NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)
We consider that the carrying value of cash and cash equivalents, receivables, accounts
payable and accrued expenses approximates fair value (Level 1) given the short-term nature of these items. The fair value of the Companys notes payable was estimated based on rates currently available to the Company for bank loans with similar
terms and maturities and is classified in Level 2 of the fair value hierarchy.
11. NET INCOME PER SHARE
Basic net income per share is calculated by dividing net income (loss) attributable to Worldpay, Inc. by the weighted-average shares of
Class A common stock outstanding during the period.
Diluted net income per share is calculated assuming that Worldpay Holding is a
wholly-owned subsidiary of Worldpay, Inc., therefore eliminating the impact of Fifth Thirds non-controlling interest. Pursuant to the Exchange Agreement, the Class B units of Worldpay Holding
(Class B units), which are held by Fifth Third and represent the non-controlling interest in Worldpay Holding, are convertible into shares of Class A common stock on a one-for-one basis. Based on this conversion feature, diluted net income per share is calculated assuming the conversion of the Class B units on an if-converted basis. Due to the Companys structure as a C corporation and Worldpay Holdings structure as a pass-through entity for tax purposes, the numerator in the calculation of diluted net
income per share is adjusted accordingly to reflect the Companys income tax expense assuming the conversion of the Fifth Third non-controlling interest into Class A common stock.
During the three months ended March 31, 2019 and 2018, approximately 8.7 million and 15.3 million weighted-average dilutive
Class B units of Worldpay Holding were excluded in computing diluted net income (loss) per share because including them would have an antidilutive effect. As the Class B units of Worldpay Holding were not included, the numerator used in
the calculation of diluted net income (loss) per share was equal to the numerator used in the calculation of basic net income (loss) per share for the three months ended March 31, 2019 and 2018. As of March 31, 2019, all Class B units
have been converted to Class A common stock and therefore there are no Class B units outstanding. As of March 31, 2018, there were approximately 15.3 million Class B units outstanding.
In addition to the Class B units discussed above, potentially dilutive securities during the three months ended March 31, 2019 and
2018 included restricted stock awards, restricted stock units, stock options, performance share awards and ESPP purchase rights. Due to the net loss for three months ended March 31, 2018, any potentially dilutive securities were also excluded
from the denominator in computing dilutive net income per share.
The shares of Class B common stock do not share in the earnings or
losses of the Company and are therefore not participating securities. Accordingly, basic and diluted net income per share of Class B common stock have not been presented.
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