Discontinued Operations of Adeona Clinical Laboratory

12 Months Ended

Dec. 31, 2011

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

3. Discontinued Operations of Adeona Clinical Laboratory

On March 8, 2012, the Company sold all of its interest in Adeona Clinical Laboratory, LLC (the “Lab”) to Hartlab, LLC, an entity controlled by the Lab’s former owner. In connection with the sale of the Lab, the consideration received was (i) the immediate assignment of the Lab’s outstanding accounts receivable up through the date of closing, plus (ii) $700,000 payable pursuant to the terms of a two-year non-recourse promissory note secured by all of the assets of the Lab.

In accordance with ASC Topic 205-20 “Presentation of Financial Statements—Discontinued Operations” (ASC 205-20), the Company determined that the sale of the Lab should be classified as “held for sale” at December 31, 2011. In accordance with ACS 205-20 all of the following criteria must be met for an entity to be classified as “held for sale”:

· Management, having the authority to approve the action, commits to a plan to sell the asset.

· The asset is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets.

· An active program to locate a buyer and other actions required to complete the plan to sell the asset have been initiated.

· The sale of the asset is probable, and transfer of the asset is expected to qualify for recognition as a complete sale within one year.

· The asset is being actively marketed for sale at a price that is reasonable in relation to its current fair value.

The Company determined that all the criteria had been met and has classified the Lab as discontinued operations and its results of operations, financial position and cash flows are separately reported for all periods presented. The assets and liabilities of the discontinued operations are presented separately under the captions “Assets of discontinued operations” and “Liabilities of discontinued operations,” respectively, in the accompanying Consolidated Balance Sheets at December 31, 2011, and December 31, 2010, and consist of the following (in thousands):

	December 31,
	2011		2010
Assets of discontinued operations:
Property and equipment, net	$	23	$	36
Goodwill		-		178
Total assets	$	23	$	214
Liabilities of discontinued operations:
Current portion of capital lease	$	-	$	24
Total liabilities	$	-	$	24

The summarized statement of operations data for Adeona Clinical Laboratory for the years ended December 31, 2011 and December 31, 2010 are as follows (in thousands):

	December 31,
	2011			2010
Laboratory fees, net	$	1,169		$	551
Operating Costs and Expenses:
General and administrative		539			599
Cost of  laboratory services		975			468
Impairment loss on goodwill		178			-
Total operating costs and expenses		1,692			1,067
Loss from discontinued operations	$	(523	)	$	(516	)