RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2014

Related Party Transactions [Abstract]

Related Party Transactions

RELATED PARTY TRANSACTIONS

In the first quarter of 2014, we were involved in various transactions with related parties, including an affiliated company, K&R, LLC ("K&R"), which is wholly-owned by Kletter Holding LLC, which is wholly-owned by a trust for which Orson Oliver, our interim CEO and Chairman of the Board, is trustee.

A summary of the K&R transactions, in thousands, as of March 31, 2014 is as follows:

	2014
Balance sheet accounts:
Accounts receivable	$	32.2
Deposits (included in current liabilities)	$	500.0
Deposits (included in other long-term assets)	$	42.1
Accrued rent (property)	$	167.7
Accrued leases (equipment)	$	21.0
Income statement activity:
Rent expense (property)	$	161.5
Lease expense (equipment)	$	31.5

See Note 5 - Lease Commitments for additional information relating to the rent and lease agreements with K&R.

On September 13, 2013, K&R made a $500.0 thousand refundable, non-interest bearing deposit with us related to K&R's potential purchase of a piece of our real property located at 1565 East 4th Street in Seymour, Indiana. We continue to negotiate the terms of the potential transaction. We were permitted and have used the deposited funds for general corporate purposes. If we are unable to agree to the terms of a transaction, we are obligated to refund the deposit to K&R. For the period ended March 31, 2014, this deposit is recorded as a current liability entitled "Deposit from related party" for $500.0 thousand.

Other related party transactions are as follows:

Board of Directors' fees:

As of March 31, 2014, we had outstanding Board of Directors' fees owed of $91.0 thousand. We accrued Board fees of $25.0 thousand during the first quarter of 2014.

Management Services payments to Algar, Inc.:

On December 2, 2013, we entered into a Management Services Agreement (the "Management Agreement") with Algar, Inc. ("Algar").  Under the Management Agreement, Algar provides us with day-to-day senior executive level services. Algar will also provide business, financial, and organizational strategy and consulting services, as our board of directors may reasonably request from time to time.

On December 2, 2013, in connection with the Management Agreement, our board of directors appointed Sean Garber as President. Under the Management Agreement, we will reimburse Algar for the portion of Mr. Garber’s salary that is attributable to Algar’s services under the Management Agreement in an amount not to exceed $20.8 thousand per month, or $250.0 thousand per year. During the first quarter of 2014, we accrued management fees to Algar of $94.9 thousand. As of March 31, 2014, we had $213.8 thousand in accounts payable to Algar and $14.6 thousand in accounts receivable from Algar.