Acquisitions

On May 8, 2014, the Company, through its indirect wholly-owned subsidiary, ACSH Urgent Care of Georgia, LLC, acquired substantially all of the assets of CorrectMed. The acquisition was consummated pursuant to the terms and conditions of an asset purchase agreement, dated April 30, 2014. CorrectMed received aggregate consideration of $2.7 million, paid by delivery of $2.2 million in cash and a $500,000 promissory note which is due and payable on May 8, 2015. The consideration is subject to certain post-closing adjustments. The total consideration is to be adjusted after closing based on, among other things, actual working capital levels.

The transaction is being accounted for using the acquisition method of accounting for business combinations in accordance with GAAP. Under this method, the total consideration transferred to consummate the acquisition is being allocated to the identifiable tangible and intangible assets acquired and liabilities assumed based on their respective fair values as of the closing date of the acquisition. The acquisition method of accounting requires extensive use of estimates and judgments to allocate the consideration transferred to the identifiable tangible and intangible assets acquired and liabilities assumed. Accordingly, the allocation of the consideration transferred in the condensed consolidated financial statements is preliminary and will be adjusted upon completion of the final valuation of the assets acquired and liabilities assumed. The final valuation is expected to be completed as soon as practicable but no later than 12 months after the closing date of the acquisition.

The preliminary allocation of the total purchase price to the fair value of the assets acquired and liabilities assumed during the three months ended June 30, 2014 are as follows:



(in thousands)
Accounts receivable	$	221
Other current assets	27
Fixed assets	1,124
Goodwill	1,948
Patient base	263
Licensed trade name	34
Other liabilities assumed	(937		)
	$	2,680

The goodwill generated from the transaction is deductible for federal income tax purposes. Approximately $106,000 and $140,000 of transaction costs were incurred related to this acquisition during the three and six months ended June 30, 2014, respectively. In addition, the Company incurred approximately $135,000 and $258,000 of transaction costs related to other acquisition activity during the three and six months ended June 30, 2014, respectively.

The following table provides certain pro forma financial information for the Company as if the acquisition of the assets of CorrectMed had occurred on January 1, 2013:



(in thousands)	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Revenues	$	6,319		$	7,343		$	12,103		$	16,116
Net loss	(1,352		)	(1,833		)	(3,102		)	(3,160		)

Loss per basic and diluted common share	$	(0.21	)	$	(0.32	)	$	(0.51	)	$	(0.55	)