Acquisitions (Tables)

12 Months Ended

Dec. 31, 2020

SiriusDecisions, Inc [Member]

Summary of Fair Value of Aggregate Consideration Paid or Payable

The following table summarizes the fair value of the aggregate consideration paid for SiriusDecisions (in thousands):

Cash paid at close (1)	$	246,801
Working capital adjustment (2)		(1,259	)
Total	$	245,542

(1) The cash paid at close represents the gross contractual amount paid. Net cash paid, which accounts for the cash acquired of $7.9 million and the working capital adjustment of $1.3 million, was $237.7 million and is reflected as an investing activity in the Consolidated Statements of Cash Flows.

(2) Amount represents the final amount receivable from the sellers based upon working capital as defined, which was received in 2019.

Summary of Allocation of Purchase Price to Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed for the acquisition of SiriusDecisions (in thousands):

Assets:
Cash and cash equivalents	$	7,858
Accounts receivable		19,237
Prepaids and other current assets		3,660
Property and equipment		4,169
Goodwill (1)		158,569
Intangible assets (2)		115,000
Other assets		418
Total assets		308,911
Liabilities:
Accounts payable and other current liabilities		8,924
Deferred revenue		26,143
Deferred tax liability		26,226
Long-term deferred revenue		1,037
Other long-term liabilities		1,039
Total liabilities		63,369
Net assets acquired	$	245,542

(1) Goodwill represents the expected revenue and cost synergies from combining SiriusDecisions with Forrester as well as the value of the acquired workforce.

(2) All of the intangible assets are finite-lived. The determination of the fair value of the finite-lived intangible assets required management judgment and the consideration of a number of factors. In determining the fair values, management primarily relied on income valuation methodologies, in particular discounted cash flow models, and replacement cost valuation methodologies. The discounted cash flow models required the use of estimates, including projected cash flows related to the particular asset, the useful lives of the particular assets, the selection of royalty and discount rates used in the models, and certain published industry benchmark data. The replacement cost methodology required the use of estimates in determining the costs to replace the assets and the amount of obsolescence existing at the time of the acquisition. In establishing the estimated useful lives of the acquired intangible assets, the Company relied primarily on the duration of the cash flows utilized in the valuation model. Of the $115.0 million assigned to intangible assets, $13.0 million was assigned to the technology asset class with useful lives of 1 to 8 years (with a weighted average amortization period of 3.2 years), $13.0 million to backlog with a useful life of 2 years, $77.0 million to customer relationships with a useful life of 9.25 years, and $12.0 million to trademarks with an original useful life of 15.5 years. The weighted-average amortization period of all intangible assets was originally 8.4 years.

Schedule of Unaudited Pro Forma Financial Information

	Years Ended
	December 31,
	2019		2018
Pro forma total revenue	$	472,810	$	438,049
Pro forma net income (loss)	$	733	$	(10,069	)

FeedbackNow [Member]

Summary of Fair Value of Aggregate Consideration Paid or Payable

The following table summarizes the fair value of the aggregate consideration payable for FeedbackNow as of the acquisition date (in thousands):

Cash paid at close (1)	$	8,425
Working capital adjustment (2)		798
Indemnity holdback (3)		1,485
Contingent purchase price (4)		3,388
Total	$	14,096

(1) The cash paid at close represents the gross contractual amount paid. Net cash paid, which accounts for the cash acquired of $0.5 million, was $8.0 million and is reflected as an investing activity in the Consolidated Statements of Cash Flows.

(2) Represents the amount payable to the sellers based upon working capital as defined, and was paid to the sellers in 2019.

(3) $1.0 million and $0.5 million of the holdback was paid during 2020 and 2019, respectively.

(4) The acquisition of FeedbackNow included a contingent consideration arrangement that required additional consideration to be paid to the sellers based on the financial performance of FeedbackNow during the two-year period subsequent to the closing date. The fair value of this contingent consideration arrangement on the acquisition date was $3.4 million, which was recognized as purchase price. $2.7 million and $1.8 million was paid during 2020 and 2019, respectively, as a result of FeedbackNow meeting the financial performance targets. Refer to Note 7 – Fair Value Measurements for further discussion.

Summary of Allocation of Purchase Price to Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed for the acquisition of FeedbackNow (in thousands):

Assets:
Cash	$	463
Accounts receivable		738
Prepaids and other current assets		487
Goodwill (1)		9,513
Intangible assets (2)		4,780
Other assets		75
Total assets		16,056
Liabilities:
Accounts payable and other current liabilities		837
Contract liabilities		298
Deferred tax liability		825
Total liabilities		1,960
Net assets acquired	$	14,096

(1) Goodwill represents the expected synergies from combining FeedbackNow with Forrester as well as the value of the acquired workforce.

(2) All of the intangible assets are finite-lived. The determination of the fair value of the finite-lived intangible assets required management judgment and the consideration of a number of factors. In determining the fair values, management primarily relied on income valuation methodologies, in particular discounted cash flow models. The use of discounted cash flow models required the use of estimates, including projected cash flows related to the particular asset, the useful lives of the particular assets, the selection of royalty and discount rates used in the models, and certain published industry benchmark data. In establishing the estimated useful lives of the acquired intangible assets, the Company relied primarily on the duration of the cash flows utilized in the valuation model. Of the $4.8 million assigned to intangible assets, $3.0 million was assigned to the technology asset class with a useful life of 6.5 years, $1.3 million to customer relationships with useful lives of 4.5 years to 7.5 years (with a weighted average amortization period of 6.1 years), and $0.5 million to trademarks with a useful life of 8.5 years. The weighted-average amortization period of all intangible assets is 4.8 years.