XML 139 R12.htm IDEA: XBRL DOCUMENT
v2.4.0.8

DISCONTINUED OPERATIONS | 12 Months Ended
--- | ---
Jun. 01, 2013
DISCONTINUED OPERATIONS |
5. | DISCONTINUED OPERATIONS
Arrow Transaction On March 1, 2011, we completed the sale of the assets primarily used or held for use in, and certain liabilities of, our RFPD division, as well as certain other Company assets, including our information technology assets, to Arrow in exchange for $238.8 million, which included an estimated pre-closing working capital adjustment of approximately $27.0 million. During the fourth quarter of fiscal 2011, we recorded a working capital adjustment of $4.2 million in our results from discontinued operations. During the second quarter of fiscal 2012, we paid Arrow $3.9 million to settle the working capital adjustment. Following the Transaction, the Compensation Committee of our Board of Directors granted cash bonus compensation to certain executive officers and former employees in recognition of their efforts for successfully completing the Transaction. The cash bonus compensation amount awarded was approximately $3.8 million, and was recorded as expense from discontinued operations during the fourth quarter of fiscal 2011. To help facilitate the transition of RFPD to Arrow, we agreed to provide certain transitional services to Arrow such as financial support services, warehouse services, and access to facilities in accordance with the terms of the Transition Services Agreement. Arrow also agreed to provide certain transitional services such as information technology services, warehouse services, and access to facilities and equipment in accordance with the terms of the Transition Services Agreement. The duration of the transitional services were less than one year from March 1, 2011, except for the information technology services which is three years. In addition, we entered into a Manufacturing Agreement with Arrow, in connection with the Transaction, for a term of three years. Pursuant to the Manufacturing Agreement, we agreed to manufacture certain products for Arrow. The Transition Services Agreement, which commenced on March 1, 2011, and ended on March 1, 2012, allowed us to exert very limited influence over Arrow’s operating and financial policies. The continuing cash flows related to our Transition Services Agreement as well as the Manufacturing Agreement are insignificant. We believe it is appropriate to include fees and associated costs with the Transition Services Agreement that relate to financial support, certain facilities, and certain warehouse services in discontinued operations as they relate specifically to RFPD. We further believe it is appropriate to treat the revenue and costs associated with the Manufacturing Agreement as discontinued operations as it relates specifically to RFPD. Financial Summary - Discontinued Operations Summary financial results for fiscal 2013, 2012, and 2011 are presented in the following table (in thousands):
|  | Fiscal 2013 |  |  | Fiscal 2012 |  |  | Fiscal 2011 |
Net sales |  | $ | 636 |  |  | $ | 2,984 |  |  | $ | 321,826 |
Gross profit (loss) (1) |  |  | (553 | ) |  |  | (227 | ) |  |  | 66,718 |
Selling, general, and administrative expenses (2) |  |  | 714 |  |  |  | 552 |  |  |  | 44,317 |
Interest expense, net |  |  | — |  |  |  | — |  |  |  | 387 |
Additional (gain)/loss on sale |  |  | 18 |  |  |  | (266 | ) |  |  | (111,432 | )
Income tax provision (benefit) (3) |  |  | (2,051 | ) |  |  | (1,049 | ) |  |  | 47,480 |
Income (loss) from discontinued operations, net of tax |  |  | 766 |  |  |  | 536 |  |  |  | 85,966 |
Notes:
(1) | Gross profit (loss) for fiscal year 2013 includes unabsorbed manufacturing labor and overhead expenses related to the Manufacturing Agreement with RFPD.
(2) | Selling, General and Administrative expenses relates primarily to tax audits resulting from the Transaction.
(3) | The income tax benefit of $2.1 million during fiscal year 2013 relates primarily to the reversal of tax reserves.
In accordance with ASC 230, Statement of Cash Flows, entities are permitted but not required to separately disclose, either in the statement of cash flows or footnotes to the financial statements, cash flows pertaining to discontinued operations. Entities that do not present separate operating cash flows information related to discontinued operations must do so consistently for all periods presented, which may include periods long after the sale or liquidation of the operation. We did not have cash balances that were specific to RFPD and elected not to present separate cash flows from discontinued operations on our statement of cash flows. Assets and liabilities classified as discontinued operations on our consolidated balance sheets as of June 1, 2013, and June 2, 2013, include the following (in thousands):
|  | June 1, 2013 |  |  | June 2, 2012 |
Inventories |  | $ | 303 |  |  | $ | 503 |
Prepaid expenses and other assets |  |  | — |  |  |  | 11 |
Discontinued operations - Assets |  | $ | 303 |  |  | $ | 514 |
Accrued liabilities - current (1) |  | $ | 245 |  |  | $ | 253 |
Long-term income tax liabilities (2) |  |  | — |  |  |  | 1,361 |
Discontinued operations - Liabilities |  | $ | 245 |  |  | $ | 1,614 |
(1) | Included in accrued liabilities as of June 2, 2012, is $0.2 million of other accrued liabilities primarily related to professional legal and tax services.
(2) | Included in long-term income tax liabilities as of June 1, 2012, is the reserve for uncertain tax positions of $1.4 million which was reversed during FY2013.
In accordance with ASC 230, Statement of Cash Flows, entities are permitted but not required to separately disclose, either in the statement of cash flows or footnotes to the financial statements, cash flows pertaining to discontinued operations. Entities that do not present separate operating cash flow information related to discontinued operations must do so consistently for all periods presented, which may include periods long after the sale or liquidation of the operation.

X
- Definition The entire disclosure for the facts and circumstances leading to the completed or expected disposal, manner and timing of disposal, the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the segment in which the disposal group was reported, and the classification (whether sold or classified as held for sale) and carrying value of the assets and liabilities comprising the disposal group. Includes all disposal groups, including those classified as components of the entity (discontinued operations). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6391110&loc=d3e2941-110230 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1361-107760 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e957-107759 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1012-107759 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1510-107760 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1020-107759 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=8077374&loc=d3e2443-110228 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1474-107760 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1436-107760 + Details
Name: | us-gaap_DisposalGroupsIncludingDiscontinuedOperationsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration