Quarterly report pursuant to Section 13 or 15(d)

Sale of TMR Business to Novadaq/Discontinued Operations

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Sale of TMR Business to Novadaq/Discontinued Operations
3 Months Ended
Mar. 31, 2012
Sale of TMR Business to Novadaq/Discontinued Operations  
Sale of TMR Business to Novadaq/Discontinued Operations

10.                               Sale of TMR Business to Novadaq/Discontinued Operations

 

On November 5, 2010, the Company entered into an agreement to sell its TMR business to Novadaq. This transaction was approved by the Company’s shareholders at a special meeting on January 31, 2011 and the transaction closed on February 1, 2011.

 

Under terms of the agreement, Novadaq acquired substantially all of the Company’s assets that were used in the TMR business including all manufacturing rights, substantially all product inventories, and all equipment, intellectual property, regulatory approvals, clinical data and documentation related to TMR, for a purchase price of $1 million in cash and the assumption of all the Company’s obligations under service contracts as of the closing date totaling $614,000.  The total carrying value of the assets sold as of the transaction date was $385,000.  In addition, the Company incurred transaction costs of $50,000.  The Company has recorded a gain on sale of discontinued operations before income taxes of $1,179,000 in the statement of operations.

 

The operating results of these operations, including those related to the prior periods, have been reclassified from continuing operations to discontinued operations in the accompanying condensed consolidated financial statements.

 

Revenues and net income attributable to discontinued operations for the three months ended March 31, 2011 are as follows:

 

 

 

Three months ended
March 31,
(In thousands)

 

 

 

2012

 

2011

 

Revenues:

 

 

 

 

 

Product sales

 

 

455

 

Service fees

 

 

68

 

Total

 

 

523

 

Income from discontinued operations

 

$

 

$

53