XML 20 R9.htm IDEA: XBRL DOCUMENT
v3.22.2.2

Acquisitions | 9 Months Ended
--- | ---
Sep. 30, 2022
Business Combination and Asset Acquisition [Abstract] |
Acquisitions | 2. Acquisitions The Company performs quantitative and qualitative analyses to determine the significance of each acquisition to the financial statements the Company. Based on these analyses the below acquisitions were deemed to be insignificant on an individual and cumulative basis. 2022 Acquisitions Acquisitions completed during the nine months ended September 30, 2022 include the following: •BA Insight - On February 22, 2022, the Company entered into an agreement to purchase the shares comprising the entire issued share capital of BA Insight Inc., (“BA Insight”), a cloud-based enterprise knowledge management solution. Revenues recorded since the acquisition date through September 30, 2022 were approximately $5.2 million. Revenues recorded for BA Insight for the quarter ended September 30, 2022 were approximately $2.4 million. •Objectif Lune - On January 07, 2022, the Company entered into an agreement to purchase the shares comprising the entire issued share capital of Objectif Lune Inc., a Quebec proprietary company (“Objectif Lune”), cloud-based document workflow product. Revenues recorded since the acquisition date through September 30, 2022 were approximately $15.5 million. Revenues recorded for Objectif Lune for the quarter ended September 30, 2022 were approximately $5.1 million. 2021 Acquisition The acquisition completed during the year ended December 31, 2021 were: •Panviva - On June 24, 2021, the Company entered into an agreement to purchase the shares comprising the entire issued share capital of Panviva Pty Ltd, an Australian proprietary company (“Panviva”), a cloud-based enterprise knowledge management solution. •BlueVenn - On February 28, 2021 the Company entered into an agreement to purchase the shares comprising the entire issued share capital of BlueVenn Group Limited, a company limited by shares organized and existing under the laws of England and Wales (“BlueVenn”), a cloud-based customer data platform. •Second Street - On January 19, 2021, the Company entered into an agreement to purchase the shares comprising the entire issued share capital of Second Street Media, Inc., a Missouri corporation (“Second Street”), an audience engagement platform. Consideration The following table summarizes the consideration transferred for the acquisitions described above (in thousands):
|  | BA Insight |  | Objectif Lune |  | Panviva |  | BlueVenn |  | Second Street |  |  |  |  |  |  |  |  |  |  |  |
Cash |  | $ | 33,355 |  |  | $ | 29,750 |  |  | $ | 19,931 |  |  | $ | 53,535 |  |  | $ | 25,436 |  |  |  |  |  |  |  |  |  |  |  |  |
Holdback (1) |  | 645 |  |  | 5,250 |  |  | 3,517 |  |  | 2,429 |  |  | 5,000 |  |  |  |  |  |  |  |  |  |  |  |  |
Contingent consideration (2) |  | — |  |  | — |  |  | — |  |  | 2,535 |  |  | 1,650 |  |  |  |  |  |  |  |  |  |  |  |  |
Working capital and other adjustments |  | 1,587 |  |  | 338 |  |  | 379 |  |  | (537) |  |  | (1,365) |  |  |  |  |  |  |  |  |  |  |  |  |
Total consideration |  | $ | 35,587 |  |  | $ | 35,338 |  |  | $ | 23,827 |  |  | $ | 57,962 |  |  | $ | 30,721 |  |  |  |  |  |  |  |  |  |  |  |  |
(1)Represents the cash holdbacks subject to indemnification claims that are payable 12 months following closing for Objectif Lune, Panviva and Second Street, 15 months following closing for BA Insight and 18 months following closing for BlueVenn. (2)Represents the acquisition date fair value of anticipated earnout payments, which are based on the estimated probability of attainment of the underlying future performance-based conditions at the time of acquisition. The maximum potential payout for the BlueVenn and Second Street earn-outs were $21.7 million and $3.0 million, respectively. As of March 31, 2022, the earnout payments for BlueVenn and Second Street were finalized resulting in no payments made. Fair Value of Assets Acquired and Liabilities Assumed The Company recorded the purchase of the acquisitions described above using the acquisition method of accounting, and has recognized the assets acquired and liabilities assumed at their fair values as of the date of the acquisition. The purchase accounting for the 2022 acquisitions of BA Insight and Objectif Lune are preliminary as the Company has not finalized the overall impact of these acquisitions. Management has recorded the purchase price allocations based upon acquired company information that is currently available. Management expects to complete the purchase accounting for BA Insight and Objectif Lune no later than the first quarter of 2023. The following condensed table presents the preliminary and finalized acquisition-date fair value of the assets acquired and liabilities assumed for the acquisitions during the year ended December 31, 2021 and through the nine months ended September 30, 2022, (in thousands):
|  | Preliminary |  | Final
|  | BA Insight |  | Objectif Lune |  | Panviva |  | BlueVenn |  | Second Street
Year Acquired |  | 2022 |  | 2022 |  | 2021 |  | 2021 |  | 2021
Cash |  | $ | 4 |  |  | $ | 745 |  |  | $ | 132 |  |  | $ | 1,115 |  |  | $ | — |
Accounts receivable |  | 2,466 |  |  | 5,251 |  |  | 2,122 |  |  | 1,289 |  |  | 1,105 |
Other current assets |  | 4,080 |  |  | 7,197 |  |  | 4,985 |  |  | 2,002 |  |  | 89 |
Operating lease right-of-use asset |  | 110 |  |  | 1,905 |  |  | 197 |  |  | 1,357 |  |  | 489 |
Property and equipment |  | 3 |  |  | 248 |  |  | 26 |  |  | 611 |  |  | 156 |
Customer relationships |  | 10,500 |  |  | 17,717 |  |  | 9,757 |  |  | 18,888 |  |  | 14,600 |
Trade name |  | 150 |  |  | 362 |  |  | 76 |  |  | 238 |  |  | 200 |
Technology |  | 2,000 |  |  | 5,512 |  |  | 2,194 |  |  | 4,337 |  |  | 3,400 |
Favorable Leases |  | — |  |  | 291 |  |  | — |  |  | — |  |  | — |
Goodwill |  | 25,993 |  |  | 23,283 |  |  | 16,604 |  |  | 44,892 |  |  | 16,586 |
Other assets |  | 25 |  |  | 744 |  |  | 33 |  |  | 24 |  |  | 13 |
Total assets acquired |  | 45,331 |  |  | 63,255 |  |  | 36,126 |  |  | 74,753 |  |  | 36,638 |
Accounts payable |  | (236) |  |  | (2,001) |  |  | (1,257) |  |  | (2,772) |  |  | (230) |
Accrued expense and other |  | (4,193) |  |  | (9,437) |  |  | (5,053) |  |  | (2,429) |  |  | (378) |
Deferred tax liabilities |  | (388) |  |  | (5,726) |  |  | (2,395) |  |  | (3,640) |  |  | (4,320) |
Deferred revenue |  | (4,817) |  |  | (8,848) |  |  | (3,397) |  |  | (6,593) |  |  | (500) |
Operating lease liabilities |  | (110) |  |  | (1,905) |  |  | (197) |  |  | (1,357) |  |  | (489) |
Total liabilities assumed |  | (9,744) |  |  | (27,917) |  |  | (12,299) |  |  | (16,791) |  |  | (5,917) |
Total consideration |  | $ | 35,587 |  |  | $ | 35,338 |  |  | $ | 23,827 |  |  | $ | 57,962 |  |  | $ | 30,721 |
The Company uses third party valuation consultants to determine the fair values of assets acquired and liabilities assumed. Tangible assets are valued at their respective carrying amounts, which approximates their estimated fair value. The valuation of identifiable intangible assets reflects management’s estimates based on, among other factors, the use of established valuation methods. Customer relationships are valued using the multi-period excess earnings method. Developed technology and trade names are valued using the relief-from-royalty method. The following table summarizes the weighted-average useful lives, by major finite-lived intangible asset class, for intangibles acquired during the nine months ended September 30, 2022 and the year ended December 31, 2021 (in years):
| Useful Life
| September 30, 2022 |  | December 31, 2021
Customer relationships | 7.0 |  | 7.0
Trade name | 2.0 |  | 2.0
Developed technology | 6.2 |  | 5.0
Favorable Leases | 6.3 |  | 0
Total weighted-average useful life | 6.8 |  | 6.6
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 offset to goodwill based on changes to management's estimates and assumptions. The goodwill of $127.4 million for the above acquisitions is primarily attributable to the synergies expected to arise after the acquisition and the value of the acquired workforce. Goodwill that is deductible for tax purposes at the time of the acquisitions was $2.0 million. Total transaction related expenses incurred with respect to acquisition activity during the three months ended September 30, 2022 and September 30, 2021 was a gain of $0.3 million and an expense of $0.1 million, respectively. During the nine months ended September 30, 2022 and September 30, 2021, total transaction related expenses were $4.6 million and $6.2 million, respectively. Transaction related expenses, excluding transformation costs, include expenses such as banker fees, legal and professional fees, insurance costs, and deal bonuses. Transaction costs are included in acquisition-related expenses in our condensed consolidated statement of operations. Other Acquisitions and Divestitures From time to time we may purchase or sell customer relationships that meet certain criteria. We had no purchase or sale of customer relationships during the three and nine months ended September 30, 2022 and September 30, 2021

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationAndAssetAcquisitionAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 https://asc.fasb.org/topic&trid=2303972 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 20 -Section 50 -Paragraph 5 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=128092470&loc=d3e4946-128472 + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration