Subsequent Event:

6 Months Ended

Jun. 29, 2013

Subsequent Event:

Subsequent Event:

13. Subsequent Event:

As discussed in Note 7, WEI was set up during March 2011 in anticipation of the development of a product by a third party that WEI would have exclusive rights to sell in North America. The expenses incurred by WEI, principally compensation and relocation expenses of its sole employee, are reported as a separate line item in the statement of operations. As part of the relocation of the sole employee of WEI in 2011, the Company purchased the former residence of, and made a loan of $352,000 to, the employee. Development of the product has ceased and the sole employee was terminated in February 2013. The Company completed negotiations of the settlement agreement with this former employee during July, but recorded the financial effect during the second quarter of 2013. As a part of the settlement agreement, the Company agreed that the note would be repaid only from future sales, if any, should development resume and result in a marketable product. Accordingly, the Company has decided to fully reserve the loan as of June 29, 2013. In addition, the settlement agreement included a severance payment of $225,000 which has also been accrued as of June 29, 2013. Finally, the residence acquired by the Company was sold on July 24, 2013. The net amount realized after sales commissions and other closing costs was $625,000. Consequently, the Company wrote down the carrying value of the residence by $25,000 during the second quarter of 2013.