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Related Party Transactions
3 Months Ended
Mar. 31, 2014
Related Party Transactions [Abstract]  
Related Party Transactions

14. RELATED PARTY TRANSACTIONS

 

Commercial Contracts

 

Three subsidiaries of the Company have executed separate financing agreements for equipment with AXIS Capital Inc. Gordon F. Glade, President and Chief Executive Officer of AXIS Capital, is a member of the Company’s Board of Directors. In March 2014, a subsidiary of the Company entered into $1.4 million of new equipment financing agreements with AXIS Capital with monthly payments beginning in April 2014. Totals of $1.4 million and $0.1 million were included in debt at March 31, 2014 and December 31, 2013, respectively, under these financing arrangements. Payments, including principal and interest, totaled $37 thousand for each of the three month periods ended March 31, 2014 and 2013. The weighted average interest rate for all financing agreements with AXIS Capital was 6.8%.

 

The Company has entered into ethanol purchase and sale agreements with Center Oil Company. Gary R. Parker was President and Chief Executive Officer of Center Oil and a member of the Company’s Board of Directors until his death on February 8, 2014. During the period from January 1, 2014 to February 8, 2014, there were no cash receipts from Center Oil and cash payments to Center Oil totaled $0.9 million on these contracts. During the three months ended March 31, 2013, cash receipts from Center Oil totaled $0.6 million and cash payments to Center Oil totaled $1.0 million on these contracts. The Company had no outstanding receivables from or payables to Center Oil at March 31, 2014 and December 31, 2013.

 

 

Aircraft Lease

 

For the three months ended March 31, 2014, the Company had entered into an agreement with an entity controlled by Wayne B. Hoovestol, for the lease of an aircraft.  Wayne B. Hoovestol is Chairman of the Company’s Board of Directors.  The Company agreed to pay $6,667 per month for use of up to 100 hours per year of the aircraft.  Any flight time in excess of 100 hours per year incurred additional hourly-based charges.  During the three months ended March 31, 2014 and 2013, payments related to the lease totaled $30 thousand and $35 thousand, respectively. The Company had approximately $1,800 in outstanding payables related to this agreement at March 31, 2014 and did not have any such outstanding payables at December 31, 2013. Effective April 1, 2014, the Company has entered into two agreements with entities controlled by Wayne B. Hoovestol, for the lease of two aircrafts.  In total, the Company has agreed to pay $15,834 per month for combined use of up to 125 hours per year of the aircrafts. Any flight time in excess of 125 hours per year will incur additional hourly-based charges.