NOTE 5: BUSINESS COMBINATION On October 12, 2018, Harris entered into the Merger Agreement with L3 and Merger Sub, pursuant to which Harris and L3 agreed to combine their respective businesses in an all-stock merger, at the closing of which Merger Sub would merge with and into L3, with L3 continuing as the surviving corporation and a direct wholly-owned subsidiary of Harris. The closing of the L3Harris Merger occurred on June 29, 2019 , the first day of our Fiscal Transition Period. Upon completion of the L3Harris Merger, Harris was renamed L3Harris Technologies, Inc. and each share of L3 common stock converted into the right to receive 1.30 shares of L3Harris common stock. L3Harris was owned on a fully diluted basis approximately 54 percent by Harris shareholders and 46 percent by L3 shareholders immediately following the completion of the L3Harris Merger. L3 was a prime contractor in intelligence, surveillance and reconnaissance (ISR) systems, aircraft sustainment (including modifications and fleet management of special mission aircraft), simulation and training, night vision and image intensification equipment, and security and detection systems. L3 also was a leading provider of a broad range of communication, electronic and sensor systems used on military, homeland security and commercial platforms. L3 employed approximately 31,000 employees and its customers included the U.S. Department of Defense and its prime contractors, the U.S. Intelligence Community, the U.S. Department of Homeland Security, foreign governments and domestic and foreign commercial customers. L3 generated calendar 2018 revenue of approximately $10 billion . Following the completion of the L3Harris Merger, we issued 104 million shares of L3Harris common stock to L3 shareholders. The trading price of L3Harris common stock was $189.13 per share as of the Closing Date. In addition to shares of our common stock issued to L3 shareholders, replacement L3Harris share-based awards were issued for certain outstanding L3 share-based awards. We are accounting for the L3Harris Merger under the acquisition method of accounting. Under the acquisition method of accounting, we are required to measure identifiable assets acquired, liabilities assumed and any noncontrolling interests in the acquiree at their fair values as of the Closing Date. Due to the timing of the L3Harris Merger relative to its size and complexity, certain aspects of our accounting for the L3Harris Merger remain preliminary, including the acquisition-date fair value of identifiable assets acquired and certain liabilities assumed. Amounts recorded associated with these assets and liabilities are based on preliminary calculations and our estimates and assumptions are subject to change as we obtain additional information during the measurement period (up to one year from the Closing Date). As of January 3, 2020, we have completed our determination of the fair value of consideration transferred as well as defined benefit plan liabilities and long-term debt assumed. Our calculation of consideration transferred is as follows: (In millions, except exchange ratio and per share amounts) June 29, 2019 Outstanding shares of L3 common stock as of June 28, 2019 79.63 L3 restricted stock unit awards settled in shares of L3Harris common stock 0.41 L3 performance unit awards settled in shares of L3Harris common stock 0.04 80.08 Exchange Ratio 1.30 Shares of L3Harris common stock issued for L3 outstanding common stock 104.10 Price per share of L3Harris common stock as of June 28, 2019 $ 189.13 Fair value of L3Harris common stock issued for L3 outstanding common stock $ 19,689 Fair value of replacement RSUs attributable to merger consideration 10 Fair value of L3Harris stock options issued for L3 outstanding stock options 101 Withholding tax liability incurred for converted L3 share-based awards 45 Fair value of replacement award consideration 156 Fair value of total consideration 19,845 Less cash acquired (1,195 ) Total net consideration transferred $ 18,650 Our preliminary measurement of assets acquired, liabilities assumed and noncontrolling interests as of the Closing Date and measurement period adjustments during the two quarters ended January 3, 2020 , are as follows: Preliminary Fair Value Measurement Period Adjustments Adjusted Fair Value (In millions) Receivables $ 849 $ (15 ) $ 834 Contract assets 1,708 (41 ) 1,667 Inventories 1,056 (37 ) 1,019 Other current assets 517 (20 ) 497 Property, plant and equipment 1,176 39 1,215 Operating lease right-of-use assets 704  704 Goodwill 15,423 (774 ) 14,649 Other intangible assets 6,768 1,109 7,877 Other non-current assets 327 (6 ) 321 Total assets acquired $ 28,528 $ 255 $ 28,783 Accounts payable $ 898 $ (14 ) $ 884 Contract liabilities 722 (4 ) 718 Other current liabilities 772 60 832 Operating lease liabilities 715  715 Defined benefit plans 1,411  1,411 Long-term debt, net 3,548  3,548 Other long-term liabilities 1,661 209 1,870 Total liabilities assumed 9,727 251 9,978 Net assets acquired 18,801 4 18,805 Noncontrolling interests (151 ) (4 ) (155 ) Total net consideration transferred $ 18,650 $  $ 18,650 The goodwill resulting from the L3Harris Merger was primarily associated with L3s market presence and leading positions, growth opportunities in the markets in which L3 businesses operate, experienced work force and established operating infrastructures. Most of the goodwill related to the L3Harris Merger is nondeductible for tax purposes. See Note 10: Goodwill in these Notes for more information regarding the preliminary allocation of goodwill by business segment. The following table provides further detail of the fair value and weighted-average amortization period of identified intangible assets acquired by major intangible asset class: Weighted Average Amortization Period Total (In years) (In millions) Identifiable intangible assets acquired: Customer relationships (Government) 15 $ 4,677 Customer relationships (Commercial) 15 643 Trade names  Divisions 9 123 Developed technology 7 562 Total identifiable intangible assets subject to amortization 14 6,005 Trade names  Corporate indefinite 1,803 In-process research and development n/a 69 Total identifiable intangible assets $ 7,877 Merger-Related Charges During the two quarters ended January 3, 2020 , we recorded $532 million of L3Harris Merger-related charges, consisting of restructuring, integration, transaction and other costs as follows:  $142 million of additional cost of sales related to the fair value step-up in inventory sold;  $117 million of costs for workforce reductions, including severance and other employee-related exit costs;  $83 million of transaction costs, recognized as incurred;  $72 million of integration costs, recognized as incurred;  $70 million of equity award acceleration charges, recognized upon change in control; and  $48 million of facility consolidation costs. See Note 4: Restructuring and Other Exit Costs in these Notes for additional information regarding severance and facility consolidation costs. Because the L3Harris Merger benefited the entire Company as opposed to any individual business segment, the above costs were not allocated to any business segment. All of the costs above were recorded in the Engineering, selling and administrative expenses line item in our Consolidated Statement of Income, except for the $142 million of additional cost of sales related to the fair value step-up in inventory sold, which is included in the Cost of product sales and services line item in our Consolidated Statement of Income. Pro Forma Results The following summary, prepared on a pro forma basis, presents our unaudited consolidated results of operations for the comparable period ended December 28, 2018 as if the L3Harris Merger had been completed on June 29, 2018, the beginning of the comparable period ended December 28, 2018 , after including any post-merger adjustments directly attributable to the L3Harris Merger, such as the sale of the Harris Night Vision business, and after including the impact of adjustments such as amortization of intangible assets as well as the related income tax effects. This pro forma presentation does not include any impact of transaction synergies. The pro forma results are not necessarily indicative of our results of operations that actually would have been obtained had the L3Harris Merger been completed on the assumed date or for the period presented, or which may be realized in the future. Two Quarters Ended December 28, 2018 (In millions) Revenue from product sales and services  as reported $ 3,208 Revenue from product sales and services  pro forma $ 8,404 Income from continuing operations  as reported $ 441 Income from continuing operations  pro forma $ 760 For the two quarters ended January 3, 2020 , our Consolidated Statement of Income includes the results of L3 operating businesses from the Closing Date, with total revenue of approximately $5.7 billion (net of intercompany sales between L3 operating businesses) and income from continuing operations before income taxes of approximately $0.4 billion (including $142 million of additional cost of sales related to the fair value step-up in inventory sold and $108 million of restructuring charges for workforce reductions associated with the L3Harris Merger).