Note R - Sale Of Royal Elastics

12 Months Ended

Dec. 31, 2011

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

NOTE R - SALE OF ROYAL ELASTICS

On April 30, 2009, the Company sold certain Royal Elastics assets, consisting of its inventory located in Taiwan and its intangible trademarks, with an approximate net book value of $1,043,000, to Royal Elastics Holdings Ltd. (“REH”), a third party, in an arm’s length transaction for $4,000,000.  In respect to this sale, the Company received a $1,104,000 promissory note from REH and REH agreed to pay the company $2,896,000 in cash by April 30, 2010.  As of December 31, 2010, however the Company only received approximately $2,438,000 in cash.  The difference between what the Company expected to receive and what had been received by April 30, 2010 was added to the principal amount of the promissory note balance such that the Company holds a promissory note in the principal amount of approximately $1,562,000 from REH.  Interest on the promissory note is payable quarterly at an interest rate of Wall Street Journal Prime plus 1%.  The principal balance is due on April 30, 2016.  The pre-tax gain on sale of $1,367,000 for the year ended December 31, 2009 was recorded in Other Income/(Expense), net on the Consolidated Statement of Earnings/Loss.  Operations of the Royal Elastics brand have been accounted for and presented as a discontinued operation in the accompanying Consolidated Financial Statements.  The operations of Royal Elastics for year ended December 31 is as follows (in thousands):

	2009
Revenues	$	5,339
Cost of goods sold		3,708
Gross profit		1,631
Selling, general and administrative expenses		1,814
Operating loss		(183	)
Interest expense, net		(929	)
Loss before income taxes		(1,112	)
Income tax benefit		(648	)
Net loss from discontinued operations	$	(464	)