Vistaprint 2010 Annual Report Download - page 83

Form 10-K
Allocations of Assets and Liabilities
The Company allocated the purchase price for Soft Sight to net tangible assets of $52,
deferred tax assets of $691, intangible assets of $2,647, goodwill of $4,168 and a deferred tax liability
of $1,059. The fair values of the acquired intangible assets were measured from the perspective of a
market participant. Of the $2,647 of acquired intangible assets, $920 was immediately expensed as it
will not be used by the Company and does not have economic value for the Company. The carrying
value of the remaining intangible assets relate to developed embroidery technology and customer
lists, which will be amortized over a weighted average life of approximately 3.8 years.
The deferred tax assets primarily relate to net operating loss carryforwards that will be able to
be utilized to reduce future tax liabilities. The deferred tax liability primarily relates to the tax impact of
future amortization or impairments associated with the identified intangible assets acquired, which are
not deductible for tax purposes.
The difference between the consideration transferred to acquire the business and the fair value
of assets acquired and liabilities assumed was allocated to goodwill. This goodwill relates to the
potential synergies from the integration of the Soft Sight embroidery software capabilities into the
existing Vistaprint product offering. The Company does not expect the goodwill to be deductible for
income tax purposes.
6. Long-Term Debt
The Company’s long-term debt is summarized as follows:
2010 2009
June 30,
Amended Canadian credit agreement . . . . . . . . . . . . . . . . . . . . . . . $ 5,222 $ 6,556
Original Canadian credit agreement . . . . . . . . . . . . . . . . . . . . . . . . . — 6,380
Euro revolving credit agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . — 5,878
Total long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,222 $ 18,814
In December 2005, the Company amended its original Canadian credit agreement to include
an additional $10,000 equipment term loan. The borrowings were used to finance printing equipment
purchases for the Windsor production facility. The remaining obligation under the Company’s
amended Canadian credit agreement is payable in monthly installments of $111 with the remaining
balance of $4,667 to be paid during December 2010. As of June 30, 2010, the interest rates on the
amended Canadian credit agreement range from 7.82% to 8.50% and the balance is classified as
current.
During the second quarter of fiscal 2010, the remaining balance of the euro revolving credit
agreement and the final balloon payment on the original Canadian credit agreement were paid in the
amounts of $6,064 and $5,960, respectively.
The Company was in compliance with all debt covenants at June 30, 2010.
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