(6) Acquisitions

On August 1, 2016, the Company purchased five Mars Super Market stores located in Maryland. Weis Markets, Inc. acquired these locations and their operations in an effort to expand its presence in the Baltimore County region. The results of operations of the former Mars Super Market acquisition are included in the accompanying Consolidated Financial Statements from the date of acquisition. The five former Mars Super Market stores contributed $13.0 million to sales in the third quarter. The cash purchase price paid was $24.3 million for the property, equipment, inventories, prepaid expenses and goodwill related to this purchase. The Company accounted for this transaction as a business combination in accordance with the acquisition method. The Company recorded the preliminary fair values of the assets acquired at August 1, 2016. The fair value of intangibles was determined based on the discounted cash flow model and property and equipment were determined based on external appraisals, which will be finalized in the fourth quarter. Weis Markets, Inc. assumed two lease obligations in the acquisition of the former Mars Super Market stores and entered into two new lease agreements. Goodwill of $13.2 million has been recorded, based upon the expected benefits to be derived from new management business strategy and cost synergies. The full $13.2 million is deductible for tax purposes. The purchase price has been preliminarily allocated to the acquired assets as follows:



		5 Mars Super Market Stores
(dollars in thousands)		August 1, 2016
Inventories	$	1,267
Accounts receivable and prepaid expenses		248
Property and equipment		7,110
Goodwill		13,200
Intangibles - favorable leases, net		2,495
Total assets acquired	$	24,320

In July 2016, the Company announced it had reached a definitive agreement with Food Lion, LLC to purchase the assets of 38 Food Lion Supermarket locations operating in the states of Maryland, Virginia and Delaware. The purchase is anticipated to be completed in the fourth quarter of 2016. With this purchase 21 Maryland stores, 13 Virginia stores, and 4 Delaware stores, will be added to the Company’s store count. As of September 24, 2016, the Company began operating ten of the 38 Food Lion, LLC locations in Maryland. The results of operations of the ten former Food Lion, LLC stores are included in the accompanying Consolidated Financial Statements from the date of each acquisition (five stores on September 11, 2016 and five stores on September 18, 2016). The cash purchase price paid to date is $23.2 million, including $15.1 million of escrowed payments made towards the remaining twenty-eight stores, for the property, equipment, inventories, prepaid expenses and liabilities. Weis Markets, Inc. assumed six lease obligations and ownership of four locations with the first ten locations acquired. The ten acquired Food Lion, LLC locations contributed $2.0 million to sales in the third quarter. Regarding the remainder of the Food Lion, LLC acquisition the Company expects to assume twenty-four additional lease obligations and own four locations. The initial accounting for the business acquisition has not been finalized as the transaction has not fully closed. Twenty-eight additional stores are to be acquired in the fourth quarter and the Company will finalize the purchase price allocation in the fourth quarter upon completion of the transaction and external appraisals of assets acquired. The table below summarizes the progress of the acquisition and the preliminary allocation of the cash purchase price paid to date.



(dollars in thousands)		38 Food Lion Supermarket Stores
Preliminary purchase price allocation for cash paid on 10 stores
Inventories	$	1,958
Prepaid expenses		433
Accounts payable and other liabilities		(66)
Property and equipment		5,719
Other		78
Total cash paid for 10 stores		8,122
Other long-term assets - Escrow payment made towards remaining 28 stores		15,105
Total cash paid as of September 24, 2016	$	23,227

(6) Acquisitions (continued)

On October 6, 2016, the Company announced plans to purchase the location, inventory, property and equipment of Nell’s Family Market in East Berlin, PA from C&S Wholesale Grocers. Exclusive of the inventory, the Company is expecting to pay approximately $8.7 million. The purchase is planned to be completed in the fourth quarter of 2016 and will increase the Company’s market presence in Adams County, PA.

Pro forma information for the completed acquisitions is not required, as such information is not material to the Company’s financial statements.

The Company paid $7.9 million for the property and equipment related to the purchase of a store in Hanover, Pennsylvania on August 31, 2015 from C&S Wholesale Grocers. The purchase price was allocated between tangible and related intangible assets in accordance with our accounting policies for business combinations. No goodwill was recognized.