Note 10 - Acquisitions

3 Months Ended

Feb. 28, 2013

Mergers, Acquisitions and Dispositions Disclosures [Text Block]

(10) Acquisitions

On May 10, 2012, the Company acquired the assets of Universal Harvester Co., Inc. consisting of inventory, equipment, land, building, goodwill, and intangible assets.  The acquisition-date fair value of the total consideration transferred was approximately $3,066,000 consisting of $3,030,450 of current and future cash to be paid and $35,550 of common stock.  Under the terms of the purchase agreement, cash in the amount $3,003,565 was paid on May 11, 2012 and $27,427 of cash will be paid on real estate taxes accrued but due on the land and building in future periods.  As of February 28, 2013, the Company has paid all of the accrued real estate taxes.  The Company issued 5,000 shares of common stock valued at $35,550 based on the closing market price as of May 10, 2012.

The operating results of the acquired business are reflected in the Company’s consolidated statement of operations from the acquisition date forward.  The acquisition was made to continue the Company’s growth strategy and diversify its product offerings inside the agricultural industry. The purchase price was determined based on an arms-length negotiated value. The transaction is being accounted for under the acquisition method of accounting, with the purchase price allocated to the individual assets acquired.  The purchase price allocation below is the final valuation.

The consideration has been allocated as follows:

Inventories	$	947,760
Equipment, tools and dies		364,053
Goodwill and intangible assets		618,729
Land and Building		1,136,000
Total	$	3,066,542

The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it had occurred at the beginning of fiscal year starting December 1, 2011.  The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time or that may result in the future:

ART’S-WAY MANUFACTURING CO., INC.

Condensed Consolidated Statements of Operations

(Unaudited)

	Three Months Ended
	February 28, 2013		February 29, 2012
Net Sales from Continuing Operations:
As Reported	$	8,415,104	$	6,312,216
Pro Forma	$	8,415,104		7,216,848
Net Income from Continuing Operations:
As Reported		819,254		193,498
Pro Forma		819,254		222,848
Basic Net income per Share:
As Reported	$	0.20	$	0.05
Pro Forma	$	0.20	$	0.06
Diluted Net income per Share:
As Reported	$	0.20	$	0.05
Pro Forma	$	0.20	$	0.06
Weighted average outstanding shares used to compute basic net income per share		4,035,052		4,028,193
Weighted average outstanding shares used to compute diluted net income per share		4,047,134		4,046,125