XML 30 R8.htm IDEA: XBRL DOCUMENT v2.4.0.6
Note 2 - Dispositions and Exit Activities
 3 Months Ended
Mar. 31, 2013
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
2.  
DISPOSITIONS AND EXIT ACTIVITIES

Ultralife Batteries UK, Ltd.

During the fourth quarter of 2012, we elected not to renew the lease for our U.K. manufacturing facility which expired on March 24, 2013 (the “U.K. Facility Lease”), and instead relocated our sales and services operations to a smaller facility. As a result of this decision, we were required to restore the facility back to its original condition pursuant to the terms of the U.K. Facility Lease.

The costs associated with the lease exit were not determinable until late in the fourth quarter of 2012. Accordingly, we recorded a liability as of the end of 2012 for our estimate of the costs to return the facility to its original condition as well as other related expenses. A total of $228 was charged to selling, general, and administrative costs related to operations transferred to our facilities in Newark, NY, and an additional $815 was recorded as discontinued operations for those operations that were not transferred to our facilities in Newark, NY. The termination of the U.K. Facility Lease did not result in any employee reductions or other termination costs, with the exception of the aforementioned restoration costs.

As a result, the results of presentation herein exclude the discontinued Ultralife Batteries UK, Ltd. operations from the results of continuing operations.  The following amounts have been reported as discontinued operations for the three-month periods ending March 31, 2013 and April 1, 2012:

   
Three-Month Periods Ended
 
   
March 31,
2013
   
April 1,
2012
 
Net sales
  $ -     $ -  
Gain from discontinued operations
    241       -  
Provision for income taxes
    -       -  
Gain from discontinued operations, net of tax
    241       -  

The cost of returning our former UK facility back to its original condition was less than our estimate of the cost made during the fourth quarter of 2012. As a result, we recognized the difference as a gain from discontinued operations during the first quarter of 2013.

RedBlack Communications, Inc.

On February 16, 2012, we announced our intention to divest our RedBlack Communications, Inc. (“RedBlack”) business in 2012. RedBlack was a wholly owned subsidiary of ours based in Hollywood, Maryland, that designed, integrated and fielded mobile, modular and fixed site communication and electronic systems.  We determined that RedBlack offered limited opportunities to achieve the operating thresholds of our business model.

On September 28, 2012 (the “Closing Date”), 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 that is currently being finalized.

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

The Agreement contains restrictive covenants that continue for two years from the Closing Date, under which 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 presentation of results herein excludes the RedBlack operations from the results of continuing operations.  The following amounts have been reported as discontinued operations for the three-month periods ended March 31, 2013 and April 1, 2012:

   
Three-Month Periods Ended
 
   
March 31,
2013
   
April 1,
2012
 
Net sales
  $ -     $ 1,186  
Gain (loss) from discontinued operations
    7       (12 )
Provision for income taxes
    -       11  
Gain (loss) from discontinued operations, net of tax
    7       (23 )

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 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, due to the variation of our actual experience compared to the estimates of reserves as of the date of closure, have been reported as discontinued operations for the three-month periods ended March 31, 2013 and April 1, 2012:

   
Three-Month Periods Ended
 
   
March 31,
2013
   
April 1,
2012
 
Net sales
  $ -     $ -  
Gain (loss) from discontinued operations
    16       (48 )
Provision for income taxes
    -       -  
Gain (loss) from discontinued operations, net of tax
    16       (48 )