Stamps.com 2015 Annual Report Download - page 74

TABLE OF CONTENTS
STAMPS.COM INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
thosegoodsorservices.IndoingsotheCompanymayberequiredtousemorejudgmentandmakemoreestimatesthanundercurrent
authoritativeguidance.ASU2014-09willbeeffectivefortheCompanyinthefirstquarteroffiscal2017andmaybeappliedonafull
retrospectiveormodifiedretrospectiveapproach.TheCompanyiscurrentlyevaluatingtheimpacttheadoptionofthisstandardwill
haveonitsconsolidatedfinancialstatements.
InApril2015,theFASBissuedanewstandardsimplifyingthepresentationofdebtissuancecosts.Thenewstandardalignsthe
treatmentofdebtissuancecostswithdebtdiscountsandpremiumsandrequiresdebtissuancecostsbepresentedasadirectdeduction
fromthecarryingamountoftherelateddebt.ThestandardiseffectiveforinterimandannualperiodsbeginningafterDecember15,
2015,withearlyadoptionpermitted,andrequiresaretrospectivemethodofadoption.Weadoptedtheprovisionsofthenewstandard
forthebalancesheetdisclosuresofdebtissuancecostsasofDecember31,2015.
InNovember2015,theFASBissuedguidancethatrequiresdeferredtaxassetsandliabilitiestobepresentedasnoncurrentina
classifiedstatementoffinancialposition.TheguidanceiseffectivebeginningJanuary1,2017,withearlyadoptionpermitted.The
guidancecanbeappliedprospectivelyorretrospectively.TheCompanyelectedtoearlyadopttherequirementsandapplythem
retrospectivelyasofDecember31,2015.Theadoptionresultedinthereclassificationof$2.1millionofcurrentdeferredtaxassets,net
tononcurrentdeferredtaxassets,netintheConsolidatedBalanceSheetsasofDecember31,2014.
3. Acquisitions
Wehaveaccountedforallofouracquisitionsundertheacquisitionmethodofaccountinginaccordancewiththeprovisionsof
FASBASCTopicNo.805BusinessCombinations(“ASC805”).
ShipStation Acquisition and Contingent Consideration
OnJune10,2014,weacquired100%oftheoutstandingequityofAuctaneLLC,whichoperatesShipStation,inacashand
contingentstocktransaction.ShipStation,basedinAustin,Texas,offersmonthlysubscriptionbasede-commerceshippingsoftware
primarilyunderthebrandsShipStationandAuctane.ShipStationisaleadingweb-basedshippingsoftwaresolutionthatallowsonline
retailersande-commercemerchantstoorganize,process,fulfillandshiptheirordersquicklyandeasily.ShipStationsupports
automaticorderimportingfromover50shoppingcartsandmarketplaces,includingeBay,Amazon,Shopify,Bigcommerce,Volusion,
Squarespaceandothers.ShipStationoffersmulti-carriershippingoptions,andautomationfeatureslikecustomhierarchicalrulesand
productprofilesthatallowcustomerstoeasilyandautomaticallyoptimizetheirshipping.UsingShipStation,anonlineretailerore-
commercemerchantcanshiptheirordersfromwherevertheysellandhowevertheyship.
ThetotalpurchasepriceforShipStationwasapproximately$66.2millionandwascomprisedofthefollowing(inthousands,
exceptshares):
Fair Value
Cashconsideration $ 50,000
Fairvalueofperformancelinkedearn-outofupto768,900sharesofStamps.comcommonstock(contingent
consideration)  16,242
Totalpurchaseprice $ 66,242
Theperformancelinkedearn-outpaymentofStamps.comshares(orcontingentconsideration)toformerequitymembersof
AuctaneLLCisbasedontheachievementofcertainfinancialmeasureswithinafuturetimeperiod.Therearetwoperiodsinwhichthe
earn-outpaymentwillbecalculated.Thefirstearn-outperiodwasbasedontheachievementofcertainfinancialmeasuresduringthe
sixmonthsendedDecember31,2014.Thesecondearn-outperiodisbasedontheachievementofcertainfinancialmeasuresduringthe
twelvemonthsendedDecember31,2015.TherangeofStamps.comsharesavailablefortheperformancelinkedearn-outforboth
periodsisbetween576,675to768,900sharesprovidedaminimumthresholdforthefinancialmeasuresisachieved.Thecurrent
portionofthecontingentconsiderationin2014representedtheestimatedfairvalueofthe
F-15