Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Aug. 31, 2016 | Oct. 13, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | GREYSTONE LOGISTICS, INC. | |
Entity Central Index Key | 1,088,413 | |
Document Type | 10-Q | |
Document Period End Date | Aug. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --05-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 28,361,201 | |
Trading Symbol | GLGI | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,017 |
Consolidated Balance Sheet (Una
Consolidated Balance Sheet (Unaudited) - USD ($) | Aug. 31, 2016 | May 31, 2016 |
Current Assets: | ||
Cash | $ 685,158 | $ 897,377 |
Accounts receivable - Trade, net of allowance for doubtful accounts of $31,860 and $13,260, respectively | 2,599,299 | 3,536,574 |
Accounts receivable - Related party | 135,621 | 150,113 |
Inventory | 1,318,498 | 1,304,495 |
Prepaid expenses and other | 18,123 | 70,058 |
Total Current Assets | 4,756,699 | 5,958,617 |
Property, Plant and Equipment | 27,226,729 | 23,646,515 |
Less: Accumulated Depreciation | (11,599,772) | (11,081,196) |
Property, Plant and Equipment, net | 15,626,957 | 12,565,319 |
Deferred Tax Asset | 1,302,532 | 1,283,682 |
Other Assets | 20,452 | 23,405 |
Total Assets | 21,706,640 | 19,831,023 |
Current Liabilities: | ||
Current portion of long-term debt and capital lease | 3,201,905 | 2,088,327 |
Accounts payable and accrued expenses | 2,359,544 | 2,642,112 |
Accrued interest - related party | 45,298 | 2,475,690 |
Preferred dividends payable | 57,329 | 60,005 |
Total Current Liabilities | 5,664,076 | 7,266,134 |
Long-Term Debt and Capital Lease, net of current portion | 16,818,973 | 13,289,236 |
Deficit: | ||
Preferred stock, $0.0001 par value; Shares authorized - 20,750,000; Shares issued and outstanding - 50,000 | 5 | 5 |
Common stock, $0.0001 par value; Shares authorized - 5,000,000,000; Shares issued and outstanding - 28,361,201 and 27,886,201, respectively | 2,836 | 2,789 |
Additional paid-in capital | 53,670,764 | 53,613,811 |
Accumulated deficit | (55,503,353) | (55,385,912) |
Total Greystone Stockholders' Deficit | (1,829,748) | (1,769,307) |
Non-controlling interest | 1,053,339 | 1,044,960 |
Total Deficit | (776,409) | (724,347) |
Total Liabilities and Deficit | $ 21,706,640 | $ 19,831,023 |
Consolidated Balance Sheet (Un3
Consolidated Balance Sheet (Unaudited) (Parenthetical) - USD ($) | Aug. 31, 2016 | May 31, 2016 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful on accounts receivable | $ 31,860 | $ 13,260 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 20,750,000 | 20,750,000 |
Preferred stock, shares issued | 50,000 | 50,000 |
Preferred stock, shares outstanding | 50,000 | 50,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 5,000,000,000 | 5,000,000,000 |
Common stock, shares issued | 28,361,201 | 27,886,201 |
Common stock, shares outstanding | 28,361,201 | 27,886,201 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Aug. 31, 2016 | Aug. 31, 2015 | |
Income Statement [Abstract] | ||
Sales | $ 7,844,261 | $ 5,569,981 |
Cost of Sales | 6,876,443 | 4,629,316 |
Gross Profit | 967,818 | 940,665 |
General, Selling and Administrative Expenses | 723,029 | 702,142 |
Operating Income | 244,789 | 238,523 |
Other Expense: | ||
Interest expense | (236,631) | (195,412) |
Income before Income Taxes | 8,158 | 43,111 |
Benefit from Income Taxes | 18,850 | 5,285 |
Net Income | 27,008 | 48,396 |
Income Attributable to Variable Interest Entity | (59,379) | (57,793) |
Preferred Dividends | (85,068) | (81,918) |
Net Loss Attributable to Common Stockholders | $ (117,439) | $ (91,315) |
Loss Per Share of Common Stock - Basic and Diluted | $ 0 | $ 0 |
Weighted Average Shares of Common Stock Outstanding - Basic and Diluted | 28,202,884 | 27,411,201 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Aug. 31, 2016 | Aug. 31, 2015 | |
Cash Flows from Operating Activities: | ||
Net income | $ 27,008 | $ 48,396 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 527,816 | 388,324 |
Deferred income taxes | (18,850) | (5,285) |
Stock-based compensation | 13,356 | |
Changes in trade receivables | 937,275 | (349,570) |
Changes in related party receivable | 14,492 | 33,076 |
Changes in inventory | (14,003) | (624,923) |
Changes in prepaid expenses and other | 51,935 | 10,249 |
Change in other assets | 200 | (1,303) |
Changes in accounts payable and accrued expenses | (237,270) | 1,817,402 |
Net cash provided by operating activities | 1,288,603 | 1,329,722 |
Cash Flows from Investing Activities: | ||
Purchase of property and equipment | (849,062) | (282,534) |
Cash Flows from Financing Activities: | ||
Payments on long-term debt and capitalized leases | (570,014) | (495,855) |
Payments on revolving loan | (300,000) | |
Proceeds from exercised stock options | 57,000 | |
Payments of preferred dividends | (87,746) | (81,027) |
Distributions by variable interest entity | (51,000) | (51,000) |
Net cash used in financing activities | (651,760) | (927,882) |
Net Increase (Decrease) in Cash | (212,219) | 119,306 |
Cash, beginning of period | 897,377 | 598,887 |
Cash, end of period | 685,158 | 718,193 |
Non-Cash Activities: | ||
Acquisition of equipment by capital lease | 2,731,152 | |
Conversion of accrued interest to long-term debt | 2,475,690 | |
Preferred dividend accrual | 57,329 | 55,206 |
Supplemental Information: | ||
Interest paid | $ 191,333 | $ 126,646 |
Basis of Financial Statements
Basis of Financial Statements | 3 Months Ended |
Aug. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | Note 1. Basis of Financial Statements In the opinion of Greystone Logistics, Inc. (“Greystone”), the accompanying unaudited consolidated financial statements contain all adjustments and reclassifications, which are of a normal recurring nature, necessary to present fairly its financial position as of August 31, 2016, and the results of its operations and its cash flows for the three-month periods ended August 31, 2016 and 2015. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the fiscal year ended May 31, 2016 and the notes thereto included in Greystone’s Form 10-K for such period. The results of operations for the three-month periods ended August 31, 2016 and 2015 are not necessarily indicative of the results to be expected for the full fiscal year. The consolidated financial statements of Greystone include its wholly-owned subsidiaries, Greystone Manufacturing, L.L.C. (“GSM”) and Plastic Pallet Production, Inc. (“PPP”), and its variable interest entity, Greystone Real Estate, L.L.C. (“GRE”). GRE owns two buildings located in Bettendorf, Iowa which are leased to GSM. Effective June 1, 2016, Greystone adopted Accounting Standards Update 2015-03, “ Simplifying the Presentation of Debt Issuance Costs” |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Aug. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 2. Earnings Per Share Basic earnings per share is based on the weighted-average effect of all common shares issued and outstanding and is calculated by dividing net income (loss) attributable to common stockholders by the weighted-average shares outstanding during the period. Diluted earnings per share is calculated by dividing net income (loss) attributable to common stockholders by the weighted-average number of common shares used in the basic earnings per share calculation plus the number of common shares that would be issued assuming exercise or conversion of all potentially dilutive common shares outstanding. Greystone excludes equity instruments from the calculation of diluted earnings per share if the effect of including such instruments is anti-dilutive. For the three months ended August 31, 2016 and 2015 e |
Inventory
Inventory | 3 Months Ended |
Aug. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 3. Inventory Inventory consists of the following: August 31, 2016 May 31, 2016 Raw materials $ 781,856 $ 536,350 Finished goods 536,642 768,145 Total inventory $ 1,318,498 $ 1,304,495 |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Aug. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Note 4. Property, Plant and Equipment A summary of the property, plant and equipment for Greystone is as follows: August 31, 2016 May 31, 2016 Production machinery and equipment $ 22,149,817 $ 18,616,603 Plant buildings and land 4,663,339 4,663,339 Leasehold improvements 245,568 198,568 Furniture and fixtures 168 005 168,005 27,226,729 23,646,515 Less: Accumulated depreciation (11,599,772 ) (11,081,196 ) Net Property, Plant and Equipment $ 15,626,957 $ 12,565,319 Production machinery and equipment includes equipment capitalized pursuant to a capital lease in the amount of $2,731,152. The equipment is being depreciated using the straight-line method of depreciation over 10 years. Production machinery includes deposits on equipment in the amount of $159,698 that had not been placed into service as of August 31, 2016. The plant buildings and land are owned by GRE, a VIE, and have a net book value of $3,215,197 at August 31, 2016. Depreciation expense for the three months ended August 31, 2016 and 2015 is $518,576 and $378,966, respectively. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Aug. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 5. Related Party Transactions Yorktown Management & Financial Services, LLC Yorktown Management & Financial Services, LLC (“Yorktown”), an entity wholly owned by Greystone’s CEO and President, owns and rents to Greystone (1) grinding equipment used to grind raw materials for Greystone’s pallet production and (2) extruders for pelletizing recycled plastic into pellets for resale and for use as raw material in the manufacture of pallets. GSM pays weekly rental fees to Yorktown of $22,500 for use of Yorktown’s grinding equipment and $5,000 for the use of Yorktown’s pelletizing equipment. GSM paid Yorktown total equipment rental fees of $385,000 and $357,500 for the three months ended August 31, 2016 and 2015, respectively. In addition, Yorktown provides office space for Greystone in Tulsa, Oklahoma at a monthly rental of $2,200. TriEnda Holdings, L.L.C. TriEnda Holdings, L.L.C. (“TriEnda”) is a manufacturer of plastic pallets, protective packing and dunnage utilizing thermoform processing for which Warren F. Kruger, Greystone’s president and CEO, serves TriEnda as the non-executive Chairman of the Board and is a partner in a partnership which has a majority ownership interest. Greystone charges a tolling fee for blending and pelletizing plastic resin using TriEnda’s equipment and raw materials. Revenue from TriEnda totaled $187,002 and $3,113 for the three months ended August 31, 2016 and 2015, respectively. The account receivable from TriEnda at August 31, 2016 was $71,342. The tolling service provided by Greystone generates a certain amount of scrap material which is purchased by Greystone. Purchases for the three months ended August 31, 2016 and 2015 totaled $8,905 and $-0-, respectively. Greystone had accounts payable to TriEnda of $7,628 at August 31, 2016. Green Plastic Pallets Greystone sells plastics pallets to Green Plastic Pallets (“Green”), an entity that is owned by James Kruger, brother to Warren F. Kruger, Greystone’s president and CEO. Greystone had sales to Green of $18,365 and $55,080 for the three months ended August 31, 2016 and 2015, respectively. As of August 31, 2016, Greystone had an account receivable of $56,908 from Green. |
Debt
Debt | 3 Months Ended |
Aug. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Note 6. Debt Debt as of August 31, 2016 and May 31, 2016 is as follows: August 31, 2016 May 31, 2016 Term note A payable to International Bank of Commence, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019 $ 5,140,476 $ 5,310,179 Term note B payable to International Bank of Commence, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019 2,448,894 2,688,659 Revolving note payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, due January 31, 2018 1,675,000 1,675,000 Term note payable by GRE to International Bank of Commerce, interest rate of 4.5%, monthly principal and interest payments of $26,215, due January 31, 2019 2,977,666 3,021,734 Capital lease with a private pallet leasing company, interest rate of 5%, maturity of August 7, 2019 2,672,078 - Note payable to Robert Rosene, 7.5% interest, due January 15, 2018 4,541,690 2,066,000 Note payable to Yorktown Management & Financial Services, LLC, 5% interest, due February 28, 2019, monthly principal and interest payments of $20,629 580,614 634,616 Other 47,158 50,560 Debt issue costs, net of amortization (62,698 ) (69,185 ) 20,020,878 15,377,563 Less: Current portion (3,201,905 ) (2,088,327 ) Long-term debt $ 16,818,973 $ 13,289,236 The prime rate of interest as of August 31, 2016 was 3.5%. Loan Agreement between Greystone and International Bank of Commerce (“IBC”) On January 31, 2014, Greystone and GSM (the “Borrowers”) and International Bank of Commerce (“IBC”) entered into a Loan Agreement (the “IBC Loan Agreement”). The IBC Loan Agreement provides for a revolving loan in an aggregate principal amount of up to $2,500,000 (the “Revolving Loan”) and a term loan in the aggregate principal amount of $9,200,000 (the “Term Loan”). The exact amount which can be borrowed under the Revolving Loan from time to time is dependent upon the amount of the borrowing base, but can in no event exceed $2,500,000. On January 7, 2016, the Borrowers and IBC entered into the First Amendment to the IBC Loan Agreement (the “First Amendment”) whereby IBC made an additional term loan to Borrowers in the original principal amount of $2,530,072 (the “New Equipment Loan”). The New Equipment Loan and $2,917,422 of the principal amount outstanding on the Term Loan were consolidated into a new loan in the combined principal amount of $5,447,504 (the “Term Loan A”). The Term Loan’s remaining principal balance of $3,000,000 was deemed to be a separate term loan (the “Term Loan B”). The Term Loans A and B bear interest at the New York Prime Rate plus 0.5% but not less than 4.0% and mature January 7, 2019. The Borrowers are required to make equal monthly payments of principal and interest in such amounts sufficient to amortize the principal balance of (i) the Note A Term Loan over a seven year period beginning January 31, 2016 (currently $74,455 per month) and (ii) the Note B Term Loan over the three-year life of the loan (currently $88,790 per month). The Revolving Loan bears interest at the New York Prime Rate plus 0.5% but not less than 4.0% and matures January 31, 2018. The Borrowers are required to pay all interest accrued on the outstanding principal balance of the Revolving Loan on a monthly basis. Any principal on the Revolving Loan that is prepaid by the Borrowers does not reduce the original amount available to the Borrowers. The IBC Loan Agreement includes customary representations and warranties and affirmative and negative covenants which include (i) requiring the Borrowers to maintain a debt service coverage ratio of 1:25 to 1:00 and a funded debt to EBIDA ratio not exceeding 3:00 to 1:00, (ii) subject to certain exceptions, limiting the Borrowers’ combined capital expenditures on fixed assets to $1,000,000 per year, (iii) prohibiting Greystone, without IBC’s prior written consent, from declaring or paying any dividends, redemptions of stock or membership interests, distributions and withdrawals (as applicable) in respect of its capital stock or any other equity interest, other than additional payments to holders of its preferred stock in an amount not to exceed $500,000 in any fiscal year, (iv) subject to certain exceptions, prohibiting the incurrence of additional indebtedness by the Borrowers, and (v) requiring the Borrowers to prevent (A) any change in capital ownership such that there is a material change in the direct or indirect ownership of (1) Greystone’s outstanding preferred stock, and (2) any equity interest in GSM, or (B) Warren Kruger from ceasing to be actively involved in the management of Greystone as President and/or Chief Executive Officer. The foregoing list of covenants is not exhaustive and there are several other covenants contained in the IBC Loan Agreement. Greystone’s debt service coverage ratio at August 31, 2016 was 0.84 which is not in compliance with the IBC Loan Agreement’s minimum debt service coverage ratio of 1.25. Greystone has received a waiver from IBC for this instance of non-compliance. The IBC Loan Agreement includes customary events of default, including events of default relating to non-payment of principal and other amounts owing under the IBC Loan Agreement from time to time, inaccuracy of representations, violation of covenants, defaults under other agreements, bankruptcy and similar events, the death of a guarantor, certain material adverse changes relating to a Borrower or guarantor, certain judgments or awards against a Borrower, or government action affecting a Borrower’s or guarantor’s ability to perform under the IBC Loan Agreement or the related loan documents. Among other things, a default under the IBC Loan Agreement would permit IBC to cease lending funds under the IBC Loan Agreement, and require immediate repayment of any outstanding loans with interest and any unpaid accrued fees. The IBC Loan Agreement is secured by a lien on substantially all of the assets of the Borrowers. In addition, the IBC Loan Agreement is secured by a mortgage granted by GRE on the real property owned by GRE in Bettendorf, Iowa (the “Mortgage”). GRE is owned by Warren F. Kruger, Greystone’s President and CEO, and Robert B. Rosene, Jr., a director of Greystone. Messrs. Kruger and Rosene have provided a combined limited guaranty of the Borrowers’ obligations under the IBC Loan Agreement, with such guaranty being limited to a combined amount of $6,500,000 (the “Guaranty”). The Mortgage and the Guaranty also secure or guaranty, as applicable, the obligations of GRE under the Loan Agreement between GRE and IBC dated January 31, 2014, as discussed in the following paragraph. Loan Agreement between GRE and IBC On January 31, 2014, GRE and IBC entered into a Loan Agreement which provided for a mortgage loan to GRE of $3,412,500. The loan provides for a 4.5% interest rate and a maturity of January 31, 2019 and is secured by a mortgage on the two buildings in Bettendorf, Iowa which are leased to Greystone. Capital Lease with Private Pallet Leasing Company In August, 2016, Greystone entered into a three-year lease agreement with a private pallet leasing company to provide for certain production equipment with a total cost of approximately $5.4 million. The lease agreement includes a bargain purchase option to acquire the production equipment at the end of the lease term. The lease is for two Milacron injection molding machines and two pallet molds designed and dedicated to production of 48X40 pallets (the “Pallets”) for the pallet leasing company. Monthly lease payments, estimated at approximately $100,000 per machine, are payable on a per invoice basis at the rate of $6.25 for each pallet produced by the leased production equipment and shipped to the company. The lease bears an interest rate of 5%, has a three-year maturity and provides for minimum monthly lease rental payment based upon the total Pallets sold in excess of a specified amount not to exceed the monthly productive capacity of the leased machines. The first of the Milacron machines was placed into service in August, 2016. The second machine was placed into service in September, 2016 under the same terms and conditions as the first machine. Maturities for the three years subsequent to August 31, 2016 for the capital lease placed in service in August, 2016 are estimated to be $1,091,375, $1,147,092 and $433,611. Note Payable between Greystone and Robert B. Rosene, Jr. Effective December 15, 2005, Greystone entered into an agreement with Robert B. Rosene, Jr., a member of Greystone’s board of directors, to convert $2,066,000 of advances into a note payable at 7.5% interest. Effective June 1, 2016, the note was restated (the “Restated Note”) to combine the outstanding principal, $2,066,000, and accrued interest, $2,475,690, into a note payable of $4,541,690 with an extended maturity date of January 15, 2018. The Restated Note provides that accrued interest is payable monthly and allows Greystone to use commercially reasonable efforts to pay such amounts as allowed by the IBC Loan Agreement against the interest accrued prior to the restatement. Note Payable between Greystone and Yorktown Management Financial Services, LLC (“Yorktown”) On February 29, 2016, Greystone entered into an unsecured note payable to Yorktown in the amount of $688,296 in connection with the acquisition of equipment from Yorktown. The note payable bears interest at the rate of 5% and is payable over three years with monthly principal and interest payments of $20,629. Maturities Maturities of Greystone’s long-term debt and capital leases for the five years subsequent to August 31, 2016 are $3,201,905, $9,564,108, $7,309,827, $7,736 and $-0-. |
Stock Compensation Costs
Stock Compensation Costs | 3 Months Ended |
Aug. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Compensation Costs | Note 7. Stock Compensation Costs Stock compensation costs, resulting from stock options issued June 1, 2012, were $-0- and $13,356 for the three months ended August 31, 2016 and 2015, respectively. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Aug. 31, 2016 | |
Investments, All Other Investments [Abstract] | |
Fair Value of Financial Instruments | Note 8. Fair Value of Financial Instruments The following methods and assumptions are used in estimating the fair-value disclosures for financial instruments: Debt: The carrying amount of loans with floating rates of interest approximate fair value. Fixed rate loans are valued based on cash flows using estimated rates of comparable loans. The carrying amounts reported in the balance sheet approximate fair value. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Aug. 31, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Note 9. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “ Revenue from Contracts with Customers In February 2016, the FASB issued Accounting Standards 2016-02, Leases (Topic 842) In March 2016, FASB issued Accounting Standards 2016-09, Improvements to Employee Share-Based Payment Accounting Compensation – Stock Compensation |
Concentrations, Risks and Uncer
Concentrations, Risks and Uncertainties | 3 Months Ended |
Aug. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Concentrations, Risks and Uncertainties | Note 10. Concentrations, Risks and Uncertainties In fiscal year 2017, Greystone derived 66% of its total sales from two customers (36% and 30% respectively). In fiscal year 2016, there was one significant customer which accounted for approximately 31% of Greystone’s total sales. The loss of a material amount of business from these customers could have a material adverse effect on Greystone. Greystone purchases damaged pallets from its customer at a price based on the value of the raw material content in the pallet. A majority of these purchases, totaling $478,752 and $490,092 in fiscal years 2017 and 2016, respectively, is from one of its major customers. Robert B. Rosene, Jr., a Greystone director, has provided financing and guarantees on Greystone’s bank debt. As of August 31, 2016, Greystone is indebted to Mr. Rosene in the amount of $4,541,690 pursuant to a note payable due January 15, 2018. There is no assurance that Mr. Rosene will continue to provide extensions in the future. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Aug. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Event | Note 11. Subsequent Event Effective September 1, 2016, Greystone’s board of directors authorized the issuance of warrants to purchase 250,000 shares of Greystone’s common stock for $0.01 per share to each of Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., a member of Greystone’s board, as compensation for providing guarantees on Greystone’s debt with International Bank of Commerce. The warrants have a vesting period of two years and expire August 31, 2026. The issuance will be capitalized as debt issue cost as of the measurement date for approximately $125,000 and amortized over the remaining guaranty term. |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Aug. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consists of the following: August 31, 2016 May 31, 2016 Raw materials $ 781,856 $ 536,350 Finished goods 536,642 768,145 Total inventory $ 1,318,498 $ 1,304,495 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Aug. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | A summary of the property, plant and equipment for Greystone is as follows: August 31, 2016 May 31, 2016 Production machinery and equipment $ 22,149,817 $ 18,616,603 Plant buildings and land 4,663,339 4,663,339 Leasehold improvements 245,568 198,568 Furniture and fixtures 168 005 168,005 27,226,729 23,646,515 Less: Accumulated depreciation (11,599,772 ) (11,081,196 ) Net Property, Plant and Equipment $ 15,626,957 $ 12,565,319 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Aug. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt as of August 31, 2016 and May 31, 2016 is as follows: August 31, 2016 May 31, 2016 Term note A payable to International Bank of Commence, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019 $ 5,140,476 $ 5,310,179 Term note B payable to International Bank of Commence, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019 2,448,894 2,688,659 Revolving note payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, due January 31, 2018 1,675,000 1,675,000 Term note payable by GRE to International Bank of Commerce, interest rate of 4.5%, monthly principal and interest payments of $26,215, due January 31, 2019 2,977,666 3,021,734 Capital lease with a private pallet leasing company, interest rate of 5%, maturity of August 7, 2019 2,672,078 - Note payable to Robert Rosene, 7.5% interest, due January 15, 2018 4,541,690 2,066,000 Note payable to Yorktown Management & Financial Services, LLC, 5% interest, due February 28, 2019, monthly principal and interest payments of $20,629 580,614 634,616 Other 47,158 50,560 Debt issue costs, net of amortization (62,698 ) (69,185 ) 20,020,878 15,377,563 Less: Current portion (3,201,905 ) (2,088,327 ) Long-term debt $ 16,818,973 $ 13,289,236 |
Basis of Financial Statements (
Basis of Financial Statements (Details Narrative) | 12 Months Ended |
May 31, 2016USD ($) | |
Accounting Standards Update 2015-03 [Member] | |
Reclassifying debt issue costs | $ 69,185 |
Earnings Per Share (Details Nar
Earnings Per Share (Details Narrative) - shares | 3 Months Ended | |
Aug. 31, 2016 | Aug. 31, 2015 | |
Preferred Stock Convertible Into Common Stock [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 3,333,334 | 3,333,334 |
Options To Purchase Common Stock [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 200,000 | 1,150,000 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) | Aug. 31, 2016 | May 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 781,856 | $ 536,350 |
Finished pallets | 536,642 | 768,145 |
Total Inventory | $ 1,318,498 | $ 1,304,495 |
Property, Plant and Equipment23
Property, Plant and Equipment (Details Narrative) - USD ($) | 3 Months Ended | |
Aug. 31, 2016 | Aug. 31, 2015 | |
Property, Plant and Equipment [Abstract] | ||
Capitalized production machinery and equipment | $ 2,731,152 | |
Equipment depreciation period | 10 years | |
Production machinery includes deposits on equipment | $ 159,698 | |
Plant buildings and land net book value | 3,215,197 | |
Depreciation expense | $ 518,576 | $ 378,966 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) | Aug. 31, 2016 | May 31, 2016 |
Property, Plant and Equipment [Abstract] | ||
Production machinery and equipment | $ 22,149,817 | $ 18,616,603 |
Plant buildings and land | 4,663,339 | 4,663,339 |
Leasehold improvements | 245,568 | 198,568 |
Furniture and fixtures | 168,005 | 168,005 |
Property and Equipment gross | 27,226,729 | 23,646,515 |
Less: Accumulated depreciation | (11,599,772) | (11,081,196) |
Net Property, Plant and Equipment | $ 15,626,957 | $ 12,565,319 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | |
Aug. 31, 2016 | Aug. 31, 2015 | |
Yorktown's Pelletizing Equipment [Member] | ||
Payments of rental fees | $ 5,000 | |
Yorktown's Grinding Equipment [Member] | ||
Payments of rental fees | 22,500 | |
Yorktown [Member] | ||
Payments of rental fees | 385,000 | $ 357,500 |
Oklahoma [Member] | ||
Operating lease rental fees | 2,200 | |
Trienda Holdings, LLC [Member] | ||
Pallet sales | 187,002 | 3,113 |
Account receivable | 71,342 | |
Scrap material purchase amount | 8,905 | 0 |
Accounts payable | 7,628 | |
Green Plastic Pallets [Member] | ||
Pallet sales | 18,365 | $ 55,080 |
Account receivable | $ 56,908 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) | Jun. 02, 2016 | Feb. 29, 2016 | Jan. 07, 2016 | Jan. 31, 2014 | Aug. 31, 2016 | Jan. 31, 2014 | Aug. 31, 2016 | May 31, 2016 | Dec. 15, 2005 |
Preferred stock amount | $ 5 | $ 5 | $ 5 | ||||||
Maturities long term debt current | 3,201,905 | 3,201,905 | |||||||
Maturities long term debt year two | 9,564,108 | 9,564,108 | |||||||
Maturities long term debt year three | 7,309,827 | 7,309,827 | |||||||
Maturities long term debt year four | 7,736 | 7,736 | |||||||
Maturities long term debt year five | $ 0 | $ 0 | |||||||
Private Pallet Leasing Company [Member] | |||||||||
Debt instrument interest rate | 5.00% | 5.00% | |||||||
Capital expenditure on fixed assets | $ 5,400,000 | $ 5,400,000 | |||||||
Monthly lease payments amount | $ 100,000 | ||||||||
Capital lease payable invoice basis rate | $ 6.25 | $ 6.25 | |||||||
Maturities long term debt current | $ 1,091,375 | $ 1,091,375 | |||||||
Maturities long term debt year two | 1,147,092 | 1,147,092 | |||||||
Maturities long term debt year three | $ 433,611 | $ 433,611 | |||||||
Robert B. Rosene, Jr. [Member] | |||||||||
Debt instrument interest rate | 7.50% | ||||||||
Notes payable | $ 2,066,000 | ||||||||
Yorktown Management Financial Services, LLC [Member] | |||||||||
Debt instrument interest rate | 5.00% | ||||||||
Loan term | 3 years | ||||||||
Debt monthly payment | $ 20,629 | ||||||||
Notes payable | $ 688,296 | ||||||||
Restated Note [Member] | Mr.Rosene [Member] | |||||||||
Debt instrument principal amount | $ 2,066,000 | ||||||||
Debt instrument maturity date | Jan. 15, 2018 | ||||||||
Debt accrued interest | $ 2,475,690 | ||||||||
Notes payable | $ 4,541,690 | ||||||||
Greystone and GSM [Member] | |||||||||
Borrowed loans | $ 2,500,000 | $ 2,500,000 | |||||||
Greystone and GSM [Member] | Revolving Loan [Member] | |||||||||
Debt instrument principal amount | 2,500,000 | 2,500,000 | |||||||
Greystone and GSM [Member] | Term Loan [Member] | |||||||||
Debt instrument principal amount | $ 9,200,000 | $ 9,200,000 | |||||||
New Equipment Loan [Member] | International Bank of Commerce [Member] | |||||||||
Debt instrument principal amount | $ 2,530,072 | ||||||||
Term Loan [Member] | International Bank of Commerce [Member] | |||||||||
Debt instrument principal amount | $ 2,917,422 | ||||||||
Term Loan A [Member] | |||||||||
Loan term | 7 years | ||||||||
Debt monthly payment | $ 74,455 | ||||||||
Term Loan A [Member] | International Bank of Commerce [Member] | |||||||||
Debt instrument principal amount | $ 5,447,504 | ||||||||
Term Loan B [Member] | |||||||||
Loan term | 3 years | ||||||||
Debt monthly payment | $ 88,790 | ||||||||
Term Loan B [Member] | International Bank of Commerce [Member] | |||||||||
Remaining principal balance | $ 3,000,000 | ||||||||
International Bank of Commerce [Member] | |||||||||
Debt instrument maturity date | Jan. 7, 2019 | ||||||||
International Bank of Commerce [Member] | Minimum [Member] | |||||||||
Debt instrument interest rate | 0.50% | 0.50% | |||||||
International Bank of Commerce [Member] | Maximum [Member] | |||||||||
Debt instrument interest rate | 4.00% | 4.00% | |||||||
Revolving Loan [Member] | |||||||||
Debt instrument maturity date | Jan. 31, 2018 | ||||||||
Revolving Loan [Member] | Minimum [Member] | |||||||||
Debt instrument interest rate | 0.50% | ||||||||
Revolving Loan [Member] | Maximum [Member] | |||||||||
Debt instrument interest rate | 4.00% | ||||||||
IBC Loan Agreement [Member] | |||||||||
Borrowers maintain coverage ratio description | Borrowers to maintain a debt service coverage ratio of 1:25 to 1:00 and a funded debt to EBIDA ratio not exceeding 3:00 to 1:00 | Greystones debt service coverage ratio at August 31, 2016 was 0.84 which is not in compliance with the IBC Loan Agreements minimum debt service coverage ratio of 1.25. | |||||||
Capital expenditure on fixed assets | $ 1,000,000 | $ 1,000,000 | |||||||
Preferred stock amount | 500,000 | 500,000 | |||||||
Borrowings combined amount | $ 6,500,000 | $ 6,500,000 | |||||||
GRE And IBC [Member] | Mortgage Loan [Member] | |||||||||
Debt instrument interest rate | 4.50% | 4.50% | |||||||
Debt instrument principal amount | $ 3,412,500 | $ 3,412,500 | |||||||
Debt instrument maturity date | Jan. 31, 2019 | ||||||||
Prime Rate [Member] | |||||||||
Debt instrument interest rate | 3.50% | 3.50% |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) | Aug. 31, 2016 | May 31, 2016 |
Debt issue costs, net of amortization | $ (62,698) | $ (69,185) |
Long-term debt | 20,020,878 | 15,377,563 |
Less: Current portion | (3,201,905) | (2,088,327) |
Long-term Debt | 16,818,973 | 13,289,236 |
Term Note A Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | ||
Long-term debt gross | 5,140,476 | 5,310,179 |
Term Note B Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | ||
Long-term debt gross | 2,448,894 | 2,688,659 |
Revolving Note Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Due January 31, 2018 [Member] | ||
Long-term debt gross | 1,675,000 | 1,675,000 |
Term Note Payable by GRE to International Bank of Commerce, Interest Rate of 4.5%, Monthly Principal and Interest Payments of $26,215, Due January 31, 2019 [Member] | ||
Long-term debt gross | 2,977,666 | 3,021,734 |
Capital Lease with a Private Pallet Leasing Company, Interest Rate of 5%, Maturity of August 7, 2019 [Member] | ||
Long-term debt gross | 2,672,078 | |
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2018 [Member] | ||
Long-term debt gross | 4,541,690 | 2,066,000 |
Note Payable to Yorktown Management & Financial Services, LLC, 5.0% Interest, Due February 28, 2019, Monthly Principal and Interest Payments of $20,629 [Member] | ||
Long-term debt gross | 580,614 | 634,616 |
Other Note Payable [Member] | ||
Long-term debt gross | $ 47,158 | $ 50,560 |
Debt - Schedule of Debt (Deta28
Debt - Schedule of Debt (Details) (Parenthetical) - USD ($) | 3 Months Ended | 12 Months Ended |
Aug. 31, 2016 | May 31, 2016 | |
Term Note A Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 7, 2019 | Jan. 7, 2019 |
Term Note A Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | Maximum [Member] | ||
Debt instrument interest rate | 4.00% | 4.00% |
Term Note B Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 7, 2019 | Jan. 7, 2019 |
Term Note B Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | Maximum [Member] | ||
Debt instrument interest rate | 4.00% | 4.00% |
Revolving Note Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Due January 31, 2018 [Member] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 31, 2018 | Jan. 31, 2018 |
Revolving Note Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Due January 31, 2018 [Member] | Maximum [Member] | ||
Debt instrument interest rate | 4.00% | 4.00% |
Term Note Payable by GRE to International Bank of Commerce, Interest Rate of 4.5%, Monthly Principal and Interest Payments of $26,215, Due January 31, 2019 [Member] | ||
Debt instrument interest rate | 4.50% | 4.50% |
Debt instrument maturity date | Jan. 31, 2019 | Jan. 31, 2019 |
Debt instrument principal and interest amount | $ 26,215 | $ 26,215 |
Capital Lease with a Private Pallet Leasing Company, Interest Rate of 5%, Maturity of August 7, 2019 [Member] | ||
Debt instrument interest rate | 5.00% | 5.00% |
Debt instrument maturity date | Aug. 7, 2019 | Aug. 7, 2019 |
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2018 [Member] | ||
Debt instrument interest rate | 7.50% | 7.50% |
Debt instrument maturity date | Jan. 15, 2018 | Jan. 15, 2018 |
Note Payable to Yorktown Management & Financial Services, LLC, 5.0% Interest, Due February 28, 2019, Monthly Principal and Interest Payments of $20,629 [Member] | ||
Debt instrument interest rate | 5.00% | 5.00% |
Debt instrument maturity date | Feb. 28, 2019 | Feb. 28, 2019 |
Debt instrument principal and interest amount | $ 20,629 | $ 20,629 |
Stock Compensation Costs (Detai
Stock Compensation Costs (Details Narrative) - USD ($) | 3 Months Ended | |
Aug. 31, 2016 | Aug. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Stock compensation costs | $ 13,356 |
Concentrations, Risks and Unc30
Concentrations, Risks and Uncertainties (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended |
Aug. 31, 2016 | May 31, 2016 | |
Purchases from customers | $ 490,092 | |
Robert B Rosene [Member] | ||
Notes payable | $ 4,541,690 | |
Debt instrument maturity date | Jan. 15, 2018 | |
Fiscal Years 2017 [Member] | ||
Purchases from customers | $ 478,752 | |
Sales Revenue, Net [Member] | Two Customers [Member] | Fiscal Years 2017 [Member] | ||
Concentration risk percentage | 66.00% | |
Sales Revenue, Net [Member] | Customer One [Member] | Fiscal Years 2017 [Member] | ||
Concentration risk percentage | 36.00% | |
Sales Revenue, Net [Member] | Customer Two [Member] | Fiscal Years 2017 [Member] | ||
Concentration risk percentage | 30.00% | |
Sales Revenue, Net [Member] | One Customer [Member] | ||
Concentration risk percentage | 31.00% |
Subsequent Event (Details Narra
Subsequent Event (Details Narrative) - Subsequent Event [Member] - Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., Member of Greystone's Board [Member] | Sep. 02, 2016USD ($)$ / sharesshares |
Issuance of warrants to purchase shares of common stock | shares | 250,000 |
Common stock price per share | $ / shares | $ 0.01 |
Warrants vesting period | 2 years |
Warrants expiration date | Aug. 31, 2026 |
Capitalized debt issue cost | $ | $ 125,000 |