N-able Inc

3. Acquisitions

Spinpanel B.V.

On July 1, 2022, we completed the acquisition of all the outstanding equity of Spinpanel for a total consideration of up to approximately $20.0 million, including up to $10.0 million payable upon the achievement of certain revenue metrics through July 1, 2025. We funded the transaction with cash on hand. Based in the Netherlands, Spinpanel is a multi-tenant Microsoft 365 management and automation platform built for Microsoft Cloud Solution Providers to automate the provisioning, security, and management of all Microsoft tenants, users, and licenses in a single consolidated hub. The acquisition of Spinpanel is intended to help our partners optimize the value of their Microsoft Cloud products and, in turn, give Spinpanel customers access to a wider array of IT management and security solutions. We incurred net acquisition-related costs of $0.3 million during the year ended December 31, 2022, which are included in general and administrative expense. Goodwill and acquired identifiable intangible assets for this acquisition are not deductible for tax purposes.

During the three months ended March 31, 2023, a measurement period adjustment of $1.6 million was recorded to non-current deferred tax liabilities and goodwill. See Note 4. Goodwill and Intangible Assetsfor further details regarding changes in goodwill during the year ended December 31, 2023. The measurement period concluded as of June 30, 2023.

The following table summarizes the amounts recognized for the assets acquired and liabilities assumed:

The following table summarizes the total consideration for the assets acquired and liabilities assumed:

The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life by category:

The results of operations related to Spinpanel since the acquisition date are included in our Consolidated Financial Statements during the years ended December 31, 2023 and 2022. As noted above, total consideration includes up to $10.0 million payable upon the achievement of certain revenue metrics through July 1, 2025. The contingent consideration liabilities will be re-evaluated periodically, but at least quarterly, with the resulting gains and losses recognized within general and administrative expense in our Consolidated Statements of Operations. The fair value of this contingent consideration was $5.2 million at the date of acquisition, $5.1 million as of December 31, 2022, and $3.7 million as of December 31, 2023, resulting in the recognition of a gain of $1.4 million and $0.1 million during the years ended December 31, 2023 and 2022, respectively. The current portion of the contingent consideration of $0.8 million is included in “accrued liabilities and other” and the non-current portion of $2.9 million is included in “other long-term liabilities” in our Consolidated Balance Sheets as of December 31, 2023. See Note 7. Fair Value Measurements, Note 8. Accrued Liabilities and Other and Note 15. Commitments and Contingenciesfor additional information regarding the contingent consideration liabilities.

Pro forma information for the acquisition has not been provided because the impact of the historical financials on our revenue, net income and net income per share is not material. We recognize revenue on the acquired products in accordance with our revenue recognition policy as described in Note 2. Summary of Significant Accounting Policies.