Company: CELH
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001341766-25-000080
Chunk: 72

Company: Celsius Holdings, Inc.
Filing Date: 2025-05-06
Form: 10-Q
Item: Item 1
Chunk 72
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’s transition of certain existing distribution rights in the Territory to Pepsi (the “Transition Agreement”). Under the terms of the Transition Agreement, Pepsi agreed to pay the Company up to $250.0 million in multiple tranches to facilitate the Company’s transition of certain distribution rights to Pepsi. The Company received $227.8 million from Pepsi that were contractually restricted to be used only to pay termination fees due to other distributors; any excess cash received over amounts due to other distributors was required to be refunded to Pepsi. During 2023, $34.8 million of such funds were refunded to Pepsi. As of and after December 31, 2023, there was no refund liability owed to Pepsi.On March 23, 2024, the Company entered into Amendment No. 1 to the Distribution Agreement with Pepsi, pursuant to which the Company has agreed to provide Pepsi with an incentive program designed to incentivize and compensate Pepsi for its continued focus on and actions to support the Company. These incentives are accounted for as promotional allowances and recorded as a reduction to revenue.

5.    ACQUISITION

On November 1, 2024, the Company acquired 100% of the outstanding voting equity interests of Big Beverages Contract Manufacturing, L.L.C. ("Big Beverages"), a longtime co-packer for Celsius located in Huntersville, North Carolina. The acquisition provides the Company with in-house manufacturing capacity including access to manufacturing and warehouse facilities and a skilled workforce. The total purchase consideration was cash of $75.3 million, which is net of $1.5 million of acquired cash. The transaction was accounted for as a business combination under ASC 805. There have been no changes to the purchase price allocation since December 31, 2024. A summary of the allocation of the total purchase consideration is presented below:Purchase ConsiderationGoodwillProperty, Plant and Equipment AcquiredOther Net Identifiable Assets AcquiredBig Beverages Acquisition$76,812 $58,257 $13,254 $5,301 

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Celsius Holdings, Inc.Notes to the Condensed Consolidated Financial Statements (Unaudited)March 31, 2025(Tabular dollars in thousands, except per share amounts)

The acquired intangible asset fair values consisted of the following, which are amortized on a straight-line basis over their estimated useful lives:Estimated Useful Life in YearsAt November 1, 2024Customer relationships6$900 Trade name3500 Intangibles$