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Acquisition of Alfa & Ariss
 12 Months Ended
Dec. 31, 2012
Acquisition of Alfa & Ariss [Abstract]  
Acquisition of Alfa & Ariss

Note 4 – Acquisition of Alfa & Ariss

On April 1, 2011, we acquired all of the stock of Alfa & Ariss B.V. (“Alfa & Ariss”), an open identity and access management specialist of Enschede, The Netherlands, in exchange for cash consideration of €1,000 ($1,410 at the exchange rate of 1.41 US Dollars per Euro). The purchase price was subject to verification of certain balances resulting in an additional payment of €36 in May 2011 (approximately $51 at an exchange rate of 1.41 US Dollars per Euro). The acquisition was funded by our existing cash balances.

Consideration was allocated to assets acquired and liabilities assumed based on their respective fair values as of the acquisition date as follows:

 

         

Prepaid compensation - current

   $ 141  

Other current assets

     343  

Prepaid compensation - non-current

     423  

Property and equipment

     64  

Goodwill

     468  

Intangible assets

     606  

Deferred income tax liabilities - current

     (68 ) 

Other current liabilities

     (292 ) 

Deferred income tax liabilities - non-current

     (224 ) 
   

 

 

  
    $ 1,461  
   

 

 

  

Consideration includes contingent consideration of €400 ($564 at the exchange rate of 1.41 US Dollars per Euro) held in escrow payable ratably over four years on the anniversary date of the transaction subject to continued employment of a former officer and shareholder of Alfa & Ariss. The amount was recorded as a prepaid expense and amortized ratably based on the four year contract period. During 2012, the former officer and shareholder resigned forfeiting the remaining €300. The forfeiture was recorded as a reduction in consideration.

 

Acquired identifiable intangible assets totaling $606 are being amortized over their respective useful lives ranging from two to five years.

The acquisition is not material to our consolidated balance sheet and results of operations. The consolidated financial statements include the operating results of Alfa & Ariss from the acquisition date.