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Acquisitions | 12 Months Ended
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Jan. 31, 2021
Business Combinations [Abstract] |
Acquisitions | Acquisitions Acquisition of QueueDr On January 8, 2021, the Company entered into a stock purchase agreement with QueueDr Inc. (QueueDr) to acquire 100% of the outstanding equity of QueueDr, an early-stage software company that automates the process of rescheduling cancellations and no-shows. We acquired QueueDr to enhance our appointments solution. The total consideration transferred for the acquisition consists of $5.8 million in cash, $2.1 million of liabilities incurred and $2.2 million in performance-related contingent payments. The acquisition of QueueDr was accounted for as a business combination. The following table summarizes the purchase price consideration based on the estimated acquisition-date fair value of the acquisition consideration:
Cash consideration paid on acquisition date | $ | 5,773 |
Liabilities incurred | 2,111 |
Contingent consideration | 2,240 |
Total fair value of acquisition consideration | $ | 10,124 |
The following table summarizes the calculation of cash paid for the acquisition of QueueDr, net of cash acquired per the Company's Consolidated Statement of Cash Flows for the year ended January 31, 2021:
Cash consideration paid on acquisition date | $ | 5,773 |
Payments of acquisition date fair value of contingent consideration | 954 |
Less cash acquired | (217) |
Cash paid for acquisition of QueueDr, net of cash acquired per statement of cash flows | $ | 6,510 |
Liabilities incurred are primarily related to hold-backs for general representations and warranties. The maximum amount payable for contingent consideration was $2,574, based upon the performance of certain customer contracts. The purchase price was allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based on their acquisition-date estimated fair values. The following table summarizes the final allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition:
Cash | $ | 217 |
Accounts receivable | 455 |
Other current assets | 192 |
Identified intangible assets acquired | 1,780 |
Deferred tax asset | 262 |
Goodwill | 8,057 |
Other assets | 223 |
Total assets acquired | 11,186 |
Accounts payable | (86) |
Accrued liabilities | (254) |
Deferred revenue | (55) |
Long-term debt | (223) |
Deferred tax liability | (444) |
Total purchase price | $ | 10,124 |
The components of intangible assets acquired were as follows:
| Estimated Useful Life (in Years) |  | Fair Value
Acquired technology | 5 |  | 920 |
Customer relationships | 10 |  | 860 |
Total identifiable intangible assets acquired |  |  | $ | 1,780 |
The weighted average amortization period for acquired intangible assets as of the date of acquisition is 7.4 years. The Company, with the assistance of a third-party appraiser, assessed the fair value of the assets of QueueDr. The fair value of the acquired technology was estimated using the relief from royalty method. The fair value of customer relationships was estimated using a multi period excess earnings method. To calculate fair value, the Company used cash flows discounted at a rate considered appropriate given the inherent risks associated with each client grouping. The useful lives of the intangible assets were estimated based on the expected future economic benefit of the assets and are being amortized over the estimated useful life in proportion to the economic benefits consumed using the straight-line method. The amortization of intangible assets is not deductible for income tax purposes. The goodwill recognized in the acquisition of QueueDr is primarily attributable to expected synergies of the combined businesses and the acquisition of an assembled workforce. The goodwill is not expected to be deductible for tax purposes. During the fiscal year ended January 31, 2021, the Company incurred $282 of acquisition related costs for the acquisition of QueueDr. These costs are included within General and Administrative Expenses in our Statement of Operations. Acquisition of Vital Score On December 4, 2018, the Company entered into an asset purchase agreement with Vital Score, Inc. (Vital Score) to acquire all of the assets, and assumed certain of the liabilities, of Vital Score. The acquisition of Vital Score expanded the Company’s clinical and patient activation offerings and deepened its capabilities in motivational science. The acquisition consideration was comprised of cash consideration consisting of (i) $1,540 with $1,190 payable upon the closing of the acquisition and $350 payable on the first anniversary; and (ii) 40,327 shares of common stock issued to the two principals of Vital Score which vest 50% at closing and 50% in 4 equal annual installments beginning on the one-year anniversary of closing provided that the principals are still employed at the Company. These shares were valued at $8.03 per share. In addition, the principals can receive up to $750 in contingent consideration based upon the achievement of certain sales goals. Since 50% of the shares of common stock and the contingent consideration are contingent upon the principals continued service with the Company, these amounts will be recorded as compensation expense and not included in the purchase price. The following table summarizes the purchase price consideration based on the estimated acquisition-date fair value of the acquisition consideration:
Cash consideration | $ | 1,540 |
Common stock issued (20,164 shares at $8.03 per share) | 162 |
Total fair value of acquisition consideration | $ | 1,702 |
The following table summarizes the final allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition:
Property and equipment | $ | 5 |
Acquired technology | 490 |
Customer relationships | 980 |
Goodwill | 250 |
Total assets acquired | $ | 1,725 |
Accounts payable | (23) |
Total purchase price | $ | 1,702 |
The purchase price was allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based on their acquisition-date estimated fair values. The identifiable intangible assets principally included acquired technology and customer relationships, both of which are subject to amortization on a straight-line basis and are being amortized over five years and seven years, respectively. The weighted average amortization period for acquired intangible assets as of the date of acquisition is 5.8 years. The Company, with the assistance of a third-party appraiser, assessed the fair value of the assets of Vital Score. The fair value of the acquired technology was estimated using the cost to replace method. The fair value of customer relationships was estimated using a multi period excess earnings method. To calculate fair value, the Company used cash flows discounted at a rate considered appropriate given the inherent risks associated with each client grouping. The useful lives of the intangible assets were estimated based on the expected future economic benefit of the assets and are being amortized over the estimated useful life in proportion to the economic benefits consumed using the straight-line method. The amortization of intangible assets is deductible for income tax purposes. The Company believes the goodwill related to the acquisition was a result of providing the Company a complementary service offering that will enable the Company to leverage its services with existing and new clients. The goodwill is deductible for income tax purposes.

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- 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 http://asc.fasb.org/topic&trid=2303972 + Details
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