| Schedule of Business Acquisitions, by Acquisition |
The consideration for the EMC Acquisition consisted of the following (in thousands, except amounts in the footnotes to the table):
|
|
|
|
|
|
Amount |
Cash consideration paid to seller (1)
|
$ |
100,454 |
|
Issuance of 5,466,886 shares of Company common stock (2)
|
40,607 |
|
Deferred consideration (3)
|
25,000 |
|
Settlement of pre-existing relationship |
228 |
|
Total |
$ |
166,289 |
|
|
|
(1) |
In June 2017, the Company finalized the working capital adjustments with the EMC seller, resulting in the release to the Company of $1.3 million from a working-capital adjustment escrow.
|
|
|
(2) |
The fair value of the Company’s common stock issued as consideration in the EMC Acquisition was measured based on the common-stock price upon closing of the transaction on July 27, 2016, less a 7.5% discount thereon for restriction on transferability.
|
|
|
(3) |
On July 27, 2017, the Company elected to pay this amount in 5,080,049 newly issued shares of its common stock, which the Company issued to the EMC seller.
|
The following is a summary of the purchase price allocation to the estimated fair values of the identifiable assets acquired and the liabilities assumed at the EMC Acquisition date (dollars in thousands):
|
|
|
|
|
|
|
|
Weighted Average Useful Life (Years) (2)
|
|
Preliminary |
Cash and cash equivalents |
|
|
$ |
8,208 |
|
Restricted cash |
|
|
16,257 |
|
Other current assets |
|
|
60,625 |
|
Property, plant and equipment |
|
|
82,220 |
|
Equity method investments (1)
|
|
|
152,700 |
|
Intangible assets: |
|
|
|
Completed technology |
3.4 |
|
18,500 |
|
Customer relationships |
8.0 |
|
47,700 |
|
Backlog |
3.0 |
|
18,300 |
|
Trademarks |
5.0 |
|
1,000 |
|
Other non-current assets |
|
|
2,321 |
|
Accounts payable and accrued liabilities |
|
|
(68,864 |
) |
Debt, including current |
|
|
(371,990 |
) |
Unfavorable vendor contracts, including current |
|
|
(13,500 |
) |
Deferred tax liabilities, net |
|
|
(71,954 |
) |
Deferred revenue, including current |
|
|
(4,602 |
) |
Other non-current liabilities |
|
|
(9,479 |
) |
Fair value of net assets acquired |
|
|
(132,558 |
) |
Consideration transferred |
|
|
166,289 |
|
Goodwill |
|
|
$ |
298,847 |
|
|
|
(1) |
Represents 49% investments held by the Company in WMS and Santander.
|
|
|
(2) |
The weighted average useful life in total is 5.9 years.
|
|
| Schedule of Pro Forma Revenue and Net Loss |
The following unaudited pro forma summary presents consolidated information of EMC for the three months ended March 31, 2016 assuming the EMC Acquisition had occurred on January 1, 2016. The most significant pro forma adjustments were to reflect the (net of tax) impact of: (i) amortization expenses related to intangibles; and (ii) interest expense on the then existing EMC indebtedness (taking into account the fair value adjustment to the debt as of the date of the EMC Acquisition). The unaudited pro forma financial information is an estimate for informational purposes only and does not reflect the actual results on the Company’s operations had the EMC Acquisition been consummated on January 1, 2016. These pro forma amounts are not designed to represent the future expected financial results of the Company.
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
(Dollars in Thousands) |
2017 |
2016 |
|
Actual |
Pro forma |
Revenue |
$ |
152,592 |
|
$ |
158,914 |
|
Net loss |
(125,611 |
) |
(16,448 |
) |
|