ACQUISITIONS

The following tables provide information related to the acquisitions of domestic and foreign retail and financial services locations during the years ended September 30, 2013, 2012 and 2011:



	Fiscal Year Ended September 30,
	2013		2012		2011
	Go Cash	Other Acquisitions	Grupo Finmart	Other Acquisitions	Other Acquisitions
Number of asset purchase acquisitions	1	1	—	7	9
Number of stock purchase acquisitions	—	3	1	4	3

U.S. stores acquired	—	12	—	50	34
Foreign stores acquired	—	26	45	1	6
Total stores acquired	—	38	45	51	40



	Fiscal Year Ended September 30,
	2013					2012						2011
	Go Cash		Other Acquisitions			Grupo Finmart			Other Acquisitions			Other Acquisitions
	(in thousands)
Consideration:
Cash	$	—	$	17,980		$	45,001		$	95,415		$	69,057
Equity instruments	27,776		10,929			—			17,984			7,304
Deferred consideration	23,000		2,872			5,785			—			—
Contingent consideration	—		248			23,000			—			—
Fair value of total consideration transferred	50,776		32,029			73,786			113,399			76,361
Cash acquired	—		(3,040		)	(13,641		)	(2,833		)	(1,138		)
Total purchase price	$	50,776	$	28,989		$	60,145		$	110,566		$	75,223



	Fiscal Year Ended September 30,
	2013				2012				2011
	Go Cash		Other Acquisitions		Grupo Finmart		Other Acquisitions		Other Acquisitions
Current assets:	(in thousands)
Pawn loans	$	—	$	5,714	$	—	$	6,781	$	8,572
Consumer loans, net	—		902		8,935		3,641		710
Service charges and fees receivable, net	23		714		18,844		1,940		1,270
Inventory, net	—		2,441		—		5,911		4,838
Deferred tax asset	—		—		—		238		461
Prepaid expenses and other assets	120		508		3,543		204		728
Total current assets	143		10,279		31,322		18,715		16,579
Property and equipment, net	268		1,078		2,326		4,061		1,051
Goodwill	39,228		17,187		99,486		99,747		56,703
Non-current consumer loans, net	—		3,011		56,120		—		—
Intangible assets	11,215		619		16,400		3,980		2,478
Other assets	124		314		7,497		294		80
Total assets	$	50,978	$	32,488	$	213,151	$	126,797	$	76,891
Current liabilities:
Accounts payable and other accrued expenses	$	202	$	560	$	6,853	$	5,496	$	1,176
Customer layaway deposits	—		103		—		808		182
Current maturities of long-term debt	—		—		22,810		—		—
Other current liabilities	—		—		—		257		26
Total current liabilities	202		663		29,663		6,561		1,384
Long-term debt, less current maturities	—		—		86,872		—		—
Deferred tax liability	—		—		171		113		284
Total liabilities	202		663		116,706		6,674		1,668
Redeemable noncontrolling interest	—		2,836		36,300		9,557		—
Net assets acquired	$	50,776	$	28,989	$	60,145	$	110,566	$	75,223
Goodwill deductible for tax purposes	$	39,228	$	—	$	—	$	48,445	$	34,376
Indefinite-lived intangible assets acquired:
Trade name	$	—	$	—	$	2,200	$	2,706	$	—
Domain name	215		—		—		—		—
Definite-lived intangible assets acquired (1):
Favorable lease asset	$	—	$	—	$	—	$	404	$	111
Internally developed software	11,000		66		—		—		—
Non-compete agreements	—		30		300		420		769
Contractual relationship	—		523		13,900		450		—

(1) The weighted average useful life of definite-lived intangible assets acquired is five years.

Go Cash

On November 20, 2012, we entered into a definitive agreement with Go Cash, LLC and certain of its affiliates ("Go Cash") to acquire substantially all the assets of Go Cash's online lending business. This acquisition of assets was completed on December 20, 2012 and was accounted for as a business combination. No liabilities were assumed other than trade payables and accounts payable incurred prior to closing in the ordinary course of business, which were approximately $0.2 million.

The assets acquired include a proprietary software platform, including a loan management system and a lending decision science engine, that will enable geographic expansion both within the U.S. and internationally; an internal customer service and collections call center; a portion of the existing Go Cash multi-state loan portfolio; and related assets, including customer lists, customer data and customer transaction information. We hired substantially all of Go Cash's employees, including the management team, an internal underwriting and customer experience analytics team, and an experienced customer service and collections call center team.

The total purchase price is performance-based and will be determined over a period of four years following the closing. A minimum of $50.8 million will be paid, of which $27.8 million was paid at closing, $6.0 million was paid on November 12, 2013 and the remaining $17.0 million will be paid in installments over the next two years. The performance consideration element will be based on the net income generated by the "Post-Closing Business Unit" (which will include all of our online consumer lending business). Within a specified period after the end of each of the first four years following the closing, we will make a contingent supplemental payment equal to the difference between (a) the adjusted net income for such year, multiplied by 6.0, and (b) all consideration payments previously paid. Each payment may be made, in our sole discretion, in cash or in the form of shares of EZCORP Class A Non-Voting Common Stock. The initial payment was made in the form of 1,400,198 shares of EZCORP Class A Non-Voting Common Stock, and the November 2013 payment was made in cash.

The contingent consideration element of the purchase price, which is the amount in excess of the guaranteed $50.8 million, has been preliminarily valued at zero as of September 30, 2013. The fiscal year ended September 30, 2013 includes $6.7 million in total revenues and $8.0 million in operating losses related to EZCORP Online.

TUYO

On November 1, 2012, we acquired a 51% interest in Renueva Comercial S.A. de C.V., a company headquartered in Mexico City and doing business under the name “TUYO”, for approximately $1.1 million. As of September 30, 2013, TUYO owned and operated 19 stores in Mexico City and the surrounding metropolitan area. In these stores, TUYO buys quality used merchandise from customers and then resells that merchandise to other customers. TUYO also sells refurbished or other merchandise acquired in bulk from wholesalers. As this acquisition was individually immaterial, we present its related information, other than information related to the redeemable noncontrolling interest, combined with other immaterial acquisitions.

Pursuant to the acquisition agreement, the sellers have a put option with respect to their remaining shares of TUYO. The sellers have the right to sell their TUYO shares to EZCORP during a specified exercise period, with specified limitations on the number of shares that may be sold within a consecutive 12-month period. Under the guidance in ASC 480-10-S99, securities that are redeemable for cash or other assets are to be classified outside of permanent equity; therefore, we have included the redeemable noncontrolling interest related to TUYO in temporary equity.

The acquisition date fair value of the TUYO redeemable noncontrolling interest was estimated by applying an income and market approach. This fair value measurement was based on significant inputs that are not observable in the market and thus represents a Level 3 measurement. Key assumptions include discount rates of 10% and 18% representing discounts for lack of control and lack of marketability respectively that market participants would consider when estimating the fair value of the noncontrolling interest. The fair market value of TUYO was determined using a multiple of future earnings. We expect the recorded values related to the noncontrolling interest at September 30, 2013 to approximate fair value.

Other - 2013

On April 26, 2013, Grupo Finmart, our 60% owned subsidiary, purchased 100% of the outstanding shares of Fondo ACH, S.A. de C.V., a specialty consumer finance company. The total purchase price is performance-based and will be determined over a period of four years. A minimum of $3.5 million will be paid, of which $2.7 million was paid at closing with the remaining due on January 2, 2017. The performance consideration element will be based on interest income generated by the acquired portfolios and new loans made through Fondo ACH's contractual relationships. The contingent consideration element of the purchase price, which is the amount in excess of the guaranteed $3.5 million, has been preliminarily valued at zero as of September 30, 2013. As this acquisition was individually immaterial, we present its related information combined with other immaterial acquisitions.

On June 30, 2013, Grupo Finmart, purchased a consumer loan portfolio for total consideration of approximately $1.3 million. The total purchase price is performance-based and will be determined over the life of the loan portfolio. As this acquisition was individually immaterial, we present its related information combined with other immaterial acquisitions.

The fiscal year ended September 30, 2013, includes the December 2012 acquisition of 12 pawn locations in Arizona, which was a new state of operation for EZCORP. As this acquisition was individually immaterial, we present its related information combined with other immaterial acquisitions.

All acquisitions were made as part of our continuing strategy to enhance and diversify our earnings over the long-term. The factors contributing to the recognition of goodwill were based on several strategic and synergistic benefits we expect to realize from the acquisitions. These benefits include our initial entry into several markets and a greater presence in others, as well as the ability to further leverage our expense structure through increased scale. The purchase price allocation of assets acquired in the most recent twelve months is preliminary as we continue to receive information regarding the acquired assets. Transaction related expenses for the years ended September 30, 2013, 2012 and 2011 of approximately $0.5 million, $2.2 million, and $0.9 million, respectively, were expensed as incurred and recorded as operations expense. These amounts exclude costs related to transactions that did not close and future acquisitions. The results of all acquisitions have been consolidated with our results since their respective closing. Pro forma results of operations have not been presented because it is impracticable to do so, as historical audited financial statements in U.S. GAAP are not readily available.

Grupo Finmart

On January 30, 2012, we acquired a 60% interest in Prestaciones Finmart, S.A. de C.V., SOFOM, E.N.R. (“Grupo Finmart" formerly known as Crediamigo), a specialty consumer finance company headquartered in Mexico City. The total consideration of $60.1 million, net of cash acquired, includes contingent consideration related to two earn out payments. If certain financial performance targets are achieved during calendar years 2012 and 2013, the sellers will receive $12.0 million dollars, each year, for a total amount of $24.0 million dollars. The purchase price above includes a fair value amount of $23.0 million attributable to the contingent consideration payments. This amount was calculated using a probability-weighted discounted cash flow approach, in which all outcomes were successful. The significant inputs used for the valuation are not observable in the market, and thus this fair value measurement represents a Level 3 measurement within the fair value hierarchy. On April 5, 2013, we made the first payment of $12.8 million, this amount includes a $0.8 million transaction loss as the payment was made in Mexican pesos.

Pursuant to the Master Transaction Agreement, the sellers have a put option with respect to their remaining shares of Grupo Finmart. Each seller has the right to sell their Grupo Finmart shares to us during the exercise period commencing on January 30, 2014 and ending on January 30, 2017 , with no more than 50% of the seller's shares being sold within a consecutive twelve-month period. Under the guidance in ASC 480-10-S99, securities that are redeemable for cash or other assets are to be classified outside of permanent equity; therefore, we have included the redeemable noncontrolling interest related to Grupo Finmart in temporary equity.

The acquisition date fair value of the redeemable noncontrolling interest in Grupo Finmart was estimated by applying an income approach and a market approach. This fair value measurement is based on significant inputs that are not observable in the market and thus represents a Level 3 measurement. Key assumptions include discount rates ranging from 10% to 18%, representing discounts for lack of control and lack of marketability that market participants would consider when estimating the fair value of the noncontrolling interest. The fair market value of Grupo Finmart was determined using a multiple of future earnings.

The years ended September 30, 2013 and 2012, include $52.4 million and $27.7 million in total revenues and $8.0 million and $10.1 million in income attributable to EZCORP, Inc. related to the Grupo Finmart acquisition respectively.

Cash Genie

On April 14, 2012, we acquired a 72% interest in Ariste Holding Limited and its affiliates, which provides online loans in the U.K under the name "Cash Genie." As this acquisition was individually immaterial, we present its related information, other than information related to the redeemable noncontrolling interest, combined basis with other immaterial acquisitions

Pursuant to the acquisition agreement, the sellers had a put option with respect to their remaining shares of Cash Genie. Each of the sellers had the right to sell his Cash Genie shares to us for cash, during the exercise period commencing on April 14, 2014 and ending on April 14, 2016, with no more than 50% of the seller's shares being sold within a consecutive 12-month period. In addition, each of the sellers had the right to sell his Cash Genie shares to us in exchange for shares of Class A Non-Voting Common Stock at any time after April 14, 2012. Under the guidance in ASC 480-10-S99, securities that are redeemable for cash or other assets are to be classified outside of permanent equity; therefore, at acquisition, we included the redeemable noncontrolling interest related to Cash Genie in temporary equity.

The acquisition date fair value of the Cash Genie redeemable noncontrolling interest was estimated by applying an income and market approach. This fair value measurement was based on significant inputs that are not observable in the market and thus represents a Level 3 measurement. Key assumptions included discount rates ranging from 10% to 18%, representing discounts for lack of control and lack of marketability that market participants would consider when estimating the fair value of the noncontrolling interest, and it was determined using a multiple of future earnings.

During fiscal 2013, the sellers exercised their put options and we increased our ownership in Cash Genie to 100% as of September 30, 2013. See Note 11, "Redeemable Noncontrolling Interest” for details.

Other - 2012

The year ended September 30, 2012, includes the acquisition of 50 locations in the U.S. and one in Canada. As these acquisitions were individually immaterial, we present their related information combined basis with other immaterial acquisitions.

The amounts above for the year ended September 30, 2012 include the acquisition of a decision science model for the underwriting of consumer loans, a contractual relationship with an income tax return preparer to facilitate refund anticipation loans, an online lending business in the U.K., and 15 financial services stores in Hawaii and Texas. The 15 financial services stores in Hawaii and Texas were acquired from FS Management, 1st Money Centers, Inc. and 1429 Funding, Inc., companies owned partially by Brent Turner, the former President of our eCommerce and Card Services division and a former executive officer, for total consideration of $3.0 million in cash and 387,924 shares of our Class A Non-Voting Common Stock. The basic terms of the acquisitions were agreed prior to the commencement of Mr. Turner's employment (and, thus, prior to Mr. Turner's becoming an executive officer), subject to our completion of appropriate due diligence and the execution of appropriate definitive documentation. Even though the terms of the acquisitions were agreed to prior to Mr. Turner's becoming an executive officer, we treated the transactions as related party transactions. Consequently, pursuant to our Policy for Review and Evaluation of Related Party Transactions, the Audit Committee reviewed and evaluated the terms of the acquisitions and concluded that the transactions were fair to, and in the best interest of the company and its stockholders. Mr. Turner received $2.0 million in cash and 167,811 shares of stock in connection with these acquisitions.