As of March 31,September 30, 2016, there was approximately $4.0$2.7 million of unrecognized pre-tax compensation expense related to share-based awards not yet vested that will be recognized over a weighted-average period of 2.01.5 years.  The closing of the pending merger transaction between Accuride and Crestview, as described above, would result in a change of control under outstanding share-based award agreements, which would result in such awards vesting on an accelerated basis or being terminated as of closing.

We have assessed the need to maintain a valuation allowance for deferred tax assets based on an assessment of whether it is more likely than not that deferred tax benefits will be realized through the generation of future taxable income.  Appropriate consideration is given to all available evidence, both positive and negative, in assessing the need for a valuation allowance.  Due to our recent history of U.S. and Italian operating and taxable losses, the inconsistency of income, and the uncertainty of our financial outlook, we continue to maintain a full valuation allowance against our domesticU.S. and Italian deferred tax assets.assets in those jurisdictions.  Deferred tax assets in our foreignCanadian and Mexican jurisdictions are more likely than not to be recognized, therefore, no valuation allowance has been recorded for these assets.

On August 12, 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606):  Deferral of the Effective Date".  The amendments in this update defer the effective date of Update 2014-09 for all entities by one year. The Company is evaluating the effect, if any, on its financial statements.

On August 27, 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements-Going Concern. The amendments in this update provide guidance in U.S. GAAP about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company is evaluating the effect, if any, on its financial statements.

On July 22, 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. The FASB is using this update as part of its Simplification Initiative. The amendments in this update more closely align the measurement of inventory in GAAP with the measurement of Inventory in IFRS. This amendment is for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendment should be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. The Company is evaluating the effect, if any, on its financial statements.

On January 5, 2016, the FASB issued ASU 2016-01.2016-01, Financial Instructions-Overall (Topic 825-10).  The amendments in this update address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. This amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is evaluating the effect, if any, on its financial statements.

On February 25, 2016, the FASB issued ASU 2016-02, Leases (Topic 842).  The amendments in this update will increase the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This amendment is effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company is evaluating the effect, if any, on its financial statements.

On March 30, 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensations (Topic 718).  The amendments in this update are intended to simplify accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods.  Early adoption is permitted.  The Company is evaluating the effect, if any, on its financial statements.

On April 15, 2015, the FASB issued ASU 2015-05, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement.   The amendments in this update provide guidance to customers about whether a cloud computing arrangement includes a software license. The amendment is effective for annual and interim periods within those annual periods beginning after December 15, 2015. This amendment did not have a material effect on the financial statements.

On April 7, 2015, the FASB issued ASU 2015-03, Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. FASB is issuingissued this update as part of its initiative to reduce complexity in accounting standards (the Simplification Initiative). To simplify presentation of debt issuance costs, the amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts.

On November 3, 2015, Accuride subscribed to a controlling seventy percent (70%) ownership interest in Gianetti, Route, S.r.l., an Italian manufacturer of steel wheels for heavy- and medium-duty commercial vehicles and motorcycles, ("Gianetti"), in exchange for a commitment to invest €19.75 million ($21.8 million) in Gianetti. The remaining 30%30 percent ownership interest in Gianetti was retained by MW Italia S.r.l., a subsidiary of Coils Lamiere Nastri - C.L.N. S.p.A.  Accuride contributed €3.75 million ($4.1 million) to Gianetti after closing and has agreed to invest the remaining commitments no later than as follows:  €5.4 million ($5.9 million) in 2016, €9.1 million ($10.1 million) in 2017, and the remainder in 2018.  Accuride will finance its remaining investment in Gianetti through general working capital and availability under its existing credit agreements.  Gianetti's principle manufacturing and engineering facility is located in Ceriano Laghetto, near Milan, Italy. The Company acquired the controlling interest to expand into the European market under its "Grow" strategy. The results of operations have been included in the consolidated financial statements since the date of acquisition.

The following summarizes the allocation of the purchase price (in thousands) to the fair value of the assets and liabilities acquired including noncontrolling interest:

The pro forma revenue and losses of the combined entity had the acquisition occurred on January 1, 2015 are as follows:

Pro forma financial information includes an adjustment for depreciation based on the step up value of property, plant and equipment.

The Company has recognizedIn connection with the sale of Brillion, we have reclassified current and prior period operating results, including the gain/loss on the sale transaction, to discontinued operations.  In addition, we have reclassified certain operating results related to itsour Imperial Group sold in 2013, and Bostrom sold in 2011, businesses, in Discontinued Operations.which had previously been concluded as immaterial, to discontinued operations.

The following table presents sales and income attributable toreconciliations of the major line items constituting profit (loss) from discontinued operations.operations:

Inventories at March 31,September 30, 2016 and December 31, 2015, on a first-in, first-out ("FIFO") basis, wereare as follows:

The grossGross goodwill is $163.5was $159.1 million as of March 31,September 30, 2016 and December 31, 2015. The accumulated impairment is $67.3was $62.8 million for the periods ended March 31,September 30, 2016 and December 31, 2015.  As of March 31,September 30, 2016 and December 31, 2015, the accumulated impairment iswas related to our Gunite and Brillion reporting units.unit.  The carrying value of our goodwill at March 31,as of September 30, 2016 and December 31, 2015 ofwas $96.3 million, relatesrelated exclusively to our Wheels reporting unit.

The changes in the carrying amount of other intangible assets for the period December 31, 2015 to March 31,September 30, 2016, by reportable segment, are as follows:

The changes in the carrying amount of other intangible assets for the period December 31, 2014 to March 31,September 30, 2015, by reportable segment, are as follows:

The summary of other intangible assets is as follows:

We estimate that ourthe annual amortization expense for our other intangible assets for 2016 through 2020 will be approximately $8.3$8.2 million and $8.3 million annually from 2017 through 2020.each year.

Components of net periodic benefit cost charged (credited) to incomefor continuing operations for the three and nine months ended March 31:September 30, 2016 and September 30, 2015 are as follows:

As of March 31,September 30, 2016, $1.5$3.5 million has been contributed in 2016 to our sponsored pension plans.  We presently anticipate contributing an additional $3.9$0.2 million to fund our pension plans during 2016 for a total of $5.4$3.7 million.  

Starting in 2016, we refined the method to estimate the current service cost for pension and other postretirement benefits. Previously, the current service cost was estimated using a single weighted-average discount rate derived from the yield curve used to measure the defined benefit obligation at the beginning of the year. Under the refined method, different discount rates are derived from the same yield curve, reflecting the different timing of benefit payments for past service (the defined benefit obligation) and future service (the current service cost). Differentiating in this way represents a refinement in the basis of estimation applied in prior periods. This change does not affect the measurement of the total defined benefit obligation recorded on the consolidated balance sheet as of December 31, 2015 or any other period. The refinement compared to the previous method resulted in a decrease in the current service cost and interest components with an equal offset to actuarial gains (losses) with no net impact on the total benefit obligation. The refinement did not have a material impact on the March 31,September 30, 2016 consolidated statement of operations. This change is accounted for prospectively as a change in accounting estimate.

We are from time to time involved in various legal proceedings of a character normally incidental to our business. We do not believe that the outcome of these proceedings will have a material adverse effect on our consolidated financial condition or results of our operations and cash flows.

In addition to environmental laws that regulate our ongoing operations, we are also subject to environmental remediation liability. Under the federal Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") and analogous state laws, we may be subject to joint and several liability without regard to fault or the legality of the original conduct as a result of the release or threatened release of hazardous materials into the environment regardless of when the release occurred. We are currently involved in several matters relating to the investigation and/or remediation of locations where we have arranged for the disposal of foundry wastes. Such matters include situations in which we have been named or are believed to be potentially responsible parties in connection with the contamination of these offsite disposal locations. Additionally, environmental remediation may be required to address soil and groundwater contamination identified at certain of our facilities.

As of March 31, 2016, weAlthough reserves had an environmental reserve of approximately $0.5 million, related primarily to our foundry operations. This reserve is based on management's review of potential liabilities as well as cost estimates related thereto. Any expenditure required for us to comply with applicable environmental laws and/or pay for anybeen previously held, remediation efforts willhave led to the Company not be reducedcarrying any environmental reserves as of September 30, 2016. Management did not identify any environmental matters that represented loss contingencies for which the likelihood of incurrence was probable at the balance sheet date or otherwise affected byin the existence of the environmental reserve.future. Our environmental reserve may not be adequate to cover our future costs related to the sites associated with the environmental reserve, and any additional costs may have a material adverse effect on our business, results of operations or financial condition. The discovery of additional environmental issues, the modification of existing laws or regulations or the promulgation of new ones, more vigorous enforcement by regulators, the imposition of joint and several liability under CERCLA or analogous state laws, or other unanticipated events could also result in a material adverse effect on our consolidated financial statements.

The Iron and Steel Foundry National Emission Standard for Hazardous Air Pollutants ("NESHAP") was developed pursuant to Section 112(d) of the Clean Air Act and requires major sources of hazardous air pollutants to achieve compliance with emission limits representative of maximum achievable control technology. Based on currently available information, we do not anticipate material costs regarding ongoing compliance with the NESHAP; however if we are found to be out of compliance with NESHAP, we could incur a liability that could have a material adverse effect on our consolidated financial statements.

Management does not believe that the outcome of any currently pending environmental proceeding will have a material adverse effect on our consolidated financial statements.

As of March 31,September 30, 2016, we had approximately 2,1731,766 employees, of which 516440 were salaried employees with the remainder paid hourly. Unions represent approximately 1,4651,156 of our employees, which is approximately 6765 percent of our total employees.  Each of our unionized facilities has a separate contract with the union that represents the workers employed at such facility. The union contracts expire at various times over the next few years with the exception of our union contract that covers the hourly employees at our Monterrey, Mexico, facility, which expires on an annual basis in January unless otherwise renewed.  The 2016 negotiations in Monterrey were completed prior to the expiration of oursuch union contract. In 2014, we successfully negotiated new bargaining agreements for our Erie, Pennsylvania and Rockford, Illinois facilities, which will expire on September 3, 2018 and March 25, 2019, respectively. The union contract at our London, Ontario runs throughfacility expires on March 12, 2018. No other collective bargaining agreements expire in 2016.  Our contractUnion workers at Gianetti expireswork under clarification documents and local variances to the collective labor agreement for the metalworking and mechanical engineering industry, whose national contract expired on December 31, 2015.  However, as is typical in October 2017.Italy, all parties continue to work under the previous agreement while a new national contract is negotiated.  The on-going national-level negotiations between the trade unions and employer federations have periodically led to brief and temporary work stoppages at various plants throughout Italy, including at Gianetti, in order for workers to show solidarity, but management currently does not believe that any such solidarity strikes will have a material impact to operations at Gianetti.

We have determined the estimated fair value amounts of financial instruments using available market information and other appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop the estimates of fair value.  A fair value hierarchy accounting standard exists for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and our own assumptions (unobservable inputs).  Determining which category an asset or liability falls within the hierarchy requires significant judgment.  We evaluate our hierarchy disclosures each quarter.

The hierarchy consists of three levels:

The carrying amounts of cash and cash equivalents, customer receivables, and accounts payable approximate fair value because of the relatively short maturity of these instruments.  The fair value of our 9.5% senior secured notes based on market quotes, which we determined to be Level 1 inputs, at March 31,September 30, 2016 was $293.1$309.1 million compared to the carrying amount of $304.7$305.8 million.  The fair value of our 9.5% senior secured notes based on market quotes, which we determined to be Level 1 inputs, at December 31, 2015 was approximately $263.8 million compared to the carrying amount of $304.3 million.  The Company believes the fair value of our variable interest rate Asset Based Loan ("ABL") facility at March 31, 2016 and December 31, 2015 equals the carrying value of $10.3 million, and $0 million, respectively.  As of March 31,September 30, 2016 and December 31, 2015 we had no other significant long-term financial instruments.

Based on our continual monitoring of the long-term economic characteristics, products and production processes, class of customer, and distribution methods of our operating segments, we have identified each of our operating segments below as reportable segments.  We believe this segmentation is appropriate based upon operating decisions and performance assessments by our President and Chief Executive Officer and our Senior Vice-President and CFO.Officer.  The accounting policies of the reportable segments are the same as described in Note 1, Summary of Significant Accounting Policies of our Annual Report on Form 10-K for the year ended December 31, 2015.

As of March 31,September 30, 2016, total debt was $323.7$318.1 million, consisting of $304.7$305.8 million of our outstanding 9.5% senior secured notes, net of discount and debt issuance costs, $8.7and $12.3 million in short termdebt obligations related to our majority interest in Gianetti and $10.3 million drawn on our ABL Credit Facility.Gianetti.  As of March 31,September 30, 2016, Accuride had $18.5$27.0 million of cash plus $43.3$37.0 million in availability under itsthe ABL Credit Facility for total liquidity of $61.8$64.0 million.  As of December 31, 2015, total debt was $314.5 million, consisting of $304.3 million of our outstanding 9.5% senior secured notes, net of discount and debt issuance costs, and $10.3 million in short term obligations related to our majority interest in Gianetti.  As of December 31, 2015, Accuride had $29.8 million of cash plus $46.8 million in availability under itsthe ABL Credit Facility for total liquidity of $76.6 million.  

Our credit documents (the ABL Facility and the indenture governing the senior secured notes) contain operating covenants that limit the discretion of management with respect to certain business matters.  These covenants place significant restrictions on, among other things, the ability to incur additional debt, to pay dividends, to create liens, to make certain payments and investments and to sell or otherwise dispose of assets and merge or consolidate with other entities.  In addition, the ABL Facility contains a fixed charge coverage ratio covenant which will be applicable if the availability under the ABL Facility is less than 10.0% of the amount of the ABL Facility.  If applicable, that covenant requires us to maintain a minimum ratio of adjusted EBITDA less capital expenditures made during such period (other than capital expenditures financed with the net cash proceeds of asset sales, recovery events, incurrence of indebtedness and the sale or issuance of equity interests) to fixed charges of 1.00 to 1.00.  We are not currently in a compliance period, and we do not expect to be in a compliance period during the next twelve months.  However, we continue to operate in a challenging commercial environment and our ability to maintain liquidity and comply with our debt covenants may be affected by changes in economic or other conditions that are beyond our control and which are difficult to predict.

The ABL Facility provides for loans and letters of credit in an amount up to the aggregate availability under the facility, subject to meeting certain borrowing base conditions, with sub-limits of up to $10.0 million for swingline loans and $20.0 million for letters of credit.  Borrowings under the ABL Facility bear interest through maturity at a variable rate based upon, at our option, either LIBOR or the base rate (which is the greatest of one-half of 1.00% in excess of the federal funds rate, 1.00% in excess of the one-month LIBOR rate and the Agent's prime rate), plus, in each case, an applicable margin.  The applicable margin for loans under the first-in last-out term facility that are (i) LIBOR loans ranges, based on the our average excess availability, from 2.75% to 3.25% per annum and (ii) base rate loans ranges, based on our average excess availability, from 1.00% to 1.50%.  The applicable margin for other advances under the ABL Facility that are (i) LIBOR loans ranges, based on our average excess availability, from 1.75% to 2.25% and (ii) base rate loans ranges, based on our average excess availability, from 0.00% to 0.50%.

We must also pay an unused line fee equal to 0.25% per annum to the lenders under the ABL Facility if utilization under the facility is greater than or equal to 50.0% of the total available commitments under the facility, or an unused line fee equal to 0.375% per annum if utilization under the facility is less than 50.0% of the total available commitments under the facility. Customary letter of credit fees are also payable, as applicable.

Our senior secured notes are, jointly and severally, fully and unconditionally guaranteed, on a senior basis, by all of our existing and future 100% owned domestic subsidiaries ("Guarantor(collectively, the "Guarantor Subsidiaries"). The non-guarantor subsidiaries are our foreign subsidiaries and discontinued operations.  The following condensed financial information illustrates the composition of the combined Guarantor Subsidiaries:Subsidiaries.  The divested Brillion subsidiary was released from the Guarantor Subsidiaries upon its divestiture on September 2, 2016.  In order to portray the operational history of the guarantor, Brillion remains in the Guarantor Subsidiaries columns through the date of such disposal, with no retrospective application of loss of guarantor status.