Sale of DuraFit Business Sale of DuraFit Business

9 Months Ended

Sep. 30, 2018

Discontinued Operations and Disposal Groups [Abstract]

On September 8, 2017, the Company entered into an Asset Purchase Agreement with AP Emissions Technologies, LLC (“AP") wherein the Company sold substantially all of the assets of its DuraFit and private label OEM replacement diesel particulate filter ("DPF") and diesel oxidation catalysts ("DOC") business for approximately $3.3 million in cash. The assets sold included all tangible and intangible assets of that business, including brands, intellectual property, equipment, customer agreements, private label programs and inventory. As a result of the transaction, for the three and nine months ended September 30, 2017, the Company recorded a gain on sale of DuraFit of approximately $0.8 million. The Company will continue to serve this market through coating arrangements and its powder-to-coat technology.

Concurrently with the sale of the DuraFit business, the Company repaid in full all indebtedness owed to FGI Worldwide LLC, successor to Faunus Group International, Inc. ("FGI"), and terminated the Company's loan agreements with FGI and all commitments thereunder. In connection with termination of the loan agreements, FGI terminated and released all of its security interests in and liens on all of the assets of the Company and its subsidiaries. Of the proceeds received by the Company from the sale of the DuraFit business, the Company applied approximately $315,000 in repayment of the outstanding indebtedness to FGI. The Company did not incur any prepayment or early termination penalties in connection with termination of the FGI loan agreements.

Discontinued Operations

The Coated Catalyst operations are presented below as discontinued operations. The following table presents the major classes of assets and liabilities of discontinued operations in the consolidated balance sheets as of September 30, 2018 and December 31, 2017 (in thousands).



	September 30, 2018		December 31, 2017
Assets
Accounts receivable, net	$	140	$	220
Inventories	45		1,292
Prepaid expenses and other current assets	31		12
Current assets of discontinued operations	216		1,524

Property and equipment, net	—		300
Other assets	105		124
Assets of discontinued operations	105		424

Total assets of discontinued operations	321		1,948

Liabilities
Accounts payable	45		375
Accrued expenses and other current liabilities	843		2,046
Current liabilities of discontinued operations	888		2,421

Other liabilities	674		—

Net liabilities of discontinued operations	$	1,241	$	473

The following table presents revenue and expense information for discontinued operations for the three and nine months ended September 30, 2018 and 2017 (in thousands).



	Three Months Ended September 30,					Nine Months Ended September 30,
	2018			2017		2018			2017
Revenues	$	132		$	3,348	$	3,422		$	12,556
Pre-tax (loss) income	(645		)	730		(486		)	2,149
Income tax expense	—			—		—			—
Net (loss) income from discontinued operations	$	(645	)	$	730	$	(486	)	$	2,149