Disposition of Discontinued Operations

9 Months Ended

Oct. 31, 2011

Disposition of Discontinued Operations [Abstract]

DISPOSITION OF DISCONTINUED OPERATIONS

NOTE 3 — DISPOSITION OF DISCONTINUED OPERATIONS

VLI, a wholly owned subsidiary representing the Company’s nutritional products business segment, completed the sale of substantially all of its assets (the “Asset Sale”) to NBTY Florida, Inc. (“NBTY”) in March 2011. The Asset Sale was consummated for an aggregate cash purchase price of up to $3,100,000 and the assumption by NBTY of certain trade payables and accrued expenses of VLI. NBTY also assumed the remaining minimum lease obligations related to VLI’s office, warehouse and manufacturing facilities which totaled approximately $400,000 as of the sale date. Of the cash purchase price, $800,000 was paid at closing and the remaining $2,300,000 was placed into escrow. VLI is being paid from the escrow amount the cost of all pre-closing inventory sold, used or consumed within nine months of the closing; it was paid the amounts of all pre-closing accounts receivable of VLI that were collected by September 30, 2011. At September 30, 2011, all uncollected accounts receivable, the total amount of which was not material, were transferred back to VLI at no cost. At the end of the nine-month period subsequent to the closing, all money still held in the escrow account will be returned to NBTY. During the three and nine months ended October 31, 2011, VLI received cash proceeds from the escrow account in the amounts of $58,000 and $1,737,000, respectively. Amounts received from the escrow account are recorded as proceeds of the Asset Sale upon receipt.

The financial results of this business have been presented as discontinued operations in the accompanying condensed consolidated financial statements, including legal costs associated with this business. The amount of net revenues of the discontinued operations for the nine months ended October 31, 2011 was $1.5 million. The net revenues of the discontinued operations for the three and nine months ended October 31, 2010 were $2.9 million and $7.8 million, respectively. Assets held for sale at October 31, 2011 primarily included deferred tax assets.