DISCONTINUED OPERATIONS AND REAL ESTATE HELD FOR SALE

9 Months Ended

Mar. 31, 2014

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS AND REAL ESTATE HELD FOR SALE

NOTE 6. DISCONTINUED OPERATIONS AND REAL ESTATE HELD FOR SALE

In February 2012, we completed thesale of our fractional horsepower motor product line, operating under thename Pro-DexAstromec (“Astromec”) and located in Carson City, Nevada, to SL Montevideo Technology, Inc. (“MTI”), a whollyowned subsidiary of SLIndustries, Inc., pursuant to an Asset Purchase Agreement (the “APA”).

Under the terms of the APA, we may receive earnout payments based onrevenues generated fromthe sale of (i) Astromecproducts and (ii) MTI products to Astromecprospects (defined in the APA)(collectively, the “Earnout Sales Base”). Such earnoutpayments,if and when earned,are paid by MTI to us within 30 days following the end of each of our fiscal quartersduring the threeyears subsequent tothe February 2012 closing date,and amount to 6%, 4% and 2% of the Earnout Sales Base in the first,second and third such years, respectively. The earnoutpayments are recognized in the quarter in which we become entitledto receivethem. We recognized income from earnout payments of $33,000 and $43,000 for the three months ended March 31, 2014 and 2013, respectively, and $103,000 and $135,000 for the nine months ended March 31, 2014 and 2013, respectively. We have recognized an aggregate of $334,000 in income fromsuch earnout payments since the February 2012 closing date.

In addition, as a result of thesale of the Astromec product line, we listed for sale theland and building constituting the facilityinCarson City, Nevada, which was presented asreal estate heldfor sale in the June 30, 2013 consolidated balance sheet with an aggregatecarrying amount of $733,000. On April 22, 2013, we entered into aPurchase Agreement with Aesthetic and Reconstructive Technologies,Inc., a Nevada corporation,whereby we agreed to sell theCarson City facility described above. On July 5, 2013, we completed thesale andclosed the Purchase Agreement in conformity with its terms. The sales price ofthe property was $980,000, of which we received netproceedsof $900,000,after deductionsfor expenses related to the sale, primarily consisting of broker commissionsand fees, aggregating approximately $80,000, resulting in a gain of $167,000.

Based on the foregoing,and in conformity with applicable accounting guidance, the Astromec product line qualifies as adiscontinued operation. Accordingly, financial results of Astromec have been reported as discontinued operations inthe accompanyingconsolidated statements of operations for all periods presented. Information regarding revenue and operating results of Astromec included indiscontinued operations is as follows (in thousands):

	Three Months Ended March 31,
	2014		2013
Revenues	$	33	$	43
Income before provision for income taxes of $55,000 and $14,000, respectively	$	28	$	33

	Nine Months Ended March 31,
	2014		2013
Revenues	$	103	$	135
Income before provision for income taxes of $91,000 and $39,000, respectively	$	258	$	111

Information regarding Astromec assets and liabilities included in the accompanying consolidated balance sheets is as follows (in thousands):

	March 31, 2014		June 30, 2013
Accounts receivable	$	32	$	31
Prepaid expenses	$	7	$	—
Accrued expenses	$	2	$	5