World Fuel Services 2008 Annual Report Download - page 60

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WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The identified intangible assets and their estimated lives are as follows (in thousands):
Amount
Estimated
Lives
Customer relationships (charge cardholder, merchant and
government).......................................... $18,300 2-20years
Non compete agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600 1-3 years
Trademark/trade name rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000 Indefinite
$22,900
Under the terms of the purchase agreement, the sellers agreed to indemnify us (by cash payment or
offsetting against the promissory note) for acquired accounts receivable that existed as of the date of acquisition
that were not collected within 120 days after the acquisition. To the extent that we have been indemnified with
respect to certain accounts and such accounts are subsequently collected by us within two years from the date of
acquisition, we are obligated to reimburse the sellers, less any related collection costs, in the same manner in
which we were indemnified. As of December 31, 2008, approximately $0.9 million of the accounts and other
receivables acquired at the acquisition date had not been collected. The purchase agreement provides that the first
$0.2 million in aggregate of indemnification claims are not recoverable by us. During 2008, we recorded a
decrease in the fair value of our acquired accounts receivable with a related increase in goodwill of $0.2 million.
As of December 31, 2008, we had not asserted any other indemnification claims. Accordingly, the amount of the
indemnification as of December 31, 2008 was $0.7 million, which was recorded as a reduction of $0.7 million to
the promissory note.
The following reconciles the estimated fair values of the assets acquired, liabilities assumed and promissory
notes issued with cash paid for the acquisition of AVCARD, net of cash acquired (in thousands):
Assets acquired:
Cash........................................................... $ 3,438
Accountsreceivable .............................................. 57,970
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,179
Propertyandequipment ........................................... 1,586
Identifiable intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,900
Goodwill ....................................................... 8,083
Otherassets ..................................................... 360
Liabilities assumed:
Accountspayable ................................................ (30,004)
Customerdeposits................................................ (713)
Accrued expenses and other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . (453)
Long-termliabilities .............................................. (1,001)
Purchaseprice ..................................................... 63,345
Promissorynotesissued ............................................. (5,000)
Cash paid for acquisition of business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58,345
Cashacquired ..................................................... (3,438)
Cash paid for acquisition of business, net of cash acquired . . . . . . . . . . . . . . . . . . $ 54,907
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