v3.21.1

Acquisition of Simply Mac | 12 Months Ended
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Jan. 30, 2021
Simply Mac, Inc. [Member] |
Acquisition | NOTE 14—ACQUISITION OF SIMPLY MAC On May 9, 2019, the Company, Simply Mac and GameStop Corp. (“GameStop” or the “Seller”) entered into a stock purchase agreement, as amended on September 20, 2019 (the “Stock Purchase Agreement”), pursuant to which the Company would purchase from the Seller all of the issued and outstanding shares of capital stock of Simply Mac (the “Stock Purchase”). On September 25, 2019, the Stock Purchase closed and Simply Mac became a wholly-owned subsidiary of the Company. Aggregate consideration for the Stock Purchase amounted to $12,554,000 which consisted of cash consideration of $4,696,000 (comprised of $5,157,000 paid in 2019 less a working capital true-up of $461,000 received subsequent to year-end) and a 12% secured promissory note of $7,858,000. The Company accounted for the Stock Purchase in accordance with the guidance of ASC 805 on business combinations using the acquisition method. In assessing the fair value, the Company did not assume any synergies from combining with Simply Mac, and used the relief-from-royalty method to determine the fair value of the Simply Mac trademark and tradename. Because the purchase of Simply Mac was a stock purchase, none of the implied goodwill of $411,000 is deductible for tax purposes. The purchase price was allocated to the net assets acquired in the transaction as follows (in thousands):
Cash |  | $ | 12 |
Accounts receivable |  |  | 1,367 |
Inventory |  |  | 9,145 |
Other current assets |  |  | 288 |
Fixed assets |  |  | 613 |
Right-of-use leased assets |  |  | 3,414 |
Goodwill |  |  | 699 |
Intangibles |  |  | 2,092 |
Other assets |  |  | 44 |
Accounts payable |  |  | (401 | )
Lease liability |  |  | (3,430 | )
Accrued liabilities |  |  | (1,289 | )
Total |  | $ | 12,554 |
The sales and operating loss of Simply Mac for the period from September 25, 2019 through the end of fiscal 2019 included in the Company’s 2019 statement of operations amounted to $21,269,000 and $1,665,000, respectively. On an unaudited pro forma basis, had the acquisition of Simply Mac occurred on January 1, 2019, the net sales of the Company for the fiscal year ended December 31, 2019 would have been $71,173,000, and the net loss for the Company would have been $24,289,000. This pro forma information includes adjustments for interest expense on the financing for the acquisition consideration, as well as amortization expense of intangible assets arising from the acquisition.

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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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