Acquisition (Tables)

9 Months Ended

Sep. 30, 2015

Dealix [Member]

Fair value of assets and liabilities assumed

	(in thousands)
Net identifiable assets acquired:
Total tangible assets acquired	$	9,664
Total liabilities assumed		2,488
Net identifiable assets acquired		7,176
Definite-lived intangible assets acquired		8,195
Indefinite-lived intangible assets acquired		2,200
Goodwill		7,440
	$	25,011

Acquired intangible assets

	Valuation Method	Estimated Fair Value		Estimated Useful Life (1)
		(in thousands)		(years)
Non-compete agreement – from CDK	Discounted cash flow (2)	$	500	2
Non-compete agreement – key employee	Discounted cash flow (2)		40	1
Customer relationships	Excess of earnings (3)		7,020	10
Trademark/trade names – Autotegrity	Relief from Royalty (4)		120	3
Trademark/trade names – UsedCars.com	Relief from Royalty (4)		2,200	Indefinite
Developed technology	Cost Approach (5)		515	3
Total purchased intangible assets		$	10,395

(1)	Determination of the estimated useful lives of the individual categories of purchased intangible assets was based on the nature of the applicable intangible asset and the expected future cash flows to be derived from such intangible asset. Amortization of intangible assets with definite lives is recognized over the shorter of the respective life of the agreement or the period of time the assets are expected to contribute to future cash flows.
(2)	The non-compete agreement fair value was derived by calculating the difference between the present value of the Company's forecasted cash flows with the agreement in place and without the agreement in place.
(3)	The excess of earnings method estimates a purchased intangible asset's value based on the present value of the prospective net cash flows (or excess earnings) attributable to it. The value attributed to these intangibles was based on projected net cash inflows from existing contracts or relationships.
(4)	The relief from royalty method is an earnings approach which assesses the royalty savings an entity realizes since it owns the asset and isn’t required to pay a third party a license fee for its use.
(5)	The cost approach estimates the cost required to repurchase or reproduce the intangible assets. The method takes into account technological and economic obsolescence of the technology.

Pro forma information

	Three Months Ended September 30, 2014		Nine Months Ended September 30, 2014
	(in thousands)
Unaudited pro forma consolidated results:
Revenues	$	39,910	$	121,836
Net income	$	2,263	$	9,231

Auto USA [Member]

Fair value of consideration transferred

	(in thousands)
Cash (including a working capital adjustment of $44)	$	10,044
Convertible subordinated promissory note		1,300
Warrant to purchase 69,930 shares of Company common stock		510
	$	11,854

Fair value of assets and liabilities assumed

The following table summarizes the fair values of the assets acquired and liabilities assumed: 

	(in thousands)
Net identifiable assets acquired	$	758
Definite-lived intangible assets acquired		3,750
Goodwill		7,346
	$	11,854

The fair value of the acquired intangible assets was determined using the below valuation approaches. In estimating the fair value of the acquired intangible assets, the Company utilized the valuation methodology determined to be most appropriate for the individual intangible asset being valued as described below. The acquired intangible assets include the following:

	Valuation Method	Estimated Fair Value		Estimated Useful Life (1)
		(in thousands)		(years)
Non-compete agreement	Discounted cash flow (2)	$	90		2
Customer relationships	Excess of earnings (3)		2,660		5
Trademark/trade names	Relief from Royalty (4)		1,000		5
Total purchased intangible assets		$	3,750

(1)	Determination of the estimated useful lives of the individual categories of purchased intangible assets was based on the nature of the applicable intangible asset and the expected future cash flows to be derived from such intangible asset. Amortization of intangible assets with definite lives is recognized over the shorter of the respective life of the agreement or the period of time the assets are expected to contribute to future cash flows.
(2)	The non-compete agreement fair value was derived by calculating the difference between the present value of the Company's forecasted cash flows with the agreement in place and without the agreement in place.
(3)	The excess of earnings method estimates a purchased intangible asset's value based on the present value of the prospective net cash flows (or excess earnings) attributable to it. The value attributed to these intangibles was based on projected net cash inflows from existing contracts or relationships.
(4)	The relief from royalty method is an earnings approach which assesses the royalty savings an entity realizes since it owns the asset and isn’t required to pay a third party a license fee for its use.