costs | 6,689 | 5,578 | |||||||
Computer equipment | 6,241 | 4,832 | |||||||
Rental clocks | 5,743 | 4,865 | |||||||
Furniture, fixtures and equipment | 4,052 | 3,189 | |||||||
Vehicles | 421 | 421 | |||||||
Leasehold improvements | 159 | 135 | |||||||
50,495 | 33,848 | ||||||||
Less: accumulated depreciation | (14,130 | ) | (11,540 | ) | |||||
36,365 | 22,308 | ||||||||
Land | 8,993 | 8,993 | |||||||
Construction in process | — | 7,370 | |||||||
Property, plant and equipment, net | $ | 45,358 | $ | 38,671 | |||||
GOODWILL_AND_INTANGIBLE_ASSETS1
GOODWILL AND INTANGIBLE ASSETS, NET (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Components of Intangible Assets | ' | ||||||||||||||||
The components of intangible assets were as follows: | |||||||||||||||||
June 30, 2014 | |||||||||||||||||
Weighted Avg. | Gross | Accumulated | Net | ||||||||||||||
Remaining | Amortization | ||||||||||||||||
Useful Life | |||||||||||||||||
(Years) | |||||||||||||||||
Intangibles: | |||||||||||||||||
Customer relationships | 3 | $ | 13,997 | $ | (9,798 | ) | $ | 4,199 | |||||||||
Trade name | 8 | 3,194 | (1,491 | ) | 1,703 | ||||||||||||
Total | $ | 17,191 | $ | (11,289 | ) | $ | 5,902 | ||||||||||
December 31, 2013 | |||||||||||||||||
Weighted Avg. | Gross | Accumulated | Net | ||||||||||||||
Remaining | Amortization | ||||||||||||||||
Useful Life | |||||||||||||||||
(Years) | |||||||||||||||||
Intangibles: | |||||||||||||||||
Customer relationships | 3.5 | $ | 13,997 | $ | (9,098 | ) | $ | 4,899 | |||||||||
Trade name | 8.5 | 3,194 | (1,384 | ) | 1,810 | ||||||||||||
Total | $ | 17,191 | $ | (10,482 | ) | $ | 6,709 | ||||||||||
Schedule of Estimated Amortization Expense of Intangible Assets | ' | ||||||||||||||||
Estimated amortization expense as of June 30, 2014 for our existing intangible assets for the next five years and thereafter was as follows: | |||||||||||||||||
Year Ending December 31, | Amortization | ||||||||||||||||
Expense | |||||||||||||||||
2014 | $ | 806 | |||||||||||||||
2015 | 1,613 | ||||||||||||||||
2016 | 1,613 | ||||||||||||||||
2017 | 913 | ||||||||||||||||
2018 | 213 | ||||||||||||||||
Thereafter | 744 | ||||||||||||||||
$ | 5,902 | ||||||||||||||||
LONGTERM_DEBT_Tables
LONG-TERM DEBT (Tables) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Schedule of Long-term Debt | ' | ||||||||
Our long-term debt consisted of the following: | |||||||||
June 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Term note to bank due December 15, 2018 (1) (3) | $ | — | $ | 11,963 | |||||
Construction note to bank (2)(3) | — | 9,127 | |||||||
$27,421 term note to bank due June 1, 2021 (3) | 27,421 | — | |||||||
Note to related party due April 3, 2017 (4) | — | 46,193 | |||||||
Note to related party due April 3, 2022 (5) | — | 18,807 | |||||||
Less: Unamortized debt discounts | — | (4,125 | ) | ||||||
Total long-term debt (including current portion) | 27,421 | 81,965 | |||||||
Less: Current portion | (893 | ) | (9,545 | ) | |||||
Total long-term debt, net | $ | 26,528 | $ | 72,420 | |||||
-1 | In December 2011, we consolidated pre-existing construction loans for the construction of a new corporate headquarters, processing center and gymnasium into a term note (the “2011 Consolidated Loan”). Under the 2011 Consolidated Loan, principal and interest was payable monthly based on a 20 year amortization rate of 5.0%. The 2011 Consolidated Loan was collateralized by a first mortgage covering our original corporate headquarters building and was secured by a first lien security interest in certain personal property relating to our original corporate headquarters building. As of June 30, 2014, the 2011 Consolidated Loan was consolidated into the 2021 Consolidated Loan. See note (3) below for more information on, and the definition of, the 2021 Consolidated Loan. | ||||||||
-2 | In March 2013, we entered into a construction loan agreement for the construction of a second building at our corporate headquarters with Kirkpatrick Bank due May 1, 2015, which allowed for a maximum principal amount of $12.3 million (the “2013 Construction Loan”). The 2013 Construction Loan was secured by a first mortgage covering the second headquarters building and a first lien security interest in certain personal property relating to the second headquarters building. Under the 2013 Construction Loan, interest accrued monthly at the Wall Street Journal U.S. Prime Rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. Interest on the 2013 Construction Loan was payable monthly on the first day of each month. This loan, along with the 2011 Consolidated Loan, was converted into a term loan in July 2013. | ||||||||
In November 2013, we entered into a loan agreement for the purchase of approximately 18.3 acres for future expansion at our headquarters with Kirkpatrick Bank, which allowed for a maximum principal amount of $3.0 million (“2013 Land Loan”). Under the 2013 Land Loan, interest accrued monthly at the Wall Street Journal U.S. Prime Rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. | |||||||||
In December 2013, we consolidated the 2013 Construction Loan and the 2013 Land Loan (“2013 Consolidated Loan”) under a modification agreement that increased the combined maximum principal amount of the 2013 Consolidated Loan to $14.6 million. The 2013 Consolidated Loan was secured by a first mortgage covering all of the second headquarters building and a first lien security interest in certain personal property relating to the second headquarters building. Under the 2013 Consolidated Loan, interest accrued monthly at the Wall Street Journal U.S. Prime rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. As of June 30, 2014, the 2013 Consolidated Loan was consolidated into the 2021 Consolidated Loan. See note (3) below for more information on, and the definition of, the 2021 Consolidated Loan. | |||||||||
The 2011 Consolidated Loan and the 2013 Consolidated Loan were subject to certain financial covenants, as defined in the applicable agreement, including maintaining a debt coverage ratio of indebtedness (defined as current maturities of long-term debt, interest expense and distributions) to EBITDA of less than 1.5 to 1.0. As of December 31, 2013, we were not in compliance with the financial covenant related to the debt coverage ratio. We obtained a letter of waiver from the lender that excluded this item from the calculation as of December 31, 2013 and which remains in effect through April 30, 2015. We were in compliance with the financial covenant related to the debt coverage ratio as of June 30, 2014. | |||||||||
-3 | In June 2014, our only outstanding indebtedness consisted of a term note under a Loan Agreement (the “2021 Consolidated Loan”) with an outstanding principal balance of $27.4 million as of June 30, 2014. The 2021 Consolidated Loan is due to Kirkpatrick Bank and matures on May 30, 2021. Under the 2021 Consolidated Loan, interest is payable monthly and accrues at a fixed rate of 4.75% per annum. The 2021 Consolidated Loan is secured by a mortgage covering our headquarters buildings and certain personal property relating to our headquarters buildings. | ||||||||
-4 | In April 2014, we paid off the balance of the 2017 Note that was issued by WCAS Holdings and was payable to Welsh, Carson, Anderson & Stowe X, L.P., a related party (“WCAS X”) with proceeds from our IPO. The 2017 Note accrued interest at a rate of 14% per annum. As of December 31, 2013, the outstanding principal balance of the 2017 Note was $46.2 million. | ||||||||
-5 | In April 2014, we paid off the balance of the 10% Senior Note due 2022 (the “2022 Note”) with WCAS Capital Partners IV, L.P., a related party (“WCAS CP IV”) with proceeds from our IPO and from existing cash. The 2022 Note accrued interest at a rate of 10% per annum. As of December 31, 2013, the outstanding principal amount of the 2022 Note was $18.8 million. |
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Summary of Fair Value of Financial Instruments Measured on Recurring Basis | ' | ||||||||||||||||
The following tables provide a summary of the fair value of financial instruments that are measured on a recurring basis using the above input categories as of December 31, 2013: | |||||||||||||||||
December 31, 2013 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Liabilities | |||||||||||||||||
Derivative liability | $ | — | $ | — | $ | 1,107 | $ | 1,107 | |||||||||
$ | — | $ | — | $ | 1,107 | $ | 1,107 | ||||||||||
Schedule of Fair Value Inputs Liabilities Quantitative Information | ' | ||||||||||||||||
Quantitative information regarding significant unobservable inputs used for recurring Level 3 fair value measurements of financial instruments were as follows as of December 31, 2013: | |||||||||||||||||
Significant unobservable input(s) / sensitivity of the fair value to the | |||||||||||||||||
changes in the unobservable inputs | |||||||||||||||||
December 31, 2013 | |||||||||||||||||
Valuation Technique | Key Inputs | Range | |||||||||||||||
Derivative Liability | Lattice Model | Probability of exit | 90% | ||||||||||||||
Remaining term | 0.8 years - 8.3 years | ||||||||||||||||
Yield Volatility | 21.4% - 31.1% | ||||||||||||||||
Credit Spread | 8.90% | ||||||||||||||||
Risk-free rate | 0.13% - 2.45% | ||||||||||||||||
Summary of Change in Fair Value of Level 3 Financial Instruments | ' | ||||||||||||||||
The following table summarizes the changes in fair value of our Level 3 financial instruments for the three and six months ended June 30, 2013 and 2014: | |||||||||||||||||
Three Months | Six Months | ||||||||||||||||
Ended June 30, 2013 | Ended June 30, 2013 | ||||||||||||||||
Beginning Balance | $ | 1,421 | $ | 1,767 | |||||||||||||
Issuances | — | — | |||||||||||||||
Change in fair value of derivative liability | 345 | (1 | ) | ||||||||||||||
Ending Balance | $ | 1,766 | $ | 1,766 | |||||||||||||
Three Months | Six Months | ||||||||||||||||
Ended June 30, 2014 | Ended June 30, 2014 | ||||||||||||||||
Beginning Balance | $ | 472 | $ | 1,107 | |||||||||||||
Issuances | — | — | |||||||||||||||
Change in fair value of derivative liability | — | (635 | ) | ||||||||||||||
Write-off to Other income (expense) | (472 | ) | (472 | ) | |||||||||||||
Ending Balance | $ | — | $ | — | |||||||||||||
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Computation of Basic and Diluted Net Income Per Share | ' | ||||||||||||||||
The following is a reconciliation of net income and the shares of common stock used in the computation of basic and diluted net earnings per share: | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||||||||||||
Numerator: | |||||||||||||||||
Net income | $ | (593 | ) | $ | 360 | $ | 467 | $ | 2,995 | ||||||||
Net income attributable to non-controlling interest | — | (3 | ) | — | (22 | ) | |||||||||||
Net income attributable to Paycom | $ | (593 | ) | $ | 357 | $ | 467 | $ | 2,973 | ||||||||
Denominator: | |||||||||||||||||
Weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 | |||||||||||||
Adjustment for vested restricted stock | — | 1,061,815 | — | 681,886 | |||||||||||||
Shares for calculating basic EPS | 50,284,362 | 45,621,868 | 48,015,577 | 45,241,939 | |||||||||||||
Weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 | |||||||||||||
Dilutive effect of unvested restricted stock | — | 3,438,171 | 2,315,425 | 3,398,286 | |||||||||||||
Shares for calculating diluted EPS | 50,284,362 | 47,998,224 | 50,331,002 | 47,958,339 | |||||||||||||
Net income (loss) per share: | |||||||||||||||||
Basic | $ | (0.01 | ) | $ | 0.01 | $ | 0.01 | $ | 0.07 | ||||||||
Diluted | $ | (0.01 | ) | $ | 0.01 | $ | 0.01 | $ | 0.06 | ||||||||
Pro Forma [Member] | ' | ||||||||||||||||
Computation of Basic and Diluted Net Income Per Share | ' | ||||||||||||||||
The following is a reconciliation of pro forma net income for the three and six months ended June 30, 2013 and the shares of stock used in the computation of pro forma basic and diluted net income per share: | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, 2013 | June 30, 2013 | ||||||||||||||||
Pro forma numerator: | |||||||||||||||||
Net income attributable to Paycom | $ | 357 | $ | 2,973 | |||||||||||||
Pro forma additional income tax expense (Note 12) | 79 | 656 | |||||||||||||||
Pro forma net income attributable to Paycom (Note 12) | $ | 278 | $ | 2,317 | |||||||||||||
Pro forma denominator: | |||||||||||||||||
Pro forma weighted average shares outstanding | 44,560,053 | 44,560,053 | |||||||||||||||
Adjustment for vested restricted stock | 1,061,815 | 681,886 | |||||||||||||||
Pro forma shares for calculating basic EPS | 45,621,868 | 45,241,939 | |||||||||||||||
Pro forma weighted average shares outstanding | 44,560,053 | 44,560,053 | |||||||||||||||
Effect of dilutive restricted stock | 3,438,171 | 3,398,286 | |||||||||||||||
Pro forma shares for calculating diluted EPS | 47,998,224 | 47,958,339 | |||||||||||||||
Pro forma net income per share: | |||||||||||||||||
Basic | $ | 0.01 | $ | 0.05 | |||||||||||||
Diluted | $ | 0.01 | $ | 0.05 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended | ||||
Jun. 30, 2014 | |||||
Schedule of Future Annual Minimum Lease Payments | ' | ||||
Future annual minimum lease payments under noncancellable operating leases with initial or remaining terms of one year or more at June 30, 2014 were as follows: | |||||
Year Ending December 31, | Operating | ||||
2014 | $ | 1,566 | |||
2015 | 3,281 | ||||
2016 | 3,000 | ||||
2017 | 2,606 | ||||
2018 | 2,015 | ||||
Thereafter | 1,192 | ||||
Total minimum lease payments | $ | 13,660 | |||
Recovered_Sheet1
Consolidation and Basis of Presentation - Additional Information (Detail) | 0 Months Ended | 3 Months Ended |
Dec. 31, 2013 | Jun. 30, 2014 | |
14% Note due 2017 [Member] | ' | ' |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ' | ' |
Debt instrument, interest rate | 14.00% | 14.00% |
Restricted Stock [Member] | ' | ' |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ' | ' |
Conversion of units to shares | 8,121,101 | ' |
Anti-dilutive securities excluded from dilutive earning per share calculation | ' | 1,984,938 |
Common Stock [Member] | ' | ' |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ' | ' |
Conversion of units to shares | 45,708,573 | ' |
Property_Plant_and_Equipment_S
Property, Plant and Equipment - Schedule of Property, Plant and Equipment and Accumulated Depreciation (Detail) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | $50,495 | $33,848 |
Less: accumulated depreciation | -14,130 | -11,540 |
Property, plant and equipment, net | 45,358 | 38,671 |
Buildings [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | 27,190 | 14,828 |
Software and capitalized software costs [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | 6,689 | 5,578 |
Computer equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | 6,241 | 4,832 |
Rental clocks [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | 5,743 | 4,865 |
Furniture, fixtures and equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | 4,052 | 3,189 |
Vehicles [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | 421 | 421 |
Leasehold improvements [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property plant and equipment, gross | 159 | 135 |
Excluded Land and Construction in process [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, plant and equipment, net | 36,365 | 22,308 |
Land [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, plant and equipment, net | 8,993 | 8,993 |
Construction in process [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, plant and equipment, net | ' | $7,370 |
Property_Plant_and_Equipment_A
Property, Plant and Equipment - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Interest cost paid | $300,000 | $200,000 | $600,000 | $400,000 |
Interest cost capitalized | 100,000 | 18,000 | 400,000 | 35,000 |
Property, Plant and Equipment [Member] | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Depreciation | $1,300,000 | $900,000 | $2,600,000 | $1,800,000 |
Recovered_Sheet2
Goodwill and Intangible Assets, Net - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' |
Goodwill | $51,889,000 | ' | $51,889,000 | ' | $51,889,000 |
Goodwill, Impairment Loss | ' | ' | 0 | ' | 0 |
Weighted average remaining useful life | ' | ' | '4 years 5 months 12 days | ' | ' |
Amortization of intangible assets | $400,000 | $400,000 | $800,000 | $800,000 | ' |
Recovered_Sheet3
Goodwill and Intangible Assets, Net - Components of Intangible Assets (Detail) (USD $) | 6 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Weighted average remaining useful life | '4 years 5 months 12 days | ' |
Gross | $17,191 | $17,191 |
Accumulated amortization | -11,289 | -10,482 |
Net | 5,902 | 6,709 |
Customer Relationships [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Weighted average remaining useful life | '3 years | '3 years 6 months |
Gross | 13,997 | 13,997 |
Accumulated amortization | -9,798 | -9,098 |
Net | 4,199 | 4,899 |
Trade Name [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Weighted average remaining useful life | '8 years | '8 years 6 months |
Gross | 3,194 | 3,194 |
Accumulated amortization | -1,491 | -1,384 |
Net | $1,703 | $1,810 |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets, Net - Schedule of Estimated Amortization Expense of Intangible Assets (Detail) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ' | ' |
2014 | $806 | ' |
2015 | 1,613 | ' |
2016 | 1,613 | ' |
2017 | 913 | ' |
2018 | 213 | ' |
Thereafter | 744 | ' |
Net | $5,902 | $6,709 |
Recovered_Sheet4
Funds Held for Clients and Client Funds Obligation - Additional Information (Detail) | 6 Months Ended |
Jun. 30, 2014 | |
Accounts Payable And Accrued Expenses [Line Items] | ' |
Maximum holding period for funds collected from clients | '120 days |
Minimum [Member] | ' |
Accounts Payable And Accrued Expenses [Line Items] | ' |
Disbursement period of funds collected from clients | '1 day |
Maximum [Member] | ' |
Accounts Payable And Accrued Expenses [Line Items] | ' |
Disbursement period of funds collected from clients | '30 days |
Longterm_Debt_Schedule_of_Long
Long-term Debt - Schedule of Long-term Debt (Detail) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Less: Unamortized debt discounts | ' | ($4,125) |
Total long-term debt (including current portion) | 27,421 | 81,965 |
Less: Current portion | -893 | -9,545 |
Total long-term debt, net | 26,528 | 72,420 |
2013 Construction Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Construction loan | ' | 9,127 |
2013 Consolidated Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Construction loan | ' | 11,963 |
2022 Note [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Related party note | ' | 18,807 |
Less: Unamortized debt discounts | -2,400 | ' |
Total long-term debt (including current portion) | 18,800 | ' |
2021 Consolidated Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Construction loan | 27,421 | ' |
Total long-term debt (including current portion) | 27,400 | ' |
2017 Related Party Note [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Related party note | ' | $46,193 |
Longterm_Debt_Schedule_of_Long1
Long-term Debt - Schedule of Long-term Debt (Parenthetical) (Detail) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Dec. 31, 2013 | |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt instrument, restrictive covenants | 'Maintaining a debt coverage ratio of indebtedness (defined as current maturities of long-term debt, interest expense and distributions) to EBITDA of less than 1.5 to 1.0. | ' |
Carrying value, long term debt | $27,421,000 | $81,965,000 |
Notes issued at discount | ' | 4,125,000 |
2013 Construction Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Construction loan | ' | 9,127,000 |
Long-term debt | 12,300,000 | ' |
Debt Instrument, Interest Rate Terms | 'U.S. Prime Rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. | ' |
Debt instrument, basis spread on variable rate | 0.50% | ' |
Debt instrument, interest rate, stated percentage rate range, minimum | 4.00% | ' |
2013 Consolidated Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt instrument maturity date | 15-Dec-18 | ' |
Construction loan | ' | 11,963,000 |
Long-term debt | 14,600,000 | ' |
Debt Instrument, Interest Rate Terms | 'U.S. Prime rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. | ' |
Debt instrument, basis spread on variable rate | 0.50% | ' |
Debt instrument, interest rate, stated percentage rate range, minimum | 4.00% | ' |
2022 Note [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt instrument maturity date | 3-Apr-22 | ' |
Debt instrument, interest rate | 10.00% | ' |
Carrying value, long term debt | 18,800,000 | ' |
Notes issued at discount | 2,400,000 | ' |
Remaining unamortized discount | 500,000 | ' |
Total unamortized discount | ' | 4,100,000 |
Two Thousand and Eleven Consolidated Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt instrument, amortization period | '20 years | ' |
Debt instrument, interest rate | 5.00% | ' |
14% Note due 2017 [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt instrument, interest rate | 14.00% | 14.00% |
Carrying value, long term debt | 46,200,000 | ' |
2013 Land Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Long-term debt | 3,000,000 | ' |
Debt Instrument, Interest Rate Terms | 'U.S. Prime Rate plus 0.5%, adjusted monthly, subject to a minimum interest rate of 4.0% per annum. | ' |
Debt instrument, basis spread on variable rate | 0.50% | ' |
Debt instrument, interest rate, stated percentage rate range, minimum | 4.00% | ' |
Land purchased | 18.3 | ' |
2021 Consolidated Loan [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt instrument maturity date | 1-Jun-21 | ' |
Construction loan | 27,421,000 | ' |
Debt instrument, interest rate | 4.75% | ' |
Carrying value, long term debt | $27,400,000 | ' |
2017 Related Party Note [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt instrument maturity date | 3-Apr-17 | ' |
Maximum [Member] | ' | ' |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Debt coverage ratio of indebtedness | 1.5 | ' |
Longterm_Debt_Additional_Infor
Long-term Debt - Additional Information (Detail) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Schedule Of Long Term Debt [Line Items] | ' | ' |
Carrying value, long term debt | $27,421,000 | $81,965,000 |
Fair value of long term debt including current maturities | $82,000,000 | $84,900,000 |
Employee_Savings_Plan_Addition
Employee Savings Plan - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
401(k) eligibility minimum service period | ' | ' | '90 days | ' |
401(k) description of plan contributions | ' | ' | 'Contribution equal to 100% of the first 1% of salary deferrals and 50% of salary deferrals between 2% and 6%, up to a maximum of 3.5% of salary each plan year for our employees | ' |
Employee vested percentage in salary deferrals and roll over contributions | ' | ' | 100.00% | ' |
Minimum period for vesting 100% contributions | ' | ' | '2 years | ' |
Discretionary contributions vested period | ' | ' | '6 years | ' |
Matching contribution amount | $0.40 | $0.20 | $0.90 | $0.60 |
100% Match for Percent of Participants Contribution [Member] | ' | ' | ' | ' |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
Employer contribution percentage | ' | ' | 100.00% | ' |
Percentage of salary deferrals | ' | ' | 1.00% | ' |
50% Matching Contribution [Member] | ' | ' | ' | ' |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
Employer contribution percentage | ' | ' | 50.00% | ' |
Two Years of Service [Member] | ' | ' | ' | ' |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
Matching contributions, vesting percentage | ' | ' | 100.00% | ' |
Minimum [Member] | ' | ' | ' | ' |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
401(k) eligible age of employee | ' | ' | '21 years | ' |
Minimum [Member] | 50% Matching Contribution [Member] | ' | ' | ' | ' |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
Percentage of salary deferrals | ' | ' | 2.00% | ' |
Maximum [Member] | ' | ' | ' | ' |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
Percentage of salary deferrals | ' | ' | 3.50% | ' |
Maximum [Member] | 50% Matching Contribution [Member] | ' | ' | ' | ' |
Defined Contribution Plans Disclosure [Line Items] | ' | ' | ' | ' |
Percentage of salary deferrals | ' | ' | 6.00% | ' |
Recovered_Sheet5
Fair Value of Financial Instruments - Summary of Fair Value of Financial Instruments Measured on Recurring Basis (Detail) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | $1,107 |
Derivative liability [Member] | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | 1,107 |
Level 1 [Member] | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | ' |
Level 1 [Member] | Derivative liability [Member] | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | ' |
Level 2 [Member] | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | ' |
Level 2 [Member] | Derivative liability [Member] | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | ' |
Level 3 [Member] | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | 1,107 |
Level 3 [Member] | Derivative liability [Member] | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' |
Liabilities | $1,107 |
Recovered_Sheet6
Fair Value of Financial Instruments - Schedule of Fair Value Inputs Liabilities Quantitative Information (Detail) (Derivative liability [Member], Lattice Model [Member]) | 12 Months Ended |
Dec. 31, 2013 | |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ' |
Probability of exit | 90.00% |
Credit Spread | 8.90% |
Minimum [Member] | ' |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ' |
Remaining term | '9 months 18 days |
Yield Volatility | 21.40% |
Risk-free rate | 0.13% |
Maximum [Member] | ' |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ' |
Remaining term | '8 years 3 months 18 days |
Yield Volatility | 31.10% |
Risk-free rate | 2.45% |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments - Summary of Change in Fair Value of Level 3 Financial Instruments (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' | ' |
Beginning Balance | $472 | $1,421 | $1,107 | $1,767 |
Issuances | ' | ' | ' | ' |
Change in fair value of derivative liability | ' | 345 | -635 | -1 |
Write-off to Other income (expense) | -472 | ' | -472 | ' |
Ending Balance | ' | $1,766 | ' | $1,766 |
Fair_Value_of_Financial_Instru3
Fair Value of Financial Instruments - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Maximum [Member] | ||||
Fair Value Disclosures [Line Items] | ' | ' | ' | ' |
Change in fair value of derivative liability recognized as other income (expenses), net | ($0.50) | $0.30 | ($1.10) | ($0.10) |
Earnings_Per_Share_Additional_
Earnings Per Share - Additional Information (Detail) | 0 Months Ended | 3 Months Ended |
Dec. 31, 2013 | Jun. 30, 2014 | |
Restricted Stock [Member] | ' | ' |
Earnings Per Share [Line Items] | ' | ' |
Conversion of units to shares | 8,121,101 | ' |
Anti-dilutive securities excluded from dilutive earning per share calculation | ' | 1,984,938 |
Common Stock [Member] | ' | ' |
Earnings Per Share [Line Items] | ' | ' |
Conversion of units to shares | 45,708,573 | ' |
Earnings_Per_Share_Computation
Earnings Per Share - Computation of Basic and Diluted Net Income Per Share (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Numerator: | ' | ' | ' | ' |
Net income | ($593) | $360 | $467 | $2,995 |
Net income attributable to non-controlling interest | 0 | -3 | 0 | -22 |
Net income attributable to Paycom | ($593) | $357 | $467 | $2,973 |
Denominator: | ' | ' | ' | ' |
Weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 |
Adjustment for vested restricted stock | ' | 1,061,815 | ' | 681,886 |
Shares for calculating basic EPS | 50,284,362 | 45,621,868 | 48,015,577 | 45,241,939 |
Weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 |
Dilutive effect of unvested restricted stock | ' | 3,438,171 | 2,315,425 | 3,398,286 |
Shares for calculating diluted EPS | 50,284,362 | 47,998,224 | 50,331,002 | 47,958,339 |
Net income (loss) per share: | ' | ' | ' | ' |
Basic | ($0.01) | $0.01 | $0.01 | $0.07 |
Diluted | ($0.01) | $0.01 | $0.01 | $0.06 |
Earnings_Per_Share_Computation1
Earnings Per Share - Computation of Pro Forma Basic and Diluted Net Income Per Share (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Pro forma numerator: | ' | ' | ' | ' |
Net income attributable to Paycom | ($593) | $357 | $467 | $2,973 |
Pro forma additional income tax expense | ' | 79 | ' | 656 |
Pro forma net income attributable to Paycom | ($593) | $278 | $467 | $2,317 |
Pro forma denominator: | ' | ' | ' | ' |
Pro forma weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 |
Adjustment for vested restricted stock | ' | 1,061,815 | ' | 681,886 |
Pro forma shares for calculating basic EPS | 50,284,362 | 45,621,868 | 48,015,577 | 45,241,939 |
Pro forma weighted average shares outstanding | 50,284,362 | 44,560,053 | 48,015,577 | 44,560,053 |
Effect of dilutive restricted stock | ' | 3,438,171 | 2,315,425 | 3,398,286 |
Pro forma shares for calculating diluted EPS | 50,284,362 | 47,998,224 | 50,331,002 | 47,958,339 |
Pro forma net income per share: | ' | ' | ' | ' |
Basic | ($0.01) | $0.01 | $0.01 | $0.05 |
Diluted | ($0.01) | $0.01 | $0.01 | $0.05 |
Recovered_Sheet7
Stockholders' Equity and Incentive Compensation - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 6 Months Ended | 0 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Apr. 21, 2014 | Dec. 31, 2013 | Jun. 30, 2014 |
Series A Preferred Stock [Member] | Common Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Percentage of preferred yield entitled | ' | ' | 9.00% | ' | ' | ' | ' |
Conversion of units to shares | ' | ' | ' | 45,708,573 | ' | 8,121,101 | ' |
Reclassification adjustment recorded of deficit to additional paid in capital | $29.60 | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation cost related to unvested restricted stock | ' | ' | ' | ' | ' | $1.30 | $1.10 |
Unrecognized compensation expected to be recognized | ' | '2 years 10 months 24 days | ' | ' | ' | ' | ' |
Number of restricted stock converted into common stock | ' | ' | ' | ' | 217,378 | ' | ' |
RelatedParty_Transactions_Addi
Related-Party Transactions - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Payments for rent | $71,000,000 | $64,000,000 | $133,000,000 | $131,000,000 |
Former Employee [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Number of incentive units purchased | ' | ' | 2,605 | ' |
Purchase price per incentive unit | ' | ' | $260.21 | ' |
Incentive units purchased | ' | ' | 700,000 | ' |
Advantage [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Administrative expenses | $5,000 | $3,000 | $8,000 | $5,000 |
Chief Sales Officer [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
General partnership ownership interest in related party, percentage | 0.01% | ' | 0.01% | ' |
Limited partnership interest in related party, percentage | 10.49% | ' | 10.49% | ' |
Recovered_Sheet8
Commitments and Contingencies - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | 1 Months Ended | 1 Months Ended | |||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jul. 03, 2014 | Mar. 31, 2010 | Jun. 30, 2014 | Dec. 31, 2013 | Mar. 31, 2010 | |
Subsequent Events [Member] | Oklahoma City Economic Development Trust [Member] | Oklahoma City Economic Development Trust [Member] | Oklahoma City Economic Development Trust [Member] | Oklahoma City Economic Development Trust [Member] | |||||
Boston [Member] | Minimum [Member] | ||||||||
Job | |||||||||
Other Commitments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Up-front job creation payment from Trust | ' | ' | ' | ' | ' | $2,000,000 | ' | ' | ' |
Number of jobs created within a 5 year period | ' | ' | ' | ' | ' | ' | ' | ' | 492 |
Average first year wage | ' | ' | ' | ' | ' | ' | ' | ' | 37,000 |
Term of agreement | ' | ' | ' | ' | ' | '5 years | ' | ' | ' |
Capital investment in the project | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 |
Earned job creation payments | ' | ' | ' | ' | ' | ' | 1,800,000 | 1,500,000 | ' |
Operating lease expiration period | ' | ' | '2014 to 2019 | ' | ' | ' | ' | ' | ' |
Total future minimum lease payments | 13,660,000 | ' | 13,660,000 | ' | 1,300,000 | ' | ' | ' | ' |
Operating lease rent expense | $800,000 | $500,000 | $1,400,000 | $900,000 | ' | ' | ' | ' | ' |
Commitments_and_Contingencies_1
Commitments and Contingencies - Schedule of Future Annual Minimum Lease Payments (Detail) (USD $) | Jun. 30, 2014 |
In Thousands, unless otherwise specified | |
Operating Leased Assets [Line Items] | ' |
2014 | $1,566 |
2015 | 3,281 |
2016 | 3,000 |
2017 | 2,606 |
2018 | 2,015 |
Thereafter | 1,192 |
Total minimum lease payments | $13,660 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax [Line Items] | ' | ' | ' | ' |
Effective tax rate | 42.82% | 31.95% | 42.06% | 32.01% |
Deferred tax liability charged on equity | $200,000 | ' | $200,000 | ' |
Pro forma effective income tax rate | ' | ' | ' | 46.90% |
Income tax expense | ' | $79,000 | ' | $656,000 |