Company: CWAN
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001628280-25-021833
Chunk: 61

Company: Clearwater Analytics Holdings, Inc.
Filing Date: 2025-05-02
Form: 10-Q
Item: Part I, Item 8
Chunk 61
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 AxiomSM, Wilshire AtlasSM, Wilshire Abacus (“AAA”), and Wilshire iQComposite (“IQComposite” and, together with AAA, the “Wilshire Technology”)), which together comprise the risk and performance analytics solutions businesses of Wilshire Advisors LLC, (“Wilshire”), a leading global financial services firm. We acquired the employee base and all customer contracts associated with the Wilshire Technology. Following the acquisition, the Wilshire Technology is co-branded as Clearwater Wilshire Analytics and enables clients to calculate performance and risk attribution, assist with security-level portfolio construction, access high-quality portfolio models, and identify investment opportunities that maximize returns and mitigate risk. The total purchase consideration for the acquisition of the Wilshire Technology was $40.1 million in cash, paid upon completion of the acquisition. In connection with the acquisition, the Company and Wilshire entered into a Transition Services Agreement pursuant to which Wilshire agreed to perform certain services for a period of time with respect to the Company’s use and operation of the Wilshire Technology, and a Master SaaS Agreement for Wilshire to license back the underlying technology for use in their retained business. We expensed acquisition-related costs in the amount of $1.3 million in general and administrative expenses in the first and second quarters of 2024. We have accounted for this transaction as a business combination and allocated the fair value of the consideration to the tangible and intangible assets acquired as well as liabilities assumed, based on their estimated fair values. The excess of 

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the purchase price over the fair values of these identifiable assets and liabilities was recorded as goodwill. The allocated fair value is summarized as follows (in thousands):Fair ValueAccounts receivable$412 Prepaid expenses325 Intangible assets11,700 Goodwill28,237 Deferred revenue(552)Cash paid for acquisition of business, net of cash acquired$40,121 Goodwill generated from this business combination is primarily attributable to the assembled workforce, expected post-acquisition synergies from integrating the Wilshire Technology into our platform and the expansion of product offerings to our existing global customer base. The goodwill is deductible for income tax purposes.The following table presents details of the fair values of identified intangible assets acquired (in thousands, except years): Fair ValueEstimated Useful LifeDeveloped technology - AAA$9,100 5 yearsDeveloped technology - iQComposite900 6 yearsClient relationships1,350 11 yearsTrademarks350 3 yearsTotal$11,700 

The identified int