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RELATED PARTY TRANSACTIONS
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12 Months Ended |
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Aug. 31, 2014
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| Related Party Transactions | |
| RELATED PARTY TRANSACTIONS |
On December 16, 2009, the Company entered into a Participation Agreement with the District, whereby the Company agreed to provide funding to the District in connection with the District joining the South Metro Water Supply Authority (SMWSA). The Company provided funding of $114,900, $139,500, and $115,500 for the fiscal years ended August 31, 2014, 2013, and 2012, respectively. The funding was expensed in the general and administrative expenses line in the accompanying statements of operations for the years ended August 31, 2014, 2013, and 2012, respectively. Through our funding agreement with the District and subsequent to fiscal year end, we made payments of $535,200 to purchase certain rights to use existing water transmission and related infrastructure acquired by the WISE project. We anticipate will be investing approximately $1.2 million per year for the next 5 years for additional payments for the water transmission line and additional facilities, water and related assets for the WISE project.
In 1995, the Company extended a loan to the District, a related party. The loan provided for borrowings of up to $250,000, is unsecured, bears interest based on the prevailing prime rate plus 2% (5.25% at August 31, 2014) and matures on December 31, 2015. The $568,000 balance of the note receivable at August 31, 2014 includes borrowings of $229,300 and accrued interest of $338,700. The $556,000 balance of the note receivable at August 31, 2013 includes borrowings of $229,300 and accrued interest of $326,700. The Company extended the due date to December 31, 2015, and accordingly the note has been classified as non-current. |