EvolutionIQ

On January 6, 2025, the Company completed its acquisition of EvolutionIQ, Inc. (“EvolutionIQ”), a privately held provider of AI-driven solutions for disability and injury claims management, for total consideration of $674.3 million. Refer to Note 3, “Business Acquisition,” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 for additional details, including the final purchase price allocation.

The acquisition was accounted for as a business combination in accordance with Accounting Standard Codification 805. The purchase price allocation was finalized during the quarter ended December 31, 2025. The transaction resulted in the recognition of $537.8 million of goodwill and $167.9 million of identifiable intangible assets (consisting of acquired technology, customer relationships, and a trademark), which remain unchanged from year-end 2025. Goodwill and intangible assets are not deductible for tax purposes.

In accordance with the acquisition agreement, $8.9 million of the purchase price was held in escrow for post-closing adjustments and indemnity holdbacks. During 2025, the purchase price adjustment escrow was settled, with $2.6 million paid to the sellers and $4.7 million returned to the Company (reducing the purchase consideration and related goodwill). As of June 30, 2026, the remaining escrow for general indemnity was $1.6 million, unchanged from December 31, 2025, and subject to release within 36 months of the closing date, pending any indemnity claims. Additionally, during the first quarter of 2026, the $3.2 million option holdback related to certain unvested EvolutionIQ stock options was settled, with the Company retaining $3.1 million in cash and returning $0.1 million to the selling shareholders, consistent with the terms of the acquisition agreement.

No business combinations were completed during the three and six months ended June 30, 2026.