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These excerpts taken from the SOHU 10-K filed Feb 26, 2009. 11. Acquisitions 21 East On October 31, 2006, the Company completed the acquisition of a 70% interest in 21 East Entertainment Limited (“21 East Hong Kong”) and Beijing 21 East Culture Development Co., Ltd. (“21 East Beijing”) (collectively “21 East”) for consideration of $3.5 million in cash. The main purpose of the acquisition of the 70% interest in 21 East is to enable the Company to secure and develop attractive, high-quality music and content. The acquisition was accounted for as a purchase business combination and resulted goodwill of US$3.5 million and the results of operations from the acquisition date have been included in the Company’s consolidated financial statements in accordance with SFAS 94. The acquisition had been accounted for as a purchase business combination and the results of operations from the acquisition date have been included in the Company’s consolidated financial statements in accordance with SFAS 94. The allocation of the purchase price is as follows (in thousands):
The excess of purchase price over tangible assets and identifiable intangible assets (mainly copyrights of song lyrics) acquired and liabilities assumed were recorded as goodwill relating to the wireless segment. Prior to the acquisition, 21 East did not prepare its financial statements under accounting principles generally accepted in the United States of America. The Company determined that the cost of reconstructing the financial statements of 21 East for the periods prior to the acquisition outweighed its benefits. Accordingly, unaudited pro forma consolidated financial information reflecting the results of operations of 21 East has not been presented. 11. Acquisitions 21 East On October 31, 2006, the Company completed the acquisition of a 70% interest in 21 East Entertainment Limited (“21 East Hong Kong”) and The acquisition had been accounted for as a purchase business combination
The excess of purchase price over tangible assets and identifiable intangible assets (mainly copyrights of song Prior to the acquisition, 21 East did not prepare its SIZE="2">12. Zero Coupon Convertible Senior Notes The Company completed a private placement
F-19 Table of ContentsFor the year ended December 31, 2006, the Company early redeemed from the market a portion of its zero coupon As of During the year ended December 31, 2008, the remaining $6,000 of zero coupon convertible senior notes were These excerpts taken from the SOHU 10-K filed Feb 28, 2008. 11. Acquisitions (a) 21 East On October 31, 2006, the Company completed the acquisition of a 70% interest in 21 East Entertainment Limited (“21 East Hong Kong”) and Beijing 21 East Culture Development Co., Ltd. (“21 East Beijing”) (collectively “21 East”) for consideration of $3.5 million in cash and an additional amount, not to exceed $1.4 million, which will be paid over three years after the date of the closing of the acquisition, subject to the satisfaction and attainment of certain post closing operating and financial milestones of 21 East. Other estimated direct acquisition costs were $219,000. The main purpose of the acquisition of the 70% interest in 21 East is to enable the Company to secure and develop attractive, high-quality music and content. The Company considers the acquisition of 21 East to have been made in the ordinary course of its business. The purchase price was determined based on arms’ length negotiations between Sohu and 21 East. The acquisition had been accounted for as a purchase business combination and the results of operations from the acquisition date have been included in the Company’s consolidated financial statements in accordance with SFAS 94. The allocation of the purchase price is as follows (in thousands):
The excess of purchase price over tangible assets and identifiable intangible assets (mainly copyrights of song lyrics) acquired and liabilities assumed were recorded as goodwill relating to the wireless segment. The purchase price used in the calculation of goodwill excludes contingent consideration of $1.4 million and contingent taxes obligations relating to the pre-acquisition period, which may result in recognition of an additional element of cost of the acquisition entity when the outcome of the contingencies, if any, become estimable. The identifiable intangible assets were amortized over a weighted average period of three years. Prior to the acquisition, 21 East did not prepare its financial statements under accounting principles generally accepted in the United States of America. The Company determined that the cost of reconstructing the financial statements of 21 East for the periods prior to the acquisition outweighed its benefits. Accordingly, unaudited pro forma consolidated financial information reflecting the results of operations of 21 East has not been presented. (b) Go2Map On May 31, 2005, the Company completed the acquisition of all of the outstanding capital stock of Go2Map Inc., a company incorporated in Cayman Islands, and all of the registered share capital of Tu Xing Tian Xia, a company incorporated in the PRC which was an affiliate of Go2Map Inc. (collectively “Go2Map”) for $9.3 million in cash, and an additional amount, not to exceed $2.5 million, which will be paid over two years after the date of the closing of the acquisition, subject to the satisfaction and attainment of certain post closing operating and financial milestones of Go2Map. In 2007 and 2006, $545,000 and $520,000 was payable based upon the achievement of certain operating and financial milestones of Go2Map, respectively. The other direct acquisition costs amounting to $454,000 were paid during the year ended December 31, 2005. Go2Map is one of the leading online mapping service providers in China. The Company considers the acquisition of Go2Map to have been made in the ordinary course of its business. The purchase price was determined in arms’ length negotiations between Sohu and Go2Map. The acquisition had been accounted for as a purchase business combination and the results of operations from the acquisition date have been included in the Company’s consolidated financial statements. The allocation of the purchase price is as follows (in thousands):
F-18
Table of ContentsThe excess of purchase price over tangible and identifiable intangible assets (mainly trade name, non-compete agreements and customer relationship) acquired and liabilities assumed were recorded as goodwill relating to the sponsored search segment. Purchase price used in the calculation of goodwill excludes the remaining contingent consideration not exceeding $2.5 million, which may result in recognition of an additional element of cost of the acquired entity when the outcome of the contingency is materialized. During 2007 and 2006, the Company recorded the effects of materialization of the contingent consideration of $545,000 and $520,000 for the acquisition, respectively. The acquired identifiable intangible assets were valued by various approaches, including income approach, market approach and replacement cost approach, as appropriate. Identifiable intangible assets were amortized over a weighted average period of six years. Prior to the acquisition, Go2Map did not prepare its financial statements under accounting principles generally accepted in the United States of America. The Company determined that the cost of reconstructing the financial statements of Go2Map for the periods prior to the acquisition outweighed its benefits. Accordingly, unaudited pro forma consolidated financial information reflecting the results of operations of Go2Map has not been presented. 11. Acquisitions SIZE="2">(a) 21 East On October 31, 2006, the Company completed the acquisition of a 70% interest in 21 East Entertainment Limited (“21 The acquisition had been accounted for
The excess of purchase price over tangible assets and identifiable intangible assets (mainly copyrights of song Prior to the acquisition, 21 East did not prepare its financial statements under accounting principles generally (b) Go2Map the registered share capital of Tu Xing Tian Xia, a company incorporated in the PRC which was an affiliate of Go2Map Inc. (collectively “Go2Map”) for $9.3 million in cash, and an additional amount, not to exceed $2.5 million, which will be paid over two years after the date of the closing of the acquisition, subject to the satisfaction and attainment of certain post closing operating and financial milestones of Go2Map. In 2007 and 2006, $545,000 and $520,000 was payable based upon the achievement of certain operating and financial milestones of Go2Map, respectively. The other direct acquisition costs amounting to $454,000 were paid during the year ended December 31, 2005. Go2Map is one of the leading online mapping service providers in China. The Company considers the acquisition of Go2Map to have been made in the ordinary course of its business. The purchase price was determined in arms’ length negotiations between Sohu and Go2Map. Company’s consolidated financial statements. The allocation of the purchase price is as follows (in thousands):
F-18 Table of ContentsThe excess of purchase price over tangible and identifiable intangible assets (mainly trade name, non-compete agreements Prior to the acquisition, Go2Map did not prepare SIZE="2">12. Zero Coupon Convertible Senior Notes The Company completed a private placement on July 14, 2003 of $90 million principal amount of in aggregate face value, after deducting the related portion of unamortized offering cost. As of the end of the notification period associated with the As of December 31, 2007, the outstanding balance of zero coupon convertible senior notes was $6,000. The Company’s subsidiaries in China F-19 Table of ContentsThis excerpt taken from the SOHU 10-K filed Mar 8, 2007. 12. Acquisitions (a) 21 East On October 31, 2006, the Company completed the acquisition of a 70% interest in 21 East Entertainment Limited (“21 East Hong Kong”) and Beijing 21 East Culture Development Co., Ltd. (“21 East Beijing”) (collectively “21 East”) for consideration of $3.5 million in cash and an additional amount, not to exceed $1.4 million, which will be paid over three years after the date of the closing of the acquisition, subject to the satisfaction and attainment of certain post closing operating and financial milestones of 21 East. Other estimated direct acquisition costs were $219,000. The main purpose of the acquisition of the 70% interest in 21 East is to enable the Company to secure and develop attractive, high-quality music and content. The Company considers the acquisition of 21 East to have been made in the ordinary course of its business. The purchase price was determined based on arms’ length negotiations between Sohu and 21 East. The acquisition had been accounted for as a purchase business combination and the results of operations from the acquisition date have been included in the Company’s consolidated financial statements in accordance with SFAS 94. The allocation of the purchase price is as follows (in thousands):
The excess of purchase price over tangible assets and identifiable intangible assets (mainly copyrights of song lyrics) acquired and liabilities assumed were recorded as goodwill relating to the wireless segment. The purchase price used in the calculation of goodwill excludes contingent consideration of $1.4 million and contingent taxes obligations relating to the pre-acquisition period, which may result in recognition of an additional element of cost of the acquisition entity when the outcome of the contingencies, if any, become estimable. The identifiable intangible assets were amortized over a weighted average period of three years. Prior to the acquisition, 21 East did not prepare its financial statements under accounting principles generally accepted in the United States of America. The Company determined that the cost of reconstructing the financial statements of 21 East for the periods prior to the acquisition outweighed its benefits. Accordingly, unaudited pro forma consolidated financial information reflecting the results of operations of 21 East has not been presented. (b) Go2Map On May 31, 2005, the Company completed the acquisition of all of the outstanding capital stock of Go2Map Inc., a company incorporated in Cayman Islands, and all of the registered share capital of Tu Xing Tian Xia, a company incorporated in the PRC which was an affiliate of Go2Map Inc. (collectively “Go2Map”) for $9.3 million in cash, and an additional amount, not to exceed $2.5 million, which will be paid over two years after the date of the closing of the acquisition, subject to the satisfaction and attainment of certain post closing operating and financial milestones of Go2Map. In 2006, $520,000 was payable based upon the achievement of certain operating and financial milestones of Go2Map. The other direct acquisition costs amounting to $454,000 were paid during the year ended December 31, 2005. Go2Map is one of the leading online mapping service providers in China. The Company considers the acquisition of Go2Map to have been made in the ordinary course of its business. The purchase price was determined in arms’ length negotiations between Sohu and Go2Map. The acquisition had been accounted for as a purchase business combination and the results of operations from the acquisition date have been included in the Company’s consolidated financial statements. The allocation of the purchase price is as follows (in thousands):
The excess of purchase price over tangible and identifiable intangible assets (mainly trade name, non-compete agreements and customer relationship) acquired and liabilities assumed were recorded as goodwill relating to the sponsored search segment. Purchase price used in the calculation of goodwill excludes the remaining contingent consideration not exceeding $2.5 million, which may result in recognition of an additional element of cost of the acquired entity when the outcome of the contingency is materialized. During 2006, the Company recorded the effects of materialization of the contingent consideration of $520,000 for the acquisition. The acquired identifiable intangible assets were valued by various approaches, including income approach, market approach and replacement cost approach, as appropriate. Identifiable intangible assets were amortized over a weighted average period of six years.
F-19
Table of ContentsPrior to the acquisition, Go2Map did not prepare its financial statements under accounting principles generally accepted in the United States of America. The Company determined that the cost of reconstructing the financial statements of Go2Map for the periods prior to the acquisition outweighed its benefits. Accordingly, unaudited pro forma consolidated financial information reflecting the results of operations of Go2Map has not been presented. | EXCERPTS ON THIS PAGE:
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