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Discontinued Operations | 9 Months Ended
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Jul. 31, 2013
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations |
Note 2 - Discontinued Operations During the third quarter of fiscal 2013, the Company sold its RF Neulink division pursuant to an asset purchase agreement as discussed below. As part of the RF Wireless segment, the RF Neulink division was engaged in the sale of wireless data products, such as transmitter and receiver modules and standard or smart programmable modems, for use in certain high-speed wireless connection markets. Given the Company’s focus on the higher growth and higher margin components of its business, the Company decided to sell RF Neulink in order to reduce operating costs and focus its resources on more profitable divisions. Accordingly, during the third quarter of fiscal 2013, the RF Neulink division had met the criteria to be accounted for as discontinued operations. The operations and cash flows from RF Neulink will be eliminated from the ongoing operations of the Company as a result of the sale of the business, and the Company will not have any continuing involvement in the operations of RF Neulink after the disposal transaction. Effective July 31, 2013, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Raveon Technologies Corporation (“Raveon”), whereby Raveon agreed to acquire the assets related to the RF Neulink business, primarily consisting of inventory, certain intellectual property and licenses, customer lists and trademarks. Pursuant to the Purchase Agreement, no purchase price was paid at the closing. Rather, the purchase price for the RF Neulink business will consist of cash payments made by Raveon to the Company under the following circumstances: (i) for each RF Neulink inventory item that Raveon sells, Raveon is required to pay the Company the assigned value of that inventory item. This arrangement continues until the earlier of three years from the closing date or the date all inventory items are sold; and (ii) Raveon is required to pay the Company a royalty based on Raveon’s use of RF Neulink’s tradename or trademark, its customer list or its intellectual property. The royalty, which ranges from 5% to 10% of Raveon’s sales of such RF Neulink-related products, may not exceed $450,000 in the aggregate, and will not be payable on sales of inventory items. The following summarized financial information related to RF Neulink is segregated from continuing operations and reported as discontinued operations (in thousands):
|  | Three Months Ended July 31, |  | Nine Months Ended July 31, |
|  | 2013 |  | 2012 |  | 2013 |  | 2012 |
Net sales |  | $ | 75 |  | $ | 157 |  | $ | 184 |  | $ | 474 |
Cost of sales |  |  | 398 |  |  | 137 |  |  | 518 |  |  | 304 |
Gross profit (loss) |  |  | (323) |  |  | 20 |  |  | (334) |  |  | 170 |
Operating expenses |  |  | 71 |  |  | 87 |  |  | 246 |  |  | 256 |
Operating loss |  |  | (394) |  |  | (67) |  |  | (580) |  |  | (86) |
Provision for income taxes |  |  | (156) |  |  | (27) |  |  | (226) |  |  | (34) |
Loss from discontinued operations, net of tax |  | $ | (238) |  | $ | (40) |  | $ | (354) |  | $ | (52) |
Given the nature of the inventory at RF Neulink, the Company assessed the fair value of such inventory at $0 and recorded a charge of $297,000, which has been classified within discontinued operations, in connection with the sale of RF Neulink. The inventory at RF Neulink is highly specialized and not easily transferrable to other products. Additionally, certain components require programming and engineering expertise, which is unique to these products, in order to become fully functional.

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- 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
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