NOTE 5 - GOODWILL AND OTHER INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2011

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE 5 – GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill at December 31, 2011 totaled $159.5 million. Goodwill is recorded as a result of business combinations. Activity in goodwill for the years ended December 31, 2009, 2010 and 2011, is provided below (in thousands):

Balance as of December 31, 2008	$	105,278
Goodwill acquired through the acquisition of Elite Diagnostic Imaging, LLC		100
Goodwill acquired through the acquisition of Ridgewood Diagnostics and Unity Hospital		1,105
Goodwill acquired through the acquisition of Chesapeake Urology Associates		19
Balance as of December 31, 2009		106,502
Goodwill acquired through the acquisition of Union Imaging		3,748
Goodwill acquired through the acquisition of Anaheim Open MRI		305
Goodwill acquired through the acquisition of Truxtun Medical Group		10,652
Goodwill acquired through the acquisition of Sonix Medical Resources		884
Goodwill acquired through the acquisition of Health Diagnostics		977
Goodwill acquired through the acquisition of Image Medical Corporation		7,327
Goodwill acquired through the acquisition of Progressive Health		12,856
Goodwill acquired through the acquisition of two imaging centers from Presgar Imaging		102
Balance as of December 31, 2010		143,353
Goodwill acquired through the acquisition of Imaging On Call, LLC		3,799
Goodwill acquired through the acquisition of the imaging practice of Stuart London, MD		600
Goodwill acquired through the acquisition of certain imaging centers from Diagnostic Health Corp.		2,009
Goodwill acquired through the acquisition of Hematology-Oncology		1,016
Adjustments to our preliminary allocation of the purchase price of Image Medical Corp.		2,443
Adjustments to our preliminary allocation of the purchase price of Progressive Health		1,369
Adjustments to our preliminary allocation of the purchase price of Presgar Imaging		155
Goodwill acquired through the acquisition of our controlling interest in Radar, LLC		845
Goodwill acquired through the acquisition of Raven Holdings U.S., Inc.		3,918
Balance as of December 31, 2011	$	159,507

The amount of goodwill from these acquisitions that is deductible for tax purposes is $ 89.8 million.

Other intangible assets are primarily related to the value of management service agreements obtained through our acquisition of Radiologix, Inc. in 2006 and are recorded at a cost of $57.9 million less accumulated amortization of $11.9 million at December 31, 2011. Also included in other intangible assets is the value of covenant not to compete contracts associated with our recent facility acquisitions (see Note 3 above) totaling $4.3 million less accumulated amortization of $3.2 million, as well as the value of trade names associated with acquired imaging facilities totaling $5.7 million less accumulated amortization of $1.2 million. Also in connection with our recent purchase of eRAD (see Note 4 above) and included in other intangible assets is the value of eRAD’s developed technology and its customer relationships. Amortization expense for the year ended December 31, 2011, 2010 and 2009 was $3.5 million, $3.5 million and $3.2 million, respectively. Intangible assets are amortized using the straight-line method. Management service agreements are amortized over 25 years using the straight line method. Developed technology and customer relationships are amortized over 5 years using the straight line method.

The following table shows annual amortization expense, by asset classes that will be recorded over the next five years (in thousands):

	2012		2013		2014		2015		2016		Thereafter		Total

Management Service Contracts	$	2,315	$	2,315	$	2,315	$	2,315	$	2,315	$	34,440	$	46,015
Covenant not to compete contracts		629		244		173		61		-		-		1,107
Customer relationships		197		197		197		182		-		-		773
Developed technology and in-process R&D		189		189		189		149		24		-		740
Trade Names		150		112		-		-		-		-		262
Total Annual Amortization	$	3,480	$	3,057	$	2,874	$	2,707	$	2,339	$	34,440	$	48,897

This table excludes approximately $4.2 million of Trade Names that we have determined to have an indefinite life.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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