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ACQUISITIONS | 6 Months Ended
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May 31, 2021
Business Combinations [Abstract] |
ACQUISITIONS |
6. | ACQUISITIONS
Asset Acquisition On May 12, 2021, the Company entered into an asset purchase agreement to purchase certain assets used in the business of designing, developing, manufacturing, licensing, and selling of products and services for the Mission Less Lethal brand from Kore Outdoor (U.S.) Inc., (“Kore”) a wholly owned subsidiary of Kore Outdoor, Inc. The transaction was accounted for as an asset acquisition, with estimated $3.7 million total cost of which $0.2 million were acquisition-related expenses. The estimated total cost of the acquisition has been allocated as follows (in thousands):
|  | Assets acquired |
Accounts receivable |  | $ | 465 |
Prepaid expenses |  |  | 165 |
Inventory |  |  | 82 |
Property and equipment |  |  | 180 |
Intangible assets |  |  | 2,810 |
Total acquired assets |  | $ | 3,702 |
The Company accounted for the transaction as an asset acquisition where the assets acquired were measured based on the amount of cash paid to Kore as well as transaction costs incurred as the fair value of the assets given was more readily determinable than the fair value of the assets received. The Company classified and designated identifiable assets acquired and assessed and determined the useful lives of the acquired intangible assets subject to amortization. The Company is still in the process of finalizing the working capital adjustments and tax impacts, and therefore, the allocation of the asset acquisition consideration is subject to change. Business Combination On May 5, 2020, the Company acquired 100% of the equity interests in Roboro, its exclusive manufacturer in South Africa, in order to reduce its dependence on third parties for production. As a result of this acquisition, operations were assumed by Byrna South Africa. The acquisition date fair value of the consideration was $0.6 million, including $0.5 million paid in cash. In addition, Roboro’s sellers purchased 138,889 shares of the Company’s common stock for $0.5 million at a contractual price of $3.60 per share. These shares, which were issued on May 27, 2020, are restricted and subject to a 15-month vesting schedule. The fair market value of the common stock of $0.6 million was based on the stock’s closing price of $4.00 on May 5, 2020. The difference between the fair market value plus approximately $0.002 million of transaction costs and the amount paid, was treated as an additional consideration for the acquisition. The estimated fair value of assets acquired and liabilities assumed on May 5, 2020 is as follows:
Property and equipment |  | $ | 67 |
Goodwill |  |  | 651 |
Right-of-use asset, net |  |  | 54 |
Loan payable |  |  | (123 | )
Operating lease liability, current |  |  | (35 | )
Operating lease liability, noncurrent |  |  | (19 | )
Other net asset (liabilities) |  |  | (38 | )
Net Assets |  | $ | 557 |

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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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- References No definition available. + Details
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