Note 4 - Investment in Affiliate

9 Months Ended

Sep. 30, 2021

Notes to Financial Statements

Equity Method Investments and Joint Ventures Disclosure [Text Block]

4.     Investment in Affiliate

HC Realty’s 10.00% Series B Cumulative Convertible Preferred Stock (the “Series B Stock”) is not deemed to be in-substance common stock and is accounted for using the measurement alternative for equity investments with no readily determinable fair value. The Series B Stock will be reported at cost, adjusted for impairments or any observable price changes in ordinary transactions with identical or similar investments issued by HC Realty.

The following table summarizes the Company’s investment in HC Realty as of September 30, 2021 and December 31, 2020 (in thousands):

	Ownership %						Investment in Affiliate Balance				Loss recorded in the Statements of Operations (b)
											For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	September 30, 2021			December 31, 2020			September 30, 2021		December 31, 2020		2021			2020			2021			2020
HC Realty Series B Stock (a)		26.9	%		28.7	%	$	10,250	$	10,250	$	-			-		$	-			-
HC Realty common stock		7.2	%		7.7	%		1,423		1,822		(50	)		(124	)		(275	)		(301	)
Total		34.1	%		36.4	%	$	11,673	$	12,072	$	(50	)	$	(124	)	$	(275	)	$	(301	)

(a) Represents investments in shares of HC Realty preferred stock with a basis of $10.25 million. Each share of preferred stock can be converted into one share of HC Realty common stock at a conversion price equal to the lesser of $9.10 per share or the fair market value per share of HC Realty common stock, subject to adjustment upon the occurrence of certain events.

(b) Loss from these investments is included in “Loss from affiliate” in the consolidated statement of operations. Since HC Realty is a Real Estate Investment Trust and not a taxable entity, the loss is not reported net of taxes.

The Company’s investment in HC Realty common stock is accounted for under the equity method of accounting.