On May 27, 2022, the Company acquired certain assets and liabilities of Adaptive Spectrum and Signal Alignment, Incorporated (“ASSIA”), an industry pioneer of broadband access quality-of-experience and service assurance software solutions (the “ASSIA Acquisition”). The core assets acquired include the CloudCheck® WiFi experience management and Expresse® access network optimization software solutions.

The initial purchase consideration was $25.0 million, including a $2.5 million holdback that was released during the third quarter of 2023. In October 2022, the Company agreed to pay an additional $1.35 million of purchase consideration to settle certain unresolved matters related to the ASSIA Acquisition.

The acquisition was recorded as a business combination with valuation of the assets acquired and liabilities assumed recorded at their acquisition date fair value determined using primarily level three inputs, defined as unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company used a combination of income approach and market approach to determine the fair value of intangible assets acquired. Significant unobservable inputs included estimated future cash flows and a discount rate. Cash flow projections were based on management’s estimates of revenue growth rates and operating margins, EBITDA margins, consideration of industry and market conditions, terminal growth rates and management’s estimates of working capital requirements. The discount rate of 23% was based on a weighted average cost of capital adjusted for the relevant risk associated with the characteristics of intangible assets acquired. Under the market approach, the Company utilized an analysis of royalty rate licensing data. We completed the purchase price allocation for ASSIA Acquisition in the first quarter of 2023.

The following summarizes the final fair values of the assets acquired and liabilities assumed at the date of the ASSIA Acquisition (in thousands):


Provisional allocation of purchase consideration
Cash and cash equivalents	$	203
Accounts receivable		2,322
Other assets		407
Right-of-use assets		2,172
Property, plant and equipment		232
Intangible assets		30,200
Accounts payable		(75	)
Contract liabilities		(12,192	)
Operating lease liabilities		(2,612	)
Accrued and other liabilities		(756	)
Goodwill		6,449
Total purchase consideration	$	26,350

The purchase price allocation resulted in the recognition of goodwill of approximately $6.4 million, which included the experienced workforce and the expected synergies from combining operations. The Company expects no goodwill to be deductible for tax purposes.

The following table represents the preliminary estimated fair value and useful lives of identifiable intangible assets acquired (estimated fair value in thousands):


	Estimated		Estimated
	fair value		useful life
Intangible assets acquired
Customer relationships	$	18,600	15 years
Customer backlog		5,100	10 years
Developed technology		6,200	5 - 7 years
Tradenames		300	10 years
Total intangible assets	$	30,200

We included $16.9 million of net revenue generated by ASSIA since the acquisition date in the Company’s consolidated statements of comprehensive income (loss) for the reporting period. We did not present the supplemental pro forma information for ASSIA Acquisition since it is impracticable to prepare such financial statements considering the timing and materiality of the transaction.