ACQUISITION

Effective April 1, 2013, CUI Global closed on a share purchase agreement to acquire 100% of the equity interest in Orbital Gas Systems Limited, a company organized under the laws of England and Wales (“Orbital”), from Orbital’s sole shareholder. The purchase price for the acquisition of Orbital was £17,000,000 British pounds sterling (“£”), subject to purchase price adjustments, 100% of the purchase price was paid in cash. To secure indemnification obligations, 5.0% of the purchase price, or £850,000, is held in escrow to and through December 1, 2013. The purchase price was $26,205,500, based on the actual exchange rate for British pound sterling to U.S. dollars achieved on April 18, 2013 for the acquisition of Orbital.

We funded the consideration paid to the shareholder of Orbital with a portion of the net proceeds received from a public offering of our $0.001 par value common stock that was registered on an SEC Form S-1 registration statement declared effective by the SEC on April 11, 2013. Subsequent to closing on this acquisition, Orbital Gas Systems, Ltd. became a wholly owned subsidiary of CUI Global, Inc.

The acquisition was accounted for using the purchase method of accounting and the purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition.

The allocation of the purchase price is as follows:

Purchase price	$	26,205,500
Cash and cash equivalents		8,495,993
Trade Accounts receivable, net		5,597,361
Unbilled accounts receivable		66,109
Inventory, net		445,119
Costs in excess of billings		350,943
Other current assets		20,892
Property & equipment, net		1,562,908
Intangible, customer lists		7,180,307
Intangible, order backlog		3,434,462
Intangible, tradename		1,846,717
Intangible, technology-based asset know how		2,908,811
Intangible, technology-based asset software		630,474
Goodwill		5,128,008
Liabilities assumed		(11,462,604)
	$	26,205,500

Due to the recent acquisition date, the purchase price allocation is based upon preliminary data that is subject to adjustments and could change significantly pending the completion of management’s evaluation of the assets and liabilities acquired.

The table below summarizes the unaudited condensed pro forma information of the results of operations of CUI Global, Inc. for the six months ended June 30, 2013 and 2012 as though the acquisition had been completed as of January 1, 2013 and 2012:

	For the six months ended
	June 30,
	2013			2012
Gross revenue	$	32,779,961	$	31,513,092
Total expenses		34,492,787		33,416,205
Net profit (loss)	$	(1,712,826)	$	(1,903,113)
Basic profit (loss) per share	$	(0.12)	$	(0.20)
Diluted profit (loss) per share	$	(0.12)	$	(0.20)

The above unaudited condensed pro forma information does not purport to represent what the Companies’ combined results of operations would have been if such transactions had occurred at the beginning of the periods presented, and are not indicative of future results.