Discontinued Operations

12 Months Ended

Dec. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

DISCONTINUED OPERATIONS

EFLS

As part of the strategy to align our resources with developing and selling our energy-efficient LED products into the

commercial and military maritime markets, we completed the exit of our turnkey solutions business, operated by EFLS during the third quarter of 2015. During 2014, we shifted our focus away from the turnkey solutions business. We stopped accepting new projects and completed all outstanding solutions-based projects in the first quarter of 2015. As of September 30, 2015, the exit of our turnkey solutions business was complete. Accordingly, the operating results related to EFLS have been included as discontinued operations in the Consolidated Statements of Operations for all periods presented. There were no assets disposed as a result of the disposition, and we did not recognize a gain or loss on disposal or record an income tax expense or benefit. We do not anticipate any significant continuing involvement related to this discontinued operation.

CLL

In August 2015, we sold our wholly-owned United Kingdom subsidiary, CLL. The sale was for nominal consideration under the terms of the agreement. As a result of the transaction and the elimination of this foreign subsidiary consolidated under the equity method of accounting, we recorded a one-time loss of $44 thousand, which included a $469 thousand accumulated other comprehensive income reclassification adjustment for foreign currency translation adjustments. The loss was recorded in the Consolidated Statements of Operations under the caption "Loss on disposal of discontinued operations." We do not anticipate any significant continuing involvement related to this discontinued operation.

Pool Products Business

On November 26, 2013, we announced the sale of our pool products business for a cash purchase price of $5.2 million. Under the terms of the Purchase Agreement, we sold substantially all of the assets associated with the pool products business and the buyer assumed certain related liabilities. In connection with the sale, we and the buyer entered into a transition services agreement that continued until April 30, 2014, under which we provided services to transition the pool products business to the buyer. In addition, the Purchase Agreement contains representations, warranties and covenants of us and the buyer and prohibits us from competing with the buyer in the pool business for a period of five years following the closing. The Purchase Agreement also provided for an escrow of $500 thousand of the purchase price to secure customary indemnification obligations with respect to our representations, warranties, covenants and other obligations under the Purchase Agreement. Under the terms of the Purchase Agreement, the first of five $100 thousand scheduled escrow releases commenced on March 25, 2014, and was to continue on the 25th day of each of the next four subsequent months. As of December 31, 2015 and 2014, $200 thousand of the cash held in escrow had been released to us and $300 thousand remained in escrow subject to the resolution of outstanding buyer claims that were the subject of an arbitration claim filed by the buyer in February 2015. The legal fees incurred for the arbitration are included in the loss on disposal of discontinued operations. For more information on the status of the remaining cash in escrow, please refer to Note 15, "Legal Matters."

As a result of exiting EFLS and selling CLL and the pool products businesses, we have eliminated all net sales and expenses associated with this business from the Consolidated Statements of Operations, and have reported the net (loss) income from those activities as discontinued operations in the Consolidated Statements of Operations for all years presented.

The following table shows the components included in assets and liabilities of discontinued operations within the Consolidated Balance Sheets (in thousands):

	December 31, 2014
	EFLS		CLL		Total
Cash and cash equivalents	$	93	$	4	$	97
Trade accounts receivable	312		145		457
Inventories	—		414		414
Prepaid and other current assets	7		95		102
Current assets of discontinued operations	412		658		1,070
Property and equipment, net	—		23		23
Other assets	—		50		50
Non-current assets of discontinued operations	—		73		73
Total assets of discontinued operations	$	412	$	731	$	1,143
Accounts payable	$	163	$	318	$	481
Accrued liabilities	73		362		435
Billings in excess of costs and estimated earnings on uncompleted contracts	23		—		23
Current liabilities of discontinued operations	259		680		939
Total liabilities of discontinued operations	$	259	$	680	$	939

The following table summarizes the components included in loss from discontinued operations in our Consolidated Statements of Operations for the periods presented (in thousands):

	December 31,
	2015			2014			2013
Net sales	$	1,078		$	6,262		$	16,564
Cost of sales	588			4,690			12,254
Gross Profit	490			1,572			4,310
Operating expenses of discontinued operations	657			3,079			4,746
Other expenses (income)	—			64			(68		)
(Loss) gain on disposal of discontinued operations	(534		)	(30		)	3,915
(Loss) gain from discontinued operations before income taxes	(701		)	(1,601		)	3,547
(Benefit from) provision for income taxes	(10		)	(2		)	1
(Loss) gain from discontinued operations	$	(691	)	$	(1,599	)	$	3,546

The following table shows the components of the loss from discontinued operations by business for the periods presented (in thousands):

	December 31,
	2015			2014			2013
CLL	(138		)	(1,020		)	(174		)
EFLS	(29		)	(531		)	(866		)
Pool products business	—			(20		)	672
(Loss) gain from discontinued operations	(167		)	(1,571		)	(368		)
CLL	(44		)	—			—
Pool products business	(490		)	(30		)	3,915
(Loss) gain on disposal of discontinued operations	(534		)	(30		)	3,915
(Loss) gain from discontinued operations before income taxes	(701		)	(1,601		)	3,547
(Benefit from) provision for income taxes	(10		)	(2		)	1
(Loss) gain from discontinued operations	$	(691	)	$	(1,599	)	$	3,546