||As of March 31, 2018, the Company had prepaid $229.8 million related to the Acquisition and recorded the payment as prepaid acquisition consideration in its consolidated balance sheet. As part of the pro forma
adjustments, the Company assumed the payment was made as of March 31, 2018 resulting in an increase in cash and cash equivalent and decrease in prepaid acquisition consideration resulting from the reclassification of the payment from prepaid
acquisition consideration to cash and cash equivalent combined with a subsequent decrease of cash and cash equivalent by the same amount (assuming the payment took place on March 31, 2018). The above had no net impact on the Companys pro
forma cash and cash equivalent balance. |
||Reflects the issuance of 5,328,853 Class A ordinary shares of Momo to Tantans shareholders, valued at US$22.96 per share, or US$122.4 million, as discussed in Note 3 above. |
||Reflects the adjustments to record the identifiable intangible assets acquired in the Acquisition at their estimated fair value of $157.5 million based on a preliminary valuation. The preliminary estimates of the
fair values of the intangible assets acquired relate to the acquisition of trade name, active user and technology. The estimated useful life of the intangible assets range form 3-10 years. |
||Reflects the preliminary estimate of goodwill, which represents the excess of the purchase price over the fair value of Tantans identifiable assets acquired and liabilities assumed as shown in Note 3. Upon final
completion of the fair value assessment, the ultimate purchase price may differ from the preliminary assessment outlined above. Any changes to the initial estimates of the fair value of the assets and liabilities will be allocated to goodwill.
||Represents an increase in non-current deferred tax liabilities and a corresponding increase in intangible assets resulting from the excess of the asset bases for financial
reporting over the asset bases for tax reporting. The increased asset bases for financial reporting is the result of an increase in the value of the assets of Tantan to reflect their estimated fair value at the time of the Acquisition as described
in Note 3 above. A statutory rate of 25% is applied to arrive at the adjustment. |
||Represents the conversion of Tantan redeemable ordinary shares and Series A, B, C and D convertible redeemable participating preferred shares to Momos ordinary shares upon the Acquisition as well as to eliminate
Tantans historical equity balance which includes ordinary share subscription receivable, additional paid in capital, accumulated deficits and accumulated other comprehensive income. |
||Represents the issuance of the Convertible Senior Notes as discussed in Note 2, net of approximately $14.9 million of deferred financing cost. |
Adjustments to the pro forma condensed statements of operations include the following:
||Represents additional intangible asset amortization expenses related to the acquired intangible assets recorded at their preliminary fair value as if the Acquisition had occurred on January 1, 2017.
Amortizable intangible assets consist of trade name of US$99.9 million with an estimated useful life of 10 years,
active user of US$53.5 million with an estimated useful life of 5 years and technology of US$4.1 million with an estimated useful life of 3 years. Amortizable intangible assets are being amortized using the straight line method while Momo
continues to evaluate the economic benefits of the intangible assets.
||Pro forma adjustments reflect the amortization of approximately $14.9 million deferred financing cost related to the US$650 million Convertible Senior Notes and interest expenses based on a 1.25% interest
||Reflects the income tax effect of pro forma adjustments of the Acquisition based on the estimated combined statutory tax rate of 25%. |
||Represents the increase in weighted average share with the issuance of Momo common stock in connection with the Acquisition. |