On August 21, 2019, Atkins entered into the Purchase Agreement with the Target Companies, VMG Voyage Holdings, LLC, VMG Tax-Exempt II, L.P., Voyage Employee Holdings, LLC, and other sellers defined in the Purchase Agreement. On November 7, 2019, pursuant to the Purchase Agreement, Atkins completed the Acquisition of Quest for a cash purchase price at closing of $988.9 million subject to customary post closing adjustments. Atkins acquired Quest as a part of our vision to lead the nutritious snacking movement with trusted brands that offer a variety of convenient, innovative, great-tasting, better-for-you snacks and meal replacements. Quest is a healthy lifestyle food company offering a variety of bars, cookies, chips, ready-to-drink shakes and pizzas that compete in many of the attractive, fast growing sub-segments within the nutritional snacking category. Quest has a loyal following and strong appeal among consumers 18-44 years. The Acquisition of Quest was accounted for using the acquisition method of accounting in accordance with ASC 805, Business Combinations (ASC 805), whereby the results of operations, including the revenues and earnings of Quest, are included in the financial statements from the date of acquisition. ASC 805 requires, among other things, that assets acquired and liabilities assumed be recognized at their fair values, as determined in accordance with ASC 820, Fair Value Measurements, as of the closing date. ASC 805 establishes a measurement period to provide the Company with a reasonable amount of time to obtain the information necessary to identify and measure various items in a business combination and cannot extend beyond one year from the acquisition date. The Acquisition of Quest was funded by the Company through a combination of cash, equity and debt financing. Total consideration paid on the closing date was $988.9 million . Cash sources of funding included $195.3 million of cash on hand, net proceeds of approximately $350.0 million from the Company's October 9, 2019 public equity offering, and $443.6 million in new term loan debt. Included within the Business transaction costs line item of the Consolidated Statements of Operations and Comprehensive (Loss) Income as of November 30, 2019 are $14.5 million of transaction advisory fees related to the Acquisition of Quest, $3.2 million of banker commitment fees, $6.1 million of non-deferrable debt issuance costs related to the incremental term loan, and $2.3 million of other costs including legal, due diligence, and accounting fees. Included in the transaction advisory fees paid for the Acquisition of Quest is $12.0 million paid to Centerview Partners LLC, an investment banking firm that served as the lead financial advisor to the Company for this transaction. Three members of the Companys Board of Directors, Messrs. Kilts, West, and Ratzan, have business relationships with certain partners of Centerview Partners LLC (including relating to Centerview Capital Consumer, a private equity firm and affiliate of Conyers Park Sponsor LLC), but they are not themselves partners, executives or employees of Centerview Partners LLC and Centerview Partners LLC is not a related party of the Company pursuant to applicable rules and policies. The advisory fee paid to Centerview Partners LLC represents approximately 1.2% of the total cash purchase price paid by the Company on the closing date of the Acquisition of Quest. All transaction advisory fees relating to the Acquisition of Quest were approved by the Companys Audit Committee. The following table sets forth the preliminary purchase price of the Acquisition of Quest to the estimated fair value of the net assets acquired at the date of acquisition, subject to finalization per the terms of the Purchase Agreement. The preliminary purchase price allocation may be adjusted as a result of the finalization of our purchase price allocation procedures related to the assets acquired and liabilities assumed. The preliminary November 7, 2019 fair value is as follows: (In thousands) Assets acquired: Cash and cash equivalents $ 4,745 Accounts receivable, net 29,613 Inventories 43,091 Prepaid assets 1,214 Other current assets 3,821 Property and equipment, net (1) 10,363 Intangible assets, net (2) 848,375 Other long-term assets 20,997 Liabilities assumed: Accounts payable 25,200 Other current liabilities 11,237 Deferred income taxes (3) 13,982 Other long-term liabilities 18,891 Total identifiable net assets 892,909 Goodwill (4) 96,037 Total assets acquired and liabilities assumed $ 988,946 (1) Property and equipment, net primarily consists of leasehold improvements for the Quest headquarters of $6.9 million , furniture and fixtures of $2.2 million , and equipment of $1.3 million . The Quest headquarters lease ends in April 2029. The useful lives of the leasehold improvements, furniture and fixtures, and equipment is consistent with the Company's accounting policies. (2) Intangible assets were recorded at fair value consistent with ASC 820 as a result of the Acquisition of Quest. Intangible assets consist of $730.0 million of indefinite brands and trademarks, $115.0 million of amortizable customer relationships, and $3.4 million of internally developed software. The useful lives of the intangible assets are disclosed in Note 5 of the consolidated financial statements. The fair value measurement of the assets and liabilities was based on significant inputs not observable in the market and thus represent Level 3 measurements within the fair value measurement hierarchy. Level 3 fair market values were determined using a variety of information, including estimated future cash flows and market comparable data and companies. (3) As a result of the increase in the fair value of the identifiable intangible asset, the deferred income tax liability was increased by $14.0 million . (4) Goodwill was recorded at fair value consistent with ASC 820 as a result of the Acquisition of Quest. Amounts recorded for goodwill created in an acquisition structured as a stock purchase for tax are generally not expected to be deductible for tax purposes. Amounts recorded for goodwill resulting in a tax basis step-up are generally expected to be deductible for tax purposes. Tax deductible Goodwill is estimated to be $82.4 million . Goodwill represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. The purchase price is pending finalization per the terms of the Purchase Agreement. The final determination of the fair value of the assets acquired and liabilities assumed is expected to be completed as soon as practicable after completion of the Acquisition of Quest, including a period of time to finalize working capital adjustments and tax attributes. The final determinations will be completed prior to one year from the transaction completion, consistent with ASC 805. The results of Quest's operations have been included in the Simply Good Foods' Consolidated Financial Statements since November 7, 2019, the date of acquisition. The following table provides net sales from the acquired Quest business included in the Company's results: Thirteen Weeks Ended November 30, 2019 Net sales 17,082 Unaudited Pro Forma Financial Information The following unaudited pro forma combined financial information presents combined results of Atkins and Quest as if the Acquisition of Quest has occurred at the beginning of fiscal 2019: Thirteen Weeks Ended Thirteen Weeks Ended November 30, 2019 November 24, 2018 Revenue $ 220,556 $ 189,945 Gross profit $ 88,188 $ 61,587 Net income (loss) $ 15,648 $ (19,083 ) These unaudited pro forma combined financial statements are prepared based on Article 11 period end guidance. The results include certain adjustments, as required under ASC 805, which are different than Article 11 pro forma requirements. ASC 805 requires pro forma adjustments to reflect the effects of fair value adjustments, transaction costs, capital structure changes, the tax effects of such adjustments, and also requires nonrecurring adjustments be prepared as though the Acquisition of Quest had occurred as of the beginning of the earliest period presented. The adjustments to the historical Quest financial results include the exclusion of legacy derivatives and interest expense that were settled in the execution of the Acquisition of Quest. Additional adjustments include non recurring transaction costs and the portion of the inventory fair value adjustment recorded by the Company during the thirteen weeks ended November 30, 2019. Both periods were further adjusted to reflect a full thirteen week period of a) fair value adjustments related to inventory and incremental customer relationship amortization, b) interest expense with the higher principal associated with new term loan debt, and c) the effects of the adjustments on income taxes and net income. The pro forma financial information is not intended to represent or be indicative of the actual results of operations of the combined business that would have been reported had the Acquisition of Quest been completed at the beginning of the fiscal year 2019, nor is it representative of future operating results of the Company.