On the Company acquired ACD for approximately million, net of cash acquired, plus contingent consideration of up to million as follows:

 

The Company paid approximately million, net of cash acquired and the working capital adjustments, as of the acquisition date. The remaining million will be paid to current employees who held ACD unvested stock as of the acquisition date. In order to receive payment for unvested shares, the individuals must remain employees of ACD over the -month vesting period which extends from the acquisition date through Any amounts that would have been owed to individuals who leave the company during the vesting period, will be pooled together and distributed amongst the other former ACD shareholders at the end of the vesting period. Management determined that million of the million represents purchase price consideration paid for pre-acquisition services. However, the remaining million represents compensation expense as the amount the individual employees receives is tied to future service. This current value of this liability recorded on the Consolidated Balance Sheets under the caption “Salaries, wages and related accruals”.

 

During the quarter of fiscal management determined that the calendar year revenue milestone was met. Refer to Note for discussion of this item as well as discussion of the changes to the fair value estimate for the calendar year revenue milestone as of

 

The goodwill recorded as a result of the ACD acquisition represents the strategic benefits of growing the Company's product portfolio and the expected revenue growth from increased market penetration from future products and customers. The goodwill is deductible for income tax purposes. The business became part of the Company’s Biotechnology reportable segment in the quarter of

 

Purchase accounting was finalized during the quarter of The following table (in thousands) summarizes the value of ACD assets acquired and liabilities assumed as of the acquisition date.

 

 

As summarized in the table, there have been adjustments totaling million to goodwill during the measurement period. These adjustments primarily relate to the finalization of acquired intangible asset cash flow models, and finalization of opening balance sheet deferred tax assets and liabilities. However, the adjustments also include a million decrease in the fair value of the inventory required related to an error in the preliminary valuation identified by management during the quarter. See Note for additional information regarding the impact of this error to the first, second, and quarter fiscal year financial statements.

 

Tangible assets acquired, net of liabilities assumed, were stated at fair value at the date of acquisitions based on management's assessment. The purchase price allocated to developed technology, trade names, and customer relationships was based on management's forecasted cash inflows and outflows and using a relief-from-royalty and a multi-period excess earnings method to calculate the fair value of assets purchased. The developed technology is being amortized with the expense reflected in cost of goods sold in the Condensed Consolidated Statements of Earnings and Comprehensive Income. Amortization expense related to trade names, and customer relationships is reflected in selling, general and administrative expenses in the Consolidated Statements of Earnings and Comprehensive Income. The amortization periods for intangible assets acquired in fiscal are estimated to be years for developed technology, years for trade names, years for customer relationships. The deferred income tax liability represents the net amount of the estimated future impact of adjustments for costs to be recognized upon the sale of acquired inventory that was written up to fair value and intangible asset amortization, both of which are deductible for income tax purposes.

 

As previously disclosed, ACD was acquired on The unaudited pro forma financial information below summarizes the combined results of operations for Bio-Techne and ACD as though the companies were combined as of the beginning fiscal The pro forma financial information for all periods presented includes the purchase accounting effects resulting from these acquisitions except for the increase in inventory to fair value and the fair value adjustments to contingent consideration as these are expected to have a continuing impact on cost of goods sold or selling, general and administrative expense, respectively. The pro forma financial information as presented below is for informational purposes only and is indicative of the results of operations that would have been achieved if the acquisitions had taken place at the beginning of fiscal

 

 

 

On the Company acquired Space Import-Export, Srl (Space) of Milan, Italy for approximately million. million was paid on the acquisition date and the remaining million will be paid during the quarter of fiscal year Space was a long-time distribution partner of the Company in the Italian market. The acquisition resulted in goodwill as we expect strategic benefits of revenue growth from increased market penetration. The goodwill is deductible for income tax purposes. The business became part of the Company’s Biotechnology reportable segment in the quarter of Purchase accounting was finalized during the quarter. There were material changes from the preliminary opening balance sheet. The final fair values of the assets acquired and liabilities assumed in each acquisition, are as follows (in thousands):

 

On the Company acquired Zephyrus Biosciences, Inc. (Zephyrus) for million in cash and up to million in contingent consideration. Zephyrus provides research tools to enable protein analysis at the single cell level. Addressing the burgeoning single cell analysis market, Zephyrus's product, Milo™, enables western blotting on individual cells for the time. The acquisition was funded with cash on hand. The purchase price of Zephyrus exceeded the preliminary estimated fair value of the identifiable net assets and, accordingly, the difference was allocated to goodwill, substantially all of which is tax deductible. Zephryus is included in the Company's Protein Platforms segment.

 

In connection with the Zephyrus acquisition, the Company recorded million of in process research and development which is amortized until it is converted to developed technology which occurs once a sale of its product is completed. In the quarter of fiscal the Company transferred the balance of in process research and development to developed technology and began amortizing the intangible asset after Zephyrus made its sale. The intangible asset amortization for the developed technology is deductible for income tax purposes.

 

The Company will pay Zephyrus former shareholders an additional million if and when instruments are sold prior to the -year anniversary of the closing date (In addition, the Company will pay Zephyrus former shareholders an additional million if and when million in cumulative sales are generated within years of the closing date (The Company made a million payment in the quarter of fiscal after Zephyrus sold its instrument. We estimate the remaining fair value of these contingent consideration payments to be million. Refer to Note for further discussion of this item.

 

The goodwill recorded as a result of the Zephyrus acquisition represents the strategic benefits of growing the Company's product portfolio and the expected revenue growth from increased market penetration from future products and customers. The goodwill is deductible for income tax purposes.

 

We made certain purchase accounting adjustments for the acquisition of Zephyrus, which was acquired in prior to the finalization of purchase accounting during the quarter of fiscal year The adjustments recorded during months ended included a million increase to the contingent consideration liability resulting from the finalization of the valuation model, a million increase to intangible assets resulting from valuation model adjustments, and a million increase to net deferred tax assets. A corresponding million increase was recorded to goodwill from the preliminary amount recorded as of

On the Company acquired Cliniqa Corporation (Cliniqa) for approximately million. Cliniqa specializes in the manufacturing and commercialization of blood chemistry quality controls and calibrators as well as bulk reagents used for the clinical diagnostic market to further expand and complement our Diagnostics solutions. The acquisition was funded with cash on hand and funds obtained from our revolving credit facility. The purchase price of Cliniqa exceeded the fair value of the identifiable net assets and, accordingly, the difference was allocated to goodwill. Cliniqa is included in the Company's Diagnostics segment.

 

In connection with the Cliniqa acquisition, the Company recorded million of developed technology intangible assets that have an estimated useful life of years, million of customer relationship intangible assets that have an estimated useful life of  years, and million related to trade mark and trade names with a useful life of years. The intangible asset amortization is deductible for income tax purposes.

 

The goodwill recorded as a result of the Cliniqa acquisition represents the strategic benefits of growing the Company's product portfolio and the expected revenue growth from increased market penetration from future products and customers. The goodwill is deductible for income tax purposes.

   

 

On the Company acquired CyVek, Inc. (CyVek) through a merger. CyVek has developed a transformative immunoassay technology which integrates an innovatively designed microfluidic cartridge with a state-of-the-art analyzer to deliver the most advanced and efficient bench top immunoassay system. In fiscal the Company entered into an Agreement of Investment and Merger (the Agreement) with CyVek. Pursuant to the terms of the Agreement, the Company invested million in CyVek and received shares of Common Stock representing approximately of the outstanding voting stock of CyVek. Between the time of the Company's initial investment and CyVek met certain commercial milestones related to the sale of its products, which obligated the Company to acquire CyVek through a merger, with CyVek surviving as a wholly-owned subsidiary of the Company.

 

The Company made an initial payment of approximately million to the other stockholders of CyVek on Such purchase price was adjusted after closing based on the final levels of cash, indebtedness and transaction expenses of CyVek as of the closing. The Company will also pay CyVek's previous stockholders up to million based on the revenue generated by CyVek's products before The Company will also pay CyVek's previous stockholders of the amount, if any, by which the revenue from CyVek's products and related products exceeds million in calendar year The Company has recorded the present value of these contingent payments as liabilities of million at and respectively. In addition, at the Company re-measured its previous investment in CyVek to acquisition-date fair value, resulting in a gain on the investment of million which is included in other income on the Condensed Consolidated Statements of Earnings and Comprehensive Income. The purchase price of CyVek exceeded the fair value of the identifiable net assets and, accordingly, the difference was allocated to goodwill, substantially all of which is tax deductible. CyVek is included in the Company's Protein Platforms segment.

 

In connection with the CyVek acquisition, the Company recorded million of developed technology intangible assets that have an estimated useful life of years, million of trade name intangible assets that have an estimated useful life of years, and million related to customer relationships that have an estimated useful life of years. The intangible asset amortization is deductible for income tax purposes.

 

The goodwill recorded as a result of the CyVek acquisition represents the strategic benefits of growing the Company's product portfolio and the expected revenue growth from increased market penetration from future products and customers. The goodwill is deductible for income tax purposes.

 

On the Company acquired ProteinSimple. ProteinSimple expanded the Company's solutions that it can offer its customers by developing and commercializing proprietary systems and consumables for protein analysis. The Company opened a line-of-credit to partially fund the acquisition. The purchase price of ProteinSimple exceeded the fair value of the identifiable net assets and, accordingly, the difference was allocated to goodwill. ProteinSimple is included in the Company's Protein Platform segment.

 

In connection with the ProteinSimple acquisition, the Company recorded million of developed technology intangible assets that have an estimated useful lives of - years, million of trade name intangible assets that have an estimated useful lives of - years, million related to customer relationships that have estimated useful lives of - years, and million related to non-compete agreements that have an estimated useful life of years. The intangible asset amortization is deductible for income tax purposes.

 

The goodwill recorded as a result of the ProteinSimple acquisition represents the strategic benefits of growing the Company's product portfolio and the expected revenue growth from increased market penetration from future products and customers. The goodwill is deductible for income tax purposes.

  

On the Company acquired all of the issued and outstanding equity interests of Novus Holdings LLC (Novus). Novus broadened the Company's antibody offerings by being a supplier of a large portfolio of both outsourced and in-house developed antibodies and other reagents for life science research. Novus is included in the Company's Biotechnology segment.

 

In connection with the Novus acquisition, the Company recorded million of developed technology intangible assets that have estimated useful lives of - years, million of trade name intangible assets that have an estimated useful life of years, and million related to customer relationships that have an estimated useful life of years. The majority of the intangible asset amortization is deductible for income tax purposes.

 

The goodwill recorded as a result of the Novus acquisition represents the strategic benefits of growing the Company's product portfolio and the expected revenue growth from increased market penetration from future products and customers. The majority of the goodwill is deductible for income tax purposes.

 

The aggregate purchase price of the acquisitions was allocated to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as a result of the fiscal year and acquisitions (in thousands):

 

Tangible assets acquired, net of liabilities assumed, were stated at fair value at the date of acquisition based on management's assessment. The purchase price allocated to developed technology, trade names, non-compete agreements and customer relationships was based on management's forecasted cash inflows and outflows and using a relief-from-royalty and a multi-period excess earnings method to calculate the fair value of assets purchased. The developed technology is being amortized with the expense reflected in cost of goods sold in the Consolidated Statements of Earnings and Comprehensive Income. Amortization expense related to trade names, the non-compete agreement and customer relationships is reflected in selling, general and administrative expenses in the Consolidated Statements of Earnings and Comprehensive Income. The deferred income tax liability represents the estimated future impact of adjustments for the cost to be recognized upon the sale of acquired inventory that was written up to fair value and intangible asset amortization, both of which are deductible for income tax purposes, and the future tax benefit of net operating loss and tax credit carryforwards which will be deductible by the Company in future periods.