Pension Plans

12 Months Ended

Nov. 30, 2011

Notes to Financial Statements

Pension Plans

6. Pension Plans

Defined Benefit Plan

The Company received a letter dated July 27, 2011 from the Pension Benefit Guaranty Corporation, (“PBGC”), stating that the Company’s defined benefit pension plan (the “Plan”) was terminated as of September 30, 2010, and the PBGC was appointed trustee of the Plan. Pursuant to the agreement, the PBGC has a claim to the Company for the total amount of the unfunded benefit liabilities of the Plan of $1,614,000. The PBGC has notified the Company that the liability is due and payable as of the termination date, and interest accrues on the unpaid balance at the applicable rate provided under Section 6621(a) of the Internal Revenue Code. The total amount outstanding to the PBGC at November 30, 2011 is $1,730,727, including accrued interest, which is recorded as a current liability. The Company made no payments to the Plan in fiscal 2011. The Plan covers approximately 40 former employees.

Effective June 30, 1995, the Plan was frozen, ceasing all benefit accruals and resulting in a plan curtailment. As a result of the curtailment, it has been the Company’s policy to recognize the unfunded status of the Plan as of the end of the fiscal year with a corresponding charge or credit to earnings for the change in the unfunded liability. Pension expense amounted to $248,312 and $128,379 for the years ended November 30, 2011 and 2010.

Obligations and Funded Status at November 30, 2010.

Pension Benefits	2010
Change in benefit obligation:
Benefit obligation at beginning of year	$	(1,345,612	)
Interest cost		(69,398	)
Actuarial gain (loss)		585
Benefits paid		45,030
Benefits obligation at end of year	$	(1,369,395	)
Change in plan assets:
Fair value of plan assets at beginning of year	$	78,727
Actual return on plan assets		(44,535	)
Employer contribution		10,838
Benefits paid		(45,030	)
Fair value of plan assets at end of year	$	—

Funded status	$	(1,369,395	)
Net amount recognized	$	(1,369,395	)

Amounts recognized in the statement of financial position consist of:

	2010
Accrued benefit cost	$	(1,369,395	)
Net amount recognized	$	(1,369,395	)

The accumulated benefit obligation for the Company’s defined benefit pension plan was $1,369,395 at November 30, 2010.

Information required for a pension plan with an accumulated benefit obligation in excess of plan assets:

	2010
Projected benefit obligation	$	(1,369,395	)
Accumulated benefit obligation		(1,369,395	)
Fair value of plan assets		—
Components of net periodic benefit cost:

	2010
Interest cost	$	69,398
Expected return on plan assets		(4,864	)
Amortization of net loss		51,905
Net periodic benefit cost	$	116,439

Assumptions
Weighted-average assumptions used to determine net periodic benefit cost as of November 30:
	2010
Discount rate		5.10	%
Expected long-term return on plan assets		N/A

Defined Contribution Plan

The Company has a 401(k) profit sharing plan for the benefit of all eligible employees, as defined. The plan provides for voluntary contributions not to exceed the statutory limitation provided by the Internal Revenue Code. The Company may make discretionary contributions. There were no contributions made for the years ended November 30, 2011 and 2010.