ASSET
PURCHASE AGREEMENT


THIS ASSET PURCHASE AGREEMENT (the
"Agreement") is made as of January 15, 2010 (the "Effective Date") by and
between RODA MFG., INC., an Iowa corporation ("Seller") and ART’S-WAY
MANUFACTURING CO., INC., an Iowa corporation ("Buyer").




WHEREAS,
Seller manufactures and sells certain manure spreading equipment as specified on
Exhibit A ("Product Line") (the business of manufacturing and selling products
within the Product Line being hereafter sometimes referred to as the
"Business"); and




WHEREAS,
Buyer desires to purchase from Seller, and Seller desires to sell to Buyer,
certain assets comprising and associated with the Product Line, as described
below.




NOW,
THEREFORE, in consideration of the foregoing and the mutual representations,
warranties, covenants and agreements contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:





ARTICLE
1


PURCHASE
AND SALE OF ASSETS





1.1           Sale of Purchased
Assets.  Subject to the terms and conditions set forth in this
Agreement, and subject to the performance by each of the parties hereto of their
respective obligations under this Agreement, on the Closing Date (as defined
below), Seller shall sell, convey, assign, transfer and deliver to Buyer, and
Buyer shall buy from Seller, certain assets of Seller related to the Product
Line of Seller as described below (collectively, the "Purchased
Assets"):





(a)           Equipment.  All
tools, dies, jigs, patterns, specialized equipment, sales and marketing
materials and aids and other tangible personal property owned by Seller and used
in the production and marketing of the Product Line (collectively, the
"Equipment"), including without limitation, such items set forth on Schedule
1.1(a).





(b)           Inventory.  All
inventory of new and undamaged finished goods (including optional equipment),
work in process, spare parts, prototype equipment, and such raw materials that
have been acquired specifically for the Product Line, and owned by Seller at the
time of Closing, including, without limitation, such items set forth on Schedule
1.1(b) and all other current items of inventory related to the Product Line and
all inventory ordered in the usual and ordinary course of business prior to the
Closing Date (the "Inventory").  The prices for the inventory shown on
Schedule 1.1(b) are shown at book value as determined in accordance with
GAAP.





(c)           Show
Contracts.  All of Seller’s show contracts (“Show Contracts”)
for exhibit space at those shows listed on the attached Schedule
1.1(c).





(d)           Certain Business
Records.  All of the following documents (and rights created by
such documents) related to the Product Line:  All customer lists,
customer backlog records, pending orders, pending purchase contracts, customer
files, vendor lists, purchase records, sales records, designs, drawings,
blueprints, computer data, engineering data or studies, marketing data,
prototype information, and technical information, all to the extent transferable
under applicable law (the "Business Records").







(e)           Distributor
Agreements.  All distributor and dealer agreements pertaining
to distributors and dealers handling the Product Line as listed on Schedule
1.1(d) (“Distributor Contracts”) (the Distributor Contracts and the Show
Contracts are hereinafter collectively referred to as the “Assigned
Contracts”).





(f)           Intangible
Rights.  The exclusive right to use all intangible rights and
property of Seller, including all of Seller's trade names, copyrights,
trademarks, service marks and associated logos pertaining to the Product Line,
whether registered or under common law, including without limitation, all
Seller's goodwill that has accrued to and become associated with the Product
Line or with the Purchased Assets, provided that Seller shall retain the right
to use the trade names and logos in connection with the sale of any retained
inventory of used manure spreading equipment as permitted in Section 6.4
hereof.





(g)           Toll Free Numbers; Internet
Domains.  The toll-free telephone numbers used in connection
with Seller’s business and the Seller’s internet domain names (but not the
Seller’s website or website content).





(h)           Goodwill.  All
of Seller’s goodwill in, and going concern value related to the Product Line, if
any.





Buyer
shall have the right to inspect all of the Purchased Assets at any time prior to
the Closing Date; provided, however, that such inspections shall be during
Seller's normal business hours and will not unreasonably interfere with Seller's
business operations.  Buyer further agrees to indemnify and hold
Seller harmless (which indemnification shall survive any termination of this
Agreement) from and against any costs, liabilities, claims or expenses arising
out of any damage to person or property caused by the negligent act or omission
or intentional misconduct of Buyer or any of Buyer's employees, agents or
contractors conducting such inspections.





1.2           Excluded
Assets.  Notwithstanding anything to the contrary contained in
Section 1.1 or elsewhere in this Agreement, the following assets of Seller
(collectively, the "Excluded Assets") are not part of the sale and purchase
contemplated hereunder, are excluded from the Purchased Assets and shall remain
the property of Seller after the Closing:





(a)           all
cash, cash equivalents and bank deposit accounts owned by Seller;





(b)           all
minute books, stock records, and corporate seals of Seller;





(c)           all
personnel records of Seller;





(d)           any
property not related to the Product Line;




(e)           all
insurance policies maintained by Seller in connection with the Product Lines or
the Purchased Assets;




(f)           any
used manure spreading equipment;





(g)           any
accounts receivable related to the Product Line;




2


(h)           except
as set forth in Section 1.1(g) above, all of Seller’s right, title, and interest
in and to all telephone numbers, electronic mail addresses, and P.O. boxes owned
or licensed by Seller, yellow page listings, white page listings, and
advertisements therein used or held for use by Seller as of the date of this
Agreement in connection with the operation of the Business.





(i)           Any
individual item of Finished Goods sold by Seller to a third party pursuant to a
bona fide sale, but not yet delivered and any proceeds of such
sale.





ARTICLE
2


ASSUMPTION
OF LIABILTIES





2.1           Assumed
Liabilities.  On the Closing Date, Buyer shall assume and agree
to discharge obligations arising after the Closing Date with respect to the Show
Contracts described in Schedule 1.1(c) attached hereto.  Buyer shall
assume and agree to discharge the liabilities and obligations under the
Distributor Contracts referred to in Section 1.1(e) except that Buyer does not
agree to assume any warranty obligation of Seller with respect to finished
products sold by Seller to third parties prior to closing which warranty
obligation Seller agrees to fully and timely perform in accordance with the
terms of Section 6.5.





2.2           Excluded
Liabilities.  Except as and to the extent specifically set
forth under Section 2.1 above, Buyer is not assuming, or agreeing to otherwise
become liable for any debts, liabilities, claims, lawsuits, or obligations of
any nature of Seller (the "Excluded Liabilities").  Seller hereby
agrees to be responsible for all Excluded Liabilities, and pursuant to Article 9
below, indemnify Buyer from all Excluded Liabilities.  The Excluded
Liabilities shall include without limitation:





(a)           Any
liability for taxes, including (i) any taxes arising as a result of Seller's
operation of the Business or ownership of the Assets prior to the Closing Date,
and (ii) any taxes imposed on Seller that will arise as a result of the sale of
the Assets pursuant to this Agreement;





(b)           Any
liability for any contract except to the extent such liability is expressly
assumed under the provisions of Section 2.1 above;





(c)           Any
liability arising out of or resulting from Seller's compliance or non-compliance
with any legal requirement or order of any governmental body;




(d)           Any
product liability obligation with respect to finished products sold by Seller to
third parties prior to Closing; and




(e)           Any
warranty obligation set forth in Section 6.5, with respect to any finished
products manufactured or sold by Seller to a third party prior to
Closing.




ARTICLE
3


PURCHASE
PRICE, PAYMENT TERMS AND CLOSING





3.1           Purchase
Price.  Buyer shall purchase the Purchased Assets from Seller
for a total purchase price determined as follows (the "Purchase
Price"):




3


(a)           The
amount equal to the total of the following three amounts:  (i) the
amount of $1,171,646.00 for the Inventory transferred to the Buyer at
Closing, plus (ii) the amount of $10,900.90 as reimbursement for Show Contract
expenses prepaid by Seller, which total amount shall be paid by wire transfer
from Buyer to Seller at Closing ("Initial Payment"), plus (iii) the amount of
$7,355.00 for Equipment shown on Schedule 1.1(a) hereof.  The amount
of the payment for Inventory has been determined based on the prices and count
provided by the Seller and reflected in Schedule 1.1(b) and shall be subject to
adjustment after closing as set forth in Section 3.2 hereof; and





(b)           Buyer
shall also pay to Seller, as a part of the Purchase Price, an amount equal to
two percent (2%) of the sales price ("Periodic Payment") of any Products sold by
Buyer during the period beginning at the date of Closing and ending on the last
day of the sixtieth (60th) month thereafter ("Payment Period").  As
used in this Section 3.1(b), the following terms shall be defined as set forth
below:







(i)        
"Products" shall mean manure spreading equipment manufactured or sold by Buyer
that are a part of the Product Line, or any modifications or variations thereof
(a product shall not be considered a modification or variation of a product in
the Product line if it is based upon a significantly different design
and/or significant engineering or reengineering of the product by or on
behalf of Buyer).  Any such Products shall be included in determining the
Periodic Payment, even if such Products are sold for the purpose of spreading
other materials. “Products” does not include repair parts for the Product
Line.




(ii)           "Sales
price" shall mean the total consideration paid to, or on behalf of, Buyer for
such Products (including the value of any equipment traded for the Product or
other non-monetary consideration paid or given to Buyer, but exclusive of
ordinary and reasonable discounts allowed by Buyer), and excluding any amount
paid for actual freight charges and sales or use taxes pertaining to such
sale.





(iii)           "Sold
during the Payment Period" shall mean actual sale of a Product or any binding
agreement to sell such Product (even if the actual delivery of the Product
occurs after the Payment Period).





Buyer
shall, in good faith, use all reasonable efforts during the Payment Period to
manufacture, market and sell the Products, and shall not engage in any action to
defer or delay sales of Products for the purpose of avoiding payments due
hereunder.  Seller shall have the right from time to time to review
and audit Buyer's sales and financial records to verify the amounts of the
Periodic Payments owed by Buyer under this Agreement.  Seller will
cooperate with such review and audit and provide all records necessary
therefor.  In the event such audit shows that the Buyer has under paid
the Periodic Payment to Seller by five percent (5%) or more, Buyer will
reimburse Seller for the costs of such audit.





The
Periodic Payment shall be made annually by Buyer to Seller within sixty (60)
days after each annual anniversary date of the date of Closing.







3.2          Post Closing Adjustment to Purchase
Price.Within 15 days after all of the Inventory is received
by the Purchaser at its Armstrong, Iowa, facilities (or within 30 days after
closing with respect to inventory on consignment), Purchaser shall notify Seller
of any discrepancy in the Inventory count, condition or valuation category (i.e.
valued at cost, $0.00 value, or 50% of Cost as set forth below in this Section)
of such Inventory actually received by Purchaser with the Inventory used for
closing (Discrepancy Notice).  Similarly, Seller may furnish to Buyer a
Discrepancy Notice as to any such matters affecting the Inventory that Seller
discovers when loading the Inventory for shipment.  If the Discrepancy
Notice shall indicate that the value of the Inventory is less than the portion
of the Purchase Price attributable to Inventory paid at Closing, Seller shall
refund to Purchaser the amount of such discrepancy set forth in the Discrepancy
Notice within 5 days of receipt of same by Seller.  If the Discrepancy
Notice shall indicate that the value of the Inventory received is more than the
portion of the Purchase Price attributable to Inventory paid at Closing, Buyer
shall pay amount thereof to Seller within 5 days of the date of such
Notice.  Any item of Inventory for which there is a value shown in the
“Extended Cost” column of Schedule 1.1(b) but no amount is shown in the
“Contract Total” column has been agreed by the parties to be obsolete or
otherwise unusable.  Any item of inventory that is damaged, used, in excess
of a three year supply or is otherwise unusable shall be included at a value of
$0.00 except that “mini spreader” finished goods have been included on the
Schedule at a value of 50% of cost.  No item of Inventory that is valued at
$0.00 on Schedule 1.1(b) shall be included in a Discrepancy Notice and
there shall be no adjustment paid if the Inventory as to such item is not
correct.  In the case of Inventory that is damaged or rendered unusable due
to damage occurring after Closing for which Seller is not responsible under
the provisions of Section 6.3 of this Agreement, no adjustment to purchase price
shall be made in respect thereto.  In the event of a disagreement by Seller
with respect to the Discrepancy Notice Seller may request binding arbitration
under the rules of the American Arbitration Association.  During such time
as any such disagreement shall exist, Seller or Buyer, as the case may be, shall
pay the amount of the discrepancy over to an escrow agent mutually agreeable to
the parties to be held pending resolution of the disagreement in the manner set
forth herein.




4


3.3           Tax Allocation.  The
Purchase Price shall be allocated in accordance with the Asset Allocation
Statement set forth on Schedule 3.3 attached hereto, which shall be mutually
agreed upon between the Buyer and Seller on or before the Closing
Date.  Neither party shall make any claims or treat any items on their
respective federal, state, or other tax returns in a manner which is
inconsistent with such allocations.  The parties shall file all tax
returns and reports, including Internal Revenue Service Form 8594, in accordance
with such allocation and shall not take any position inconsistent therewith
unless required to do so pursuant to a “determination” as such term is defined
in Section 1313 of the Internal Revenue Code of 1986, as amended.




3.4           Closing Date.  The
consummation of the transactions contemplated herein (the "Closing") shall take
place at immediately following the execution of this agreement.




5


ARTICLE
4


REPRESENTATIONS
AND WARRANTIES OF BUYER





For the purpose of inducing Seller to
enter into this Agreement, Buyer hereby makes the following representations and
warranties:





4.1           Organization of
Buyer.  Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Iowa with full power and
authority to carry on the business in which it is engaged, to own, lease and
operate its properties and to enter into and perform its obligations under this
Agreement.





4.2           Authority.  Buyer
has the power and authority to enter into this Agreement and to carry out the
terms of this Agreement.  The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary company action required on the part of
Buyer.  The Agreement constitutes the valid and legally binding
obligation of Buyer and is enforceable against Buyer in accordance with its
terms, subject to limitations imposed by laws and judicial decisions relating to
or affecting the rights of creditors or secured creditors generally or general
principles of equity (regardless of whether enforcement is considered in
proceedings at law or in equity), upon the enforceability of any of the
remedies, covenants or other provisions of this Agreement and the availability
of injunctive relief or other equitable remedies.





4.3           Performance of Assigned
Contracts.  After Closing, Buyer will perform all of Seller's
obligations in accordance with the terms and conditions of each Assigned
Contract to the extent such obligations are specifically assumed by Buyer in
Section 2.1 above.




4.4           No Breach of
Agreement.  The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not (i) violate or result in a breach of or default or
acceleration under the Articles of Incorporation or By-Laws of Buyer or any
instrument or agreement to which Buyer is a party or is bound which would have a
material adverse effect on the Purchased Assets; (ii) violate any judgment,
order, injunction, decree or award against or binding upon Buyer or the
Purchased Assets which would have a material adverse effect on the Purchased
Assets; (iii) result in the creation of any material lien, charge or encumbrance
upon the Purchased Assets; or (iv) violate any law or regulation of any
jurisdiction relating to the Business or the Purchased Assets, assuming all
required regulatory approvals have been obtained in connection with the
transactions contemplated hereby.





ARTICLE
5


REPRESENTATIONS
AND WARRANTIES


OF
SELLER





For the purpose of inducing Buyer to
enter into this Agreement, Seller hereby makes the following representations and
warranties:





5.1           Organization and Qualification of
Seller.  Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Iowa with full
power and authority to carry on the Business and to own, lease and operate the
Purchased Assets and to perform its obligations hereunder.




6


5.2           Authorization of
Agreement.  The execution and delivery of this Agreement has
been duly authorized by all necessary company action including approval by the
Board of Directors of Seller.  This Agreement is a valid and binding
obligation of Seller enforceable in accordance with its terms, subject to
limitations imposed by laws and judicial decisions relating to or affecting the
rights of creditors or secured creditors generally or general principles of
equity (regardless of whether enforcement is considered in proceedings at law or
in equity), upon the enforceability of any of the remedies, covenants or other
provisions of this Agreement and the availability of injunctive relief or other
equitable remedies.





5.3           Absence of Material
Changes.  Seller has operated the Business in the ordinary
course and there has not been:





(a)           Any
material change in the operation of the Business other than changes in the
ordinary course of business, none of which has individually or in the aggregate
been materially adverse to the operation of the Business; or





(b)           Any
dispute or any event or condition of any character that materially and adversely
affects, or could be reasonably expected to materially and adversely affect, the
Business.





5.4           Title to Acquired
Assets.  Seller has, or will have at Closing, good, valid and
marketable title to all property comprising the Purchased Assets, free and clear
of all liens, security interests, or encumbrances.





5.5           Litigation and
Claims.  There are no judgments unsatisfied against Seller or
consent decrees or injunctions affecting the Purchased Assets or to which the
Purchased Assets are subject, and there is no litigation, claim or proceeding
pending, or to the knowledge of the Seller threatened, in any court or by any
governmental authority or before any arbitrator that would have an adverse
effect (whether covered by insurance or not) on the Purchased Assets or the
Business, nor does the Seller know or have reasonable grounds to know of any
basis for any such action or of any governmental investigation related
thereto.





5.6           Compliance with
Laws.  Seller, to the best of Seller's knowledge, has complied
in all material respects with all laws, regulations and orders applicable to the
Business, and has obtained all governmental permits, licenses, franchises or the
like required in order to conduct the Business, and the present uses of the
Purchased Assets and the conduct of the Business does not violate in any
material respect any law, regulation, ordinance or order.  Seller has
not received any notice or warning from any governmental authority with respect
to any failure or alleged failure of Seller to comply with any applicable law,
regulation or order and no such notice or warning has been proposed or
threatened.





5.7           No Breach of
Agreement.  The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not (i) violate or result in a breach of or default or
acceleration under the Articles of Incorporation or By-Laws of Seller or any
instrument or agreement to which Seller is a party or is bound which would have
a material adverse effect on the Purchased Assets; (ii) violate any judgment,
order, injunction, decree or award against or binding upon Seller or the
Purchased Assets which would have a material adverse effect on the Purchased
Assets; (iii) result in the creation of any material lien, charge or encumbrance
upon the Purchased Assets; or (iv) violate any law or regulation of any
jurisdiction relating to the Business or the Purchased Assets, assuming all
required regulatory approvals have been obtained in connection with the
transactions contemplated hereby.




7


5.8           Tax Matters.





(a)           Generally.  Seller
has timely filed all federal, state and local tax reports, returns, information
returns and any other documents required to be filed by it (collectively, "Tax
Returns") and has duly paid all taxes shown to be due and payable on such Tax
Returns and all estimated or advance payments required by law.  All
taxes for periods ending on or prior to the Closing Date have been fully paid by
Seller.  All taxes which are required to be withheld or collected by
Seller have been duly withheld or collected and, to the extent required, have
been paid to the proper federal, state or local authorities or properly
segregated or deposited as required by applicable regulations.  There
are no liens for taxes upon any Purchased Assets, except for liens for taxes not
yet due and payable.  Seller has not requested an extension of time
within which to file any Tax Return and has not waived the statute of
limitations on the right of the IRS or any other taxing authority to assess or
collect additional taxes or to contest the information reported on any Tax
Return.





(b)           Good
Faith.  All Tax Returns described in Section 5.8(a) have been
prepared in good faith and are correct and complete in all material respects,
and there is no basis for assessment of any addition to the taxes shown
thereon.





(c)           Claims.  There
are no proceedings, examination or claims currently pending by any taxing
authority in connection with any Tax Returns described in Section 5.8(a) nor
with respect to the periods to which such Tax Returns relate, and there are no
unresolved issues or unpaid deficiencies or outstanding or proposed assessments
relating to any such proceedings, examinations, claims or Tax
Returns.  None of the Tax Returns described in Section 5.8(a)
currently is under audit or has been audited in the past five
years.





5.9           Access to
Properties.  At all times prior to the Closing Date, Seller
shall allow Buyer and its authorized representatives access to the Purchased
Assets as is reasonably required for Buyer to make such investigation as it may
desire of the Purchased Assets.




5.10           Assigned
Contacts.  To the best of Seller’s knowledge, there are no
defaults by any party under the Assigned Contracts, nor have any events or
circumstances occurred, which with the passage of time or giving of notice,
could result in a default under any of the Assigned Contracts.




5.11           Trade Names and
Logos.  Seller has not licensed or otherwise authorized the use
of any of the trade names, trademarks, copyrights, service marks, or logos, or
any derivations thereof, to anyone other than Buyer as provided herein, provided
that Seller has allowed use of Seller's trade name, logos, and service marks by
distributors of Seller in connection with the sale of products in the Product
Line.  The use thereof by Buyer after Closing in connection with the
sale of the products within the Product Line will not, to Seller's knowledge,
infringe upon any copyright, trade name or trademark held by any third
party.




5.12           Patents.  There are
no patents or patents pending applicable with respect to any products in the
Product Line.




5.13           Accounting
Matters.  The book value of Seller's Inventory to be conveyed
to Buyer hereunder has been kept and determined in accordance with
GAAP.  All historical sales figures and financial information
furnished to Buyer by Seller is true, accurate and correct in all material
respects.




8


5.14           Tooling and
Equipment.  The Purchased Assets includes all tooling
applicable to the Product Line as set forth on Schedule 1.1(a).




ARTICLE
6


OTHER
OBLIGATIONS OF THE PARTIES





6.1           Cooperation.  The
parties shall cooperate reasonably with each other and shall provide each other
with such assistance as they may reasonably request for the purpose of
facilitating their performance under this Agreement and any and all other
consents and waivers from third parties necessary or convenient to consummate
the transactions contemplated by this Agreement.  The parties shall
use their best efforts and good faith to do all things contemplated herein prior
to the Closing Date.





6.2           Inventory of Purchased
Assets.  Seller has prepared an inventory of the Inventory
items to be transferred to Buyer at Closing, which is attached hereto as
Schedule 1.1(b). The Schedule will be used to determine the Inventory portion of
the Payment for Inventory to be paid by Buyer to Seller at Closing, provided
however, the said Schedule and the purchase price shall be subject to adjustment
as provided in Section 3.2.





6.3           Removal of Purchased
Assets.  Buyer shall remove all Purchased Assets, other than
finished goods, from the Seller's premises within fifteen (15) working days
after the date of Closing ("Initial Removal Period").  If any such
Purchased Assets remain on the Seller's premises after the Initial Removal
Period and the failure to remove same within the allotted time is not due to the
fault of the Seller, Buyer shall pay Seller Five Hundred Dollars ($500.00) per
day for each day after the Initial Removal Period that any of the Purchased
Assets remain within any building on the Seller's premises.  All
Purchased Assets that are finished goods located on Seller's premises shall be
removed from Seller's premises within sixty (60) working days after the date of
Closing ("Final Removal Period").  If any finished goods that are
Purchased Assets remain on Seller's premises after the Final Removal Period,
Buyer shall pay to Seller One Hundred Dollars ($100.00) per day for each day
that such finished goods remain on Seller's premises.  Seller agrees,
at no cost to Buyer, to prepare the Purchased Assets for shipment and load same
onto trucks or trailers furnished by Buyer (or as may be furnished by
Seller).  At Buyer’s request Seller shall furnish trucks and/or
trailers to transport all or part of the Purchased assets.  There
shall be no cost to Buyer to use Seller’s trailers, but if Seller’s truck or
trucks, with driver are used, Buyer shall pay to Seller the sum of $400.00 for
each load transported by such truck and driver. Notwithstanding the fact that
Purchased Assets will remain on Seller's premises after Closing, Buyer shall
have risk of loss or damage thereto from and after Closing, and Seller shall not
be liable to Buyer for any such loss or damage to any of the Purchased Assets
other than from the gross negligence or intentional misconduct of Seller or its
employees.





6.4           Noncompete of
Seller.  As a material inducement to Buyer to enter into this
Agreement, Seller agrees not to compete with Buyer in the manufacture or
distribution of manure spreaders either directly or indirectly, through
affiliated persons or entities or otherwise, for a period of five (5) years
following Closing Date.  Notwithstanding any provision contained
herein to the contrary, this Section 6.4 shall not prohibit Seller from selling
any of its retained inventory of used manure spreading equipment, or from
providing warranty service as described in Section 6.5 hereof.  This
covenant shall automatically terminate without notice and shall be of no further
force and effect in the event Buyer fails or refuses to perform any duty or
obligation under this Agreement or is otherwise in default
hereunder.  For purposes of this Section, a person shall be considered
an affiliated person if that person is an agent, employee, officer, director or
shareholder of Seller or with an entity affiliated with Seller provided,
however, that if any former employee or agent competes with Buyer during such
five (5) year period in the manufacture or distribution of manure spreaders,
such activity shall not violate the provisions of this Section 6.4, unless such
employee or agent is working directly or indirectly for Seller.  An
entity shall be considered an affiliated entity if it is the parent or
subsidiary of Seller or its stock, or the stock of its parent or subsidiary
corporation is owned more than 25% by the Shareholders of Seller or Seller's
parent or subsidiary corporation. As used in the preceding sentence the term
Shareholder and stock shall include the terms member and membership interest in
the case of an entity that is a limited liability company, partner and
partnership interest  in the case of an entity that is a partnership
or the owner of any equity interest in the case of any other type of
entity.




9


6.5           Warranty
Service.  Seller shall remain responsible for furnishing
warranty service under Seller’s standard warranty terms and conditions
for:  (i) any manure spreaders sold by Seller prior to Closing; and
(ii) any manure spreaders sold to Buyer pursuant hereto as finished goods and
unmodified by Buyer and subsequently sold by Buyer to third parties (“Seller
Warranty”).  Any manure spreaders sold by Buyer to which the Seller’s
Warranty is applicable shall be sold by Buyer with the same or lesser warranty
as the standard warranty terms offered by Seller for the same or similar model
of manure spreaders sold by Seller immediately prior to Closing.  Any
additional warranty given by Buyer shall be the responsibility of
Buyer.  At Seller’s request, Buyer agrees to provide warranty repairs
on behalf of Seller for the Seller Warranty which Seller understands will be
provided by Buyer’s distributors and/or dealers.  Any such Seller
Warranty repair work shall only be undertaken by such distributor or dealer when
expressly authorized in advance by Seller.  Seller agrees to pay when
invoiced the dealer/distributor’s charges for such authorized warranty
repairs.  In the case of Warranty work done directly by Seller or on
behalf of Seller by a distributor or dealer, Buyer agrees to sell repair parts
to Seller or such distributor or dealer for such warranty repairs at a equal to
Buyer’s then current cost plus twenty-five percent (25%).  Other than
the Seller Warranty to third parties described herein, the other warranties of
Seller specifically described in this Agreement and the warranties of title in
the bill of sale, all of the Purchased Assets are being sold and transferred to
Buyer “AS IS” and “WHERE IS” and Seller makes no other warranties with respect
thereto, either express or implied, including NO WARRANTIES OF FITNESS FOR A
PARTICULAR PURPOSE OR MERCHANTIBILITY.





6.6           Restrictions on Operations Prior to
Closing.From the date of this Agreement until the Closing,
Seller shall conduct its operations in accordance with its ordinary and usual
course of business, and Seller shall not take any action which would cause, or
fail to take any action necessary to prevent, a material adverse change to the
Business.




6.7           Location of
Assets.  All tooling, dies, patterns, or other items of
equipment used in the manufacturing of the Product Line and being sold to Buyer
are located at Seller's main facility and are described on Schedule 1.1(a) of
this Agreement.  Buyer acknowledges that certain finished products
being sold to Buyer by Seller are located at various Distributors'
premises.  Buyer will be responsible for any storage or transportation
arrangements necessary with respect to such finished products.




10


ARTICLE
7


CONDITIONS
PRECEDENT TO OBLIGATIONS


OF
SELLER





The obligations of Seller under this
Agreement are subject to the fulfillment prior to or on the Closing Date of the
following conditions:





7.1           Representations and
Warranties.  Each of the representations and warranties of
Buyer contained in this Agreement shall be accurate in all material respects as
of the date hereof and as of the Closing Date, and Buyer shall have performed
all covenants and agreements required to be performed by it and shall not be in
default under any of the provisions of this Agreement at or prior to the Closing
Date.





7.2           Consents and
Approvals.  All consents, approvals, authorizations, permits,
certificates and orders with respect to the transactions contemplated by this
Agreement required from any person, entity, court or governmental agency or
instrumentality (federal, state or local) shall have been obtained and shall be
valid and in full force and effect.





7.3           Resolutions certified copies
of resolutions, duly adopted by the Board of Directors of Buyer, which shall be
in full force and effect at the time of Closing, authorizing the execution,
delivery and performance by Buyer of this Agreement and the consummation of the
transactions contemplated hereby;





7.4           Payment.  Buyer
shall pay the Purchase Price in accordance with Article 3.




7.5           Deliveries by
Buyer.  On or before the Closing Date, Buyer shall have
executed and delivered to Seller the Assignment and Assumption Agreement with
respect to the Assigned Contracts.





ARTICLE
8


CONDITIONS
PRECEDENT TO OBLIGATIONS OF BUYER





The obligations of Buyer under this
Agreement are subject to the fulfillment prior to or on the Closing Date of the
following conditions:





8.1           Representations and
Warranties.  Each of the representations and warranties of the
Seller contained in this Agreement shall be accurate in all material respects as
of the date hereof and as of the Closing Date (except to the extent that such
representations and warranties shall be incorrect as of the Closing Date because
of events or changes occurring after the date hereof in the ordinary course of
operating the Business as contemplated in this Agreement); and Seller shall have
performed all covenants and agreements required to be performed by it and shall
not be in default under any of the provisions of this Agreement at or prior to
the Closing Date.





8.2           Consents and
Approvals.  All consents, approvals, authorizations, permits,
certificates and orders with respect to the transactions contemplated by this
Agreement required from any person, entity, court or governmental agency or
instrumentality (federal, state or local) shall have been obtained and shall be
valid and in full force and effect, and no conditions, requirements or
qualifications shall have been imposed by such consents, approvals,
authorizations, permits, certificates or orders.




11


8.3           Deliveries by
Seller.  On or before the Closing Date, Seller shall have
executed and delivered to Buyer the following:





(a)           Bill
of Sale executed by Seller in a form reasonably acceptable to Buyer, sufficient
to pass title to the Purchased Assets to be conveyed hereunder, free and clear
of all liens or encumbrances of any type or nature together with other good and
sufficient instruments of transfer and conveyance as, in the reasonable opinion
of Buyer’s counsel, shall be effective to vest in Buyer good and marketable
title to the assets to be sold as provided in this Agreement;





(b)           Assignment
and Assumption Agreement in a form reasonably acceptable to the attorney for
Buyer with respect to the Assigned Contracts;




(c)           certified
copies of resolutions, duly adopted by the Board of Directors of Seller and the
Shareholders, which shall be in full force and effect at the time of Closing,
authorizing the execution, delivery and performance by Seller of this Agreement
and the consummation of the transactions contemplated hereby; and




(d)           All
other documents reasonably necessary to transfer title to the Purchased Assets
to Buyer and as reasonably necessary to perform all other obligations of Buyer
hereunder.





8.4           No Litigation.  No
claim, suit, action or other proceeding shall be pending or threatened before
any court or governmental body to restrain or prohibit the consummation of the
transactions contemplated hereunder or seeking to put a lien on the Purchased
Assets.




8.5           Condition of Equipment and
Inventory.  Within twenty-four (24) hours prior to Closing,
Buyer shall (i) have conducted an inspection of the Equipment and Inventory to
confirm the condition thereof and to confirm the existence of the specific items
of Equipment described on Schedule 1.1(a) and the Inventory described on Exhibit
1.1(b) and (ii) be satisfied, in its sole discretion, with the results of such
inspection.




8.6           Delivery of
Possession.  Seller shall deliver possession of all of the
Purchased Assets to Buyer at Closing.




ARTICLE
9


INDEMNIFICATION





9.1           Matters Covered by Seller
Indemnification.  Seller hereby covenants and agrees that it
shall defend and indemnify Buyer and hold harmless Buyer at all times after the
Closing Date from and against and in respect to any and all losses, liabilities,
obligations, claims, costs (including, without limitation, court costs and
reasonable attorneys' fees), damages, expenses or deficiencies ("Covered
Liabilities") arising out of or due to:





(a)           Any
breach of any representation, warranty or any agreement, covenant or obligation
on the part of Seller made in this Agreement;





(b)           Any
transaction, occurrence, action or omission in connection with the operation of
the Business by Seller on or before the Closing Date; or




12


(c)           Any
claim against any of the Purchased Assets hereunder as a result of Seller's acts
or omissions occurring on or before the Closing Date.





(d)           Any
liability, debt or obligation of Seller whatsoever, not specifically assumed by
Buyer under the provisions of Section 2.1 of this Agreement.





9.2           Matters Covered by Buyer
Indemnification.  Buyer hereby covenants and agrees that it
shall defend and indemnify Seller and hold harmless Seller at all times after
the Closing Date from and against and in respect to any Covered Liabilities
arising out of or due to:





(a)           Any
breach of any representation, warranty or any agreement, covenant or obligation
on the part of Buyer made in this Agreement;





(b)           Any
transaction, occurrence, action or omission in connection with the Purchased
Assets or the operation of the Business by Buyer on or after the Closing Date;
or





(c)           Any
failure to perform any obligation on Buyer's part to be performed after Closing
under any of the Assigned Contracts.





9.3           Procedure for
Indemnification.  A party shall assert any claim or claims for
indemnification under the provisions of this Article 9 by giving written notice
of such claim or claims to the other party.  Each such notice shall
set forth in reasonable detail the factual basis giving rise to the claim or
claims and the amount of the damages and expenses incurred by such party as a
result of such claim or claims.  Such notice shall be given within a
reasonable time after receipt of actual notice of such claim by the party
seeking indemnification.





ARTICLE
10


TERMINATION





10.1           Right of
Termination.  This Agreement and the transactions contemplated
herein may be terminated at any time prior to Closing in any one of the
following circumstances:





(a)           By
mutual written consent of Buyer and Seller.





(b)           By
Seller in the event that any of the conditions set forth in Article 7 of this
Agreement shall not have been satisfied or waived and Closing shall not have
occurred on or before January 20, 2010, or such later date as may be agreed upon
pursuant to this Agreement and provided Seller was not at fault.





(c)           By
Buyer in the event that any of the conditions set forth in Article 8 of this
Agreement shall not have been satisfied or waived and Closing shall not have
occurred on or before January 20, 2010, or such later date as may be agreed upon
pursuant to this Agreement and provided Buyer was not at fault.




In the
event this Agreement is terminated as allowed in this Section 10.1, neither
party shall have any further duties, obligations or rights
hereunder.  In the event of Seller fails or refuses to perform and
duty or obligation under this Agreement, Buyer may, in lieu of termination,
pursue any remedy that it may have against Seller by reason
thereof.




13


10.2           Notice of
Termination.  Notice of termination of this Agreement as
provided for in this Article 10 shall be given by the party or parties so
terminating to the other parties hereto in accordance with the provisions of
Section 11.4 of this Agreement.




10.3           Other Default.  In
the event, after Closing, either party fails to perform any duty or obligation
on such party's part to perform, and such default is not cured after ten (10)
days notice thereof to the defaulting party, then such party shall be deemed in
default, and the non-defaulting party shall have such remedies upon default as
are provided herein and as are allowed by law.





10.4           Time is of the
Essence.  Time is of the essence with respect to this
Agreement.





ARTICLE
11


MISCELLANEOUS





11.1           Entire
Agreement.  This Agreement, together with the schedules,
exhibits and attachments hereto, constitutes the entire agreement among the
parties and supersedes all prior agreements, oral or written.  This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and assigns.





11.2           Severability.  If
any severable provision of this Agreement is held to be invalid or unenforceable
by any judgment of a court of competent jurisdiction, the remainder of this
Agreement shall not be affected by such judgment, and the Agreement shall be
carried out as nearly as possible according to its original terms and
intent.





11.3           Expenses.  Whether
or not the Closing occurs, each party shall pay its own expenses incident to the
preparation and performance of this Agreement and the transactions contemplated
hereby.





11.4           Notice.  Any notice,
demand or other communication required or permitted by any provision of this
Agreement shall be deemed to have been sufficiently given or served for all
purposes when delivered in person or sent by facsimile transmission with
telephone confirmation of receipt, overnight courier or registered or certified
mail, return receipt requested, all postage and other charges prepaid, as
follows:





If
      to Buyer:
                If
      to Seller:Roda
      Mfg., Inc.
                  1110
      Albany Place
                  Orange
      City, IA 51041
                Art’s-Way
      Manufacturing Co., Inc.
                  P.
      O. Box 288
                  Armstrong,
      IA 50514-0288





with
      a copy to:
                P.
      Scott Dye
                1500
      Woodmen Tower
                1700
      Farnam Street
                Omaha,
      NE 68102
              with
      a copy to:
                
                Everette
      L. Wooten, Jr.
                Wooten
      & Coley, Attorneys
                P.
      O. Box 1555
                Kinston,
      NC 28504





or at
such other address as may be designated by notice pursuant to this
Section 11.4 from such party to the other party.  Notice sent by
overnight courier shall be deemed delivered on the business day immediately
following deposit with such courier.  Notice sent by facsimile
transmission shall be deemed delivered on the day of transmission if a business
day or if not a business day the first business day following the day of
transmission.  Notice sent by certified or registered mail shall be
deemed delivered on the fifth (5th) day after deposit with the United States
postal service.




14


11.5           Governing Law.  This
Agreement shall be governed by and construed in accordance with the laws of the
State of Iowa.





11.6           No Third-Party
Beneficiaries.The representations, warranties, covenants and
agreements expressed in this Agreement are for the sole benefit of the other
parties hereto, and each indemnified person under Article 9 above, and are not
intended to benefit, and may not be relied upon or enforced by any other party
as a third-party beneficiary or otherwise.





11.7           Amendment.  This
Agreement may be amended, modified, superseded or cancelled, and any of the
terms, provisions, covenants, representations, warranties or conditions hereof
may be waived, only by a written instrument executed by the parties hereto or,
in the case of a waiver, by the party waiving compliance.





11.8           Waiver.  The failure
to enforce or to require the performance at any time of any of the provisions of
this Agreement shall in no way be construed to be a waiver of such provisions
and shall not affect either the validity of this Agreement or any part hereof or
the right of any party thereafter to enforce each and every provision in
accordance with the terms of this Agreement.





11.9           Counterparts.  This
Agreement may be executed in one or more counterparts, all of which shall be
considered one and the same Agreement.  This Agreement shall become
effective when one or more counterparts shall have been signed by each of the
parties and delivered to the other parties.





11.10         
Incorporation by
Reference.  The exhibits and schedules referred to in this
Agreement are hereby incorporated in this Agreement as a part hereof as if set
forth in full herein.





11.11         
Specific
Performance.  In the event of a breach of this Agreement, the
parties acknowledge and agree that each of them shall, in addition to any other
remedies available at law or in equity, have the right to seek specific
performance by the other parties of their respective obligations
hereunder.





11.12         
Confidentiality.  The
parties hereto agree that until the earlier of Closing or the termination of
this Agreement, each party hereto shall keep confidential and not disclose or
divulge to any person the existence of this Agreement or the transaction
contemplated hereby, other than the following individuals and entities required
to have such knowledge for sole purpose of advising such party and evaluating
and analyzing the proposed transaction contemplated hereby: (a) authorized
employees, agents and directors of each party; (b) accountants, attorneys and
other professional advisers of each party utilized in connection with this
transaction; (c) authorized employees, directors and professional advisers of
any financial institution providing funding for the transaction; (d) service
providers to Buyer necessary for Buyer to evaluate the purchase, such as title
insurance companies, surveyor, environmental consultants and the like and their
respective employees; and (e) any employees of any governmental offices as
necessary to obtain any required governmental approvals in connection with this
transaction.  Nothing stated herein shall prohibit the disclosure of
this Agreement and the transaction that is the subject of this Agreement as
necessary to judicially enforce any of the terms and conditions
hereof.





15


11.13         
Brokers'
Fees.  Seller represents that in connection with this sale it
has not dealt with any business brokers.  Seller will indemnify and
hold the Buyer harmless (which indemnification shall survive Closing) from any
and all claims and/or expense resulting to Buyer by reason of breach of the
representations made by Seller herein.  Buyer represents that it has
not retained any business brokers in connection with this sale.  Buyer
shall indemnify and hold Seller harmless (which indemnification shall survive
Closing) from any and all claims and/or expense resulting to Seller by reason of
breach of the representation made by Buyer.




11.14         
Survival.  This
Agreement, and the duties and obligations stated herein, shall survive closing
and shall not be deemed merged into any document delivered at
Closing.





11.15         
Further
Actions.  Following the Closing Date, at the request of Buyer,
the Seller shall deliver such further instruments of transfer and take all
reasonable action as may be necessary or appropriate to effectuate this
Agreement and the transactions contemplated hereby.  Each party will
promptly notify the other party of any information delivered to or obtained by
such party which would prevent the consummation of the transactions contemplated
by this Agreement, or would indicate a breach of the representations, warranties
or covenants of any of the parties to this Agreement.








Signature
Page Follows





16


IN
WITNESS WHEREOF, the parties have executed this Agreement the day and year first
above written.





BUYER:ART’S-WAY
      MANUFACTURING CO., INC., an Iowa corporationBy:
                      /s/
      Carrie MajeskiName:
                      Carrie
      MajeskiIts:








SELLER:RODA
      MFG., INC., an Iowa corporationBy:
                      /s/
      Drew VogelName:
                      Drew
      VogelIts:




17