

NOTE 3:	EQUITY METHOD INVESTMENTS

As of December 31, 2015, the Company’s investments accounted for on the equity method of accounting consist of the following: (1) 30 percent interest in ICP, which manufactures alcohol for fuel, industrial and beverage applications, and (2) 50 percent interest in DMI, which produced certain specialty starch and protein ingredients.

ICP Investment

ICP's Limited Liability Company Agreement generally allocates profits, losses and distributions of cash of ICP based on the percentage of a member's capital contributions to ICP relative to total capital contributions of all members ("Percentage Interest") to ICP, of which the Company has 30 percent and its joint venture partner, ICP Holdings, has 70 percent.

The Limited Liability Company Agreement grants the right to either member to elect (the "Electing Member") to shut down the Pekin facility ("Shutdown Election") if ICP operates at an EBITDA (as defined in the agreement) loss greater than or equal to $500 in any quarter, subject to the right of the other member (the "Objecting Member") to override that election. If the Objecting Member overrides the election, then EBITDA loss and EBITDA profit for each subsequent quarter are allocated 80 percent to the Objecting Member and 20 percent to the Electing Member until the end of the applicable quarter in which the Electing Member withdraws its Shutdown Election and thereafter allocations revert to a 70 percent/30 percent split (subject to a catch-up allocation of 80 percent of EBITDA profits to the Objecting Member until it equals the amount of EBITDA loss allocated to such member on an 80 percent/20 percent basis). ICP experienced an EBITDA loss in excess of $500 for the quarter ended March 31, 2013, which was one factor that prompted the Company to deliver notice of its Shutdown Election on April 18, 2013. However, the Company withdrew its Shutdown Election on March 31, 2014 (thereby causing the allocation of profits and losses to revert to 30 percent to the Company and 70 percent to ICP Holdings as of April 1, 2014) based partially on the strong financial results ICP generated during the period ended March 31, 2014.

During 2014, management reassessed the most likely events that would result in a recovery of its investment in ICP and, as a result, the Company remeasured its cumulative equity in the undistributed earnings of ICP. The cumulative effect of this change in estimate resulted in a decrease in equity method investment earnings of ICP of $1,882 for the period beginning April 1, 2013 and ending March 31, 2014; a decrease in the earnings per share of $0.10 per share for the year to date period ended September 30, 2014; and a decrease in the related equity method investment in ICP at September 30, 2014, of $1,882.

On December 3, 2014, the ICP advisory board recommended payment of a cash dividend distribution to its members. The Company received its portion of the distribution, $4,835, on December 4, 2014. The cash dividend distribution received was a return on investment and, therefore, reduced the Company's equity method investment in ICP on its consolidated balance sheets by $4,835, and was a source of cash flow from operating activities of $4,835. See Notes 14 and 18 for information regarding a cash dividend distribution received from ICP in 2016.

On April 9, 2015, ICP obtained a $30,000 revolving credit facility with JPMorgan Chase Bank, N.A., which could be increased in the future by an additional $20,000, subject to lender approval. The revolver matures on April 9, 2018. Simultaneous with the execution of the new revolving credit facility, ICP terminated its $15,000 amended and restated revolving credit facility with an affiliate of SEACOR, which would have matured January 31, 2016. The Company has no funding requirement to ICP.

DMI Investment

On December 29, 2014, the Company gave notice to DMI and to the Company's partner in DMI, Crespel and Dieters GmbH & Co. KG ("C&D"), to terminate the joint venture effective June 30, 2015. C&D also provided notice to terminate DMI effective June 30, 2015. On June 22, 2015, a termination agreement was executed by and between the Company, DMI, and C&D to dissolve DMI effective June 30, 2015. Additionally, on June 22, 2015 a termination agreement was executed by and between the Company and DMI to terminate their distribution agreement effective June 29, 2015. Under German law, commencing on June 30, 2015, normal operations for DMI ceased and a one-year winding down process began.

Related Party Transactions

See Note 14 for discussion of related party transactions.

Realizability of investments

No other than temporary impairments were recorded during 2015, 2014, and 2013 for the Company's equity method investments.

Summary Financial Information

Condensed financial information of the Company’s equity method investment in ICP is shown below:



	Year Ended December 31,
ICP’s Operating results:	2015				2014			2013
Net sales^(a)	$	166,905			$	236,486		$	193,682
Cost of sales and expenses^(b)	(146,098		)		(196,551		)	(194,519		)
Net income (loss)	$	20,807		^(c)	$	39,935		$	(837	)


^(a)	Includes related party sales to MGPI of $40,787, $35,613, and $7,736 for 2015, 2014, and 2013, respectively.


^(b)	Includes depreciation and amortization of $2,634, $2,847, and $4,523 for 2015, 2014, and 2013, respectively.


^(c)	Includes business interruption insurance proceeds of $4,112 for 2015.

The Company’s equity method investment earnings (losses) are as follows:



	Year Ended December 31,
	2015			2014		2013
ICP (30% interest)	$	6,242		$	10,098	$	(251	)
DMI (50% interest)	(140		)	39		47
Total	$	6,102		$	10,137	$	(204	)

The Company’s equity method investments are as follows:



	December 31,
	2015		2014
ICP (30% interest) ^(a)	$	18,179	$	11,924
DMI (50% interest)	384		449
Total	$	18,563	$	12,373


^(a)	During 2014, the Company received a $4,835 cash distribution from ICP, which reduced the Company's investment in ICP.