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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years Ended December 31, 2001, 2000 and 1999
On the dates of the First Issuance and Second Issuance, the price of Go2Net's Series A Convertible Preferred Stock was at a discount to
the price of the common stock into which the preferred stock was then convertible. The common stock price on March 12, 1999 was $23.901
and on June 17, 1999 was $32.8296. The discount of $159,930,733 was recognized as a dividend to Vulcan.
Note 7: Business Combinations and Asset Acquisitions
Fiscal Year 2001
: On December 19, 2001, the Company acquired certain assets of GiantBear, Inc. (GiantBear) a wireless technology and
service provider that enables wireless carriers to offer their subscribers access to content, data and mobile commerce through wireless devices,
delivery channels and applications, for purchase consideration of $6.0 million plus acquisition expenses of $21,000. The acquisition was
accounted for as a purchase.
The purchase price was allocated to the assets and liabilities assumed based on their estimated fair values as follows:
Tangible assets acquired
Net book value of net assets acquired
Fair value adjustments:
Fair value of net assets acquired
Less fair value of net assets acquired
Excess of purchase price over net assets acquired, allocated to goodwill
The expected life of the core technology was assumed to be five years, after which substantial modification and enhancement would be
required for the technology to remain competitive. The expected life of the customer list was also assumed to be five years, which is consistent
with the expected cash flows from the customer contracts. The Company is amortizing the core technology and customer list over an estimated
life of five years. In accordance with SFAS No. 142, no amortization of the goodwill will be recorded, as it has an indefinite life. The goodwill
will be tested for impairment annually, with the Company's other indefinite life intangibles.
As of the date of the acquisition, the technology acquired from GiantBear was substantially complete and no material alterations or
enhancements were under development. The core of GiantBear's services revolved around its BearWare platform. The BearWare infrastructure
platform provides the engine that allows users to migrate from one or more delivery vehicles (e.g. SMS, WAP, Audio) to others over time (e.g.
3G). There are six primary technologies that made up the GiantBear suite of services: InfoAlert, one way SMS push, BearTracks, a
configurable book marking capability; AudioCub, which delivers customized audio content on request to any analog or digital phone; Presto, a
turnkey SMS solution for Tier 2 and Tier 3 wireless carriers; Mobile Originated Short Message Services, a 2 way SMS pull delivery vehicle;
and BearCub, which enables any digital phone to access Internet content.