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15. CAPITAL LEASE OBLIGATIONS
9 Months Ended
Sep. 30, 2012
Capital Lease Obligations [Abstract]  
Note 15. CAPITAL LEASE OBLIGATIONS

 

The Company has several capital lease obligations, one of which is a $1,000,000 equipment lease facility entered into with an equipment leasing company in October 2009. The terms of this agreement allow for use of the facility for 24 months and for use of the facility in multiple tranches with each individual tranche having a 24 month term. As of September 30, 2012, the Company had utilized $743,000 of this facility, which has been accounted for as a capital lease. As of September 30, 2012, $104,000 remained outstanding for those tranches that have not yet expired under this facility. Pursuant to the terms of the agreements related to this facility, the Company has given the equipment leasing company notice of its intent to terminate each individual lease that was reaching the 24 month term as well as its intent to purchase the equipment under the expiring lease at fair market value. The Company and the leasing company were in dispute over the terms of the lease agreements and the fair market value of the equipment, and as a result, the leasing company notified the Company that it was in default of the leasing agreements and filed suit against the Company in Minnesota federal court. The parties resolved the dispute in September 2012, and the negotiated cost to purchase the equipment under the expired leases is reflected in the Company’s accompanying consolidated financial statements. The negotiated cost to purchase such equipment was not materially different from the estimated cost previously recorded.