Note 6 – Equity Investments in Affiliates

The Company invests in non-majority interests in its Affiliates. The Company’s equity investments and respective ownership interest as of December 31, 2014 and 2013 are as follows:

		Ownership %
Affiliate	Location	2014			2013
Surgical Hospitals:
Grayson County Physicians Property, LLC	Sherman, TX		20	%		20	%
Houston Orthopedic Hospital, LLC	Houston, TX		20	%		20	%
ASCs:
Foundation Surgery Affiliate of Nacogdoches, LLP	Nacogdoches, TX		13	%		13	%
Kirby Glenn Surgery Center	Houston, TX		10	%		10	%
Park Ten Surgery Center	Houston, TX		10	%		10	%
Foundation Surgery Affiliate of Middleburg Heights, LLC	Middleburg Heights, OH		10	%		10	%
Foundation Surgery Affiliate of Huntingdon Valley, LP	Huntingdon Valley, PA		20	%		20	%
New Jersey Surgery Center, LLC	Mercerville, NJ		10	%		10	%
Foundation Surgery Affiliate of Northwest Oklahoma City, LLC	Oklahoma City, OK		20	%		20	%
Metropolitan Medial Partners, LLC ("Chevy Chase")	Chevy Chase, MD		0	%		18	%
Cumberland Valley Surgery Center, LLC	Hagerstown, MD		32	%		32	%
Frederick Surgical Center, LLC	Frederick, MD		20	%		20	%

The results of operations and financial position for the years ended and as of December 31, 2014 and 2013, respectively, of the Company’s equity investments in Affiliates are as follows:

	2014		2013
Net operating revenues	$	93,657,544	$	186,777,871
Net income	$	22,016,318	$	40,559,684
Current assets	$	20,145,429	$	44,091,846
Noncurrent assets		40,297,744		44,668,968
Total assets	$	60,443,173	$	88,760,814
Current liabilities	$	13,343,319	$	31,891,679
Noncurrent liabilities		21,489,753		29,015,316
Total liabilities	$	34,833,073	$	60,906,995
Members' equity	$	25,610,100	$	27,853,819

The Master Agreement covering the Company’s ownership in Chevy Chase included a redemption feature that allowed the majority owner of Chevy Chase to purchase the Company’s 18% interest in Chevy Chase for $178,000. In January 2014, the Company received notice from the majority owner that they intend to exercise their right to purchase the Company’s interest in October 2014 which is the term date of the Company’s management agreement. Based on these facts, management concluded that the Company no longer has significant influence over Chevy Chase and, effective December 31, 2013, began accounting for Chevy Chase using the cost method of accounting versus the equity method previously used. In addition, the Company performed an impairment analysis of the investment in Chevy Chase and determined that the projected cash distributions in 2014 from Chevy Chase would approximate the Company’s share in the earnings of Chevy Chase. As a result, the Company recorded an impairment charge of $1.6 million to write-down the recorded investment down to $178,000. The distributions that the Company received in 2014 were recorded as other revenue. In October of 2014, the majority owner did exercise the right to purchase the Company’s interest for $178,000. The amount received equaled our book value of the investment and did not result in a gain or loss on the transaction.