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ACQUISITION | 6 Months Ended
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Jun. 30, 2018
ACQUISITION | NOTE C —ACQUISITION On December 22, 2017, the Company entered into an agreement providing for the acquisition of Filament by the Company. The acquisition was completed on March 2, 2018. The aggregate consideration for Filament, after taking into account certain adjustments, was $295.4 million, consisting of $218.5 million of cash consideration and 5,593,116 newly issued shares of the Company’s common stock, with a value equal to $76.9 million based on the market value of the Company’s common stock as of March 2, 2018. The cash portion of the consideration was revised for certain adjustments as defined in the agreement. The purchase price, as adjusted, has been determined to be as follows (in thousands):
Cash |  | $ | 218,506 |
Share consideration |  |  | 76,905 |
Total purchase price |  | $ | 295,411 |
The purchase price was allocated based on the Company’s preliminary estimate of the fair value of the assets acquired and liabilities assumed, as follows (in thousands):
Accounts receivable |  | $ | 26,453 |
Inventory |  |  | 26,696 |
Other assets |  |  | 9,093 |
Other liabilities |  |  | (25,176 | )
Deferred income tax |  |  | (26,633 | )
Goodwill and other intangibles |  |  | 284,978 |
Total allocated value |  | $ | 295,411 |
The acquisition is being accounted for as a business combination using the acquisition method of accounting in accordance with FASB ASC Topic 805, Business Combinations (“ASC Topic 815”), which established a new basis of accounting for all identifiable assets acquired and liabilities assumed at fair value. ASC Topic 805 allows the acquiring Company to adjust preliminary amounts recognized at the acquisition date to their subsequently determined final fair values during a measurement period, generally up to one year from the date of acquisition. The fair values of net assets acquired are based on the Company’s preliminary estimate of the respective fair values. The final valuation of net assets may result in material adjustments to the respective fair values and resulting goodwill. During the six months ended June 30, 2018, the Company increased goodwill by approximately $1.4 million, net, due to certain adjustments primarily related to the opening balance sheet income tax provision and unrecorded accruals. Goodwill results from such factors as an assembled workforce. The total amount of goodwill is not expected to be deductible for tax purposes. The goodwill and other intangible assets are primarily included in the U.S. Wholesale segment. Customer relationships, which are included in intangible assets, net, are amortized on a straight-line basis over their estimated useful lives (see Note E– Intangible Assets to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q). The six months ended June 30, 2018 includes the operations of Filament for the period from March 2, 2018, the date of acquisition, to June 30, 2018. The condensed consolidated statement of operations for the three months ended June 30, 2018, includes $29.3 million of net sales and $0.4 million of net loss from operations contributed by Filament. The condensed consolidated statement of operations for the six months ended June 30, 2018, includes $38.6 million of net sales and $1.5 million of net loss from operations contributed by Filament. Unaudited Pro forma Results The following table presents the Company’s pro forma consolidated net sales, loss before income taxes and equity in earnings and net loss for the three and six months ended June 30, 2018 and June 30, 2017. The unaudited pro forma results include the historical statement of operations information of the Company and of Filament, giving effect to the Filament acquisition and related financing as if they had occurred at the beginning of the periods presented.
|  | Unaudited pro forma results |
|  | Three Months Ended |  |  | Six Months Ended |
|  | June 30, 2018 |  |  | June 30, 2017 |  |  | June 30, 2018 |  |  | June 30, 2017 |
|  | (In thousands, except per share data) |  |  | (In thousands, except per share data) |
Net sales |  | $ | 148,651 |  |  | $ | 149,043 |  |  | $ | 292,631 |  |  | $ | 307,313 |
Loss before income taxes and equity in earnings |  |  | (6,694 | ) |  |  | (6,193 | ) |  |  | (22,904 | ) |  |  | (11,245 | )
Net loss |  |  | (5,092 | ) |  |  | (3,295 | ) |  |  | (17,235 | ) |  |  | (5,935 | )
Basic and diluted loss per common share |  |  | (0.25 | ) |  |  | (0.16 | ) |  |  | (0.85 | ) |  |  | (0.30 | )
The unaudited pro forma results do not include any revenue or cost reductions that may be achieved through the business combination or the impact of non-recurring items directly related to the business combination. The unaudited pro forma results are not necessarily indicative of the operating results that would have occurred if the Filament acquisition had been completed as of the date for which the pro forma financial information is presented. In addition, the unaudited pro forma results do not purport to project the future condensed consolidated operating results of the combined company.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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