XML 20 R9.htm IDEA: XBRL DOCUMENT
v3.22.2

Note 2 - Acquisitions | 6 Months Ended
--- | ---
Jun. 30, 2022
Notes to Financial Statements |
Business Combination Disclosure [Text Block] | 2. Acquisitions Fiscal 2022 Acquisitions On June 30, 2022, the Company acquired Electronic Environments Co. LLC and related subsidiaries (collectively EEC). Headquartered in Marlborough, Massachusetts, EEC is an industrial generator distributor as well as a provider of data center and telecom facility design, build, maintenance, and repair services. Fiscal 2021 Acquisitions Acquisition of Deep Sea On June 1, 2021, the Company acquired Deep Sea for a purchase price, net of cash acquired, of $420,700. Headquartered in Hunmanby, United Kingdom, Deep Sea is an industry leading designer and manufacturer of a diverse suite of flexible control solutions focused on the global power generation and transfer switch markets. The acquisition purchase price was funded solely through cash on hand. The Company finalized its purchase price allocation during the second quarter of 2022 based upon the Company's estimates of the fair value of the acquired assets and assumed liabilities. The finalization did not result in material adjustments to the Company's preliminary estimates. As a result, the Company recorded $437,874 of intangible assets, including $263,604 of goodwill recorded in the International segment, as of the acquisition date. The goodwill ascribed to this acquisition is not deductible for tax purposes. The accompanying condensed consolidated financial statements include the results of Deep Sea from the date of acquisition through June 30, 2022. Acquisition of Chilicon On July 2, 2021, the Company acquired Chilicon for a purchase price, net of cash acquired, of $61,129. Based in Los Angeles, California, Chilicon is a designer and provider of grid-interactive microinverter and monitoring solutions for the solar market. Chilicon's power inversion and monitoring system technologies maximize photovoltaic (solar power) system production, lower installer operational cost, and promote end-user satisfaction. The fair value of the consideration transferred consisted of the following:
Cash paid at closing |  | $ | 11,821 |
Deferred cash payment (1) |  |  | 6,000 |
Common stock issued at closing |  |  | 12,000 |
Contingent consideration (2) |  |  | 31,308 |
Total purchase price |  | $ | 61,129 |
(1) | Payable on the third business day after December 31, 2023.
(2) | Payable within 45 calendar days following the conclusion of the earnout period, December 31, 2025. To be paid in the form of common stock issued upon achievement of certain performance targets at the end of the earnout period.
The Company finalized its purchase price allocation during the second quarter of 2022 based upon the Company's estimates of the fair value of the acquired assets and assumed liabilities. The finalization did not result in material adjustments to the Company's preliminary estimates. As a result, the Company recorded $70,174 of intangible assets, including $36,974 of goodwill recorded in the Domestic segment, as of the acquisition date. The goodwill ascribed to the Chilicon acquisition is not deductible for tax purposes. The accompanying condensed consolidated financial statements include the results of Chilicon from the date of acquisition through June 30, 2022. Acquisition of Off Grid Energy On September 1, 2021, the Company acquired Off Grid Energy for a purchase price of $56,949, net of cash acquired and inclusive of estimated contingent consideration of $29,054 that is to be paid in cash upon achievement of certain performance targets at the end of the earnout period which ended on March 31, 2022. The contingent consideration is expected to be paid during Q3 2022. Headquartered in Rugby, United Kingdom, Off Grid Energy is a designer and manufacturer of industrial-grade mobile energy storage systems. The acquisition purchase price was funded through cash on hand. The Company recorded its preliminary purchase price allocation during the third quarter of 2021, and it was updated in the fourth quarter of 2021 as well as in the first and second quarters of 2022, based upon the Company's estimates of the fair value of the acquired assets and assumed liabilities at that time. As a result, the Company recorded $56,076 of intangible assets, including $21,531 of goodwill recorded in the International segment, as of the acquisition date. The goodwill ascribed to this acquisition is not deductible for tax purposes. The accompanying condensed consolidated financial statements include the results of Off Grid Energy from the date of acquisition through June 30, 2022. The allocation of the purchase price to identifiable assets and liabilities is based on the preliminary valuations performed to determine the fair value of the net assets as of the acquisition date. The measurement period for the valuation of net assets acquired ends as soon as information on the facts and circumstances that existed as of the acquisition date becomes available, but not to exceed 12 months following the acquisition date. As the Company finalizes valuations, adjustments in purchase price allocations may require a change in the amounts allocated to net assets acquired during the periods in which the adjustments are determined. Acquisition of ecobee On December 1, 2021, the Company acquired ecobee for a purchase price, net of cash acquired, of $735,632. Headquartered in Toronto, Canada, ecobee is a leader in sustainable home technology solutions including smart thermostats that deliver significant energy savings, security and peace of mind. The fair value of the consideration transferred consisted of the following:
Cash paid at closing |  | $ | 225,458 |
Common stock issued at closing |  |  | 420,774 |
Contingent consideration (1) |  |  | 89,400 |
Total purchase price |  | $ | 735,632 |
(1) | To be paid in the form of common stock issued upon achievement of certain performance targets following the end of each of two earnout periods, one ended June 30, 2022, and one ending June 30, 2023.
The Company recorded its preliminary purchase price allocation during the fourth quarter of 2021, which was updated in the first and second quarters of 2022, based upon the Company's estimates of the fair value of the acquired assets and assumed liabilities at that time. As a result, the Company recorded $798,746 of intangible assets, including $243,346 of goodwill recorded in the Domestic segment, as of the acquisition date. A portion of the goodwill ascribed to this acquisition is deductible for tax purposes. The accompanying condensed consolidated financial statements include the results of ecobee from the date of acquisition through June 30, 2022. The allocation of the purchase price to identifiable assets and liabilities is based on the preliminary valuations performed to determine the fair value of the net assets as of the acquisition date. The measurement period for the valuation of net assets acquired ends as soon as information on the facts and circumstances that existed as of the acquisition date becomes available, but not to exceed 12 months following the acquisition date. As the Company finalizes valuations, adjustments in purchase price allocations may require a change in the amounts allocated to net assets acquired during the periods in which the adjustments are determined. Other Acquisitions On September 1, 2021, the Company acquired Apricity Code, an advanced engineering and product design company located in Bend, Oregon. On October 1, 2021, the Company acquired Tank Utility, a provider of IoT propane tank monitoring that enables the optimization of propane fuel logistics. The combined purchase price for these two acquisitions was $29,945, net of cash acquired, and was funded solely through cash on hand. The Company recorded its preliminary purchase price allocation for Apricity Code and Tank Utility during the third and fourth quarters of 2021, respectively, and then updated in the first and second quarters of 2022, based upon the Company's estimates of the fair value of the acquired assets and assumed liabilities. The accompanying consolidated financial statements include the results of these two acquired businesses since the dates of acquisition through June 30, 2022. The allocation of the purchase price to identifiable assets and liabilities is based on the preliminary valuations performed to determine the fair value of the net assets as of the acquisition date. The measurement period for the valuation of net assets acquired ends as soon as information on the facts and circumstances that existed as of the acquisition date becomes available, but not to exceed 12 months following the acquisition date. As the Company finalizes valuations, adjustments in purchase price allocations may require a change in the amounts allocated to net assets acquired during the periods in which the adjustments are determined. Pro forma financial information is not presented for the above acquisitions as the effects of the acquisitions individually and in the aggregate are not material to the Company's results of operations or financial position prior to the acquisition dates. Summary Purchase Price Allocations The fair values assigned to certain assets acquired and liabilities assumed, as of the acquisition dates, are as follows for the 2021 acquisitions:
|  | Deep Sea |  |  | ecobee |  |  | All Other |  |  | Total |
Accounts receivable |  | $ | 9,574 |  |  | $ | 23,337 |  |  | $ | 13,852 |  |  | $ | 46,763 |
Inventories |  |  | 9,970 |  |  |  | 7,258 |  |  |  | 7,034 |  |  |  | 24,262 |
Prepaid expenses and other assets |  |  | 1,181 |  |  |  | 5,689 |  |  |  | 6,594 |  |  |  | 13,464 |
Property and equipment |  |  | 8,838 |  |  |  | 3,588 |  |  |  | 480 |  |  |  | 12,906 |
Intangible assets |  |  | 174,270 |  |  |  | 555,400 |  |  |  | 81,171 |  |  |  | 810,841 |
Goodwill |  |  | 263,604 |  |  |  | 243,346 |  |  |  | 80,871 |  |  |  | 587,821 |
Deferred income taxes |  |  | - |  |  |  | 46,721 |  |  |  | 6,547 |  |  |  | 53,268 |
Other assets |  |  | 151 |  |  |  | 11,722 |  |  |  | 8,526 |  |  |  | 20,399 |
Total assets acquired |  |  | 467,588 |  |  |  | 897,061 |  |  |  | 205,075 |  |  |  | 1,569,724 |
Accounts payable |  |  | 8,998 |  |  |  | 25,968 |  |  |  | 7,473 |  |  |  | 42,439 |
Accrued wages and employee benefits |  |  | 2,106 |  |  |  | 1,354 |  |  |  | 872 |  |  |  | 4,332 |
Other accrued liabilities |  |  | 1,737 |  |  |  | 19,898 |  |  |  | 18,258 |  |  |  | 39,893 |
Short-term borrowings |  |  | - |  |  |  | - |  |  |  | 800 |  |  |  | 800 |
Current portion of long-term debt |  |  | - |  |  |  | - |  |  |  | 233 |  |  |  | 233 |
Deferred income taxes |  |  | 33,957 |  |  |  | 80,447 |  |  |  | 19,930 |  |  |  | 134,334 |
Other long-term liabilities |  |  | 90 |  |  |  | 33,762 |  |  |  | 7,862 |  |  |  | 41,714 |
Long-term borrowings and finance lease obligations |  |  | - |  |  |  | - |  |  |  | 1,624 |  |  |  | 1,624 |
Net assets acquired |  | $ | 420,700 |  |  | $ | 735,632 |  |  | $ | 148,023 |  |  | $ | 1,304,355 |

X
- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI https://asc.fasb.org/topic&trid=2303972 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 20 -Section 50 -Paragraph 5 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=128092470&loc=d3e4946-128472 + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureTextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration