Note 3.

Acquisitions

TEW Plus, Ltd

On November 23, 2015, the Company acquired the 75% balance of the remaining shares of TEW Plus, Ltd (“Tew Plus”) for $2,130, net of cash acquired. Headquartered in Nottingham, UK, Tew Plus provides telecommunications and security systems to the railway and commercial markets. Their offerings include full installation services including: design, project management, survey, and commissioning along with future maintenance. The results of Tew Plus’ operations are included within the Rail Products and Services segment from the date of acquisition.

Inspection Oilfield Services

On March 13, 2015, the Company acquired IOS Holdings, Inc. (“IOS”) for $167,404, net of cash acquired and a net working capital receivable adjustment of $2,363. The purchase agreement includes an earn-out provision for the seller to generate an additional $60,000 of proceeds upon achieving certain levels of EBITDA during the three-year period beginning on January 1, 2015. The Company has not accrued an estimated earn-out obligation based upon a probability weighted valuation model of the projected EBITDA results, which indicates that the minimum target will not be achieved. Approximately $7,600 of the purchase price relates to amounts held in escrow to satisfy potential indemnity claims made under the purchase agreement. Headquartered in Houston, TX, IOS is a leading independent provider of tubular management services with operations in every significant oil and gas producing region in the continental United States. The acquisition is included within our Tubular and Energy Services segment from the date of acquisition. See Note 4 Goodwill and Other Intangible Assets, with respect to an impairment of the goodwill related to this acquisition.

TEW Holdings, Ltd

On January 13, 2015, the Company acquired TEW Holdings, Ltd (“Tew”) for $26,467, net of cash acquired, working capital, and net debt adjustments totaling $4,200. The purchase price includes approximately $600 which is held in escrow to satisfy potential indemnity claims made under the purchase agreement. Headquartered in Nottingham, UK, Tew provides application engineering solutions primarily to the rail market and other major industries. The results of Tew’s operations are included within the Rail Products and Services segment from the date of acquisition.

Chemtec Energy Services, L.L.C.

On December 30, 2014, the Company acquired Chemtec Energy Services, LLC (“Chemtec”) for $66,719, net of cash received, which is inclusive of $1,867 related to working capital adjustments. The cash payment included $5,000 that is held in escrow to satisfy potential indemnity claims made under the purchase agreement. Headquartered in Willis, TX, Chemtec is a domestic manufacturer and turnkey provider of blending, injection, and metering equipment for the oil and gas industry. The acquired business is included within our Tubular and Energy Services segment. See Note 4 Goodwill and Other Intangible Assets, with respect to an impairment of the goodwill related to this acquisition.

FWO

On October 29, 2014, the Company acquired assets of FWO, a business of Balfour Beatty Rail GmbH for $1,103, inclusive of a $161 post-closing working capital receivable adjustment. Headquartered in Germany, FWO is engaged in the electronic track lubrication and maintenance business and has been included in our Rail Products and Services segment.

Carr Concrete

On July 7, 2014, the Company acquired assets of Carr Concrete Corporation (“Carr”) for $12,480, inclusive of a $189 post-closing purchase price adjustment. Carr is a provider of pre-stressed and precast specialty concrete products located in Waverly, WV. Included within the purchase price is $1,000 that is held in escrow to satisfy potential indemnity claims made under the purchase agreement. The results of Carr’s operations are included in our Construction Products segment.

Acquisition Summary

Each transaction was accounted for under the acquisition method of accounting under U.S. generally accepted accounting principles, which requires an acquiring entity to recognize, with limited exceptions, all of the assets acquired and liabilities assumed in a transaction at fair value as of the acquisition date. Goodwill primarily represents the value paid for each acquisition’s enhancement to the Company’s product and service offerings and capabilities, as well as a premium payment related to the ability to control the acquired assets. The Company has concluded that intangible assets and goodwill values resulting from the Chemtec, FWO, and Carr transactions are deductible for tax purposes.

No acquisition-related costs were incurred during the year ended December 31, 2016. The Company incurred $760 and $2,240 of acquisition-related costs that are included in the results of operations within selling and administrative costs for the years ended December 31, 2015 and 2014.

The following unaudited pro forma consolidated income statement presents the Company’s results as if the acquisitions of IOS, Tew, and Chemtec had occurred on January 1, 2014. The 2015 pro forma results include the impact of the current year impairment of goodwill as further described in Note 4.



		Twelve months ended
		December, 31
		2015		2014
Net sales	$	640,596	$	806,384
Gross profit		138,123		183,163
Net (loss) income		(44,399)		41,745
Diluted (loss) earnings per share
As Reported	$	(4.33)	$	2.48
Pro forma	$	(4.32)	$	4.04

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of the acquisition:


Allocation of Purchase Price		November 23, 2015 - Tew Plus		March 13, 2015 - IOS			January 13, 2015 - Tew		December 30, 2014 - Chemtec		October 29, 2014 - FWO		July 7, 2014 - Carr
Current assets	$	4,420	$	19,877		$	12,125	$	15,528	$	131	$	3,180
Other assets		-		708			-		-		-		45
Property, plant, and equipment		47		51,453	*		2,398		4,705		-		7,648
Goodwill		822		69,908	*		8,772		22,302	*	971		1,936
Other intangibles		1,074		50,354	*		14,048		33,130		419		1,348
Liabilities assumed		(3,597)		(23,596)			(6,465)		(6,756)		(418)		(1,677)
Total	$	2,766	$	168,704		$	30,878	$	68,909	$	1,103	$	12,480

*	- See Note 4 Goodwill and Other Intangible Assets, and Note 7 Property, Plant, and Equipment, with respect to an impairment of property, plant, and equipment, intangible assets, and goodwill related to this acquisition.

The following table summarizes the estimates of the fair values and amortizable lives of the identifiable intangible assets acquired:



Intangible Asset		November 23, 2015 - Tew Plus		March 13, 2015 - IOS			January 13, 2015 - Tew		December 30, 2014 - Chemtec		October 29, 2014 - FWO		July 7, 2014 - Carr

Trade name	$	-	$	2,641		$	870	$	3,149	$	-	$	613
Customer relationships		817		41,171			10,035		23,934		34		524
Technology		203		4,364			2,480		4,930		341		87
Non-competition agreements		54		2,178			663		1,117		44		124
Total identified intangible assets	$	1,074	$	50,354	**	$	14,048	$	33,130	$	419	$	1,348

**- See Note 4 Goodwill and Other Intangible Assets, with respect to an impairment of intangible assets related to this acquisition.