Company: ACTG
Filing Date: 2025-05-09
Form Type: 10-Q
Source: 0000934549-25-000021
Chunk: 125

Company: ACACIA RESEARCH CORP
Filing Date: 2025-05-09
Form: 10-Q
Item: Part I, Item 8
Chunk 125
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Transaction expenses paid to Sellers15,290 Adjustment and indemnity escrow amount1,184 Total consideration$97,763 Identifiable assets acquired and liabilities assumed:Cash and cash equivalents$11,316 Accounts receivables15,705 Inventories17,617 Prepaid expenses and other current assets4,498 Deferred tax assets11,588 Property, plant and equipment, net23,203 Operating lease, right-of-use assets8,841 Customer relationships22,400 Trade names and trademarks 9,100 Developed technology1,000 Favorable leases704 Accounts payable(8,836)Accrued expenses(17,172)Liability for sales tax and fees(7,000)Current lease liabilities(2,614)Long-term lease liabilities(6,354)Deferred tax liabilities(3,031)Total identifiable net assets$80,965 Goodwill$16,798 

During the three months ended March 31, 2025, the goodwill arising from the acquisition was decreased by $3.8 million due to measurement period adjustments.  The measurement period adjustments were related to proceeds received from working capital adjustments of $1.2 million and increases in the preliminary valuations of the acquired assets and liabilities 

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comprising: $2.2 million in customer relationships, $0.5 million in trade names and trademarks, $0.3 million in deferred tax assets, and $0.4 million in deferred tax liabilities.  

The estimates for acquired assets and liabilities remain provisional and may be subject to further adjustments during the measurement period, not to exceed one year from the date of acquisition. The final purchase price allocation is expected to be completed by the end of 2025 and will be based on the final working capital adjustments and other analysis of fair values of acquired assets and liabilities.

Intangible Assets

Goodwill of $16.8 million represents the excess of the consideration transferred over the estimated fair values of assets acquired and liabilities assumed. The goodwill recognized is primarily attributed to the assembled workforce of Deflecto and new customer relationships that did not exist at the time of the transaction. None of the goodwill resulting from the acquisition is deductible for tax purposes. All of the goodwill acquired is allocated to the Deflecto reporting unit. Other intangible assets include $22.4 million of customer relationships, $1.0 million of developed technology, $9.1 million of trade names and trademarks and $