Acquisition of Heritage Global Partners, Inc.

9 Months Ended

Sep. 30, 2012

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

Note 3 – Acquisition of Heritage Global Partners, Inc.

On February 29, 2012 the Company acquired all of the issued and outstanding capital stock in Heritage Global Partners, Inc. (“Heritage Global Partners”), a full-service, global auction and asset advisory firm. The acquisition of Heritage Global Partners is consistent with CRBCI’s strategy to expand the services provided by its asset liquidation business. In connection with the acquisition, CRBCI entered into employment agreements with the previous owners and employees of Heritage Global Partners.

The following table summarizes the consideration paid for Heritage Global Partners and the amounts of the assets acquired and liabilities assumed recognized at the acquisition date:

At February 29, 2012
	$
Consideration paid
Cash		3,000
Promissory notes, net of receivable from owners 1		849
Equity instruments:
1,000,000 CRBCI common shares 2		2,100
625,000 options to purchase CRBCI common shares at $2.00 per share 3		1,131
Fair value of total consideration		7,080
Acquisition related costs (included in selling, general, and administrative expenses in CRBCI’s condensed consolidated interim statement of operations for the nine months ended September 30, 2012)		73
Recognized amounts of identifiable assets acquired and liabilities assumed
Cash		656
Accounts receivable (net of $0 allowance for doubtful accounts)		870
Deposits		20
Prepaid expenses		43
Property, plant and equipment		37
Identifiable intangible assets		5,640
Accounts payable and accrued liabilities		(1,212	)
Client liability account		(1,424	)
Short-term note payable		(100	)
Future income taxes payable		(2,178	)
Total identifiable net assets assumed		2,352
Goodwill		4,728
		7,080

¹ The notes (the “Promissory Notes”) were paid in full on their August 31, 2012 maturity date.

² Determined using the closing price of the Company’s common shares on February 29, 2012

³ Determined using the Black-Scholes Option Pricing Model. Inputs to the model included an expected volatility rate of 133%, a risk-free interest rate of 1.25%, an expected life of 4.75 years, and an expected dividend yield of $nil.

The fair value of the accounts receivable is the value as reported in the above table.

In finalizing the purchase price, $3,462 was reallocated from goodwill in order to recognize a deferred tax liability of $2,178 and intangible assets of $5,640. These were the only changes made to the previously recognized amounts of identifiable assets acquired and liabilities assumed. The identifiable intangible assets are discussed in Note 6.

To date, the only transactions recognized separately from the acquisition were the acquisition costs noted in the above table. The Company expects to incur up to an additional $10 of acquisition-related expenses.