BUSINESS COMBINATIONS

In April 2017, we completed the acquisition of substantially all of the assets of Instrument Associates, LLC d/b/a Nutfield Technology (“Nutfield”), a component technology business located in Hudson, New Hampshire, which specializes in the design and manufacture of advanced galvanometer-based optical scanners, scan heads and laser kits, for a total purchase price of approximately $5.5 million. This acquisition supports our long-term strategy to expand our presence in key markets and improve our existing product lines with innovative technology. The results of the acquired business’ operations as of and after the date of acquisition have been included in our condensed consolidated financial statements for the three and six months ended June 30, 2018 and June 30, 2017.

On March 9, 2018, we acquired all of the outstanding shares of Laser Control Systems Limited, a laser component technology business located in Bedfordshire, United Kingdom, which specializes in the design and manufacture of advanced digital scan heads and laser software, for a purchase price of $1.7 million. An additional $0.7 million in contingent consideration may be earned by the former owners if certain milestones are met. This acquisition supports our long-term strategy to expand our presence in key markets and improve our existing product lines with innovative technology. The results of the acquired business’ operations as of and after the date of acquisition have been included in our condensed consolidated financial statements as of and for the three and six months ended June 30, 2018.

On March 16, 2018, we acquired all of the outstanding shares of Photocore AG, a vision-based 3D measurement application and software developer, for a total purchase price of $2.4 million. This acquisition supports our long-term strategy to improve our existing software offerings with innovative technology. The results of the acquired business’ operations as of and after the date of acquisition have been included in our condensed consolidated financial statements as of and for the three and six months ended June 30, 2018.

The acquisitions of Nutfield, Laser Control Systems Limited, and Photocore AG constitute business combinations as defined by ASC Topic 805. Accordingly, the assets acquired and liabilities assumed were recorded at their fair values on the date of acquisition. The purchase price allocations marked as “Preliminary” below are based on the information that was available to make estimates of the fair value and may change as further information becomes available and additional analyses are completed. While we believe such information provides a reasonable basis for estimating the fair values, we may obtain more information and evidence during the measurement period that result in changes to the estimated fair value amounts. The measurement period ends on the earlier of one year after the acquisition date or the date we received the information about the facts and circumstances that existed at the acquisition date. Subsequent adjustments, if necessary, will be recognized during the period in which the amounts are determined. These refinements include: (1) changes in the estimated fair value of certain intangible assets acquired; and (2) changes in deferred tax assets and liabilities related to the fair value estimates. The purchase price allocation marked as “Final” below represents our final determination of the fair value of the assets acquired and liabilities assumed for such acquisition.

Following is a summary of our allocations of the purchase price to the fair values of the assets acquired and liabilities assumed as of the date of each acquisition:



	Nutfield (Final)			Laser Control Systems Limited (Preliminary)			Photocore AG (Preliminary)
Accounts receivable	$	160		$	—		$	—
Inventory	539			—			—
Other assets	96			—			—
Deferred income tax assets	131			—			—
Intangible assets	2,329			1,400			1,435
Goodwill ⁽¹⁾	2,357			928			1,010
Accounts payable and accrued liabilities	(12		)	—			—
Other liabilities ⁽²⁾	(104		)	(579		)	—
Total purchase price, net of cash acquired	$	5,496		$	1,749		$	2,445

⁽¹⁾ A portion of the goodwill is expected to be tax deductible for Nutfield and Photocore AG.

⁽²⁾ For Laser Control Systems Limited, this total consists primarily of the fair value of the projected

contingent consideration.

Following are the details of the purchase price allocated to the intangible assets acquired for the acquisitions noted above:



	Nutfield (Final)			Laser Control Systems Limited (Preliminary)			Photocore AG (Preliminary)
	Amount		Weighted Average Life (Years)	Amount		Weighted Average Life (Years)	Amount		Weighted Average Life (Years)
Trade name	$	29	1	$	—	0	$	—	0
Brand	—		0	26		1	22		1
Non-competition agreement	144		5	29		3	9		3
Technology	1,970		10	1,319		7	1,343		7
Customer relationship	95		10	26		10	61		10
Favorable in-place lease	91		12	—		0	—		0
Fair value of intangible assets acquired	$	2,329	10	$	1,400	7	$	1,435	7

The goodwill for the Nutfield acquisition has been allocated to the 3D Factory reporting segment. The goodwill for Laser Control Systems Limited will be allocated to the 3D Factory reporting segment. The goodwill for Photocore AG will be allocated to the Construction BIM reporting segment.

Pro forma financial results for Nutfield, Laser Control Systems Limited and Photocore AG have not been presented because the effects of these transactions, individually and in the aggregate, were not material to our consolidated financial results.