Quarterly report pursuant to Section 13 or 15(d)

Discontinued Operations

v2.4.1.9
Discontinued Operations
 3 Months Ended
Mar. 31, 2015
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations [Text Block]
DISCONTINUED OPERATIONS
On December 31, 2014 the Company classified Group DCA as held-for-sale and wrote the assets of the business down to their fair values as the assets have become impaired. On February 27, 2015, the Company entered into an agreement (the Haymarket Agreement) to sell certain assets and liabilities of Group DCA to Haymarket Media, Inc. (Haymarket) in exchange for future services and potential future royalty payments.

The assets transferred under the Haymarket Agreement are customer facing contracts and agreements, and the related supporting records. The liabilities transferred are obligations to complete services under the aforementioned contracts and agreements. In exchange, the Company will receive: 

1. services performed by Haymarket, valued at approximately $0.8 million; and
2. a 15% royalty on contracts signed over the period from March 1, 2015 through February 28, 2018 relating to the clients, contracts and opportunities transferred to Haymarket under the agreement, valued at $0.1 million.

As of December 31, 2014, the Company incurred a non-cash charge of approximately $1.9 million. This non-cash charge included the write-down of goodwill and the accounts receivable of Group DCA, which is partially offset by the value of services performed by Haymarket and the fair value of future royalties, and included the write-off of assets of $0.7 million. During the quarter ended March 31, 2015, the Company closed the transaction with Haymarket, reviewed its previous assumptions and recorded a non-cash adjustment of $0.3 million. The operations and related exit costs of Group DCA are shown as discontinued operations in all periods presented.

On December 29, 2011 the Company entered into an agreement to sell certain assets of our Pharmakon business unit to Informed Medical Communications, Inc. (“Informed”) in exchange for potential future royalty payments and an ownership interest in Informed. In the fourth quarter of 2012, the Company wrote-off all of the assets related to the sale of Pharmakon to Informed as it believes that these assets have become impaired. On July 19, 2010, the Board approved closing the TVG business unit. The Company notified employees and issued a press release announcing this decision on July 20, 2010. The Consolidated Statements of Comprehensive Loss reflect the presentation of Group DCA, Pharmakon, and TVG as discontinued operations in all periods presented.

The table below presents the significant components of Group DCA's, Pharmakon's and TVG’s results included in Loss from Discontinued Operations, Net of Tax in the consolidated statements of comprehensive loss for the quarters ended March 31, 2015 and 2014.

 
Three Months Ended
 
March 31,
 
2015

2014
Revenue, net
$
260

 
$
988

Loss from discontinued operations, before income tax
(124
)
 
(1,114
)
Provision for income tax
1

 
1

Loss from discontinued operations, net of tax
$
(125
)
 
$
(1,115
)

The major classes of assets and liabilities included in the Condensed Consolidated Balance Sheets for Group DCA, TVG, and Pharmakon as of March 31, 2015 and December 31, 2014 are as follows:
 
March 31,
2015
 
December 31,
2014
Current assets
$
1,495

 
$
613

Non-current assets
418

 
1,445

Total assets
$
1,913

 
$
2,058

Current liabilities
$
1,856

 
$
2,820

Non-current liabilities
250

 
329

Total liabilities
$
2,106

 
$
3,149