2.ACQUISITION

In December 2015, the Company, through its wholly-owned subsidiary, Allied Motion Technologies B.V., entered into a Share Purchase Agreement (the “Purchase Agreement”) to purchase all of the outstanding equity interests of Heidrive GmbH, a German limited liability company (“Heidrive”) from palero fünf S.à r.l for $22,000 (approximately €20,000), which included certain management performance bonuses to be paid after closing.

The adjusted purchase price as of January 12, 2016 is $18,534 (€17,068). During the year, the purchase price was reduced by $795 (€732) for a seller concession that was finalized.

The purchase price was funded with cash of $7,675 ($8,470 less purchase price adjustments of $795) plus $10,859 (€10,000) of borrowings under the Company’s international revolving credit facility (Note 6).

Heidrive is headquartered in Kelheim, Germany, and has manufacturing facilities located in Germany and the Czech Republic.

The Company incurred $467 of transaction costs in 2015 and $135 in 2016 related to the acquisition of Heidrive. Transaction costs are included in Business Development expenses on the consolidated statements of income and comprehensive income.

The purchase price was allocated to the underlying net assets based on fair value as of the acquisition date, as follows (in thousands):

	January 12, 2016
Cash	$	2,329
Other current assets	5,868
Property, plant and equipment	4,002
Amortizable intangible assets	7,710
Goodwill	10,248
Current liabilities	(7,696		)
Long-term liabilities	(3,927		)
Net purchase price	$	18,534

The purchase price allocation was revised during the year to reflect an updated valuation of intangible assets and property, plant and equipment, adjustment to inventory reserves, and final adjustments to income taxes. These adjustments were offset with corresponding adjustments to goodwill. The purchase price allocation will be finalized during the first quarter 2017.

The intangible assets acquired consist of customer lists, tradename, and technology. Goodwill generated in the acquisition is related to the assembled workforce, synergies between Allied Motion’s other Technology Units (“TUs”) that will occur as a result of the combined engineering knowledge, the ability of each of the TUs to integrate each other’s products into more fully integrated system solutions and Allied Motion’s ability to utilize Heidrive’s management knowledge in providing complementary product offerings to the Company’s customers.

The goodwill resulting from the Heidrive acquisition is not tax deductible.

The full year 2016 revenues and earnings for Heidrive are included in the consolidated statements of income and comprehensive income. Unaudited proforma revenues, earnings, and diluted earnings per share were approximately $264,793, $12,386 and $1.34 for the year ended December 31, 2015, assuming the acquisition occurred on January 1, 2015. Included in the proforma information is: the additional depreciation and amortization resulting from the valuation of amortizable tangible and intangible assets, interest expense on acquisition debt, acquisition costs and US GAAP adjustments. The pro forma financial information is for informational purposes only and does not purport to present what the Company’s results would have been had these transactions occurred on the date presented.