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Note 19 - Acquisition | 12 Months Ended
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Dec. 31, 2019
Notes to Financial Statements |
Business Combination Disclosure [Text Block] |
| ( 19 ) | Acquisition
On 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. Founded in 1954 and based in Chicopee, Massachusetts, Dielectrics is a leader in the design, development, and manufacture of medical devices using thermoplastic materials. They primarily use radio frequency and impulse welding to design and manufacture solutions for the medical industry. The Company has leased the Chicopee location from a realty trust owned by the selling shareholder and affiliates. The lease is for five years with two five -year renewal options. 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 year ended December 31, 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 years ended December 31, 2018 and 2017, as if the Dielectrics acquisition had occurred at the beginning of each of the respective periods (in thousands):
|  | Year Ended December 31,
|  | 2018 |  | 2017
|  | (Unaudited) |  | (Unaudited)
Sales |  | $ | 193,510 |  |  | $ | 180,419 |
Operating Income |  | $ | 19,464 |  |  | $ | 18,990 |
Net Income |  | $ | 14,110 |  |  | $ | 13,126 |
Earnings per share: |  |  |  |  |  |  |  |
Basic |  | $ | 1.92 |  |  | $ | 1.81 |
Diluted |  | $ | 1.90 |  |  | $ | 1.79 |
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 occurred had the Dielectrics acquisition occurred as presented. In addition, future results may vary significantly from the results reflected in such pro forma information.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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