Note 2 - Acquisition
|3 Months Ended|
Mar. 31, 2019
|Notes to Financial Statements|
|Business Combination Disclosure [Text Block]||
March 18, 2019,the Company entered into an Asset and Franchise Purchase Agreement under which (i) the Company repurchased from the seller
oneoperating franchise in West Covina, California and (ii) the parties agreed to terminate a
secondfranchise agreement for an operating franchise. The Company intends to operate the remaining franchise as a company-managed clinic. The total purchase price for the transaction was
$3,847of deferred revenue resulting in total purchase consideration of
Purchase Price Allocation
The following summarizes the aggregate estimated fair values of the assets acquired and liabilities assumed during
2019as of the acquisition date:
Intangible assets in the table above consist of reacquired franchise rights of
$30,000amortized over an estimated useful life of
threeyears and customer relationships of
$32,000amortized over an estimated useful life of
Pro Forma Results of Operations (Unaudited)
The following table summarizes selected unaudited pro forma condensed consolidated statements of operations data for the
March 31, 2019and
2018as if the acquisition in
2019had been completed on
January 1, 2018.
This selected unaudited pro forma consolidated financial data is included only for the purpose of illustration and does
notnecessarily indicate what the operating results would have been if the acquisition had been completed on that date. Moreover, this information is
notindicative of what the Company’s future operating results will be. The information for
2019prior to the acquisition is included based on prior accounting records maintained by the acquired company. In some cases, accounting policies differed materially from accounting policies adopted by the Company following the acquisition. For
2018,this information includes actual data recorded in the Company’s financial statements for the period subsequent to the date of the acquisition. The Company’s condensed consolidated statement of operations for the
March 31, 2019includes net revenue and net loss of approximately
$5,000,respectively, attributable to the acquisition.
The pro forma amounts included in the table above reflect the application of accounting policies and adjustment of the results of the clinics to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to property and equipment and intangible assets had been applied from
January 1, 2018.
The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef