v3.20.2

BUSINESS COMBINATION (Tables)

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the total consideration paid for ApiFix and allocation of purchase price to the estimated fair value of the assets acquired and liabilities assumed at the acquisition date (in thousands):

Description						Amount
Preliminary fair value of estimated total acquisition consideration						$	87,379
Assets
Cash						344
Accounts receivable-trade						245
Inventories						685
Prepaid expenses and other current assets						77
Property and equipment						153
Intangible assets						24,330
Other intangible assets						8,620
Operating lease right-of-use asset						104
Total assets						34,558
Liabilities
Accounts payable and accrued liabilities						226
Operating lease liabilities						106
Other long-term liabilities						270
Total liabilities						602
Less: total net assets						33,956
Goodwill						$	53,423

The following table summarizes the total consideration paid for Telos and allocation of purchase price to the estimated fair value of the assets acquired and liabilities assumed at the acquisition date (in thousands):

Description						Amount
Preliminary fair value of estimated total acquisition consideration						$	3,318
Assets
Cash						81
Accounts receivable-trade						215
Property and equipment						10
Intangible assets						950
Other intangible assets						$	210
Total assets						1,466
Liabilities
Accounts payable and accrued liabilities						60
Total liabilities						60
Less: total net assets						1,406
Goodwill						$	1,912

The following table summarizes the total consideration paid for Vilex and Orthex and allocation of purchase price to the estimated fair value of the assets acquired and liabilities assumed at the acquisition date (in thousands):

Description						Amount
Fair value of estimated total acquisition consideration						$	60,184
Assets
Cash						348
Accounts receivable-trade						2,088
Inventories						3,652
Prepaid expenses and other current assets						12
Property and equipment						7,540
Intangible assets						31,180
Operating lease right-of-use asset						323
Total assets						45,143
Liabilities
Accounts payable and accrued liabilities						563
Operating lease liabilities						323
Deferred tax liability						1,175
Other long-term liabilities						68
Total liabilities						2,129
Less: total net assets						43,014
Goodwill						$	17,170

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination

The estimated fair value and useful life of identifiable intangible assets are as follows:

						Amount						Remaining Economic Useful Life
Trademarks / Names						$	8,620					Indefinite
Patents						23,790						15 years
Customer Relationships						340						10 years
Non-competition Agreements						200						4 years
						$	32,950

The fair value of identifiable intangible assets were based on valuations using a combination of the income and cost approach. The estimated fair value and useful life of identifiable intangible assets are as follows:

						Amount						Remaining Economic Useful Life
Trademarks / Names						$	210					Indefinite
Customer Relationships						910						10 years
Non-competition Agreements						40						5 years
						$	1,160

The fair value of identifiable intangible assets were based on valuations using a combination of the income and cost approach. The estimated fair value and useful life of identifiable intangible assets are as follows:

						Amount						Remaining Economic Useful Life
Trademarks / Names						$	4,610					Indefinite
Patents						22,390						15 years
Internally Developed Software						1,550						10 years
Customer Relationships						2,570						12 years
Non-competition Agreements						60						5 years
						$	31,180

Schedule of Indefinite-lived Intangible Assets Acquired as Part of Business Combination

The estimated fair value and useful life of identifiable intangible assets are as follows:

						Amount						Remaining Economic Useful Life
Trademarks / Names						$	8,620					Indefinite
Patents						23,790						15 years
Customer Relationships						340						10 years
Non-competition Agreements						200						4 years
						$	32,950

The fair value of identifiable intangible assets were based on valuations using a combination of the income and cost approach. The estimated fair value and useful life of identifiable intangible assets are as follows:

						Amount						Remaining Economic Useful Life
Trademarks / Names						$	210					Indefinite
Customer Relationships						910						10 years
Non-competition Agreements						40						5 years
						$	1,160

The fair value of identifiable intangible assets were based on valuations using a combination of the income and cost approach. The estimated fair value and useful life of identifiable intangible assets are as follows:

						Amount						Remaining Economic Useful Life
Trademarks / Names						$	4,610					Indefinite
Patents						22,390						15 years
Internally Developed Software						1,550						10 years
Customer Relationships						2,570						12 years
Non-competition Agreements						60						5 years
						$	31,180

Schedule of Business Acquisitions by Acquisition, Contingent Consideration

Presented below is a summary of the present value of the anniversary payments and system sales payment related to the ApiFix acquisition:

						April 1, 2020						June 30, 2020
Anniversary Payments:
Second Year Payment						$	10,980					$	11,485
Third Year Payment						5,780						5,965
Fourth Year Payment						5,860						6,056
Total acquisition installment payable						22,620						23,506
Less: current portion of acquisition installment payable						10,980						11,485
Acquisition installment payable, net of current portion						11,640						12,021
System sales payment						27,190						28,100
ApiFix future consideration, net of current portion						$	38,830					$	40,121

Pre-acquisition revenues and earnings for ApiFix were not material to the condensed consolidated operations.

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Tabular disclosure of contingent payment arrangements including the terms that will result in payment and the accounting treatment that will be followed if such contingencies occur, including the potential impact on earnings per share if contingencies are to be settled in common stock of the entity. The description also may include the period over which amounts are expected to be paid, and changes in the amount since the previous reporting period. This also includes contingent options and commitments.

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Tabular disclosure of finite-lived intangible assets acquired as part of a business combination or through an asset purchase, by major class and in total, including the value of the asset acquired, any significant residual value (the expected value of the asset at the end of its useful life) and the weighted-average amortization period.

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Tabular disclosure of characteristics and cost, by total and major class, of indefinite-lived intangible assets acquired as part of a business combination. Indefinite-lived intangible assets are assets that have no physical form, but have expected future economic benefit. The future benefit is not expected to diminish over a stated period of time. Acquired indefinite-lived intangible assets are disclosed by major class (assets that can be grouped together because they are similar, either by their nature or by their use in operations of the entity) and in total.

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Tabular disclosure of the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed. May include but not limited to the following: (a) acquired receivables; (b) contingencies recognized at the acquisition date; and (c) the fair value of noncontrolling interests in the acquiree.

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