(

)

Acquisition

February 1, 2018

the Company purchased

100%

of the outstanding shares of common stock of Dielectrics Inc., pursuant to a stock purchase agreement and related agreements, for an aggregate purchase price of

$80

million in cash. The purchase price was subject to adjustment based upon Dielectrics’ working capital at closing. An additional

$250

thousand of consideration was paid by the Company as a result of the final working capital adjustment. A portion of the purchase price is being held in escrow to indemnify the Company against certain claims, losses and liabilities. The Purchase Agreement contains customary representations, warranties and covenants customary for transactions of this type.

The following table summarizes the allocation of consideration paid to the acquisition date fair value of the assets acquired and liabilities assumed based on management’s estimates of fair value (in thousands):

Consideration paid:
Cash paid at closing	$	80,000
Working capital adjustment		250
Cash from Dielectrics		(3,272	)
Total consideration	$	76,978

Purchase price allocation:
Accounts receivable	$	4,384
Inventory		4,418
Other current assets		122
Property, plant and equipment		4,600
Customer list		22,555
Non-compete		462
Trade name and brand		367
Goodwill		44,516
Total identifiable assets	$	81,424
Accounts payable		(1,325	)
Accrued expenses		(946	)
Deferred revenue		(2,175	)
Net assets acquired	$	76,978

Acquisition costs associated with the transaction were approximately

$1.1

million and were charged to expense in the

nine

-month period ended

September 30, 2018.

These costs were primarily for investment banking and legal fees and are reflected on the face of the income statement.

The following table contains an unaudited pro forma condensed consolidated statement of operations for the

three

- and

nine

-month periods ended

September 30, 2018,

as if the Dielectrics acquisition had occurred at the beginning of the respective periods (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2018		2018
		(Unaudited)		(Unaudited)
Sales	$	47,808	$	142,813
Operating income	$	5,885	$	13,970
Net income	$	4,134	$	9,700
Earnings per share:
Basic	$	0.56	$	1.32
Diluted	$	0.56	$	1.31

The above unaudited pro forma information is presented for illustrative purposes only and

may

not

be indicative of the results of operations that would have actually occurred had the Dielectrics acquisition occurred as presented. In addition, future results

may

vary significantly from the results reflected in such pro forma information.