NOTE 2 — ACQUISITION

On January 16, 2015, NCI Group, Inc., a wholly-owned subsidiary of the Company, and Steelbuilding.com, LLC, a wholly owned subsidiary of NCI Group, Inc., completed the acquisition of CENTRIA (the “CENTRIA Acquisition”), a Pennsylvania general partnership (“CENTRIA”), pursuant to the terms of the Interest Purchase Agreement, dated November 7, 2014 (“Interest Purchase Agreement”) with SMST Management Corp., a Pennsylvania corporation, Riverfront Capital Fund, a Pennsylvania limited partnership, and CENTRIA. NCI acquired all of the general partnership interests of CENTRIA in exchange for $255.8 million in cash. The purchase price is subject to a post-closing adjustment to net working capital as provided in the Interest Purchase Agreement. The purchase price was funded through the issuance of $250.0 million of new indebtedness. See Note 13 — Long-Term Debt and Note Payable. CENTRIA is now a wholly-owned subsidiary of NCI.

Accordingly, the results of CENTRIA’s operations from January 16, 2015 are included in our consolidated financial statements. For the period from January 16, 2015 to May 3, 2015, CENTRIA contributed revenue and operating income (loss) of $61.9 million and $(3.9) million, respectively. CENTRIA is a leader in the design, engineering and manufacturing of architectural insulated metal panel (“IMP”) wall and roof systems and a provider of integrated coil coating services for the nonresidential construction industry. CENTRIA operates four production facilities in the United States and a manufacturing facility in China.

We report on a fiscal year that ends on the Sunday closest to October 31. CENTRIA previously reported on a calendar year that ended December 31. The unaudited pro forma financial information in the table below was prepared based on financial information for CENTRIA for the calendar months of November through April in each respective period prior to the acquisition, which correlates to the three and six month periods corresponding to our fiscal period. The unaudited pro forma financial information for the fiscal three and six months ended May 3, 2015 and May 4, 2014 give effect to the transaction as if it had occurred at the beginning of the earliest fiscal period presented.

This unaudited pro forma financial information does not necessarily represent what would have occurred if the transaction had taken place on the dates presented and should not be taken as representative of our future consolidated results of operations. The unaudited pro forma financial information includes adjustments for interest expense to match the new capital structure and amortization expense for identified intangibles. In addition, acquisition related costs and $16.1 million of transaction costs incurred by the seller are excluded from the unaudited pro forma financial information. We expect to realize operating synergies from supply chain optimization, cost reductions, alignment of purchase terms and logistics and pricing optimization. The pro forma information does not reflect these potential synergies or expense reductions.

The following table shows our unaudited pro forma financial information for the three and six month periods ended May 3, 2015 and May 4, 2014 (in thousands, expect per share amounts):

	Unaudited Pro Forma
	Fiscal Three Months Ended				Fiscal Six Months Ended
	May 3, 2015		May 4, 2014		May 3, 2015		May 4, 2014
Sales	$	360,147	$	359,290	$	727,560	$	720,485
Net income (loss)		(7,101)		(8,709)		(10,947)		(15,136)
Income (loss) per common share
Basic		(0.10)		(0.12)		(0.15)		(0.21)
Diluted	$	(0.10)	$	(0.12)	$	(0.15)	$	(0.21)

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as part of the CENTRIA Acquisition as of January 16, 2015. The fair value of all assets acquired and liabilities assumed are preliminary and the final determination of any required acquisition method adjustments will be made upon the completion of our fair value assessments. As a result, the initial purchase price allocations may be adjusted for changes in estimates of the fair value of assets acquired and liabilities assumed.

(In thousands)	January 16, 2015
Current assets	$	80,114
Property, plant and equipment		34,127
Intangible assets		92,030
Assets acquired	$	206,271
Current liabilities	$	65,173
Other liabilities		8,312
Liabilities assumed	$	73,485
Fair value of net assets acquired	$	132,786
Total consideration paid		255,841
Goodwill	$	123,055

The amount allocated to intangible assets was attributed to the following categories (in thousands):

			Useful Lives
Backlog	$	7,000	9 months
Trade names		15,620	15 years
Customer lists and relationships		69,410	20 years
	$	92,030

These intangible assets are amortized on a straight-line basis.

The excess of the purchase price over the fair values of assets acquired and liabilities assumed was allocated to goodwill. We currently include the results of the CENTRIA Acquisition in the metal components segment. However, we are currently evaluating our management reporting presentation, which may result in changes to our operating segment presentation in future periods. Goodwill of $123.1 million was recorded in our metal components segment. Additionally, because the entity acquired was treated as a partnership for tax purposes, the tax basis of the acquired assets and liabilities have been adjusted to their fair value and goodwill will be deductible for tax purposes.

For all of our intangibles, including those recently acquired as part of the CENTRIA Acquisition and from prior acquisitions, the weighted average estimated useful life is 17.7 years. We recognized $5.9 million in amortization expense for all intangibles during the six months ended May 3, 2015. Total accumulated amortization was $26.4 million at May 3, 2015. We expect to recognize amortization expense over the next five fiscal years as follows (in millions):

May 4, 2015 to November 1, 2015	$	8,001
2016		7,428
2017		7,428
2018		7,428
2019		7,428