Note

Acquisitions

Adecol

November 1, 2017,

we acquired Adecol Industria Quimica, Limitada (“Adecol”), headquartered in Guarulhos, Brazil. Adecol works with customers to develop innovative, high-quality hot melt, reactive and polymer-based adhesive solutions in the packaging, converting and assembly markets. The initial purchase price was

145.9

million Brazilian real, or approximately

$44,682,

and was funded through borrowings on our revolving credit facility and existing cash. During

2018,

we received

3.6

million Brazilian real, or approximately

$1,110,

of cash, and made other purchase accounting adjustments of

$3,227

resulting in a final purchase price of

$40,345.

Adecol is reported in our Americas Adhesives operating segment. We incurred acquisition related costs of approximately

$951,

which were recorded as SG&A expenses in the Consolidated Statements of Income in

2017.

The following table summarizes the final fair value measurement of the assets acquired and liabilities assumed as of the date of acquisition:

	Preliminary Valuation December 2, 2017			Fair Value Adjustments			Final Valuation December 1, 2018
Current assets	$	17,877		$	(1,740	)	$	16,137
Property, plant and equipment		7,308			739			8,047
Goodwill		23,282			(1,881	)		21,401
Other intangibles
Customer relationships		17,016			(383	)		16,633
Trademarks/trade names		1,363			(65	)		1,298
Other assets		4,811			-			4,811
Current liabilities		(12,765	)		(1,509	)		(14,274	)
Other liabilities		(14,210	)		502			(13,708	)
Total purchase price	$	44,682		$	(4,337	)	$	40,345

The expected lives of the acquired intangible assets are

years for customer relationships and

five

years for trademarks/trade names.

Based on the fair value measurement of the assets acquired and liabilities assumed, we allocated

$21,401

to goodwill for the expected synergies from combining Adecol with our existing business. Such goodwill is

not

deductible for tax purposes. The goodwill was assigned to our Americas Adhesives operating segment. The Adecol acquisition does

not

represent a material business combination, and therefore pro forma financial information is

not

provided.

Royal Adhesives

October 20, 2017,

we acquired Royal Adhesives and Sealants (“Royal Adhesives”), a manufacturer of high-value specialty adhesives and sealants. Royal Adhesives is a supplier of industrial adhesives in a diverse set of end markets, including aerospace, transportation, commercial roofing, insulating glass, solar, packaging and flooring applications and operates

manufacturing facilities in

five

countries. The initial purchase price of

$1,622,728

was funded through new debt financing. See Note

for further information on our debt financing. During

2018,

we received

$2,389

of cash adjusting the purchase price to a final purchase price of

$1,620,339.

Royal Adhesives is reported in multiple operating segments. We incurred acquisition related costs of approximately

$11,625,

which were recorded as SG&A expenses in the Consolidated Statements of Income in

2017.

The following table summarizes the final fair value measurement of the assets acquired and liabilities assumed as of the date of acquisition:

	Preliminary Valuation December 2, 2017			Adjustments			Final Valuation December 1, 2018
Accounts receivable	$	64,904		$	992		$	65,896
Inventory		93,680			(195	)		93,485
Other current assets		58,508			789			59,297
Property, plant and equipment		126,192			(7,409	)		118,783
Goodwill		866,013			1,730			867,743
Other intangibles
Developed technology		59,800			(100	)		59,700
Customer relationships		645,300			19,400			664,700
Trademarks/trade names		53,600			22,600			31,000
Other assets		1,443			(43	)		1,400
Accounts payable		(40,211	)		1,452			(38,759	)
Other current liabilities		(37,261	)		3,778			(33,483	)
Other liabilities		(269,240	)		(183	)		(269,423	)
Total purchase price	$	1,622,728		$	(2,389	)	$	1,620,339

The expected lives of the acquired intangible assets are

years for developed technology,

years for customer relationships and

years for trademarks/trade names.

Based on the fair value measurement of the assets acquired and liabilities assumed, we allocated

$867,743

to goodwill for assembled workforce and the expected synergies from combining Royal Adhesives with our existing business. The goodwill was assigned to multiple operating segments. The amount of goodwill that is deductible for tax purposes is

$41,638.

The remaining goodwill is

not

deductible for tax purposes.

The following unaudited pro forma information gives effect to the Royal Adhesives acquisition as if the acquisition occurred on

November

29,

2015.

The historical financial information has been adjusted to give effect to pro forma events that are directly attributable to the acquisition, supportable and expected to have a continuing impact on combined results. Pro forma earnings for the year ended

December 2, 2017

was adjusted to exclude

$62,985

(pre-tax) of acquisition-related costs and

$10,815

(pre-tax) of nonrecurring expense related to the fair value adjustment to acquisition-date inventory. Pro forma earnings for the year ended

December 3, 2016

was adjusted to include the expense related to the fair value adjustment to acquisition-date inventory. The unaudited pro forma results do

not

include any anticipated cost savings from operating efficiencies or synergies that could result from the acquisition. Accordingly, the unaudited pro forma results are

not

necessarily indicative of what actually would have occurred had the acquisition been in effect for the periods presented. The unaudited pro forma information for the years ended

December 2, 2017

and

December 3, 2016,

assuming that the acquisition occurred at the beginning of fiscal

2016,

is presented below:

	December 2, 2017		December 3, 2016
Net revenue	$	2,886,762	$	2,716,713
Net income attributable to H.B. Fuller		123,618		127,802

Pro forma earnings per share:
Basic		2.45		2.55
Diluted		2.39		2.49

Wisdom Adhesives

January 27, 2017,

we acquired substantially all of the assets of H.E. Wisdom & Sons, Inc. and its affiliate Wisdom Adhesives Southeast, L.L.C., (“Wisdom Adhesives”) headquartered in Elgin, Illinois. Wisdom Adhesives is a provider of adhesives for the packaging, paper converting and durable assembly markets. The acquisition strengthened our position in the North America adhesives market. The purchase price of

$123,549

was financed through borrowings on our revolving credit facility and is reported in our Americas Adhesives operating segment. We incurred acquisition related costs of approximately

$555,

which were recorded as SG&A expenses in the Consolidated Statement of Income for the year ended

December 2, 2017.

The following table summarizes the final fair value measurement of the assets acquired and liabilities assumed as of the acquisition date:

	Preliminary Valuation			Purchase Price and Fair Value			Final Valuation
	March 4, 2017			Adjustments			December 2, 2017
Current assets	$	13,729		$	115		$	13,844
Property, plant and equipment		10,516			(1,875	)		8,641
Goodwill		60,313			(487	)		59,826
Other intangibles
Customer relationships		33,300			12,000			45,300
Trademarks/trade names		13,600			(9,200	)		4,400
Current liabilities		(8,153	)		(309	)		(8,462	)
Total purchase price	$	123,305		$	244		$	123,549

The expected lives of the acquired intangible assets are

years for customer relationships and

years for trademarks/trade names.

Based on the fair value measurement of the assets acquired and liabilities assumed, we allocated

$59,826

to goodwill for the expected synergies from combining Wisdom Adhesives with our existing business. Such goodwill is deductible for tax purposes. The goodwill was assigned to our Americas Adhesives operating segment. The Wisdom Adhesives acquisition does

not

represent a material business combination, and therefore pro forma financial information is

not

provided.