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--12-31
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Yes
Smaller Reporting Company
Q2
2012
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In June 2011, the FASB issued
a new accounting standard on the presentation of comprehensive income. The new standard requires the presentation of comprehensive
income, the components of net income and the components of other comprehensive income either in a single continuous statement of
comprehensive income or in two separate but consecutive statements. The standard was effective for our quarter ended March 31,
2012. The adoption of this standard was limited to a change in the presentation of our results, which we have elected to include
as a separate Condensed Consolidated Statement of Comprehensive Income.
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 2 — Contingencies</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The Company is involved from
time to time in disputes and other litigation in the ordinary course of business and may encounter other contingencies, which may
include environmental and other matters.  The Company presently believes that none of these matters, individually or
in the aggregate, would be likely to have a material adverse impact on its financial position, results of operations or liquidity,
as set forth in these financial statements.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">In December 2008, the Company
sold property it owned in Bridgeport, Connecticut to B&E Juices, Inc. for $2.5 million, of which $2.0 million is secured by
a mortgage on the property.  The property consisted of approximately four acres of land and 48,000 sq. feet of warehouse
space.  The property was the site of the original Acme United scissor factory which opened in 1887 and was closed in
1996.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Under the terms of the sale
agreement, and as required by the Connecticut Transfer Act, the Company is required to remediate any environmental contamination
on the property. During 2008, the Company hired an independent environmental consulting firm to conduct environmental studies in
order to identify the extent of the environmental contamination on the property and to develop a remediation plan. As a result
of those studies and the estimates prepared by the independent environmental consulting firm, the Company recorded an undiscounted
liability of approximately $1.8 million related to the remediation of the property. This accrual included the estimated costs of
required investigation, remedial activities, and post-remediation operating and maintenance.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Remediation work on the project
began in the third quarter of 2009. The Company expects the remediation work to be completed during the second half of 2012.  At
June 30, 2012, the Company had approximately $188,000 remaining in its accrual for environmental remediation and monitoring, of
which approximately $54,000 is classified as a current liability in the accompanying balance sheet.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">In addition to the remediation
work, the Company, with the assistance of its independent environmental consulting firm, must continue to monitor contaminant levels
on the property to ensure they comply with set governmental standards. The Company expects that the monitoring period could last
a minimum of three years from the completion of the remediation work.</p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The change in the accrual
for environmental remediation for the three months ended June 30, 2012 follows (in thousands):</p>
<p style="margin: 0pt"> </p>
<table cellpadding="0" cellspacing="0" style="width: 80%; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 2px solid; width: 33%; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Balance
at</b></font></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>December
31, 2011</b></font></p></td>
<td style="border-bottom: black 2px solid; width: 34%; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Payments</b></font></p></td>
<td style="border-bottom: black 2px solid; width: 33%; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Balance
at</b></font></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>June
30, 2012</b></font></p></td></tr>
<tr style="vertical-align: bottom">
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="border-bottom: black 4px double; font: 10pt Times New Roman, Times, Serif; text-align: center; text-indent: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">$  239</font></td>
<td style="border-bottom: black 4px double; font: 10pt Times New Roman, Times, Serif; text-align: center; text-indent: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">$  (51)</font></td>
<td style="border-bottom: black 4px double; font: 10pt Times New Roman, Times, Serif; text-align: center; text-indent: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">$  188</font></td></tr>
</table>
<p style="text-indent: 0pt; margin: 0"><br />
<font style="font: 10pt Times New Roman, Times, Serif">Also, as part of the sale, the Company provided the buyer with a mortgage
of $2.0 million at six percent interest per year. The mortgage is payable in monthly installments of principal and interest with
the outstanding balance due in full, one year after remediation and monitoring on the property have been completed.</font></p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<table cellpadding="0" cellspacing="0" style="width: 80%; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 2px solid; width: 33%; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Balance
at</b></font></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>December
31, 2011</b></font></p></td>
<td style="border-bottom: black 2px solid; width: 34%; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Payments</b></font></p></td>
<td style="border-bottom: black 2px solid; width: 33%; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Balance
at</b></font></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>June
30, 2012</b></font></p></td></tr>
<tr style="vertical-align: bottom">
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="border-bottom: black 4px double; font: 10pt Times New Roman, Times, Serif; text-align: center; text-indent: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">$  239</font></td>
<td style="border-bottom: black 4px double; font: 10pt Times New Roman, Times, Serif; text-align: center; text-indent: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">$  (51)</font></td>
<td style="border-bottom: black 4px double; font: 10pt Times New Roman, Times, Serif; text-align: center; text-indent: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">$  188</font></td></tr>
</table>
<p style="text-indent: 0pt; margin: 0"></p>
<p style="margin: 0pt"></p>
188000
239000
51000
2500000
2000000
54000
In December 2008, the Company sold property it owned in Bridgeport, Connecticut to B&E Juices, Inc. for $2.5 million, of which $2.0 million is secured by a mortgage on the property. The property consisted of approximately four acres of land and 48,000 sq. feet of warehouse space. The property was the site of the original Acme United scissor factory which opened in 1887 and was closed in 1996.
1800000
3
.06
<p style="margin: 0pt"></p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 3 —</b> <b>Pension</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Components of net periodic
benefit cost are as follows (in thousands):</p>
<p style="margin: 0pt"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 9pt Times New Roman, Times, Serif; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 2px; font-size: 10pt"> </td>
<td style="padding-bottom: 2px; font-size: 10pt; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">Three Months Ended June 30,</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">Six Months Ended June 30,</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-bottom: 2px"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Components of net periodic benefit cost:</td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; width: 38%; text-indent: 0pt">Interest cost</td>
<td style="text-align: right; width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">17</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">26</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">43</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">52</td>
<td nowrap="nowrap" style="width: 1%; text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Service cost</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">12</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">17</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">10</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Expected return on plan assets</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(28</td>
<td nowrap="nowrap" style="text-align: left">)</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(26</td>
<td nowrap="nowrap" style="text-align: left">)</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(54</td>
<td nowrap="nowrap" style="text-align: left">)</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(53</td>
<td nowrap="nowrap" style="text-align: left">)</td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Amortization of prior service costs</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">2</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">3</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt">Amortization of actuarial loss</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">39</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">38</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">77</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">76</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">43</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">45</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">87</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">90</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td></tr>
</table>
<p style="margin: 0pt"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Under applicable laws and
regulations, in 2012, the Company is required to contribute to its qualified plan approximately $235,000.  The Company
expects to make contributions to the plan as required during the remainder of the year.</p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 9pt Times New Roman, Times, Serif; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 2px; font-size: 10pt"> </td>
<td style="padding-bottom: 2px; font-size: 10pt; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">Three Months Ended June 30,</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">Six Months Ended June 30,</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-bottom: 2px"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Components of net periodic benefit cost:</td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; width: 38%; text-indent: 0pt">Interest cost</td>
<td style="text-align: right; width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">17</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">26</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">43</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">52</td>
<td nowrap="nowrap" style="width: 1%; text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Service cost</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">12</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">17</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">10</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Expected return on plan assets</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(28</td>
<td nowrap="nowrap" style="text-align: left">)</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(26</td>
<td nowrap="nowrap" style="text-align: left">)</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(54</td>
<td nowrap="nowrap" style="text-align: left">)</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">(53</td>
<td nowrap="nowrap" style="text-align: left">)</td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Amortization of prior service costs</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">2</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">3</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt">Amortization of actuarial loss</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">39</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">38</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">77</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">76</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">43</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">45</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">87</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">90</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
43000
52000
17000
26000
17000
10000
12000
5000
54000
53000
28000
26000
5000
5000
2000
3000
77000
76000
39000
38000
87000
90000
43000
45000
235000000
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 4 —Debt and Shareholders
Equity</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">On April 5, 2012, the Company
entered into a new revolving loan agreement with HSBC Bank, N.A. In conjunction with signing the new revolving loan agreement,
the Company ended its agreement with Wells Fargo and used funds borrowed under the new loan agreement to pay all amounts then outstanding
under the revolving loan agreement with Wells Fargo Bank.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The new five-year credit facility
provides for increased borrowings of up to an aggregate of $30 million at an interest rate of LIBOR plus 1.75%, which is 0.25%
lower than the interest rate under the former loan agreement with Wells Fargo. All principal amounts outstanding under the agreement
are required to be repaid in a single amount on April 5, 2017, the date the agreement expires; interest is payable monthly.  Funds
borrowed under the agreement may be used for working capital, general operating expenses, share repurchases and certain other purposes.  Under
the revolving loan agreement, the Company is required to maintain specific amounts of tangible net worth, a specified debt service
coverage ratio, and a fixed charge coverage ratio. These financial covenants in the new loan agreement are similar to the covenants
in the prior agreement with Wells Fargo. At June 30, 2012 the Company was in compliance with these covenants under the new agreement
with HSBC Bank</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">As of June 30, 2012 and December
31, 2011, the Company had outstanding borrowings of $23,004,777 and $17,568,484, respectively, under the respective revolving loan
agreements.</p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">During the first six months
of 2012, the Company issued 5,000 shares of common stock and received proceeds of $21,000 upon the exercise of employee stock options.</p>
<p style="margin: 0pt"></p>
5000
21000
23004777
17568484
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 5— Segment Information</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The Company reports financial
information based on the organizational structure used by management for making operating and investment decisions and for assessing
performance. The Company’s reportable business segments consist of: (1) United States; (2) Canada and (3) Europe. As described
below, the activities of the Company’s Asian operations are closely linked to those of the U.S. operations; accordingly,
management reviews the financial results of both on a consolidated basis, and the results of the Asian operations have been aggregated
with the results of the United States operations to form one reportable segment called the “United States segment”
or “U.S. segment”. Each reportable segment derives its revenue from the sales of cutting devices, measuring instruments
and safety products for school, office, home, hardware and industrial use.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Domestic sales orders are filled
from the Company’s distribution center in North Carolina. The Company is responsible for the costs of shipping, insurance,
customs clearance, duties, storage and distribution related to such products.  Orders filled from the Company’s
inventory are generally for less than container-sized lots.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Direct import sales are products
sold by the Company’s Asian subsidiary, directly to major U.S. retailers, who take ownership of the products in Asia. These
sales are completed by delivering product to the customers’ common carriers at the shipping points in Asia. Direct import
sales are made in larger quantities than domestic sales, typically full containers. Direct import sales represented approximately
28% and 22% of the Company’s total net sales for the three and six months ended June 30, 2012 compared to 23% and 18% for
the comparable periods in 2011.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The chief operating decision
maker evaluates the performance of each operating segment based on segment revenues and operating income. Segment amounts are presented
after converting to U.S. dollars and consolidating eliminations.</p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Financial data by segment:</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">(in thousands)</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 9pt Times New Roman, Times, Serif; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 2px; font-size: 10pt"> </td>
<td style="padding-bottom: 2px; font-size: 10pt; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>Three months ended</b></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>June 30,</b></p></td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>Six months ended</b></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>June 30,</b></p></td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt">Sales to external customers:</td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="width: 38%; text-align: left; text-indent: 0pt; padding-left: 27pt">United States</td>
<td style="text-align: right; width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">22,563</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">18,527</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">35,160</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">29,086</td>
<td nowrap="nowrap" style="width: 1%; text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">Canada</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">3,310</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">3,324</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">4,967</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5,178</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Europe</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">1,721</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">2,178</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">4,345</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">4,166</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 4px; text-indent: 0pt; padding-left: 27pt">Consolidated</td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">27,594</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">24,029</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">44,472</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">38,430</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Operating income (loss):</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">United States</td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">2,587</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">1,862</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">2,753</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">1,983</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">Canada</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">521</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">599</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">571</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">749</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Europe</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(30</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(1</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">212</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(89</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Consolidated</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">3,078</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">2,460</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">3,536</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">2,643</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">Interest expense, net</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">62</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">74</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">117</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">121</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Other expense (income), net</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">43</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">3</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">86</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(22</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 4px; text-indent: 0pt; padding-left: 27pt">Consolidated income before taxes</td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">2,973</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">2,383</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">3,333</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">2,544</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px; font-size: 10pt"> </td></tr>
</table>
<p style="margin: 0pt"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 9pt Times New Roman, Times, Serif; font-size: 10pt">
<tr>
<td style="text-align: left; vertical-align: bottom; width: 64%; font-size: 10pt; text-indent: 0pt">Assets by segment:</td>
<td style="vertical-align: top; width: 1%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 1%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 14%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 2%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 2%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 1%; font-size: 10pt"> </td>
<td style="vertical-align: bottom; width: 14%; font-size: 10pt"> </td>
<td style="vertical-align: bottom; width: 1%; font-size: 10pt"> </td></tr>
<tr>
<td style="text-align: left; vertical-align: bottom; font-size: 10pt; text-indent: 0pt">( in thousands )</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: bottom; font-size: 10pt"> </td>
<td style="vertical-align: bottom; font-size: 10pt"> </td></tr>
<tr>
<td style="vertical-align: bottom; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">June 30,</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: bottom; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">December 31,</td>
<td style="vertical-align: bottom; font-size: 10pt; font-weight: bold"> </td></tr>
<tr>
<td style="vertical-align: bottom; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="vertical-align: bottom; border-bottom: black 2px solid; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td style="vertical-align: bottom; border-bottom: black 2px solid; font-size: 10pt; font-weight: bold"> </td></tr>
<tr style="background-color: #cceeff">
<td style="text-align: left; vertical-align: bottom; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">United States</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt">$</td>
<td style="text-align: right; vertical-align: top; font-size: 10pt; text-indent: 0pt">57,236</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> $</td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt; text-indent: 0pt"> 43,174</td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt"> </td></tr>
<tr style="background-color: white">
<td style="text-align: left; vertical-align: bottom; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">Canada</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: top; font-size: 10pt; text-indent: 0pt">       6,326</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt; text-indent: 0pt">           6,033</td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt"> </td></tr>
<tr style="background-color: #cceeff">
<td style="text-align: left; vertical-align: bottom; padding-bottom: 2px; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">Europe</td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: top; border-bottom: black 2px solid; font-size: 10pt; text-indent: 0pt">       5,592</td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: bottom; border-bottom: black 2px solid; font-size: 10pt; text-indent: 0pt">           6,015</td>
<td style="text-align: right; vertical-align: bottom; padding-bottom: 2px; font-size: 10pt"> </td></tr>
<tr style="background-color: white">
<td style="text-align: left; vertical-align: bottom; padding-bottom: 4px; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">Consolidated</td>
<td style="vertical-align: top; padding-bottom: 4px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 4px double; font-size: 10pt">$</td>
<td style="text-align: right; vertical-align: top; border-bottom: black 4px double; font-size: 10pt; text-indent: 0pt">69,154</td>
<td style="vertical-align: top; padding-bottom: 4px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 4px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 4px double; font-size: 10pt"> $</td>
<td style="text-align: right; vertical-align: bottom; border-bottom: black 4px double; font-size: 10pt; text-indent: 0pt"> 55,222</td>
<td style="text-align: right; vertical-align: bottom; border-bottom: black 4px double; font-size: 10pt"> </td></tr>
</table>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Financial data by segment:</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">(in thousands)</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 9pt Times New Roman, Times, Serif; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 2px; font-size: 10pt"> </td>
<td style="padding-bottom: 2px; font-size: 10pt; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>Three months ended</b></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>June 30,</b></p></td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 2px solid; text-align: center"><p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>Six months ended</b></p>
<p style="margin-top: 0; text-align: center; margin-bottom: 0"><b>June 30,</b></p></td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt">Sales to external customers:</td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td>
<td style="padding-bottom: 2px; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 2px solid; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px; font-weight: bold"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="width: 38%; text-align: left; text-indent: 0pt; padding-left: 27pt">United States</td>
<td style="text-align: right; width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">22,563</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">18,527</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">35,160</td>
<td nowrap="nowrap" style="width: 2%; text-align: left"> </td>
<td style="text-align: right; width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">29,086</td>
<td nowrap="nowrap" style="width: 1%; text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">Canada</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">3,310</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">3,324</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">4,967</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">5,178</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Europe</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">1,721</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">2,178</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">4,345</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">4,166</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 4px; text-indent: 0pt; padding-left: 27pt">Consolidated</td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">27,594</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">24,029</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">44,472</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">38,430</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt">Operating income (loss):</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">United States</td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">2,587</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">1,862</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">2,753</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">1,983</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">Canada</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">521</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">599</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">571</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">749</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Europe</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(30</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(1</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">212</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(89</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Consolidated</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">3,078</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">2,460</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">3,536</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left">$</td>
<td style="border-bottom: black 2px solid; text-align: right">2,643</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; text-indent: 0pt; padding-left: 27pt">Interest expense, net</td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">62</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">74</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">117</td>
<td nowrap="nowrap" style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">121</td>
<td nowrap="nowrap" style="text-align: left"> </td></tr>
<tr style="background-color: #cceeff; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 2px; text-indent: 0pt; padding-left: 27pt">Other expense (income), net</td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">43</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">3</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">86</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px"> </td>
<td style="text-align: right; padding-bottom: 2px"> </td>
<td style="border-bottom: black 2px solid; text-align: left"> </td>
<td style="border-bottom: black 2px solid; text-align: right">(22</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 2px">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-bottom: 4px; text-indent: 0pt; padding-left: 27pt">Consolidated income before taxes</td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">2,973</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">2,383</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">3,333</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px"> </td>
<td style="text-align: right; padding-bottom: 4px"> </td>
<td style="border-bottom: black 4px double; text-align: left">$</td>
<td style="border-bottom: black 4px double; text-align: right">2,544</td>
<td nowrap="nowrap" style="text-align: left; padding-bottom: 4px; font-size: 10pt"> </td></tr></table>
<p style="margin: 0pt"> </p>
.22
.18
.28
.23
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 6 – Stock Based
Compensation</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The Company recognizes share-based
compensation at the fair value of the equity instrument on the grant date. Compensation expense is recognized over the required
service period. Share-based compensation expense was $145,237 and $125,828 for the quarters ended June 30, 2012 and 2011, respectively.
Share-based compensation expense was $232,753 and $209,438 for the six months ended June 30, 2012 and 2011, respectively. During
the three months ended June 30, 2012, the Company issued 20,000 options with a weighted average fair value of $2.44 per share.
During the six months ended June 30, 2012 the Company issued 84,938 options with a weighted average fair value of $2.28.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">As of June 30, 2012, there was
a total of $645,000 of unrecognized compensation cost related to non-vested share –based payments granted to the Company’s
employees.  The remaining unamortized expense is expected to be recognized over a weighted average period of approximately
3 years.</p>
<p style="margin: 0pt"> </p>
232753
209438
145237
125828
84938
20000
2.28
2.44
645000
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 7 – Fair Value
Measurements</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The carrying value of the Company’s
bank debt and note receivable approximates fair value. Fair value was determined using a discounted cash flow analysis.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 8 – Business Combination</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">On June 7, 2012, the Company
purchased certain assets of The C-Thru Ruler Company, a leading supplier of drafting, measuring, lettering and stencil products.
The Company purchased inventory and intellectual property related to C-Thru’s lettering and ruler business for approximately
$1.47 million using funds borrowed under its revolving loan agreement with HSBC. The Company recorded approximately $0.42 million
for inventory, as well as approximately $1.05 million for intangible assets, consisting primarily of customer relationships.</p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">Unaudited net sales and net income for the three
and six months ended June 30, 2012 attributable to C-Thru were not material to the Company’s financial statements for those
periods.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left">Assuming C-Thru was acquired on January 1, 2012,
unaudited proforma combined net sales for the three and six months ended June 30, 2012 for the Company were approximately $28.2
million and $45.6 million, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left">Assuming C-Thru was acquired on January 1, 2011,
unaudited proforma combined net sales for the three and six months ended June 30, 2011, for the Company were approximately $24.7
million and $39.7 million, respectively.</p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">On February 28, 2011, the Company
purchased substantially all of the assets of The Pac-Kit Safety Equipment Company, a leading manufacturer of first aid kits for
the industrial, safety, transportation and marine markets. The Company purchased the accounts receivable, inventory, equipment
and intangible assets of Pac-Kit for approximately $3.4 million, less liabilities assumed of $310,000.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Assuming Pac-Kit was acquired
on January 1, 2011, unaudited proforma net sales and net income for the six months ended June 30, 2011 attributable to Pac-Kit
were approximately $3.2 million and $155,000, respectively.</p>
<p style="margin: 0"> </p>
<p style="margin: 0pt"> </p>
3400000
1470000
310000
155000
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 9pt Times New Roman, Times, Serif; font-size: 10pt">
<tr>
<td style="text-align: left; vertical-align: bottom; width: 64%; font-size: 10pt; text-indent: 0pt">Assets by segment:</td>
<td style="vertical-align: top; width: 1%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 1%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 14%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 2%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 2%; font-size: 10pt"> </td>
<td style="vertical-align: top; width: 1%; font-size: 10pt"> </td>
<td style="vertical-align: bottom; width: 14%; font-size: 10pt"> </td>
<td style="vertical-align: bottom; width: 1%; font-size: 10pt"> </td></tr>
<tr>
<td style="text-align: left; vertical-align: bottom; font-size: 10pt; text-indent: 0pt">( in thousands )</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: bottom; font-size: 10pt"> </td>
<td style="vertical-align: bottom; font-size: 10pt"> </td></tr>
<tr>
<td style="vertical-align: bottom; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">June 30,</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: bottom; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">December 31,</td>
<td style="vertical-align: bottom; font-size: 10pt; font-weight: bold"> </td></tr>
<tr>
<td style="vertical-align: bottom; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">2012</td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="vertical-align: bottom; border-bottom: black 2px solid; font-size: 10pt; font-weight: bold; text-align: center; text-indent: 0pt">2011</td>
<td style="vertical-align: bottom; border-bottom: black 2px solid; font-size: 10pt; font-weight: bold"> </td></tr>
<tr style="background-color: #cceeff">
<td style="text-align: left; vertical-align: bottom; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">United States</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt">$</td>
<td style="text-align: right; vertical-align: top; font-size: 10pt; text-indent: 0pt">57,236</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> $</td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt; text-indent: 0pt"> 43,174</td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt"> </td></tr>
<tr style="background-color: white">
<td style="text-align: left; vertical-align: bottom; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">Canada</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: top; font-size: 10pt; text-indent: 0pt">       6,326</td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="vertical-align: top; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt; text-indent: 0pt">           6,033</td>
<td style="text-align: right; vertical-align: bottom; font-size: 10pt"> </td></tr>
<tr style="background-color: #cceeff">
<td style="text-align: left; vertical-align: bottom; padding-bottom: 2px; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">Europe</td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: top; border-bottom: black 2px solid; font-size: 10pt; text-indent: 0pt">       5,592</td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 2px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 2px solid; font-size: 10pt"> </td>
<td style="text-align: right; vertical-align: bottom; border-bottom: black 2px solid; font-size: 10pt; text-indent: 0pt">           6,015</td>
<td style="text-align: right; vertical-align: bottom; padding-bottom: 2px; font-size: 10pt"> </td></tr>
<tr style="background-color: white">
<td style="text-align: left; vertical-align: bottom; padding-bottom: 4px; padding-left: 27pt; font-size: 10pt; text-indent: 0pt">Consolidated</td>
<td style="vertical-align: top; padding-bottom: 4px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 4px double; font-size: 10pt">$</td>
<td style="text-align: right; vertical-align: top; border-bottom: black 4px double; font-size: 10pt; text-indent: 0pt">69,154</td>
<td style="vertical-align: top; padding-bottom: 4px; font-size: 10pt"> </td>
<td style="vertical-align: top; padding-bottom: 4px; font-size: 10pt"> </td>
<td style="vertical-align: top; border-bottom: black 4px double; font-size: 10pt"> $</td>
<td style="text-align: right; vertical-align: bottom; border-bottom: black 4px double; font-size: 10pt; text-indent: 0pt"> 55,222</td>
<td style="text-align: right; vertical-align: bottom; border-bottom: black 4px double; font-size: 10pt"> </td></tr></table>
<p style="margin: 0pt"> </p>
45600000
39700000
28200000
24700000
3200000
Under the revolving loan agreement, the Company is required to maintain specific amounts of tangible net worth, a specified debt service coverage ratio, and a fixed charge coverage ratio. These financial covenants in the new loan agreement are similar to the covenants in the prior agreement with Wells Fargo. At June 30, 2012 the Company was in compliance with these covenants under the new agreement with HSBC Bank.
3
420000
1050000
<p style="margin: 0pt"></p>
<p style="text-align: left; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif"><b>Note 1 — Basis of Presentation</b></p>
<p style="margin: 0pt"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">In the opinion of management,
the accompanying condensed consolidated financial statements include all adjustments necessary to present fairly the financial
position, results of operations and cash flows of Acme United Corporation (the “Company”).  These adjustments
are of a normal, recurring nature.  However, the financial statements do not include all of the disclosures normally
required by accounting principles generally accepted in the United States of America or those normally made in the Company's Annual
Report on Form 10-K. Please refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2011 for such disclosures.  The
condensed consolidated balance sheet as of December 31, 2011 was derived from the audited consolidated balance sheet as of that
date.  The results of operations for interim periods are not necessarily indicative of the results to be expected for
the full year.  The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the
Management’s Discussion and Analysis of Financial Condition and Results of Operations and financial statements and notes
thereto, included in the Company’s 2011 Annual Report on Form 10-K.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">The Company has evaluated
events and transactions subsequent to June 30, 2012 and through the date these consolidated financial statements were included
in this Form 10-Q and filed with the SEC.</p>
<p style="margin: 0pt"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">Recent accounting pronouncements</p>
<p style="margin: 0pt"> </p>
<p style="text-align: justify; text-indent: 0pt; margin: 0; font: 10pt Times New Roman, Times, Serif">In June 2011, the FASB issued
a new accounting standard on the presentation of comprehensive income. The new standard requires the presentation of comprehensive
income, the components of net income and the components of other comprehensive income either in a single continuous statement of
comprehensive income or in two separate but consecutive statements. The standard was effective for our quarter ended March 31,
2012. The adoption of this standard was limited to a change in the presentation of our results, which we have elected to include
as a separate Condensed Consolidated Statement of Comprehensive Income.</p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"> </p>
0.0175
30000000
Interest rate of LIBOR plus 1.75%, which is 0.25% lower than the interest rate under the former loan agreement
2017-04-05
3127000
1474000