Rosetta Stone 2014 Annual Report Download - page 78

Table of Contents
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The Company has allocated the purchase price based on current estimates of the fair values of assets acquired and liabilities assumed in connection with
the Vivity Labs Merger. The table below summarizes the estimates of fair value of the Vivity assets acquired, liabilities assumed and related deferred income
taxes as of the acquisition date.
The Company finalized its allocation of the purchase price for Vivity as of December 31, 2014. The purchase price was allocated as follows (in
thousands):
Cash
$ 14
Accounts receivable
452
Other current assets
(3)
Accounts payable and accrued expenses
(307)
Net deferred tax liability
(919)
Net tangible assets acquired
(763)
Goodwill
9,336
Amortizable intangible assets
3,577
Purchase price
$ 12,150
The acquired amortizable intangible assets and the related estimated useful lives consist of the following (in thousands):
Estimated Useful
Lives
Estimated Value
January 2, 2014
Tradename
3 years
$ 188
Technology platform
5 years
2,448
Customer relationships
3 years
941
Total assets
$ 3,577
Tell Me More S.A.
On January 9, 2014, the Company completed its acquisition of Tell Me More S.A., (the "Tell Me More Merger" and "Tell Me More") a company
organized under the laws of France. Tell Me More provides online language-learning subscriptions and learning services primarily to corporate and
educational organizations. Tell Me More offers a robust suite of SaaS-based language-learning products and services that provide intermediate, advanced and
business language solutions in nine languages. The Tell Me More Merger strengthens the Company's growing Enterprise & Education business and expands
its global footprint. The aggregate amount of consideration paid by the Company was €22.1 million ($30.2 million), including assumed net debt.
The Tell Me More Merger resulted in goodwill of approximately $21.7 million, none of which is deductible for tax purposes. This amount represents
the residual amount of the total purchase price after allocation to the assets acquired and liabilities assumed.
All expenditures incurred in connection with the Tell Me More Merger were expensed and are included in general and administrative expenses.
Transaction costs incurred in connection with the Merger were $1.0 million and $0.5 million during the years ended December 31, 2014 and 2013,
respectively. The results of operations for Tell Me More have been included in the consolidated results of operations since January 9, 2014.
The Company has allocated the purchase price based on current estimates of the fair values of assets acquired and liabilities assumed in connection with
the Tell Me More Merger. The table below summarizes the estimates of fair value of the Tell Me More assets acquired, liabilities assumed and related deferred
income taxes as of the acquisition date.
The Company finalized its allocation of the purchase price for Tell Me More as of December 31, 2014. The purchase price was allocated as follows (in
thousands):
F-21