Sale of Kansas City Gamma Knife Center and Focus on Continuing Businesses

6 Months Ended

Jun. 30, 2012

Sale of Kansas City Gamma Knife Center and Focus on Continuing Businesses [Abstract]

Sale of Kansas City Gamma Knife Center and Focus on Continuing Businesses

Note B - Sale of Kansas City Gamma Knife Center and Focus on Continuing Businesses

In April 2011, the Company finalized certain transactions and agreements with Midwest Division - RMC, LLC ("RMC"), which owns the property and operates the medical facilities in Kansas City at which the Company's Gamma Knife center is located.

Sale of Gamma Knife Equipment at Kansas City Center

The Company sold to RMC the Leksell Gamma Knife radiosurgery equipment, along with related supplies and inventory, located at the Kansas City Center for an aggregate purchase price of $250,000.  RMC has also indicated its intention to employ the physicist who, up to the time of the sale, operated the Gamma Knife equipment on the Company's behalf.  The Company will, upon request of RMC and at RMC's cost and expense, assist RMC in replenishing the Gamma Knife equipment's radioactive cobalt 60 as is necessary for the proper operation of the Gamma Knife.

Termination of Arrangements with RMC and Settlement of Outstanding Claims

In connection with the sale of the Gamma Knife equipment described above, the Company and RMC entered into an agreement terminating the Gamma Knife Neuroradiosurgery Equipment Agreement and the Ground Lease Agreement, each originally entered into between the parties in 1993, and concluded all arrangements between the parties relating to the operation of the Gamma Knife center and the lease of the premises.  Immediately preceding the termination of these agreements, the Company and RMC satisfied all outstanding obligations between the parties, resulting in a net payment of $385,355 to the Company.  In connection with the agreement, the parties also entered into a mutual release respecting all other outstanding claims and disputes between them relating to the Kansas City center.

The Company agreed with RMC that through September 2015, it will not participate in Gamma Knife operations in the states of Missouri, Kansas, Nebraska, Iowa and Arkansas.

Effect of Discontinued Kansas City Operations

The amounts of revenue and pretax or loss reported in discontinued operations for the six months ended June 30, 2011 are as follow:

Revenue from operations	$	184,000
Pretax loss		(61,000)

Included in the pretax loss for the six months ended June 30, 2011 is an impairment recorded on the Gamma Knife for the Kansas City Center totaling $161,000.  This impairment loss is being offset by $72,000 received by the Company attributed to revenues from prior years which had been disputed by RMC, and, as such, never recorded by the Company due to the uncertainty of collection.

Continuing Businesses and Business Strategy

The Company will continue to own and operate the Gamma Knife center at NYU Hospital and participate in the newer Gamma Knife and radiosurgery centers in California and Florida.

USN is currently exploring other opportunities for Gamma Knife centers and centers that provide related healthcare services located near hospitals throughout the United States.  Discussions regarding such centers are preliminary and there can be no assurance that any such discussions will result in the opening of new centers.

As a result of the Company's experiences over the past few years, The Company has expanded its focus to the broader based cancer treatment market.  In order to reduce the risk and broaden its opportunities for profitable growth, the Company, where possible, has been pursuing partnerships with local investors/providers to develop and operate oncology centers that utilize linear accelerators (LINACs) to treat cancers in the whole body.  The Company also continues to evaluate opportunities to develop additional Gamma Knife facilities.  Florida Oncology Partners and the Southern California Regional Gamma Knife Center typify this new strategy.