CONTROLLING AND NONCONTROLLING INTERESTS

12 Months Ended

Jun. 30, 2023

Noncontrolling Interest [Abstract]

CONTROLLING AND NONCONTROLLING INTERESTS

NOTE 9 – CONTROLLING AND NONCONTROLLING INTERESTS

On February 13, 2013, the Company entered into an agreement with outside investors to acquire a 50.5% controlling interest in a newly formed limited liability company, Health Diagnostics Management LLC (HDM). According to the February 13, 2013, LLC operating agreement of HDM there are two classes of members; Class A members and one Class B member. The Class A members have an ownership interest of 49.5% of HDM. The Class B member (HMCA) has an ownership of 50.5% of HDM. On all matters on which members may vote every member is entitled to cast the percentage of votes equal to their percentage of ownership interest. Profits and losses on all items of income, gain or loss, deductions or other allocations of the Company will be allocated among the members in the same proportions as their membership interests in the Company bear to all the Class A and Class B membership interests of the Company in the aggregate outstanding. All of the depreciation and amortization of the assets of the Company will be allocated solely to the Class A members, unless and until their interests have been redeemed by the Company in full pursuant to the provisions of the operating agreement. The Company contributed $20,200,000 to HDM and the group of outside investors contributed $19,800,000 for its non-controlling membership interest.

On March 5, 2013, HDM purchased from Health Diagnostics, LLC (“HD”) and certain of its subsidiaries, a business managing twelve (12) Stand-Up MRI Centers and two (2) other scanning centers located in the States of New York and Florida for a total purchase price (including consideration of $1.5 million to outside investors) aggregating $35.9 million. Concurrently with the acquisition, HDM entered into several consulting and non-competition agreements for a consideration of $4.1 million. The acquisition was accounted for using the purchase method in accordance with ASC 805, “Business Combinations”. The Company recognized and measured goodwill as of the acquisition date, as the excess of the fair value of the consideration paid over the fair value of the identified net assets acquired.

 On January 8, 2015, the Company purchased 20% of the Class A members ownership interest at a cost of $4,971,094. The Company has a 60.4% ownership interest in HDM after this transaction. During the year ended June 30, 2022, the Company purchased noncontrolling interests for $546,000 giving the Company a direct ownership interest of 70.8% and the investors’ a 29.2% ownership interest.

The amount of each class of HDM members’ equity as of June 30, 2023 and 2022 is as follows:

Class A and B Members' Equity
	June 30, 2023						June 30, 2022
		Class A Members			Class B Member			Class A Members			Class B Member
Opening Members' Equity	($	4,053,833	)	$	50,292,073		($	3,048,524	)	$	41,923,380
Share of Net Income	$	2,750,740		$	18,513,540		$	4,793,482		$	22,228,693
Buyout of noncontrolling interests		—			—		$	23,441			—
Distributions	($	5,776,200	)	$	(14,023,800	)	($	5,822,232	)	($	13,860,000	)
Ending Members' Equity	($	7,079,293	)	$	54,781,813		($	4,053,833	)	$	50,292,073