Google 2007 Annual Report Download - page 98

Google Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
In addition, during the year ended December 31, 2007, we capitalized intangible assets of $5.2 million, paid in cash,
related to patent purchases.
The following table summarizes the allocation of the purchase price for all of the above acquisitions, excluding
Postini (in thousands):
Goodwill .................................................................................. $201,067
Patents and developed technology .............................................................. 81,275
Customer relationships ...................................................................... 13,230
Tradenames and other ....................................................................... 6,200
Net assets acquired .......................................................................... 6,181
Deferred tax liabilities ........................................................................ (25,947)
Purchased in-process research and development .................................................. 4,790
Total ................................................................................. $286,796
Goodwill expected to be deductible for tax purposes is $5.1 million.
Patents and developed technology, customer relationships, and tradenames and other intangible assets have a
weighted-average useful life of 3.7 years, 3.8 years and 3.3 years from the date of acquisition. The amount expected to be
deductible for tax purposes is $7.6 million.
Purchased in-process research and development was expensed at the time of the acquisitions because technological
feasibility had not been established and no future alternative uses existed. This amount was included in research and
development expenses on the accompanying Consolidated Statements of Income.
In connection with certain acquisitions in the current and prior years, we are obligated to make additional cash
payments if certain criteria are met. As of December 31, 2007, our remaining contingent obligations related to these
acquisitions was approximately $800 million. Since these contingent payments are based on the achievement of
performance targets, actual payments may be substantially lower.
Agreement and Plan of Merger with DoubleClick
In April 2007, we entered into an Agreement and Plan of Merger with DoubleClick to acquire all of the outstanding
interests of DoubleClick, a privately held company, for $3.1 billion in cash, plus the cash and cash equivalents of
DoubleClick, plus the aggregate exercise price for outstanding options and stock appreciation rights for DoubleClick
common stock, as well as certain other adjustments, minus certain unpaid third party expenses incurred by DoubleClick in
connection with this transaction and minus all indebtedness for borrowed money of DoubleClick.
In addition, unvested options and stock appreciation rights for DoubleClick common stock will be converted into
options to purchase our common stock with economic terms similar to outstanding vested equity interests.
Although the transaction has been cleared by the Federal Trade Commission in the U.S., the completion of this
transaction is subject to various customary conditions, including receiving antitrust clearance from the European
Commission. We and DoubleClick have each agreed to take all actions necessary to obtain the requisite antitrust and
other regulatory approvals.
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