bmtx-20210930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission file number 001-38633

BM Technologies, Inc.

(Exact name of registrant as specified in its charter)


Delaware									82-3410369
(State or other jurisdiction of incorporation or organization)									(I.R.S Employer Identification No.)

201 King of Prussia Road, Suite 350
Wayne, Pennsylvania									19087
(Address of Principal Executive)									(Zip-Code)

(877) 327-9515

Registrant's telephone number, including area code

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	BMTX	NYSE American LLC
Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50 per share	BMTX-WT	NYSE American LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

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

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

Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes ☒ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The registrant had issued and outstanding 12,206,378 shares of common stock, par value $0.0001 per share, as of November 15, 2021.

Table of Contents


			Page
Part I - Financial Information			2
Item 1. Unaudited Consolidated Financial Statements			2
Consolidated Balance Sheets at September 30, 2021 and December 31, 2020			2
Consolidated Statements of Income (Loss) for the Three and Nine Months Ended September 30, 2021 and 2020			3
Consolidated Statements of Changes in Shareholders' Equity for the Three and Nine Months Ended September 30, 2021 and 2020			4
Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2021 and 2020			5
Notes to Unaudited Consolidated Financial Statements			6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			20
Item 3. Quantitative and Qualitative Disclosures About Market Risk			26
Item 4. Controls and Procedures			26

Part II - Other Information			27
Item 1. Legal Proceedings			27
Item 1A. Risk Factors			27
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			27
Item 5. Other Information			27
Item 6. Exhibits			27

Signatures			29

Part I - Financial Information

ITEM 1. UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

BM TECHNOLOGIES, INC.

CONSOLIDATED BALANCE SHEETS — UNAUDITED

(amounts in thousands, except share and per share data)


	September 30, 2021		December 31, 2020
ASSETS
Cash and cash equivalents	$	20,407	$	2,989
Accounts receivable, net allowance for doubtful accounts of $103 and $0 for the periods ending September 30, 2021 and December 31, 2020, respectively.	4,498		7,384
Prepaid expenses and other assets	2,046		2,348
Total current assets	26,951		12,721
Premises and equipment, net	305		401
Developed software, net	31,691		39,657
Goodwill	5,259		5,259
Other intangibles, net	4,830		5,070
Other assets	840		853
Total assets	$	69,876	$	63,961
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Accounts payable and accrued liabilities	$	8,225	$	7,346
Taxes payable	863		—
Payable to partner bank	6,914		5,105
Borrowings from partner bank	—		21,000
Current portion of operating lease liabilities	596		701
Deferred revenue, current	4,306		2,588
Total current liabilities	20,904		36,740
Non-current liabilities:
Operating lease liabilities	—		430
Deferred revenue, non-current	223		2,101
Liability for private warrants	12,850		—
Total liabilities	$	33,977	$	39,271
Commitments and contingencies (Note 8)
Shareholders’ equity:
Preferred stock: Par value $0.0001 per share; 10,000,000 authorized, none issued or outstanding at both September 30, 2021 and December 31, 2020.	$	—	$	—
Common stock: Par value $0.0001 per share; 1 billion shares authorized; 12,206,378 shares issued and outstanding at September 30, 2021; 6,123,432 shares issued and outstanding at December 31, 2020.	1		1
Additional paid-in capital	49,379		64,017
Accumulated deficit	(13,481)		(39,328)
Total shareholders’ equity	$	35,899	$	24,690
Total liabilities and shareholders’ equity	$	69,876	$	63,961

See accompanying notes to the unaudited consolidated financial statements.

BM TECHNOLOGIES, INC.

CONSOLIDATED STATEMENTS OF INCOME (LOSS) — UNAUDITED

(amounts in thousands, except per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Operating revenues:
Interchange and card revenue	$	5,572	$	7,377	$	21,109	$	20,053
Servicing fees from partner bank	11,823		5,814		31,774		15,604
Account fees	2,628		2,789		7,955		8,517
University fees	1,474		1,348		4,129		4,028
Other revenue	477		1,010		4,283		1,326
Total operating revenues	21,974		18,338		69,250		49,528
Operating expenses:
Technology, communication, and processing	4,596		6,637		22,172		20,586
Salaries and employee benefits	6,728		5,689		19,321		19,796
Professional services	3,496		2,159		7,359		7,286
Provision for operating losses	1,067		1,419		3,797		3,326
Occupancy	282		435		918		1,240
Customer related supplies	1,017		195		1,678		717
Advertising and promotion	176		266		492		693
Merger and acquisition related expenses	—		377		—		452
Other	614		551		1,537		2,668
Total operating expenses	17,976		17,728		57,274		56,764
Income (loss) from operations	3,998		610		11,976		(7,236)
Non-operating income and expense:
Gain on fair value of private warrant liability	6,042		—		17,989		—
Interest expense	—		(353)		(96)		(1,146)
Income (loss) before income tax expense	10,040		257		29,869		(8,382)
Income tax expense	1,246		7		4,022		21
Net income (loss)	$	8,794	$	250	$	25,847	$	(8,403)

Basic shares outstanding	11,900		6,123		11,534		6,123
Diluted shares outstanding	11,904		6,123		12,059		6,123

Basic (loss) earnings per common share	$	0.74	$	0.04	$	2.24	$	(1.37)
Diluted (loss) earnings per common share	$	0.74	$	0.04	$	0.65	$	(1.37)

See accompanying notes to the unaudited consolidated financial statements.

BM TECHNOLOGIES, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY — UNAUDITED

For the Three and Nine Months Ended September 30, 2021 and 2020

(amounts in thousands, except share data)


	Common Stock
	Shares of Common Stock Outstanding	Common Stock		Additional Paid in Capital		Accumulated Deficit		Total
Balance, December 31, 2020 (a)	6,123,432	$	1	$	64,017	$	(39,328)	$	24,690
Net income	—	—		—		18,889		18,889
Valuation of private warrants	—	—		(30,839)		—		(30,839)
Recapitalization transaction	6,076,946	—		16,148		—		16,148
Balance, March 31, 2021	12,200,378	$	1	$	49,326	$	(20,439)	$	28,888
Net loss	—	—		—		(1,836)		(1,836)
Balance, June 30, 2021	12,200,378	$	1	$	49,326	$	(22,275)	$	27,052
Net income	—	—		—		8,794		8,794
Issuance of common stock	6,000	—		53		—		53
Balance, September 30, 2021	12,206,378	$	1	$	49,379	$	(13,481)	$	35,899


	Common Stock
	Shares of Common Stock Outstanding	Common Stock		Additional Paid in Capital		Accumulated Deficit		Total
Balance, December 31, 2019 (a)	6,123,432	$	1	$	62,164	$	(27,535)	$	34,630
Net loss	—	—		—		(4,534)		(4,534)
Capital contribution from Customers Bank	—	—		864		—		864
Balance, March 31, 2020	6,123,432	$	1	$	63,028	$	(32,069)	$	30,960
Net loss	—	—		—		(4,119)		(4,119)
Capital contribution from Customers Bank	—	—		401		—		401
Balance, June 30, 2020

SEC Form 10-Q filed by BM Technologies Inc.