Related Party Transactions

12 Months Ended

Dec. 31, 2013

Related Party Transactions [Abstract]

Related Party Transactions

Note 11. Related Party Transactions

On August 29, 2011, Wood Energy entered into a lease with a former related party for a new facility in Gibsland, La. This lease was compromised under the laws of Chapter 7 bankruptcy. This facility replaced the Company’s facility in Shreveport, La. The lease took effect in January 2012 upon the completion of development of the site. The lease called for annual rental payments of $10,000 per year and an additional commitment of 1,200 railcars per year to the leased facility at a rate of $300 per car.

During 2012 the Company issued 9,950 shares of its Series C Preferred Stock of Banyan Holdings. The preferred shares were issued for $100 a share, or $995,000 in the aggregate.

On September 24, 2012, the Company issued 86,957 shares of common stock for $500,000 to Banyan Holdings. The proceeds were used for both working capital purposes.

On November 12, 2012, the Company entered into a demand loan with Banyan Holdings in the amount of $150,000 at an annual interest rate of 6%. The proceeds received were used to fund working capital requirements. The loan was subsequently converted into 1,500 shares of its Series C Preferred stock.

On December 28, 2012, the Company entered into a demand loan with Banyan Holdings in the amount of $225,000 at an annual interest rate of 6%. The proceeds received were used to fund working capital requirements.

On March 20, 2013, the Company issued 112,822 shares of common stock to Banyan Holdings in exchange for the cancellation of the loan payable in the amount of $225,000 and the advances of $186,800.

On September 24, 2013, the Company issued 4,000 shares of common stock to Gary O. Marino for $7.50 a share or $30,000 in total, and 48,000 Shares to Banyan Holdings for $7.50 a share or $360,000 ($203,000 of cash and $157,000 in cancellation of previous advances) in total. The proceeds from the sale were used for working capital purposes.

Also in September and November 2013, the Company issued 6,000 shares of common stock to officers and directors of the Company for $7.50 a share, for an aggregate total of $45,000, as part of a private placement of common stock. The proceeds of the money received were used to fund working capital requirements.

On October 31, 2013, the Company issued 4,000 shares of common stock to Coalbrookdale Partners for a price of $7.50 a share, as part of a private placement of common stock in exchange for cash in the amount of $30,000. The proceeds of the money received were used to fund working capital requirements. Donald Denbo, a Director of the Company, is a partner in Coalbrookdale Partners.

On December 31, 2013, the Company entered into a demand promissory note with Banyan Holdings in the amount of $150,000 at an annual interest rate of 10%. The proceeds were used to fund working capital requirements. In connection with the demand promissory note, the Company issued 16,230 shares of common stock to Banyan Holdings on January 21, 2014 to induce Banyan Holdings to loan the Company working capital. The fair market value of the shares at the date of grant have been recorded as common stock payable in the Company’s Consolidated Statements of Stockholders’ Equity and additional interest expense on the Company’s Consolidated Statement of Operations.

The Company leased office space and received office services from Patriot Rail Corp., a company previously related by certain common management and ownership, for the amount of $6,000 per month which included additional support services. The arrangement was terminated in September 2012, and subsequently the Company shares office space from a related party with common management and ownership at no cost to the Company. The previous costs are included in General and Administrative expenses in the statement of operations.

The Company’s board of directors and officers beneficially own 37,950 shares of the Company’s preferred stock and 613,750 shares of common stock as of December 31, 2013 or 1,026,233 shares (56.6% of the outstanding common stock), if the preferred is converted.