Salesforce.com 2013 Annual Report Download - page 88

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The following table sets forth the components of identifiable intangible assets acquired and their estimated
useful lives as of the date of acquisition:
(in thousands) Fair value Useful Life
Developed technology ............................ $ 84,200 3 years
Customer relationships ........................... 15,000 5 years
Trade name and trademark ........................ 3,800 3 years
Total intangible assets subject to amortization ..... $103,000
Developed technology represents the fair value of the Radian6 monitoring technology. Customer
relationships represent the fair values of the underlying relationships and agreements with Radian6 customers.
Trade name and trademark represents the fair value of brand and name recognition associated with the marketing
of Radian6 service offerings. The goodwill balance is primarily attributed to the assembled workforce, expanded
market opportunities and expected synergies when integrating Radian6’s social solution media technology with
the Company’s offerings. The goodwill balance is deductible for tax purposes.
The Company assumed unvested options with a fair value of $23.9 million on the day of the acquisition. Of
the total consideration, $4.7 million was allocated to the purchase consideration and $19.2 million was allocated
to future services that are expensed over the remaining service periods on a straight-line basis.
Assistly, Inc.
On September 20, 2011, the Company acquired for cash the outstanding stock of Assistly, a cloud provider
of customer service solutions. The Company acquired Assistly to, among other things, extend its commitment to
small and emerging businesses in customer service help desk application offerings. The Company has included
the financial results of Assistly in the consolidated financial statements from the date of acquisition, which have
not been material to date. The acquisition date fair value of the consideration transferred for Assistly was
approximately $58.7 million, which consisted of the following:
Fair value of consideration transferred (in thousands)
Cash ..................................................... $53,938
Fair value of stock options assumed ............................ 1,043
Fair value of pre-existing relationship ........................... 3,694
Total ..................................................... $58,675
The fair value of the stock options assumed by the Company was determined using the Black-Scholes
option pricing model and the share conversion ratio of 0.031 was applied to convert Assistly options to the
Company’s options.
The Company had a $1.0 million, or approximately seven percent, noncontrolling equity investment in
Assistly prior to the acquisition. The acquisition date fair value of the Company’s previous equity interest was
$3.7 million and was included in the measurement of the consideration transferred. The Company recognized a
gain of $2.7 million as a result of remeasuring its prior equity interest in Assistly held before the business
combination. The gain was recognized in other expense on the consolidated statement of operations.
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