(4) Acquisitions 2018 Acquisitions (a) EVO Payments International Corp. - Canada In February 2018, a subsidiary of EVO, Inc. acquired the remaining 30% membership interest in EVO Payments International Corp. - Canada (EVO Canada) from 7097794 Canada, Inc. for $0.9 million of contingent consideration. This transaction resulted in a reduction to members deficit and nonredeemable non-controlling interests of $0.4 million and $0.5 million, respectively. EVO Canada is presented in our North America segment. (b) Nationwide Payment Solutions, LLC In March 2018, a subsidiary of EVO, Inc. acquired the remaining 38% membership interest in Nationwide Payment Solutions, LLC (NPS) for an upfront payment of $16.9 million and contingent consideration of $3.8 million to be paid on March 23, 2019. This transaction resulted in a reduction to members deficit and nonredeemable non-controlling interests of $20.1 million and $0.6 million, respectively. NPS is presented in our North America segment. (c) Liberbank, S.A. In April 2018, a subsidiary of EVO, Inc. acquired a portion of the merchant acquiring assets of Liberbank, S.A. and Banco de Castilla la Mancha, S.A. for 7.9 million ($9.5 million, based on the foreign exchange rate at the time of the acquisition). This asset acquisition is presented in our Europe segment. Equipment and intangible assets acquired consist of card processing equipment, merchant contract portfolios, marketing alliance agreements, and trademarks with useful lives of 3 years, 5 years, 15 years, and 15 years, respectively. (d) Nodus Technologies, Inc. In May 2018, a subsidiary of EVO, Inc. completed the acquisition of 100% of the outstanding shares of Nodus Technologies, Inc. (Nodus) for $18.0 million. The total consideration includes a holdback liability of $0.8 million. Nodus is presented in our North America segment. The pro forma impact of this acquisition was not material to the Companys historical consolidated operating results and is, therefore, not separately presented. Equipment and intangible assets consist of office equipment, computer software, merchant contract portfolios, trademarks, internally developed software, and non-competition agreements with useful lives of 5 to 7 years, 3 years, 15 years, 20 years, 10 years and 3 years, respectively. (e) Federated Payment Systems, LLC/Federated Payment Canada Corp. On September 28, 2018, a subsidiary of EVO, Inc. completed the acquisition of the remaining 67% of the outstanding membership interests of Federated Payment Systems, LLC (Federated US) and 100% of the outstanding shares of Federated Payment Canada Corporation (Federated Canada, together with Federated US Federated) for $37.1 million. The total consideration includes an aggregate holdback liability of $0.5 million. Federated maintains diverse sales channels which will complement the Companys strategic distribution relationships. As a result of this acquisition, the Company recognized goodwill. Federated is presented in our North America segment. The preliminary allocation of the purchase price to the assets acquired and liabilities assumed was not yet finalized as of September 30, 2018. The preliminary purchase price was allocated to Federateds net tangible and intangible assets based upon their estimated fair value as of the date of acquisition. Based upon the purchase price, the Companys understanding of the Federated business and preliminary valuation, the allocation is as follows (in thousands): Tangible assists acquired $ 1,863 Amortizable intangible assets Trademarks 2,650 Merchant contract portfolios 19,036 Goodwill 23,328 Total assets acquired 46,877 The valuation and estimated useful lives of the intangible assets acquired are provisional and subject to adjustment based upon additional information that the Company is in the process of obtaining. Intangible assets of $21.7 million have been allocated to amortizable intangible assets consisting of trademarks and merchant contract portfolios , with estimated useful lives of 5 years and 5 years, respectively. On the date of acquisition, the book value of the investment in Federated US was zero. The Company recorded a gain on acquisition of unconsolidated investee of $8.7 million to step up carrying value of the investment to fair value as of the acquisition date. The gain on acquisition of unconsolidated investee has been recorded on the unaudited condensed consolidated statements of operations and comprehensive loss. Goodwill totaling $23.3 million represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired. Goodwill generated from the Federated acquisition is deductible for income tax purposes. Pro forma information has not been presented because the effect of this acquisition was not material on the Companys consolidated operating results. 2017 Acquisitions (f) Sterling Payment Technologies, LLC In January 2017, a subsidiary of EVO, Inc. completed the acquisition of 100% of outstanding units of Sterling Payment Technologies, LLC (Sterling) for $196.8 million, including deferred purchase price of $71.2 million, a holdback liability of $0.2 million and an estimated working capital adjustment of $0.3 million. The Company agreed to a deferred purchase price of $70.0 million which was paid in full in May 2018. Total costs incurred in connection with this acquisition were $1.3 million and are presented in selling, general and administrative expenses. Sterling is presented in our North America segment. The table below presents the allocation of the purchase price of Sterling to the assets acquired and liabilities assumed based on their fair values. As of the acquisition date (In thousands) Cash and cash equivalents $ 601 Accounts receivable 945 Prepaid expenses and other 905 Inventory 851 Equipment and improvements 2,711 Amortizable intangible assets Trademarks 14,400 Internally developed software 7,300 Non-competition agreements 6,200 Merchant contract portfolios 27,300 Marketing alliance agreements 30,200 Accounts payable and accrued expenses (2,626) Total net fair value excluding goodwill 88,787 Goodwill 107,978 Total purchase price $ 196,765 Intangible assets consist of an indefinite lived trade name, internally developed software, non-competition agreements, marketing alliance agreements and merchant contract portfolios with useful lives of 7 years, 2 to 4 years, 18 to 21 years, and 12 to 18 years, respectively. Multiple assets were acquired for each of the following classes of asset resulting in variability in the assets useful life: non-competition agreements, marketing alliance agreements and merchant contract portfolios. Acquired goodwill is expected to be tax deductible. The Company views this acquisition as an important part of its long-term strategy of expanding the Companys business domestically and the goodwill arising from the acquisition was attributable to strategic benefit and growth opportunities, including alternative sales channels and operating synergies that the Company expects to realize. (g) Vision Payments Solutions, LLC In March 2017, a subsidiary of EVO, Inc. acquired the remaining 25% membership interest in Vision Payments Solutions, LLC (VPS) from Vision Payments Solutions, Inc., resulting in a reduction to members deficit and nonredeemable non-controlling interests of $0.4 million. VPS is presented in our North America segment. (h) Pineapple Payments, LLC In April 2017, a subsidiary of EVO, Inc. acquired the remaining 75% of the units of Pineapple Payments, LLC (Pineapple) for $8.4 million, inclusive of contingent consideration of $0.7 million. Pineapple is presented in our North America segment. The pro forma impact of this acquisition was not material to the Companys historical consolidated operating results and is, therefore, not presented. Intangible assets consist of merchant contract portfolios and marketing alliance agreements with useful lives of 7 years and 5 years, respectively. (i) Zenith Merchant Services, LLC In May 2017, a subsidiary of EVO, Inc. acquired the remaining 49% membership interest in Zenith Merchant Services, LLC (Zenith) for $9.2 million, inclusive of contingent consideration of $2.8 million. The transaction resulted in an increase to members deficit and reduction to nonredeemable non-controlling interests of $6.8 million and $2.4 million, respectively. Zenith is presented in our North America segment.