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Subsequent Events
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9 Months Ended |
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Sep. 30, 2013
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| Subsequent Events [Abstract] | |
| SUBSEQUENT EVENTS |
SUBSEQUENT EVENTS
The Company performed an evaluation of subsequent events through the date of the issuance of these financial statements and determined that no additional items require recognition or disclosure, except for the following:
On September 18, 2013, the Board of Directors declared a quarterly dividend of $0.125 per share, payable on October 4, 2013 to shareholders of record on September 30, 2013. The dividend was recorded on our balance sheet as a liability as of September 30, 2013, and was paid to shareholders on October 4, 2013. The Company paid cash dividends in the amount of $2,989,623. Additionally, as part of the dividend reinvestment plan the Company issued 4,293 new shares of common stock.
On October 15, 2013, Mowood entered into a Revolving Note Payable Agreement (“Note Payable Agreement”) with a financial institution with a maximum borrowing base of $1.5 million. Borrowings on the Note Payable are secured by Mowood’s assets. Interest accrues at Prime Lending Rate as published in the Wall Street Journal, plus 0.5 percent (3.75% at October 15, 2013), is payable monthly, with all outstanding principal and accrued interest payable on the termination date of October 15, 2014. The Note Payable Agreement contains various restrictive covenants, with the most significant relating to minimum consolidated fixed charge ratio, the incidence of additional indebtedness, member distributions, extension of guaranties, future investments in other subsidiaries and change in ownership.
On November 5, 2013, Arc Logistics Partners LP (“Arc Logistics”), priced its initial public offering of 6,000,000 common units representing limited partner interests at $19.00 per common unit (the “Arc IPO”), with the underwriters retaining an option to purchase up to an additional 900,000 common units from Arc Logistics. The Arc IPO is expected to close on November 12, 2013, subject to customary closing conditions. According to the prospectus, Lightfoot Capital Partners LP (in which the Company owns a 6.7 percent interest) and Lightfoot Capital Partners GP (in which the Company owns a 1.5 percent interest) (collectively, “Lightfoot”) will, in connection with the Arc IPO, contribute all of their limited partner interests in Arc Terminals LP and all of their limited liability company interests in Arc Terminals GP to Arc Logistics. In exchange, Lightfoot will receive 68,617 common units of limited partnership interest and 5,146,264 subordinated common units of limited partnership interest in Arc Logistics, collectively representing a 42.9% ownership interest following the Arc IPO (assuming no exercise of the underwriters’ option). While Lightfoot will have certain registration rights with respect to the common units and subordinated common units it will receive in the Arc IPO, these securities also will be subject to a customary 180 day lock-up period following the date of the Arc IPO prospectus. Accordingly, we expect the valuation of both the common units and the subordinated common units to be subject to adjustment for a discount due to lack of marketability extending through the lock-up period. We also expect a similar discount to be applicable to the valuation of the subordinated common units until such time as they convert to common units with equal distribution rights at the end of the subordination period. The prospectus states that Arc Logistics plans to use estimated net proceeds of approximately $102.3 million from the Arc IPO, together with borrowings under an amended and restated credit facility, to (i) purchase a 10.3% minority interest in Gulf LNG Holdings, owner of a Liquefied Natural Gas facility in Mississippi in which Lightfoot also owns a 9.7% minority interest, for approximately $73 million, (ii) repay $3 million in intercompany payables owed to Lightfoot and (iii) make a cash distribution of $29.6 million in partial consideration for the contribution of preferred units in Arc Terminals LP into the Arc IPO by another minority investor. Upon the closing of the Arc IPO, Mr. Ed Russell, a director of our affiliate Tortoise Capital Advisors, LLC, will join the Board of Directors of the general partner of Arc Logistics.
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