XML 24 R13.htm IDEA: XBRL DOCUMENT v3.25.1
Note 6 - Acquisitions and Divestitures
 3 Months Ended
Mar. 29, 2025
Notes to Financial Statements  
Business Combination [Text Block]

6.    Acquisitions and Divestitures

 

Future Contingent Payments

 

As of March 29, 2025, the Company had one acquisition agreement whereby additional contingent consideration may be earned by the sellers: effective September 30, 2018, the Company acquired certain assets of Thermal Kinetics Engineering, PLLC and Thermal Kinetics Systems, LLC. The Company estimates future contingent payments at March 29, 2025 as follows:

 

  

Total

 

Payable in fiscal 2025

 $212 
Thereafter $0 

 

 

 

For acquisitions that involve contingent consideration, the Company records a liability equal to the fair value of the estimated contingent consideration obligation as of the acquisition date. The Company determines the acquisition date fair value of the contingent consideration based on the likelihood of paying the additional consideration. The fair value is estimated using projected future operating results and the corresponding future earn-out payments that can be earned upon the achievement of specified operating objectives and financial results by acquired companies using Level 3 inputs and the amounts are then discounted to present value. These liabilities are measured quarterly at fair value, and any change in the fair value of the contingent consideration liability is recognized in the consolidated statements of operations. During the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding adjustment to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recognized in the consolidated statements of operations.

 

Estimates of future contingent payments are subject to significant judgment and actual payments may materially differ from estimates.  The Company estimates future contingent consideration payments based on forecasted performance and recorded the fair value of those expected payments as of March 29, 2025.  Contingent consideration related to acquisitions is recorded at fair value (level 3) with changes in fair value recorded in operating expense.

 

Potential future contingent payments for acquisitions after March 29, 2025 are capped at a cumulative maximum of $0.2 million. The Company did not pay contingent consideration during the thirteen week periods ended March 29, 2025 and March 30, 2024.