NOTE 2 - ACQUISITION On May 30, 2017, the Company acquired 92.3 percent of the outstanding stock of UNIWHEELS AG (now referred to as our Europe segment, Europe business, Europe operations or European operations) for approximately $703.0 million (based on an exchange rate of 1.00 U.S. dollar = 3.74193 Polish Zloty) via a tender offer. On June 30, 2017, the Company commenced the delisting and associated tender process for the remaining outstanding shares of Uniwheels. Subsequently, Superior pursued a Domination and Profit and Loss Transfer Agreement (DPLTA) which became effective on January 17, 2018, with retroactive effect as of January 1, 2018. Under the DPLTA, the Company offered to purchase any further tendered shares for cash consideration of Euro 62.18. This cash consideration may be subject to change based on appraisal proceedings that the minority shareholders of UNIWHEELS AG have initiated. Because the aggregate equity purchase price of the Acquisition (assuming an exchange rate of 1.00 U.S. dollar = 3.74193 Polish Zloty) was determined at the time of the initial tender offer, any increase in the resulting price must be reflected as a reduction of paid in capital (common stock). Each year beginning in 2019, the Company must pay an annual dividend of Euro 3.23 on any outstanding shares as long as the DPLTA is in effect. For any shares tendered prior to payment of the dividend each year, the Company must pay interest at a statutory rate, currently 4.12 percent, at the time the shares are redeemed. As of December 31, 2019, a total of 12,310,000 shares have been tendered and the Company now owns 99.3 percent of the outstanding shares of Superior Industries Europe AG (formerly Uniwheels AG). As a result of the effectiveness of the DPLTA as of January 1, 2018, the carrying value of the non-controlling interest related to UNIWHEELS AG common shares outstanding of $51.9 million, which was presented as a component of stockholders equity as of December 31, 2017, was reclassified to European non-controlling redeemable equity during the first quarter of 2018. The non-controlling interest shares may be tendered at any time and are, therefore, immediately redeemable and must be classified outside stockholders equity. For the period of time that the DPLTA is in effect, the non-controlling interest will continue to be presented in European non-controlling redeemable equity outside of stockholders equity in the consolidated balance sheets. The Companys consolidated financial statements include the results of our European operations subsequent to May 30, 2017. The Companys consolidated financial statements reflect the purchase accounting adjustments in accordance with ASC 805 Business Combinations, whereby the purchase price was allocated to the assets acquired and liabilities assumed based upon their fair values on the acquisition date. The following is the allocation of the purchase price: (Dollars in thousands) Estimated purchase price Cash consideration $ 703,000 Non-controlling interest 63,200 Preliminary purchase price allocation Cash and cash equivalents 12,296 Accounts receivable 60,580 Inventories 83,901 Prepaid expenses and other current assets 11,859 Total current assets 168,636 Property and equipment 259,784 Intangible assets 205,000 Goodwill 286,249 Other assets 32,987 Total assets acquired 952,656 Accounts payable 61,883 Other current liabilities 40,903 Total current liabilities 102,786 Other long-term liabilities 83,670 Total liabilities assumed 186,456 Net assets acquired $ 766,200 Acquired intangible assets were recorded at estimated fair value, as determined through the use of the income approach, specifically the relief from royalty and multi-period excess earnings methods. The major assumptions used in arriving at the estimated identifiable intangible asset values included estimates of future cash flows, discounted at an appropriate rate of return which are based on the weighted average cost of capital for both the Company and other market participants. The useful lives for intangible assets were determined based upon the remaining useful economic lives of the intangible assets that are expected to contribute directly or indirectly to our future cash flows. The estimated fair value of intangible assets and related useful lives as included in the purchase price allocation are as follows: Estimated Fair Value Estimated Useful Life (in Years) (Dollars in thousands) Brand name $ 9,000 4-6 Technology 15,000 4-6 Customer relationships 167,000 7-11 Trade names 14,000 Indefinite $ 205,000 Goodwill represents future economic benefits expected to be recognized from the Companys expansion into the European wheel market, as well as expected future synergies and operating efficiencies. The purchase price allocation of goodwill, which was finalized in the second quarter of 2018, yielding an amount of $286.2 million, was allocated to the Europe segment. In the fourth quarter of 2019, we recognized a goodwill impairment charge of $99.5 million, as well as an indefinite-lived intangible impairment charge of $2.7 million, relating to our European reporting unit (refer to Note 10, Goodwill and Other Intangible Assets). The following unaudited combined pro forma information is for informational purposes only. The pro forma information is not necessarily indicative of what the combined Companys results actually would have been had the acquisition been completed as of the beginning of the periods as indicated. In addition, the unaudited pro forma information does not purport to project the future results of the combined Company. Twelve Months Ended December 31, 2017 Proforma (Dollars in thousands) Proforma combined sales $ 1,351,799 Proforma net income $ 17,692