Acquisitions

12 Months Ended

Dec. 31, 2011

Acquisitions [Abstract]

Acquisitions

2. Acquisitions

Core Mobility, Inc.

On October 26, 2009, the Company acquired Core Mobility, a developer of mobility software and solutions, for $10 million in cash and 700,000 shares of Smith Micro common stock. Core Mobility became a wholly-owned subsidiary of Smith Micro. In addition, the former shareholders of Core Mobility had the ability to earn additional cash consideration of up to $1.9 million in the form of earn-out payments, contingent on Core Mobility achieving certain milestone deliverables for product development and deployment. In March 2010, a milestone payment of $0.6 million was made. Of the $10 million of cash consideration, $3.0 million was held back (“Holdback”) as security against possible indemnification obligations. As of December 31, 2010, the entire Holdback had been paid. Acquisition-related costs of $0.2 million were recorded as expense in the fiscal year ended December 31, 2009 in the general and administrative section of the consolidated statement of operations.

The total purchase price is summarized as follows (in thousands):

Cash paid at closing	$	6,970
Holdback (including interest)		3,041
Common stock issued		6,881
Milestone payments		1,839
Total purchase price	$	18,731

The Company’s allocation of the purchase price is summarized as follows (in thousands):

Assets:
Cash	$	63
Accounts receivable		997
Unbilled receivable		324
Prepaid and other assets		279
Fixed assets		856
Deferred tax assets		1,735
Intangible assets		8,858
Goodwill		10,694
Total assets		23,806
Liabilities:
Accounts payable		26
Accrued expenses		258
Deferred revenue		1,280
Deferred tax liability		3,511
Total liabilities		5,075
Total purchase price	$	18,731

The results of operations of Core Mobility have been included in the Company’s consolidated financial statements from the date of acquisition. The pro-forma effect of the acquisition on historical periods is not material and therefore is not included.