Investments in Unconsolidated Entities

The Company has made investments in entities which are accounted for under either the cost or equity method of accounting. These investments are classified as investments in unconsolidated entities in the consolidated balance sheets and consist of the following (in thousands, unless otherwise indicated):



	Ownership
	Percentage at	June 30,		December 31,
	June 30, 2014	2014		2013
Oriental DreamWorks Holding Limited	45.45%	$	16,645	$	16,389
All Other	17.5%-50.0%	3,642		3,140
Total equity method investments		20,287		19,529

Total cost method investments		29,013		19,013
Total investments in unconsolidated entities		$	49,300	$	38,542

Under the equity method of accounting, the carrying value of an investment is adjusted for the Company's proportionate share of the investees' earnings and losses (adjusted for the amortization of any differences in the Company's basis, with respect to the Company's investment in ODW, compared to the Company's share of venture-level equity), as well as contributions to and distributions from the investee. The Company classifies its share of income or loss from investments accounted for under the equity method as income/loss from equity method investees in its consolidated statements of operations.

(Loss) income from equity method investees consist of the following (in thousands):



	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2014			2013			2014			2013
Oriental DreamWorks Holding Limited⁽¹⁾	$	(2,394	)	$	(957	)	$	(4,604	)	$	(957	)
All Other	(1,073		)	(372		)	(2,123		)	(372		)
(Loss) income from equity method investees	$	(3,467	)	$	(1,329	)	$	(6,727	)	$	(1,329	)

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⁽¹⁾	The Company currently records its share of ODW results on a one-month lag. Accordingly, the Company's consolidated financial statements include its share of losses incurred by ODW from December 1, 2013 to May 31, 2014.

Oriental DreamWorks Holding Limited

On April 3, 2013 ("ODW Closing Date"), the Company formed a Chinese Joint Venture, ODW (or the "Chinese Joint Venture"), through the execution of a Transaction and Contribution Agreement, as amended, with its Chinese partners, China Media Capital (Shanghai) Center L.P. ("CMC"), Shanghai Media Group ("SMG") and Shanghai Alliance Investment Co., Ltd. ("SAIL", and together with CMC and SMG, the "CPE Holders"). In exchange for 45.45% of the equity of ODW, the Company has committed to making a total cash capital contribution to ODW of $50.0 million (of which $6.6 million had been funded as of June 30, 2014, with the balance to be funded over time) and non-cash contributions valued at approximately $100.0 million (of which approximately $28.7 million had been satisfied as of June 30, 2014). Such non-cash contributions include licenses of technology and certain other intellectual property of the Company, rights in certain trademarks of the Company, two in-development feature film projects developed by the Company and consulting and training services. During the three and six months ended June 30, 2013, the Company's consolidated statements of operations included $7.8 million of revenues recognized in connection with non-cash contributions made to ODW. The Company's consolidated statements of operations included other operating income recognized in connection with non-cash contributions made to ODW of $2.3 million and $2.9 million during the three months ended June 30, 2014 and 2013, respectively, and $4.0 million and $2.9 million during the six months ended June 30, 2014 and 2013, respectively.

As of June 30, 2014, the Company's remaining contributions consisted of the following: (i) $43.4 million in cash (which is expected to be funded over the next three years), (ii) two of the Company's in-development film projects, (iii) remaining delivery requirements under the licenses of technology and certain other intellectual property of the Company and (iv) approximately $7.0 million in consulting and training services. Some of these remaining contribution commitments will require future cash outflows for which the Company is not currently able to estimate the timing of contributions as this will depend on, among other things, ODW's operations.

Basis Differences. The Company's investment in ODW does not equal the venture-level equity (the amount recorded on the balance sheet of ODW) due to various basis differences. Basis differences related to definite-lived assets are being amortized based on the useful lives of the related assets. Basis differences related to indefinite-lived assets are not being amortized. The following are the differences between the Company's venture-level equity and the balance of its investment in ODW (in thousands):



	June 30, 2014
Company's venture-level equity	$	40,997
Technology and intellectual property licenses⁽¹⁾	(17,042		)
Other⁽²⁾	(7,310		)
Total ODW investment recorded	$	16,645

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⁽¹⁾	Represents differences between the Company's historical cost basis and the equity basis reflected at the venture-level (the amount recorded on the balance sheet of ODW) related to the Company's contributions of technology and intellectual property licenses. These basis differences arise because the contributed assets are recorded at fair value by ODW.


⁽²⁾	Represents the Company's net contribution commitment due to ODW.

Other Transactions with ODW. The Company has various other transactions with ODW, a related party. The Company has entered into a distribution agreement with ODW for the distribution of the Company's feature films in China (beginning with The Croods). In addition, from time to time, the Company may provide consulting and training services to ODW, the charges of which are based on the Company's actual cost of providing such services. The Company's consolidated statements of operations included revenues earned through ODW's distribution of its feature films of $1.3 million and $2.0 million during the three- and six-month periods ended June 30, 2014, respectively, and $13.0 million during each of the three- and six-month periods ended June 30, 2013. As of June 30, 2014 and December 31, 2013, the Company's consolidated balance sheets included receivables from ODW of $7.1 million and $3.8 million, respectively, which were classified as a component of trade accounts receivable, and $3.6 million and $16.7 million, respectively, which were classified as a component of receivables from distributors.