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accordance with the guidance on accounting for the impairment or disposal of long-lived assets, the
building and land with a carrying value of $4 million ($3 million in previous periods due to foreign
currency translation) were written down to their fair value less cost to sell of $3 million, resulting in a
loss of $1 million for the year ended December 31, 2011. The loss is included in Selling, general and
administrative on the Consolidated Statements of Earnings. Fair value was estimated using a market
approach, based on available data for transactions in the region as well as the asking price of a
comparable property. The decrease in fair value during the first quarter of 2011 was driven by the
worsening of the industrial market in Juarez. Subsequent to the recognition of the loss during the first
quarter of 2011, the Company received an offer to purchase the facility comparable to the estimated
fair value. The Company completed the sale in the third quarter of 2011. Total proceeds from the sale
were $3.0 million, which resulted in a $0.6 million pre-tax gain recognized in Selling, general and
administrative on the Consolidated Statements of Earnings in the third quarter of 2011.
Related to the 2007 restructuring plan, the Company’s Orleans, France facility qualified as held for sale
in the second quarter of 2009. The carrying value of the building and land held for sale was
approximately $7 million at September 30, 2011. Due to certain developments subsequent to the time
the facility qualified as held for sale, negotiations with a potential buyer ceased in the fourth quarter of
2011. As a result the facility was written down to fair value less cost to sell of $3 million, resulting in a
loss of $4 million included in Selling, general and administrative on the Company’s Consolidated
Statements of Earnings for the year ended December 31, 2011. Fair value was estimated using an
income approach considering, from a market participant standpoint, discounted cash flows associated
with developing, leasing and ultimately selling the facility. The facility is included in Property, plant and
equipment, net on the Consolidated Statements of Financial Position. The Company is actively
marketing the facility for sale and is taking steps to minimize recurring expenses associated with the
facility. The Company received a $0.7 million payment in the fourth quarter of 2011 pursuant to a letter
of commitment signed in the first quarter of 2010 that obligated the potential buyer to 10% of the $7
million sale price.
Land held by the Company in Tatabanya, Hungary with a carrying value of $2 million was written down
to fair value less cost to sell of $1 million during the second quarter of 2011 due to the Company’s
receipt of an offer to purchase the land that was less than the carrying value of the land. The $1 million
loss is included in Selling, general and administrative on the Consolidated Statements of Earnings for
the year ended December 31, 2011. The Company completed the sale in the third quarter of 2011.
Total proceeds from the sale were $1.3 million. No gain or loss was realized on the sale in the third
quarter of 2011.
4. BUSINESS COMBINATIONS
Acquisition of Pallas Athena Holdings B.V.
On October 18, 2011, the Company acquired all issued and outstanding shares in Pallas Athena
Holdings B. V. (“Pallas Athena”) in a cash transaction valued at approximately $50.2 million. Pallas
Athena is a leading provider of BPM, document output management and process mining software
capabilities. The acquisition allows the Company to further strengthen its fleet management solutions
and services with a broader range of workflow solutions. The acquisition also will enable the
Company’s Perceptive Software segment to expand its presence in EMEA, while concurrently
leveraging the Company’s growing worldwide sales force to sell these software solutions globally.
Of the $50.2 million total cash payment, $41.4 million was paid to acquire the outstanding shares of
Pallas Athena, $7.1 million was used to repay debt and short-term borrowings, $1.2 million was used to
pay seller transaction fees, and $0.5 million was used to repay other obligations of Pallas Athena.
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