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Business Combinations (Tables)
12 Months Ended
Dec. 31, 2019
Business Combinations [Abstract]  
Schedule of Weighted-Average Useful Lives of Intangible Assets Acquired in Business Combinations
The intangible assets acquired in connection with business combinations during the year ended December 31, 2019 have an estimated weighted-average life as follows:
 
Weighted-Average Life
Purchased customer accounts
16.8
years
Software
5
years
Carrier relationships
20
years
Trade names
5
years
Schedule of Business Acquisitions
The table below provides a summary of the total consideration and the estimated purchase price allocations made for each of the business acquisitions that became effective during the year ended December 31, 2019. Due to the complexity of valuing the consideration paid and the purchase price allocation and the timing of these activities, certain amounts included in the consolidated financial statements may be provisional and subject to additional adjustments within the measurement period as permitted by Topic 805. The Company recorded measurement period adjustments for the Lykes and MSI Partnerships, which are reflected in the table below. Any measurement period adjustments related to prior period business combinations have been reflected as current period adjustments for the year ended December 31, 2019 in accordance with Topic 805.
(in thousands)
 Lykes (1)
 
MSI (1)
 
Fiduciary Partners
 
Foundation Insurance
 
Totals
Cash consideration paid
$
36,044

 
$
45,505

 
$
2,550

 
$
20,800

 
$
104,899

Fair value of contingent earnout consideration

 
25,603

 
151

 
3,347

 
29,101

Fair value of noncontrolling interest
1,000

 
30,963

 
638

 
6,036

 
38,637

Fair value of contingently returnable consideration

 

 
(321
)
 

 
(321
)
Trust balance adjustment

 
1,138

 

 

 
1,138

Total consideration
$
37,044

 
$
103,209

 
$
3,018

 
$
30,183

 
$
173,454

 
 
 
 
 
 
 
 
 
 
Cash and restricted cash
$
1,535

 
$
6,029

 
$

 
$
50

 
$
7,614

Premiums, commissions and fees receivable
3,170

 
14,437

 
20

 

 
17,627

Other assets
17

 
308

 
1

 

 
326

Intangible assets
 
 
 
 
 
 
 
 

Purchased customer accounts
8,742

 
13,640

 
1,874

 
8,709

 
32,965

Carrier relationships

 
7,200

 

 

 
7,200

Software

 
30,000

 

 

 
30,000

Trade names

 
1,820

 

 

 
1,820

Goodwill
25,947

 
50,164

 
1,124

 
21,471

 
98,706

Total assets acquired
39,411

 
123,598

 
3,019

 
30,230

 
196,258

Premiums and producer commissions payable
(2,367
)
 
(17,447
)
 

 

 
(19,814
)
Deferred revenue

 
(2,794
)
 

 

 
(2,794
)
Accrued expenses and other current liabilities

 
(148
)
 
(1
)
 
(47
)
 
(196
)
Total liabilities acquired
(2,367
)
 
(20,389
)
 
(1
)
 
(47
)
 
(22,804
)
Net assets acquired
$
37,044

 
$
103,209

 
$
3,018

 
$
30,183

 
$
173,454

 
 
 
 
 
 
 
 
 
 
Maximum potential contingent earnout consideration
$

 
$
61,500

 
$
2,225

 
$
21,750

 
$
85,475

__________
(1)
The Company made adjustments within the measurement period to the purchase price allocations for Lykes and MSI during the year ended December 31, 2019, which have been reflected in the table. The Lykes adjustment resulted in an increase to net assets before goodwill and a reduction to goodwill of $2.7 million. The MSI adjustment resulted in an increase to intangible assets and a reduction to goodwill of $3.6 million.
Business Acquisition, Pro Forma Information
The following unaudited pro forma consolidated results of operations are provided for illustrative purposes only and have been presented as if the acquisitions of Lykes, MSI, Fiduciary Partners and Foundation Insurance occurred on January 1, 2018. This unaudited pro forma information should not be relied upon as being indicative of the historical results that would have been obtained if the acquisitions had occurred on that date, nor of the results that may be obtained in the future.
 
 
For the Years Ended December 31,
(unaudited) (in thousands)
 
2019
 
2018
Total revenues
 
$
152,610

 
$
126,011

Net income (loss)
 
(17,159
)
 
11,223