v3.10.0.1

Acquisitions | 9 Months Ended
--- | ---
Sep. 30, 2018
Acquisitions |
Acquisitions | 3. Acquisitions Elauwit Networks, LLC On August 1, 2018, we acquired the assets of Elauwit Networks, LLC (“Elauwit”) for $28,000 plus other contingent consideration. Elauwit provides data and video services to 220 multi-unit dwelling properties including student housing, condominiums, apartments, senior living, and hospitality industries throughout the U.S. In addition, Elauwit builds and maintains the network that supports these services for property owners and managers and provides support for residents and employees. The acquisition has been accounted for under the acquisition method of accounting in accordance with FASB ASC 805, Business Combinations. As such, the assets acquired and liabilities assumed are recorded at their acquisition-date fair values. The total purchase price was $29,841, which includes contingent consideration fair valued at $1,265. At the closing date, we paid cash of $15,576. $13,000 of the purchase price was held back for the following: (i) $11,000 held back for third-party consents not obtained at closing for certain customer agreements, which will be released as Elauwit delivers third-party consents with respect to such customer agreements; and (ii) a $2,000 indemnification holdback that is being retained for a period of 12 months following the closing of the acquisition. As of September 30, 2018, we paid $6,476 of the amounts held back for third-party consents, and we paid an additional $2,572 for amounts held back for third-party consents in October 2018. We expect to pay the remainder of the amounts held back for third-party consents within the next one year period. The contingent consideration could require payments in the aggregate amount of up to $15,000 that would be due and payable subject to certain conditions and the successful achievement of annual revenue targets for the acquired business during the 2018, 2019, and 2020 fiscal years. The contingent consideration is subject to acceleration under certain corporate events. The fair value of the contingent consideration is based on Level 3 inputs. Further changes in the fair value of the contingent consideration will be recorded through operating income (loss). The contingent consideration was valued at the date of acquisition using the Monte Carlo method reflecting the average expected monthly revenue, an annual risk-free rate of 2.78%, and an annual revenue volatility rate of 40%. The identifiable intangible assets were primarily valued using the excess earnings, relief from royalty, and loss-of-revenue methods using discount rates ranging from 8.0% to 21.0% and a 1.0% royalty rate, where applicable. We allocated the excess of the purchase price over the fair value of assets acquired and liabilities assumed to goodwill, which is deductible for tax purposes. The goodwill arising from the Elauwit acquisition is attributable primarily to expected synergies and other benefits, including the acquired workforce, from combining Elauwit with us. The amortizable intangible assets are being amortized straight-line over their estimated useful lives. The following summarizes the preliminary purchase price allocation:
|  | Estimated Fair Value |  | Weighted Average Estimated Useful Life (years) |
Consideration: |  |  |  |  |
Cash paid |  | $ | 15,576 |  |  |
Holdback consideration |  | 13,000 |  |  |
Contingent consideration |  | 1,265 |  |  |
Total consideration |  | $ | 29,841 |  |  |
Recognized amounts of identifiable assets acquired and liabilities assumed: |  |  |  |  |
Accounts receivable |  | $ | 4,494 |  |  |
Prepaid expenses and other current assets |  | 1,796 |  |  |
Property and equipment |  | 195 |  |  |
Other non-current assets |  | 177 |  |  |
Accounts payable |  | (2,049 | ) |  |
Accrued expenses and other liabilities |  | (232 | ) |  |
Deferred revenue |  | (4,036 | ) |  |
Other non-current liabilities |  | (307 | ) |  |
Net tangible assets acquired |  | 38 |  |  |
Backlog |  | 7,030 |  | 5.0 |
Customer relationships |  | 2,490 |  | 10.0 |
Partner relationships |  | 1,200 |  | 10.0 |
Transition services agreement |  | 540 |  | 2.0 |
Non-compete agreement |  | 1,380 |  | 3.0 |
Goodwill |  | 17,163 |  |  |
Total purchase price |  | $ | 29,841 |  |  |
The following table presents the unaudited results of Elauwit included in the Company’s revenue and net income (loss).
|  | Three Months Ended September 30, |  | Nine Months Ended September 30, |
|  | 2018 |  | 2017 |  | 2018 |  | 2017 |
|  | (Unaudited) |
Revenue |  | $ | 5,082 |  | $ | — |  | $ | 5,082 |  | $ | — |
Net loss |  | (571 | ) | — |  | (571 | ) | — |
Pro forma results (Unaudited) The following table presents the unaudited pro forma results of the Company for the three and nine months ended September 30, 2018 and 2017 as if the acquisition of Elauwit had occurred on January 1, 2017 and therefore includes Elauwit’s revenue and net income (loss), as adjusted, for those periods. These results are not intended to reflect the actual operations of the Company had the acquisition occurred on January 1, 2017. Acquisition transaction costs have been excluded from the pro forma net income (loss).
|  | Three Months Ended September 30, |  | Nine Months Ended September 30, |
|  | 2018 |  | 2017(2) |  | 2018 |  | 2017(2) |
|  | (Unaudited) |
Revenue |  | $ | 67,917 |  | $ | 59,939 |  | $ | 200,885 |  | $ | 166,078 |
Net income (loss) |  | 104 |  | (3,691 | ) | (1,221 | ) | (19,116 | )
Net loss attributable to common stockholders |  | (492 | ) | (3,901 | ) | (2,668 | ) | (19,593 | )
Net loss per share attributable to common stockholders |  |  |  |  |  |  |  |  |
Basic |  | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.06 | ) | $ | (0.50 | )
Diluted |  | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.06 | ) | $ | (0.50 | )
(2)As noted above, prior period amounts have not been adjusted upon adoption of ASC 606 under the modified retrospective method.

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 http://asc.fasb.org/topic&trid=2303972 + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

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