On April 30, 2018, the Company completed the acquisition of Spinal Kinetics Inc. (“Spinal Kinetics”), a privately held developer and manufacturer of artificial cervical and lumbar discs for $45.0 million in net cash, subject to certain adjustments, plus potential milestone payments of up to $60.0 million in cash. The acquisition date fair value of the consideration transferred was $76.6 million. The results of operations for Spinal Kinetics have been included in the Company’s financial results since the acquisition date, April 30, 2018. For additional discussion regarding the valuation of the contingent consideration, see Note 7.

The following table summarizes the fair values of assets acquired and liabilities assumed at the acquisition date. During the first quarter of 2019, the Company finalized its valuation of assets acquired and liabilities assumed, which resulted in an adjustment between deferred income taxes and goodwill.

(U.S. Dollars, in thousands)	Preliminary Acquisition Date Fair Value as Previously Reported		Adjustments			Final Acquisition Date Fair Value		Assigned Useful Life
Assets acquired
Cash and cash equivalents	$	6,785	$	—		$	6,785
Restricted cash		30		—			30
Accounts receivable		1,705		—			1,705
Inventories		8,175		—			8,175
Prepaid expenses and other current assets		315		—			315
Property, plant and equipment		2,285		—			2,285
Other long-term assets		320		—			320
Developed technology		12,400		—			12,400	10 years
In-process research and development ("IPR&D")		26,800		—			26,800	10 years
Tradename		100		—			100	2 years
Deferred income taxes		2,374		1,220			3,594
Total identifiable assets acquired	$	61,289	$	1,220		$	62,509

Liabilities assumed
Accounts payable	$	351	$	—		$	351
Other current liabilities		2,873		(4	)		2,869
Other long-term liabilities		301		—			301
Total liabilities assumed	$	3,525	$	(4	)	$	3,521
Goodwill		18,836		(1,224	)		17,612
Total fair value of consideration transferred	$	76,600	$	—		$	76,600

On February 6, 2019, the Company obtained U.S. Food and Drug Administration (“FDA”) approval of the M6-C artificial cervical disc for patients suffering from cervical disease degeneration and started amortizing IPR&D. The $17.6 million of goodwill recognized was assigned to the Global Spine reporting segment.

The Company did not recognize any acquisition related costs during the three and six months ended June 30, 2019 and recorded $1.5 million and $3.0 million of acquisition related costs during the three and six months ended June 30, 2018. These costs are included in the condensed consolidated statements of operations and comprehensive income (loss) within general and administrative expenses. The Company’s results of operations included net sales of $3.2 million and $2.3 million related to Spinal Kinetics for the three months ended June 30, 2019 and 2018, respectively, and net sales of $6.4 million and $2.3 million for the six months ended June 30, 2019 and 2018, respectively. Additionally, the Company’s results of operations included net losses of $3.4 million and $1.8 million related to Spinal Kinetics for the three months ended June 30, 2019 and 2018, respectively, and net losses of $7.4 million and $1.8 million for the six months ended June 30, 2019 and 2018, respectively.

The following table presents the unaudited pro forma results for the three and six months ended June 30, 2019 and 2018, which combines the historical results of operations of Orthofix and Spinal Kinetics as though the companies had been combined as of January 1, 2018. The unaudited pro forma information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at such time.

	Three Months Ended June 30,					Six Months Ended June 30,
(U.S. Dollars, in thousands)	2019			2018		2019		2018
	(unaudited)			(unaudited)		(unaudited)		(unaudited)
Net sales	$	115,850		$	115,129	$	224,962	$	227,584
Net income (loss)		(547	)		597		350		5,457

On January 31, 2019, the Company acquired certain assets of Options Medical, LLC, (“Options Medical”) a medical device distributor based in Florida. Under the terms of the acquisition, the parties agreed to terminate an existing exclusive sales representative agreement, employees of Options Medical became employees of the Company and the Company acquired all customer lists and customer information related to the sale of the Company’s products. As consideration for the assets acquired, the Company paid $6.4 million. Additionally, as an inducement to enter into employment with the Company, the Company provided 25,478 restricted stock units (“RSUs”), with a fair value of $1.4 million, to the Options Medical founder. These RSUs will vest in one-third annual increments beginning on the first anniversary of the grant date and are contingent upon continued employment. The following table summarizes the fair values of assets acquired and liabilities assumed at the acquisition date.

(U.S. Dollars, in thousands)	Fair Value		Balance Sheet Classification	Assigned Useful Life
Assets acquired
Operating lease assets	$	175	Other long-term assets
Customer relationships		5,832	Intangible assets, net	10 years
Assembled workforce		568	Intangible assets, net	5 years
Total identifiable assets acquired	$	6,575

Liabilities assumed
Operating lease liability - short-term	$	69	Other current liabilities
Operating lease liability - long-term		106	Other long-term liabilities
Total liabilities assumed		175
Total fair value of consideration transferred	$	6,400