Note 4 - Real Estate

12 Months Ended

Sep. 30, 2012

Real Estate Disclosure [Text Block]

4. Real Estate

At the time of the Merger, RGHS, through a wholly-owned subsidiary, owned three real estate properties held for investment and valued at $2,245,000. The three properties were recorded at management’s estimated fair value.  The properties were held as an investment and evaluated for impairment at each reporting date. In June 2010 management determined that the guidance of ASC 820-10-35-51A-D, Determining Fair Value When The Volume And Level Of Activity For The Asset Or Liability Have Significantly Decreased was applicable and reduced the carrying value of the real estate to $850,000 net of an allowance of $50,000 for the costs to sell in accordance with a reclassification to held for sale.  In October 2010 management entered into an agreement, with an entity controlled by a former director, to sell the real estate on an installment basis at a price of $900,000 (all paid by January 2011) and issued warrants to purchase up to 150,000 shares of the common stock at $2.50 per share for a term of five years (the “Warrants”) as an inducement. Management recorded in September 2010 an impairment charge to further reduce the carrying value of the real estate to $696,625, which reduced the costs to sell to $25,000 and included $178,375 for the value of the warrants.