Classmates.com 2006 Annual Report Download - page 82
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Combinations . The primary reason for the acquisition was to expand the Company’s Content & Media business offerings. MyPoints’ results of
operations are included in the Company’s consolidated financial statements from the date of acquisition.
The purchase price was allocated based on the estimated fair values of assets and liabilities, including identifiable intangible assets. The
purchase price allocation is considered final. The following table summarizes the net liabilities assumed and the intangible assets and goodwill
acquired in connection with the acquisition (in thousands):
The weighted-average amortizable life of the acquired intangible assets is 6.4 years. The acquisition was treated as an acquisition of net
assets for tax purposes and, accordingly, the $49.1 million of goodwill acquired is tax deductible.
The following summarized unaudited pro forma information assumes that the acquisition of MyPoints had occurred at January 1, 2006 and
2005 (in thousands, except per share amounts):
The Names Database
In March 2006, the Company acquired The Names Database for approximately $10.1 million in cash, including acquisition costs. The
Names Database is a global social
-networking service that acts as an
F- 20
Description
Estimated
Fair
Value
Estimated
Amortizable
Life
Net liabilities assumed:
Cash
$
7,137
Accounts receivable
9,667
Other current assets
1,905
Property and equipment
2,833
Other assets
496
Accounts payable and accrued liabilities
(9,376
)
Deferred revenue
(471
)
Member redemption liability
(17,673
)
Total net liabilities assumed
(5,482
)
Intangible assets acquired:
Customer contracts
9,230
5 years
Proprietary rights
3,700
10 years
Total intangible assets acquired
12,930
Goodwill
49,122
Total purchase price
$
56,570
Year Ended
December 31,
2006
2005
Revenues
$
535,647
$
563,343
Income before cumulative effect of accounting change
$
41,518
$
48,540
Net income
$
42,559
$
48,540
Basic net income per share:
Income before cumulative effect of accounting change
$
0.65
$
0.79
Net income
$
0.66
$
0.79
Diluted net income per share:
Income before cumulative effect of accounting change
$
0.63
$
0.76
Net income
$
0.64
$
0.76