ACQUISITIONS AND MERGERS

We account for business acquisitions in accordance with the acquisition method of accounting, which requires, among other things, that most assets acquired, liabilities assumed and earn-out consideration be recognized at their fair values as of the acquisition date. Measurement period adjustments to provisional purchase price allocations are recognized in the period in which they are determined as if they accounting had been completed on the acquisition date.

Interboro Insurance Company

On April 29, 2016, we completed the acquisition of IIC. The purchase price for IIC consisted of $48,450,000 in cash, $8,550,000 in a note payable and an accrued liability for $3,471,000 paid during July 2016. The acquisition of IIC supports the Company's growth strategy and further strengthens the Company's overall position in the property and casualty insurance market in the state of New York.

The operations of IIC are included in our Unautided Consolidated Statements of Comprehensive Income effective April 29, 2016. We have one year from the acquisition date to finalize the allocation of the purchase price of IIC. The fair value of the net liabilities assumed, the intangible assets and the related goodwill are preliminary and may be subject to change upon completing the final valuation assessment. The preliminary purchase price allocation is as follows:



Cash and cash equivalents	$	15,554
Investments	66,527
Premium and agents' receivable	3,186
Reinsurance receivable	1,042
Intangible assets	5,877
Insurance contract asset	8,334
Goodwill	10,841
Other assets	3,980
Unpaid losses and loss adjustment expenses	(24,967		)
Unearned premiums	(26,243		)
Advanced premiums	(1,472		)
Deferred taxes	(109		)
Other liabilities	(2,079		)
Total purchase price	$	60,471

The unaudited pro forma financial information below has been prepared as if the IIC acquisition had taken place on January 1, 2016. The unaudited pro forma information is not necessarily indicative of the results that we would have achieved had the transaction taken place on January 1, 2016, and the unaudited pro forma information does not purport to be indicative of future financial operating results.



	For the Three Months Ended March 31,
	2016
			Pro Forma
	As Reported		Adjustments		Pro Forma
Revenues	$	107,561	$	16,634	$	124,195

Net income	$	2,951	$	2,350	$	5,301

Diluted earnings per share	$	0.14	$	—	$	0.25

American Coastal Insurance Company

On April 3, 2017, the Company announced that it had received all necessary regulatory approvals, met all other closing conditions and successfully completed its merger with American Coastal Insurance Company (ACIC). The acquisition was completed through a series of mergers that ultimately resulted in the Company issuing 20,956,355 shares of its common stock, $0.0001 par value per share, as merger consideration to the equity holders of RDX Holding, LLC, a Delaware limited liability company. The unaudited pro forma financial information below has been prepared as if the ACIC merger had taken place on January 1, 2017. The unaudited pro forma financial information is not necessarily indicative of the results that we would have achieved had the transaction taken place on January 1, 2017, and the unaudited pro forma information does not purport to be indicative of future financial operating results.



	For the Three Months Ended March 31,
	2017
			Pro Forma
	As Reported		Adjustments		Pro Forma
Revenues	$	122,633	$	38,097	$	160,730

Net income	$	3,899	$	6,467	$	10,366

Diluted earnings per share	$	0.18	$	—	$	0.24