HLND » Topics » Note 4: Property on Lease

This excerpt taken from the HLND 8-K filed Nov 10, 2005.

Note 4:  Property on Lease

 

                On December 9, 2002 and December 20, 2002, Hiland leased compressors that it acquired at a cost of $2.1 million and $9.9 million, respectively, to CRI. The operating leases have five-year terms but are subject to cancellation by the lessee after three years. At the end of the leases, the lessee can purchase the compressors for fair market value. Otherwise, the compressors will remain the property of Hiland. On August 20, 2003, additional compressors costing $4.7 million were acquired and leased to CRI on similar terms.

 

                On December 31, 2003 and 2004, the carrying amount (at cost) of these compressors was $16.7 million. The accumulated depreciation was $1.3 million and $2.7 million, respectively.

 

                Schedule of minimum lease payments to the Company due for the remaining non-cancellable lease term at December 31, 2004:

 

Year Ended December 31,

 

Amount

 

2005

 

$

3,722

 

2006

 

684

 

Total

 

$

4,406

 

 

                Please see note 9 for a discussion of Hiland’s new contractual arrangement that replaces the operating leases described above.

 

This excerpt taken from the HLND 10-K filed Mar 30, 2005.
Note 4:   Property on Lease

On December 9, 2002 and December 20, 2002, Hiland leased compressors that it acquired at a cost of $2.1 million and $9.9 million, respectively, to CRI. The operating leases have five-year terms but are subject to cancellation by the lessee after three years. At the end of the leases, the lessee can purchase the compressors for fair market value. Otherwise, the compressors will remain the property of Hiland. On August 20, 2003, additional compressors costing $4.7 million were acquired and leased to CRI on similar terms.

On December 31, 2003 and 2004, the carrying amount (at cost) of these compressors was $16.7 million. The accumulated depreciation was $1.3 million and $2.7 million, respectively.

Schedule of minimum lease payments to the Company due for the remaining non-cancellable lease term at December 31, 2004:

Years Ended December 31,

 

 

 

Amount

 

2005

 

$

3,722

 

2006

 

684

 

Total

 

$

4,406

 

 

Please see note 9 for a discussion of Hiland’s new contractual arrangement that replaces the operating leases described above.

EXCERPTS ON THIS PAGE:

8-K
Nov 10, 2005
10-K
Mar 30, 2005
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