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Note 2 - Dispositions and Exit Activities
 9 Months Ended
Sep. 30, 2012
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
2.  DISPOSITIONS AND EXIT ACTIVITIES

RedBlack Communications, Inc.

On February 16, 2012, we announced our intention to divest our RedBlack Communications, Inc. (“RedBlack”) business in 2012. RedBlack, a wholly owned subsidiary of ours based in Hollywood, Maryland, designs, integrates and fields mobile, modular and fixed site communication and electronic systems.  As a result of management’s ongoing review of our business portfolio, management had determined that RedBlack offered limited opportunities to achieve the operating thresholds of our new business model.

On September 28, 2012, we entered into and closed a Stock Purchase Agreement (the “Agreement”) to sell 100% of our capital stock in RedBlack to BCF Solutions, Inc.  In exchange for the sale of RedBlack, we received $2,533 as a purchase price, comprised of cash at closing in the amount of $2,133, funds held in escrow for up to one year in the amount of $250, as well as $150 to be available for RedBlack employee retention programs.  In addition, there will be a customary post-closing working capital adjustment to the purchase price which is expected to be completed within ninety days.

The Agreement contains customary representations and warranties that will survive for a period of two or three years.  The Agreement also contains customary indemnification for breaches of the representations and warranties identified in the Agreement.

Pursuant to the Agreement, we are prohibited from engaging or participating with any current customer of RedBlack in any business, directly or indirectly, that competes with the business conducted by RedBlack for two years.  We are also prohibited from hiring, soliciting, or recruiting any current employee, independent contractor, or consultant of BCF Solutions, Inc. or RedBlack for two years.

Commencing with the first quarter of 2012, the results of the RedBlack operations and related divestiture costs have been reported as a discontinued operation.

As a result, the Condensed Consolidated Statements of Comprehensive Income (Loss) herein exclude the RedBlack operations from the results of continuing operations.  The following amounts have been reported as discontinued operations for the three- and nine-month periods ended September 30, 2012 and October 2, 2011:

   
Three-Month Periods Ended
   
Nine-Month Periods Ended
 
   
September 30,
2012
   
October 2,
2011
   
September 30,
2012
   
October 2,
2011
 
Net sales
  $ 1,267     $ 802     $ 3,404     $ 1,786  
Income (Loss) from discontinued operations
    (59 )     16       (3 )     (415 )
Provision (Benefit) for income taxes
    (196 )     12       (174 )     36  
Income (Loss) from discontinued operations, net of tax
    137       4       171       (451 )

Energy Services Business

On March 8, 2011, our senior management, as authorized by our Board of Directors, decided to exit our Energy Services business, which included standby power and systems design, installation and maintenance activities.   As a result of management’s review of our business segments and products, and taking into account the lack of growth and profitability potential of the Energy Services segment as well as its sizeable operating losses, we determined it was appropriate to refocus our operations on profitable growth opportunities presented in our other segments, Battery & Energy Products and Communications Systems.  In the fourth quarter of 2010, we recorded a non-cash impairment charge of $13,793 to write-off the goodwill and intangible assets and certain fixed assets associated with the standby power portion of our Energy Services business.

The actions taken to exit our Energy Services segment resulted in the elimination of approximately 40 jobs and the closing of five facilities, primarily in California, Florida and Texas, over several months.  As of the end of the second quarter of 2011, all exit activities with respect to our Energy Services segment were completed.  As a result, the presentation of results herein excludes the Energy Services segment from the results of continuing operations.  The following amounts have been reported as discontinued operations for the three- and nine-month periods ended September 30, 2012 and October 2, 2011:

   
Three-Month Periods Ended
   
Nine-Month Periods Ended
 
   
September 30,
2012
   
October 2,
2011
   
September 30,
2012
   
October 2,
2011
 
Net sales
  $ -     $ -     $ -     $ 3,895  
Gain/(loss) from discontinued operations
    63       -       8       (3,796 )
Provision for income taxes
    -       -       -       -  
Gain/(loss) from discontinued operations, net of tax
    63       -       8       (3,796 )

Included in the Loss from discontinued operations described above, we recorded the following exit charges:

   
Three-Month Periods Ended
   
Nine-Month Periods Ended
 
   
September 30,
2012
   
October 2,
2011
   
September 30,
2012
   
October 2,
2011
 
Inventory and fixed asset write-downs
  $ -     $ -     $ -     $ 941  
Employee related, including termination benefits
    -       -       -       703  
Lease termination costs
    -       -       -       250  
Other costs
    -       -       -       1,030  
Total Exit Costs
  $ -     $ -     $ -     $ 2,924  
Cash Component
  $ -     $ -     $ -     $ 1,984