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On April 30, 2004, Regency, through a newly-formed, wholly-owned subsidiary called Regency Power Corporation, a Delaware corporation, acquired a 50% membership interest in MESC Capital, LLC, a Delaware limited liability company, from DTE Mobile, LLC. MESC Capital was formed to acquire all of the membership interests in Mobile Energy Services Company, LLC. Mobile Energy owns an on-site energy facility that supplies steam and electricity to a Kimberly-Clark tissue mill in Mobile, Alabama. The energy facility is located on approximately 11 acres of land within the Kimberly-Clark tissue mill in Mobile, Alabama. The facility supplies up to 61 megawatts of co-generated steam and electricity for use in the mill’s operations, with a power-house fueled by a combination of coal, biomass and natural gas. In connection with MESC Capital’s acquisition of Mobile Energy, Kimberly-Clark entered into a 15-year agreement with Mobile Energy pursuant to which Mobile Energy will be the exclusive steam supplier to the mill and will provide a substantial portion of the mill’s electricity requirements.
Security Land and Development Company Limited Partnership
Iron Mountain Resources, Inc. Iron Mountain Resources, Inc., our 75% owned subsidiary, owns 80% of National Resource Development Corporation NRDC. NRDC owns approximately 70 million + short tons of previously quarried and stockpiled rock (“aggregate”) located at the site of the Groveland Mine in Dickinson County, Michigan. Initially, as part of the 1992-1993 restructuring, Regency planned to use this inventory as collateral to raise funds for acquisition capital. Aggregate is primarily sold for railroad ballast, construction along shorelines, decorative uses in landscaping and what is becoming extremely important given the U.S. Government’s passage of a ten year 200 billion dollar road bill for highway/road construction and reconstruction. Casual sales of aggregate made to cover the corporate costs of NRDC have been made annually. As the market for aggregate stone is highly competitive and the shipping costs are high, there can be no assurance that acting alone, NRDC will be able to consummate sales of material amounts of its aggregate without significant capital investment. Accordingly, Regency plans to monetize its investment in NRDC at the appropriate time in the future in order to create the maximum value for the common shareholders. | ||||
On November 18, 1994, Regency Affiliates, Inc. acquired a limited partnership interest in Security Land and Development Company Limited Partnership. The Partnership owns the 34.3-acre Security West complex at 1500 Woodlawn Drive, Woodlawn, Md., consisting of a two-story office building and a connected six-story office tower occupied by the United States Social Security Administration Office of Disability and International Operations under a fifteen year lease, expiring in 2018. The buildings have net rentable area of approximately 717,000 square feet. The construction of the Security West buildings was completed in 1972 and the buildings have been occupied by the Social Security Administration since 1972 under prior leases between the U.S. Government and the Partnership.