Quarterly report pursuant to Section 13 or 15(d)

Investment in Financing Receivables and Other Investments

Investment in Financing Receivables and Other Investments
6 Months Ended
Jun. 30, 2013
Receivables [Abstract]  
Investment in Financing Receivables and Other Investments

6. Investment in Financing Receivables and Other Investments

Investment in Financing Receivables

The components of investment in financing receivables as of June 30, 2013 and December 31, 2012, were as follows:


     June 30,
    December 31,

Investment in Financing Receivables


Financing or minimum lease payments

   $ 389,078,773      $ 248,126,575   

Unearned interest income

     (87,994,182     (52,174,405

Unearned fee income, net of initial direct costs

     (3,765,226     (4,553,453







Investment in Financing Receivables

   $ 297,319,365      $ 191,398,717   







These financing receivables and other investments are typically collateralized contractually committed obligations of government entities or private high credit quality obligors and are often supported by additional forms of credit enhancement, including security interests and supplier guaranties. There were no credit losses during the three and six months ended June 30, 2013 and 2012, and no financing receivables were past due, on nonaccrual status, or impaired as of June 30, 2013 and December 31, 2012. There was no allowance for credit losses as of June 30, 2013 and December 31, 2012.

The Company has a deferred funding obligation of $28,077,827 related to its investment in financing receivables and the cash amount needed to fund this obligation is included in restricted cash. On May 9, 2013, the Company provided a loan to a wholly-owned subsidiary of EnergySource LLC in the amount of $24 million, which has a coupon rate of 15.22% and matures in May, 2018 (the “EnergySource Loan”). The outstanding balance on the EnergySource Loan was $24.3 million as of June 30, 2013 and the interest paid on the loan for the three months ended June 30, 2013 was $222,247. Certain of the Company’s executive officers and directors have an indirect minority equity interest in EnergySource following the distribution of the ownership interest as described in note 12. The EnergySource Loan was approved by the Company’s independent directors.

Other Investments

Other Investments consist of a debt security that is classified as held to maturity and thus recorded at its amortized cost basis as of June 30, 2013. The debt security matures in 2035. The obligor under the debt security is an entity whose ultimate parent is Berkshire Hathaway Inc. The debt security has an investment grade rating from three rating agencies. There were no other investments as of December 31, 2012.