accordingly , at the effective time of the merger , we issued 9,493,016 shares ( post reverse stock split ) of our common stock to dni as consideration in the merger , of which 949,302 shares ( post reverse stock split ) are being held in escrow as security for claims for indemnifiable losses in accordance with the merger agreement relating to the merger . as a result , immediately following the effective time of the merger , dni held 58 % of the outstanding shares of our common stock and the holders of our common stock immediately prior to the merger retained , in the aggregate , 42 % of the outstanding shares of our common stock . see note 2 to the consolidated financial statements set forth in part ii , item 8 of this report for additional information regarding the merger . common control transaction on december 31 , 2017 , dns ( a wholly owned subsidiary of ours ) acquired 100 % and 99.99 % of the common stock of d-mobile limited ( “ d-mobile ” ) and dasan india private limited ( dasan india ) , respectively , from dni . d-mobile and dasan india are resellers of our products in taiwan and india , respectively . the consideration payable by us to dni for the common stock is the net book value of d-mobile and dasan india at december 31 , 2017 , subject to final adjustments . the net book value of d-mobile and dasan india was an aggregate of $ 0.8 million . we accounted for these transactions as common control transactions , with the net assets transferred recorded at historical cost . the transactions did not result in a change in reporting entity and hence were accounted for prospectively . items affecting comparability of our financial results as discussed in note 2 to the consolidated financial statements set forth in part ii , item 8 of this report , the merger has been accounted for as a reverse acquisition under which dns was considered the accounting acquirer of legacy zhone . as such , our financial results presented in this annual report on form 10-k reflect the operating results of dns and its consolidated subsidiaries for the year-ended december 31 , 2015 and for the period from january 1 , 2016 through september 8 , 2016 and the operating results of both dns and legacy zhone and their respective consolidated subsidiaries for all periods from and after september 9 , 2016. our balance sheet as of december 31 , 2016 included the fair value of the assets and liabilities of legacy zhone as of the effective date of the merger . those assets include the fair value of acquired intangible assets and goodwill . the year ended december 31 , 2017 was the first fiscal year in which our financial results reflected a full year of operating results for both dns and legacy zhone and their respective consolidated subsidiaries . due to the foregoing , our financial results for the year ended december 31 , 2017 are not comparable to our financial results for prior years . critical accounting policies and estimates management 's discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements , which have been prepared in accordance with generally accepted accounting principles in the united states of america . the preparation of these consolidated financial statements requires management to make estimates and judgments that affect the reported amounts of assets , liabilities , revenue and expenses , and related disclosure of contingent assets and liabilities . the policies discussed below are considered by management to be critical because changes in such estimates can materially affect the amount of our reported net income or loss . for all of these policies , management cautions that actual results may differ materially from these estimates under different assumptions or conditions . 28 revenue recognition we recognize revenue when the earnings process is complete . we recognize product revenue upon shipment of product under contractual terms which transfer title to customers upon shipment , under normal credit terms , net of estimated sales returns and allowances at the time of shipment . revenue is deferred if there are significant post-delivery obligations or if the fees are not fixed or determinable . when significant post-delivery obligations exist , revenue is deferred until such obligations are fulfilled . our arrangements generally do not have any significant post-delivery obligations . if our arrangements include customer acceptance provisions , revenue is recognized upon obtaining the signed acceptance certificate from the customer , unless we can objectively demonstrate that the delivered products or services meet all the acceptance criteria specified in the arrangement prior to obtaining the signed acceptance . in those instances where revenue is recognized prior to obtaining the signed acceptance certificate , we use successful completion of customer testing as the basis to objectively demonstrate that the delivered products or services meet all the acceptance criteria specified in the arrangement . we also consider historical acceptance experience with the customer , as well as the payment terms specified in the arrangement , when revenue is recognized prior to obtaining the signed acceptance certificate . when collectability is not reasonably assured , revenue is recognized when cash is collected . we make certain sales to product distributors . these customers are given certain privileges to return a portion of inventory . return privileges generally allow distributors to return inventory based on a percent of purchases made within a specific period of time . we recognize revenue on sales to distributors that have contractual return rights when the products have been sold by the distributors , unless there is sufficient customer specific sales and sales returns history to support revenue recognition upon shipment . story_separator_special_tag this increase was primarily related to an increase in our outstanding debt balance to $ 29.6 million at december 31 , 2017 from $ 24.4 million at december 31 , 2016. interest rates on our borrowings were relatively flat during 2017 and 2016. other expense , net other expense , net for 2017 was $ 0.7 million compared to $ 0.1 million in 2016. this includes $ 0.5 million of currency exchange loss in 2017 compared to currency exchange loss of $ 0.4 million in 2016. income tax provision ( benefit ) we recorded an income tax benefit of $ 2.1 million for the year ended 2017 compared to an income tax provision of $ 1.5 million for the year ended december 31 , 2016. the decrease during the fiscal year 2017 was mainly due to the release of valuation allowance against our net deferred tax assets in korea . management determined that it is more likely than not that the net deferred tax assets will be realized in this tax jurisdiction . on december 22 , 2017 , president trump signed the tax cuts and jobs act ( the “ act ” ) into law . the new legislation decreases the u.s. corporate federal income tax rate from 35 % to 21 % effective january 1 , 2018. the reduction in tax rate resulted in a $ 5.3 million reduction in net deferred tax assets . there was no impact on recorded deferred tax balances as the remeasurement of net deferred tax assets was offset by a change in valuation allowance . the act imposes a one-time deemed repatriation tax on undistributed foreign earnings . we did not have a deemed repatriation due to our foreign earnings deficits . the act also includes a number of other provisions including the elimination of loss carrybacks , limitations on the use of future losses , repeal of the alternative minimum tax regime , and the introduction of a base erosion and anti-abuse tax . these provisions are not expected to have immediate effect on us . 34 2016 compared with 2015 net revenue information about our net revenue for products and services for 2016 and 2015 is summarized below ( in millions ) : replace_table_token_8_th information about our net revenue for north america and international markets for 2016 and 2015 is summarized below ( in millions ) : replace_table_token_9_th net revenue increased 8 % or $ 11.1 million to $ 150.3 million for 2016 compared to $ 139.2 million for 2015 . the increase in net revenue was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of net revenue from the legacy zhone business in 2016 for the period from and after the consummation of the merger . this increase was partially offset by a decrease in product revenue resulting from the decrease in sales to certain customers in korea . international net revenue decreased 3 % or $ 3.4 million to $ 131.4 million for 2016 compared to $ 134.8 million for 2015 , and represented 87 % of total net revenue compared with 97 % in 2015 . the decrease in international net revenue was primarily due to a decrease in sales to certain customers in korea , which resulted in a decrease in net revenue from korea of 32 % or $ 36.8 million compared to the prior year period . this decrease was partially offset by the consummation of the merger in september 2016 , which resulted in the inclusion of international net revenue from the legacy zhone business in 2016 for the period from and after the consummation of the merger , primarily relating to sales in latin america , europe and the middle east . net revenue from north america increased 330 % or $ 14.5 million to $ 18.9 million in 2016 compared to $ 4.4 million in 2015 . this increase was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of net revenue related to the legacy zhone business in north america in 2016 for the period from and after the consummation of the merger . cost of revenue and gross profit total cost of revenue increased 6 % or $ 6.0 million to $ 109.4 million for 2016 , compared to $ 103.3 million for 2015 . the increase in cost of revenue was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of cost of revenue related to the legacy zhone business in 2016 for the period from and after the consummation of the merger . this increase was partially offset by lower cost of revenue resulting from decreased sales in korea in 2016 compared to the prior year period . total cost of revenue was 73 % of net revenue for 2016 , compared to 74 % of net revenue for 2015 , which resulted in an increase in gross profit percentage from 26 % in 2015 to 27 % in 2016 . gross margin slightly increased in 2016 compared to 2015 , primarily due to the inclusion of legacy zhone 's higher margin business following the consummation of the merger in september 2016 . 35 research and product development expenses research and product development expenses increased 19 % or $ 4.1 million to $ 25.4 million for 2016 compared to $ 21.3 million for 2015 . the increase was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of $ 5.1 million in research and product development expense relating to the legacy zhone business in 2016 for the period from and after the consummation of the merger . this increase was partially offset by a decrease during the period prior to the merger in research and product development expenses of $ 0.8 million resulting from lower personnel related expenses due to a lower headcount .

cash management our primary source of liquidity comes from our cash and cash equivalents , which totaled $ 17.5 million at december 31 , 2017 , as well as our credit facilities , under which we had aggregate borrowing availability of $ 12.0 million as of december 31 , 2017. our cash and cash equivalents as of december 31 , 2017 included $ 12.1 million in cash balances held by our korean subsidiary . wells fargo bank facility as of december 31 , 2017 , we had a $ 25.0 million revolving line of credit and letter of credit facility with wfb . under the wfb facility , we have the option of borrowing funds at agreed upon interest rates . the amount that we are able to borrow under the wfb facility varies based on eligible accounts receivable and inventory , as defined in the wfb facility , as long as the aggregate amount outstanding does not exceed $ 25.0 million less the amount committed as security for letters of credit . to maintain availability of funds under the wfb facility , we pay a commitment fee on the unused portion . the commitment fee is 0.25 % per annum and is recorded as interest expense . as of december 31 , 2017 , we had no outstanding borrowings under our wfb facility . based on our eligible accounts receivable and inventory and $ 2.3 million committed as security for letters of credit , we had $ 9.2 million of borrowing availability under the wfb facility as of december 31 , 2017 .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash management our primary source of liquidity comes from our cash and cash equivalents , which totaled $ 17.5 million at december 31 , 2017 , as well as our credit facilities , under which we had aggregate borrowing availability of $ 12.0 million as of december 31 , 2017. our cash and cash equivalents as of december 31 , 2017 included $ 12.1 million in cash balances held by our korean subsidiary . wells fargo bank facility as of december 31 , 2017 , we had a $ 25.0 million revolving line of credit and letter of credit facility with wfb . under the wfb facility , we have the option of borrowing funds at agreed upon interest rates . the amount that we are able to borrow under the wfb facility varies based on eligible accounts receivable and inventory , as defined in the wfb facility , as long as the aggregate amount outstanding does not exceed $ 25.0 million less the amount committed as security for letters of credit . to maintain availability of funds under the wfb facility , we pay a commitment fee on the unused portion . the commitment fee is 0.25 % per annum and is recorded as interest expense . as of december 31 , 2017 , we had no outstanding borrowings under our wfb facility . based on our eligible accounts receivable and inventory and $ 2.3 million committed as security for letters of credit , we had $ 9.2 million of borrowing availability under the wfb facility as of december 31 , 2017 .
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 Suspicious Activity Report : accordingly , at the effective time of the merger , we issued 9,493,016 shares ( post reverse stock split ) of our common stock to dni as consideration in the merger , of which 949,302 shares ( post reverse stock split ) are being held in escrow as security for claims for indemnifiable losses in accordance with the merger agreement relating to the merger . as a result , immediately following the effective time of the merger , dni held 58 % of the outstanding shares of our common stock and the holders of our common stock immediately prior to the merger retained , in the aggregate , 42 % of the outstanding shares of our common stock . see note 2 to the consolidated financial statements set forth in part ii , item 8 of this report for additional information regarding the merger . common control transaction on december 31 , 2017 , dns ( a wholly owned subsidiary of ours ) acquired 100 % and 99.99 % of the common stock of d-mobile limited ( “ d-mobile ” ) and dasan india private limited ( dasan india ) , respectively , from dni . d-mobile and dasan india are resellers of our products in taiwan and india , respectively . the consideration payable by us to dni for the common stock is the net book value of d-mobile and dasan india at december 31 , 2017 , subject to final adjustments . the net book value of d-mobile and dasan india was an aggregate of $ 0.8 million . we accounted for these transactions as common control transactions , with the net assets transferred recorded at historical cost . the transactions did not result in a change in reporting entity and hence were accounted for prospectively . items affecting comparability of our financial results as discussed in note 2 to the consolidated financial statements set forth in part ii , item 8 of this report , the merger has been accounted for as a reverse acquisition under which dns was considered the accounting acquirer of legacy zhone . as such , our financial results presented in this annual report on form 10-k reflect the operating results of dns and its consolidated subsidiaries for the year-ended december 31 , 2015 and for the period from january 1 , 2016 through september 8 , 2016 and the operating results of both dns and legacy zhone and their respective consolidated subsidiaries for all periods from and after september 9 , 2016. our balance sheet as of december 31 , 2016 included the fair value of the assets and liabilities of legacy zhone as of the effective date of the merger . those assets include the fair value of acquired intangible assets and goodwill . the year ended december 31 , 2017 was the first fiscal year in which our financial results reflected a full year of operating results for both dns and legacy zhone and their respective consolidated subsidiaries . due to the foregoing , our financial results for the year ended december 31 , 2017 are not comparable to our financial results for prior years . critical accounting policies and estimates management 's discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements , which have been prepared in accordance with generally accepted accounting principles in the united states of america . the preparation of these consolidated financial statements requires management to make estimates and judgments that affect the reported amounts of assets , liabilities , revenue and expenses , and related disclosure of contingent assets and liabilities . the policies discussed below are considered by management to be critical because changes in such estimates can materially affect the amount of our reported net income or loss . for all of these policies , management cautions that actual results may differ materially from these estimates under different assumptions or conditions . 28 revenue recognition we recognize revenue when the earnings process is complete . we recognize product revenue upon shipment of product under contractual terms which transfer title to customers upon shipment , under normal credit terms , net of estimated sales returns and allowances at the time of shipment . revenue is deferred if there are significant post-delivery obligations or if the fees are not fixed or determinable . when significant post-delivery obligations exist , revenue is deferred until such obligations are fulfilled . our arrangements generally do not have any significant post-delivery obligations . if our arrangements include customer acceptance provisions , revenue is recognized upon obtaining the signed acceptance certificate from the customer , unless we can objectively demonstrate that the delivered products or services meet all the acceptance criteria specified in the arrangement prior to obtaining the signed acceptance . in those instances where revenue is recognized prior to obtaining the signed acceptance certificate , we use successful completion of customer testing as the basis to objectively demonstrate that the delivered products or services meet all the acceptance criteria specified in the arrangement . we also consider historical acceptance experience with the customer , as well as the payment terms specified in the arrangement , when revenue is recognized prior to obtaining the signed acceptance certificate . when collectability is not reasonably assured , revenue is recognized when cash is collected . we make certain sales to product distributors . these customers are given certain privileges to return a portion of inventory . return privileges generally allow distributors to return inventory based on a percent of purchases made within a specific period of time . we recognize revenue on sales to distributors that have contractual return rights when the products have been sold by the distributors , unless there is sufficient customer specific sales and sales returns history to support revenue recognition upon shipment . story_separator_special_tag this increase was primarily related to an increase in our outstanding debt balance to $ 29.6 million at december 31 , 2017 from $ 24.4 million at december 31 , 2016. interest rates on our borrowings were relatively flat during 2017 and 2016. other expense , net other expense , net for 2017 was $ 0.7 million compared to $ 0.1 million in 2016. this includes $ 0.5 million of currency exchange loss in 2017 compared to currency exchange loss of $ 0.4 million in 2016. income tax provision ( benefit ) we recorded an income tax benefit of $ 2.1 million for the year ended 2017 compared to an income tax provision of $ 1.5 million for the year ended december 31 , 2016. the decrease during the fiscal year 2017 was mainly due to the release of valuation allowance against our net deferred tax assets in korea . management determined that it is more likely than not that the net deferred tax assets will be realized in this tax jurisdiction . on december 22 , 2017 , president trump signed the tax cuts and jobs act ( the “ act ” ) into law . the new legislation decreases the u.s. corporate federal income tax rate from 35 % to 21 % effective january 1 , 2018. the reduction in tax rate resulted in a $ 5.3 million reduction in net deferred tax assets . there was no impact on recorded deferred tax balances as the remeasurement of net deferred tax assets was offset by a change in valuation allowance . the act imposes a one-time deemed repatriation tax on undistributed foreign earnings . we did not have a deemed repatriation due to our foreign earnings deficits . the act also includes a number of other provisions including the elimination of loss carrybacks , limitations on the use of future losses , repeal of the alternative minimum tax regime , and the introduction of a base erosion and anti-abuse tax . these provisions are not expected to have immediate effect on us . 34 2016 compared with 2015 net revenue information about our net revenue for products and services for 2016 and 2015 is summarized below ( in millions ) : replace_table_token_8_th information about our net revenue for north america and international markets for 2016 and 2015 is summarized below ( in millions ) : replace_table_token_9_th net revenue increased 8 % or $ 11.1 million to $ 150.3 million for 2016 compared to $ 139.2 million for 2015 . the increase in net revenue was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of net revenue from the legacy zhone business in 2016 for the period from and after the consummation of the merger . this increase was partially offset by a decrease in product revenue resulting from the decrease in sales to certain customers in korea . international net revenue decreased 3 % or $ 3.4 million to $ 131.4 million for 2016 compared to $ 134.8 million for 2015 , and represented 87 % of total net revenue compared with 97 % in 2015 . the decrease in international net revenue was primarily due to a decrease in sales to certain customers in korea , which resulted in a decrease in net revenue from korea of 32 % or $ 36.8 million compared to the prior year period . this decrease was partially offset by the consummation of the merger in september 2016 , which resulted in the inclusion of international net revenue from the legacy zhone business in 2016 for the period from and after the consummation of the merger , primarily relating to sales in latin america , europe and the middle east . net revenue from north america increased 330 % or $ 14.5 million to $ 18.9 million in 2016 compared to $ 4.4 million in 2015 . this increase was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of net revenue related to the legacy zhone business in north america in 2016 for the period from and after the consummation of the merger . cost of revenue and gross profit total cost of revenue increased 6 % or $ 6.0 million to $ 109.4 million for 2016 , compared to $ 103.3 million for 2015 . the increase in cost of revenue was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of cost of revenue related to the legacy zhone business in 2016 for the period from and after the consummation of the merger . this increase was partially offset by lower cost of revenue resulting from decreased sales in korea in 2016 compared to the prior year period . total cost of revenue was 73 % of net revenue for 2016 , compared to 74 % of net revenue for 2015 , which resulted in an increase in gross profit percentage from 26 % in 2015 to 27 % in 2016 . gross margin slightly increased in 2016 compared to 2015 , primarily due to the inclusion of legacy zhone 's higher margin business following the consummation of the merger in september 2016 . 35 research and product development expenses research and product development expenses increased 19 % or $ 4.1 million to $ 25.4 million for 2016 compared to $ 21.3 million for 2015 . the increase was primarily due to the consummation of the merger in september 2016 , which resulted in the inclusion of $ 5.1 million in research and product development expense relating to the legacy zhone business in 2016 for the period from and after the consummation of the merger . this increase was partially offset by a decrease during the period prior to the merger in research and product development expenses of $ 0.8 million resulting from lower personnel related expenses due to a lower headcount .

