Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
May 31, 2021 | Aug. 14, 2021 | Nov. 30, 2020 | |
Cover [Abstract] | |||
Entity Registrant Name | GREYSTONE LOGISTICS, INC. | ||
Entity Central Index Key | 0001088413 | ||
Document Type | 10-K | ||
Document Period End Date | May 31, 2021 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --05-31 | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business Flag | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 15,079,000 | ||
Entity Common Stock, Shares Outstanding | 28,361,201 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2021 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | May 31, 2021 | May 31, 2020 |
Current Assets: | ||
Cash | $ 4,387,533 | $ 1,131,850 |
Accounts receivable - Trade | 4,586,134 | 6,670,771 |
Accounts receivable - Related parties | 153,550 | 94,351 |
Inventory | 3,441,974 | 4,229,895 |
Prepaid expenses | 52,315 | 7,488 |
Total Current Assets | 12,621,506 | 12,134,355 |
Property, Plant and Equipment, net | 30,998,988 | 34,142,407 |
Right-of-use Operating Lease Assets | 109,013 | 181,525 |
Total Assets | 43,729,507 | 46,458,287 |
Current Liabilities: | ||
Current portion of long-term debt | 3,236,113 | 4,416,377 |
Current portion of financing leases | 1,745,535 | 1,838,251 |
Current portion of operating leases | 56,443 | 74,024 |
Accounts payable and accrued expenses | 3,754,556 | 4,929,234 |
Deferred revenue | 6,430,607 | 3,793,167 |
Preferred dividends payable | 84,110 | |
Total Current Liabilities | 15,223,254 | 15,135,163 |
Long-Term Debt, net of current portion and debt issue costs | 12,971,529 | 18,329,633 |
Financing Leases, net of current portion | 1,848,472 | 3,617,405 |
Operating Leases, net of current portion | 52,570 | 107,501 |
Deferred Tax Liability | 2,380,642 | 1,109,052 |
Equity: | ||
Preferred stock, $0.0001 par value, cumulative, 20,750,000 shares authorized, 50,000 shares issued and outstanding, liquidation preference of $5,000,000 | 5 | 5 |
Common stock, $0.0001 par value, 5,000,000,000 shares authorized, 28,361,201 shares issued and outstanding | 2,836 | 2,836 |
Additional paid-in capital | 53,790,764 | 53,790,764 |
Accumulated deficit | (43,776,927) | (46,807,092) |
Total Greystone Stockholders' Equity | 10,016,678 | 6,986,513 |
Non-controlling interest | 1,236,362 | 1,173,020 |
Total Equity | 11,253,040 | 8,159,533 |
Total Liabilities and Equity | $ 43,729,507 | $ 46,458,287 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | May 31, 2021 | May 31, 2020 |
Statement of Financial Position [Abstract] | ||
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 |
Preferred stock, liquidation preference | $ 5,000,000 | $ 5,000,000 |
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 | 28,361,201 |
Common stock, shares outstanding | 28,361,201 | 28,361,201 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Income Statement [Abstract] | ||
Sales | $ 64,925,059 | $ 76,204,608 |
Cost of Sales | 53,468,239 | 64,721,749 |
Gross Profit | 11,456,820 | 11,482,859 |
Selling, General and Administrative Expenses | 5,202,231 | 4,623,618 |
Operating Income | 6,254,589 | 6,859,241 |
Other Income (Expense): | ||
Other income | 29,326 | 17,680 |
Interest expense | (1,177,799) | (1,705,351) |
Income before Income Taxes | 5,106,116 | 5,171,570 |
Provision for Income Taxes | 1,480,590 | 209,000 |
Net Income | 3,625,526 | 4,962,570 |
Income Attributable to Non-controlling Interest | (272,142) | (262,149) |
Preferred Dividends | (323,219) | (398,836) |
Net Income Attributable to Common Stockholders | $ 3,030,165 | $ 4,301,585 |
Income Per Share of Common Stock - Basic | $ 0.11 | $ 0.15 |
Income Per Share of Common Stock - Diluted | $ 0.10 | $ 0.15 |
Weighted Average Shares of Common Stock Outstanding - Basic | 28,361,201 | 28,361,201 |
Weighted Average Shares of Common Stock Outstanding - Diluted | 32,364,942 | 32,343,657 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total Greystone Stockholders' Equity [Member] | Non-controlling Interest [Member] | Total |
Balance at May. 31, 2019 | $ 5 | $ 2,836 | $ 53,790,764 | $ (51,108,677) | $ 2,684,928 | $ 1,126,271 | $ 3,811,199 |
Balance, shares at May. 31, 2019 | 50,000 | 28,361,201 | |||||
Cash distributions | (215,400) | (215,400) | |||||
Preferred dividends | (398,836) | (398,836) | (398,836) | ||||
Net income | 4,700,421 | 4,700,421 | 262,149 | 4,962,570 | |||
Balance at May. 31, 2020 | $ 5 | $ 2,836 | 53,790,764 | (46,807,092) | 6,986,513 | 1,173,020 | 8,159,533 |
Balance, shares at May. 31, 2020 | 50,000 | 28,361,201 | |||||
Cash distributions | (208,800) | (208,800) | |||||
Preferred dividends | (323,219) | (323,219) | (323,219) | ||||
Net income | 3,353,384 | 3,353,384 | 272,142 | 3,625,526 | |||
Balance at May. 31, 2021 | $ 5 | $ 2,836 | $ 53,790,764 | $ (43,776,927) | $ 10,016,678 | $ 1,236,362 | $ 11,253,040 |
Balance, shares at May. 31, 2021 | 50,000 | 28,361,201 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Cash Flows from Operating Activities: | ||
Net income | $ 3,625,526 | $ 4,962,570 |
Adjustments to reconcile net income to net cash provided by operating activities - | ||
Depreciation and amortization | 5,801,517 | 5,281,032 |
Change in deferred taxes | 1,271,590 | 182,410 |
Decrease (increase) in trade accounts receivable | 2,084,637 | (349,896) |
Increase in related party receivable | (59,199) | (44,031) |
Decrease (increase) in inventory | 761,171 | (1,608,904) |
Decrease (increase) in prepaid expenses | (44,827) | 231,658 |
Decrease in accounts payable and accrued expenses | (895,226) | (1,613,030) |
Increase in deferred revenue | 2,637,440 | 1,592,100 |
Net cash provided by operating activities | 15,182,629 | 8,633,909 |
Cash Flows from Investing Activities: | ||
Purchase of property and equipment | (2,905,640) | (6,284,934) |
Cash Flows from Financing Activities: | ||
Proceeds from long-term debt | 5,402,954 | |
Proceeds from revolving loan | 2,935,000 | 3,630,000 |
Payments on long-term debt and financing leases | (4,845,494) | (6,090,062) |
Payments on related party note payable and financing lease | (1,019,683) | (474,747) |
Payments on revolving loan | (5,475,000) | (4,295,000) |
Payments for debt issuance costs | (3,360) | |
Dividends paid on preferred stock | (407,329) | (426,918) |
Distributions paid by non-controlling interest | (208,800) | (215,400) |
Net cash used in financing activities | (9,021,306) | (2,472,533) |
Net Increase (Decrease) in Cash | 3,255,683 | (123,558) |
Cash, beginning of year | 1,131,850 | 1,255,408 |
Cash, end of year | $ 4,387,533 | $ 1,131,850 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
May 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Greystone Logistics, Inc. (“Greystone”), through its two wholly-owned subsidiaries, Greystone Manufacturing, LLC (“GSM”) and Plastic Pallet Production, Inc. (“PPP”), is engaged in the manufacturing and marketing of plastic pallets and pelletized recycled plastic resin. Principles of Consolidation The consolidated financial statements include the accounts of Greystone, its subsidiaries and entities required to be consolidated by the accounting guidance for variable interest entities (“VIE”). All material intercompany accounts and transactions have been eliminated. Greystone consolidates its VIE, Greystone Real Estate, L.L.C. (“GRE”), which owns the manufacturing facilities which are occupied by Greystone. GRE is owned by Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., a member of Greystone’s Board of Directors. Use of Estimates The preparation of Greystone’s consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires Greystone’s management to make estimates and assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Credit Losses on Financial Instruments Effective June 1, 2020, Greystone adopted Accounting Standards Update 2016-13, Financial Instruments-Credit Losses Accounts Receivable and Allowance for Uncollectible Accounts Greystone records its accounts receivable at their face value less an allowance for credit losses in an amount sufficient to absorb losses inherent in its accounts receivable portfolio based on projected expected credit losses. Greystone evaluates its accounts receivable and establishes an allowance for uncollectible accounts based on a combination of specific customer circumstances, credit conditions and history of collections. Inventory Inventory consists of finished pallets and raw materials which are stated at the lower of average cost or net realizable value. Property, Plant and Equipment Greystone’s property, plant and equipment is stated at cost. Depreciation expense is computed using the straight-line method over the estimated useful lives, as follows: Plant buildings 39 years Production machinery and equipment 5-12 years Leasehold improvements 5-7 years Furniture & fixtures 3-5 years Upon sale, retirement or other disposal, the related costs and accumulated depreciation of items of property, plant or equipment are removed from the related accounts and any gain or loss is recognized. When events or changes in circumstances indicate that long-lived assets may be impaired, an evaluation is performed comparing the estimated future undiscounted cash flows associated with the asset to the asset’s carrying amount. If the asset’s carrying amount exceeds the cash flows, a write-down to fair value is required. Leases Greystone recognizes right-of-use assets and lease liabilities on the balance sheet and disclosure of key information about leasing arrangements. Greystone has operating and finance leases for facilities, office space and plant equipment. Operating leases are included in right-of-use (“ROU”) operating lease assets and finance lease ROU assets are included in property, plant and equipment, net in the consolidated balance sheet. The lease liabilities are included in operating leases and financing leases (current and non-current) in the consolidated balance sheet. The lease liability is initially measured at the present value of the lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the incremental borrowing rate. The incremental borrowing rate is defined as the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. For finance leases, lease expenses are the sum of interest on the lease obligations and amortization of the ROU assets. Finance lease ROU assets are amortized based on the lesser of the lease term and the useful life of the leased asset according to the capital asset accounting policy. If ownership of the ROU assets transfers to the Greystone at the end of the lease term or if Greystone is reasonably certain to exercise a purchase option, amortization is calculated using the estimated useful life of the leased asset. For operating leases, the lease expenses are generally recognized on a straight-line basis over the lease term and recorded to general and administrative expenses in the consolidated statements of income. In accordance with Accounting Standards Codification 842, Greystone has made accounting policy elections (1) to not recognize right-of-use assets and lease liabilities for lease arrangements with a term of twelve months or less and (2) to combine lease and non-lease components. The non-lease components are not material and do not result in significant timing differences in the recognition of lease expense. Short-term leases include real estate and vehicles and are not significant in comparison to the Greystone’s overall lease portfolio. For these leases, the Company recognizes the leases as an operating expense on a straight-line basis over the term of the lease. Debt Issuance Costs The Company capitalizes debt issuance costs as incurred and amortizes such costs on a straight-line basis across the term of the debt. Debt issuance costs are fully amortized when the debt is repaid or refinanced. Stock Options The grant-date fair value of stock options and other equity-based compensation issued to employees is amortized on the straight-line basis over the vesting period of the award as compensation cost. The fair value of new option grants is estimated using the Black-Scholes option pricing model. The Black-Scholes option pricing model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option pricing models require the input of highly subjective assumptions including the expected stock price volatility, dividend yields and expected holding periods. Recognition of Revenues Revenue is recognized at the point in time a good or service is transferred to a customer and the customer obtains control of that good or receives the service performed. Sales arrangements with customers are short-term in nature involving single performance obligations related to the delivery of goods and generally provide for transfer of control at the time of shipment. In limited circumstances, where acceptance of the goods is subject to approval by the customer, revenue is recognized upon approval by the customer unless, historically, there have been insignificant rejections of goods by the customer. Contract liabilities associated with sales arrangements primarily relate to deferred revenue on prepaid sales of goods. Greystone generally purchases damaged pallets from its customers which are reground and used in Greystone’s pallet production process; however, damaged pallet purchases are historically insignificant. Income Taxes Greystone accounts for income taxes under the liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the consolidated financial statements and tax bases of assets and liabilities and tax loss carryforwards using enacted tax rates in effect for the year in which the differences are expected to reverse. Earnings Per Share Basic earnings per share is computed by dividing the earnings available to common stockholders by the weighted average number of common shares outstanding for the year. In arriving at income available to common stockholders, income attributable to non-controlling interest and preferred stock dividends are deducted from net income for the year. Basic and diluted earnings per share of common stock for the years ending May 31, are as follows: 2021 2020 Basic earnings per share of common stock: Numerator - Net income attributable to common stockholders $ 3,030,165 $ 4,301,585 Denominator - Weighted-average common shares outstanding 28,361,201 28,361,201 Income per share of common stock - Basic $ 0.11 $ 0.15 Diluted earnings per share of common stock: Numerator - Net income attributable to common stockholders $ 3,030,165 $ 4,301,585 Add: Preferred stock dividends due to assumed conversion 323,219 398,836 Net income allocated to common stockholders $ 3,353,384 $ 4,700,421 Denominator - Weighted-average common shares outstanding-basic 28,361,201 28,361,201 Incremental common shares from assumed conversion of warrants, options and preferred stock, as appropriate 4,003,741 3,982,456 Diluted weighted average common stock outstanding 32,364,942 32,343,657 Income per share of common stock - Diluted $ 0.10 $ 0.15 |
Inventory
Inventory | 12 Months Ended |
May 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 2. INVENTORY Inventory consists of the following as of May 31: 2021 2020 Raw materials $ 2,520,654 $ 1,953,957 Finished pallets 921,320 2,275,938 Total Inventory $ 3,441,974 $ 4,229,895 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
May 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Note 3. PROPERTY, PLANT AND EQUIPMENT A summary of the property, plant and equipment for Greystone is as follows, as of May 31: 2021 2020 Production machinery and equipment $ 52,292,733 $ 51,637,883 Plant buildings and land 6,970,949 6,881,326 Leasehold improvements 1,487,398 1,323,535 Furniture and fixtures 550,337 601,586 Total property, plant and equipment 61,301,417 60,444,330 Less: Accumulated depreciation (30,302,429 ) (26,301,923 ) Net Property, Plant and Equipment $ 30,998,988 $ 34,142,407 Property, plant and equipment includes production equipment with a carrying value of $426,343 which had not been placed into service as of May 31, 2021. Two plant buildings and land located in Bettendorf, Iowa are owned by GRE, a variable interest entity, and had a net book value of $2,664,805 at May 31, 2021. Depreciation expense for the years ended May 31, 2021 and 2020, was $5,796,357 and $5,275,872, respectively. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
May 31, 2021 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 4. LONG-TERM DEBT Long-term debt consists of the following as of May 31, 2021 and 2020: 2021 2020 Term loan A payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing April 30, 2023 $ 1,623,572 $ 2,459,854 Term loan C payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing August 4, 2024 905,822 1,165,774 Term loan D payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing January 10, 2022 487,390 1,136,455 Term loan E payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing February 28, 2023 447,551 696,174 Term loan F payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing February 29, 2024 2,035,670 2,752,293 Term loan G payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing April 30, 2024 789,926 837,811 Revolving loan payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.50%, due January 31, 2023 - 2,540,000 Term loan payable by GRE to International Bank of Commerce, interest rate of 5.5%, monthly principal and interest payments of $27,688, due April 30, 2023 2,049,941 2,261,425 Term note payable to Great Western Bank, interest rate of 3.7%, monthly principal and interest payments of $27,593, due March 19, 2025, secured by certain equipment 1,180,470 1,461,726 Paycheck Protection Program note, principal and interest forgiven as of June 11, 2021 3,034,000 3,034,000 Note payable to Robert Rosene, 7.5% interest, due January 15, 2023 3,536,112 4,253,228 Other 147,914 183,156 Face value of long-term debt 16,238,368 22,781,896 Less: Debt issuance costs, net of amortization (30,726 ) (35,886 ) 16,207,642 22,746,010 Less: Current portion of long-term debt (3,236,113 ) (4,416,377 ) Long-term debt $ 12,971,529 $ 18,329,633 The prime rate of interest as of May 31, 2021 was 3.25%. Debt Issuance Costs consists of the amounts paid to third parties in connection with the issuance and modification of debt instruments. These costs are shown on the consolidated balance sheet as a direct reduction to the related debt instrument. Amortization of these costs is included in interest expense. Greystone recorded amortization of debt issuance costs of $5,160 for the years ended May 31, 2021 and 2020. 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, as amended, provides for certain term loans and a revolver loan. The IBC term loans make equal monthly payments of principal and interest in such amounts sufficient to amortize the principal balance of the loans over the remaining lives. The monthly payments of principal and interest on the IBC term loans vary as a result of changes in the prime rate of interest. Currently, the aggregate payments for the IBC term loans is approximately $258,000 per month. The IBC Loan Agreement, as amended, provides a revolving loan in an aggregate principal amount of up to $4,000,000 (the “Revolving 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 in no event can exceed $4,000,000. The Revolving Loan bears interest at greater of the prime rate of interest plus 0.5%, or 4.5% and matures January 31, 2023. 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 repaid by the Borrowers does not reduce the original amount available to the Borrowers. Under these limitations, Greystone’s available revolving loan borrowing capacity was $4,000,000 at May 31, 2021. 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 $1,500,000 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. 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 provided a combined limited guaranty as of January 31, 2014, 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 Guaranty was amended and restated as of January 7, 2016, to provide that the maximum aggregate guaranty will be limited to $3,500,000 if Greystone maintains a Debt Coverage Ratio of at least 1.35:1.00 for a period of six consecutive quarters. Greystone has notified IBC that the conditions of the amended and restated Debt Service Coverage Ratio have been maintained for the six consecutive quarters ending May 31, 2021. 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. Paycheck Protection Program Loan (“PPP Loan”) On April 10, 2020, the Company received a SBA Payroll Protection Program (“PPP Loan”) pursuant to the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), with IBC for $3,034,000. On June 11, 2021, Greystone received notification from IBC that the principal and interest on the PPP Loan had been forgiven. Loan Agreement between GRE and IBC On January 31, 2014, GRE and IBC entered into a Loan Agreement, as amended, providing for a mortgage loan to GRE of $3,412,500. The loan provides for a 5.5% interest rate and a maturity of April 30, 2023 and is secured by a mortgage on the two buildings in Bettendorf, Iowa which are leased to Greystone. 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 payable with Mr. Rosene was restated (the “Restated Note”) to aggregate the accrued interest with the outstanding principal resulting in a combined note payable in the principal amount of $4,541,690 with an interest rate of 7.5% and a maturity of January 15, 2019, subsequently amended to January 15, 2023. The Restated Note requires the payment of accrued interest to Mr. Rosene. In addition, the Restated Note allows Greystone to make additional payments, at Greystone’s discretion, up to an amount allowed by the IBC Loan Agreement. Maturities Maturities of Greystone’s long-term debt, excluding the PPP Loan in the amount of $3,034,000 which was forgiven by letter dated June 11, 2021, for the five years after May 31, 2021 are $3,236,113, $7,761,154, $1,842,044 and $365,057. |
Leases
Leases | 12 Months Ended |
May 31, 2021 | |
Leases [Abstract] | |
Leases | Note 5. LEASES Financing Leases Financing leases consist of the following as of May 31: 2021 2020 Non-cancelable financing leases $ 3,594,007 $ 5,455,656 Less: Current portion of financing leases (1,745,535 ) (1,838,251 ) Non-cancelable financing leases, net of current portion $ 1,848,472 $ 3,617,405 Greystone and an unrelated private company entered into three separate lease agreements which have an effective interest rate of 7.4% and a term of five years. The leased equipment was placed into production during February 2018, August 2018 and December 2018, at a total cost of approximately $6.9 million. The lease agreements include bargain purchase options to acquire the production equipment at the end of the leases’ term. The leased equipment is used to manufacture pallets to sell to the private company. Rental payments are made as a credit on every sales invoice of pallets produced on the respective leased equipment at the rate of $3.32 per pallet. The aggregate monthly rental is estimated to be approximately $142,000. The agreements provide for minimum monthly lease rental payments based upon the total pallets sold in excess of a specified amount not to exceed the monthly productive capacity of the leased machines. Yorktown and Greystone entered into a sale and leaseback agreement effective December 28, 2018, whereby Yorktown purchased certain production equipment from Greystone at its net book value of $968,168 and entered into a four-year lease agreement with Greystone at a monthly rent of $27,915 for the initial thirty-six months and $7,695 for the remaining twelve months. The lease agreement provides for a purchase option of $10,000 at the end of the lease on December 31, 2022. The production equipment under the non-cancelable financing leases at May 31, 2021 and 2020 is as follows: 2021 2020 Production equipment under financing leases $ 8,473,357 $ 8,473,357 Less: Accumulated amortization (2,534,688 ) (1,521,818 ) Production equipment under financing leases, net $ 5,938,669 $ 6,951,539 Amortization of the carrying amount of the assets was $1,012,870 and $906,909 for the years ended May 31, 2021 and 2020, respectively. The amortization was included in depreciation expense. Operating Leases Greystone recognizes a lease liability for each lease based on the present value of remaining minimum fixed rental payments, using a discount rate that approximates the rate of interest for a collateralized loan over a similar term. A right-of-use asset is recognized for each lease, valued at the lease liability. Minimum fixed rental payments are recognized on a straight-line basis over the life of the lease as costs and expenses on the consolidated statement of income. Variable and short-term rental payments are recognized as costs and expenses as they are incurred. Greystone has three non-cancellable operating leases for (i) equipment with a fifty-two month term and a forty-eight month term and a discount rate of 5.40% and (ii) office space on a ninety-month term and a discount rate of 5.0%. The leases are single-term with constant monthly rental rates. The outstanding liability for right to use assets under operating leases as of May 31, 2021 and 2020 is as follows: 2021 2020 Liability under operating leases $ 109,013 $ 181,525 Less: Current portion (56,443 ) (74,024 ) Long-term portion of liability under operating leases $ 52,570 $ 107,051 Lease Summary Information For the years ended May 31, 2021 and 2020, a summary of lease activity follows: 2021 2020 Lease Expense Financing lease expense - Amortization of right-of-use assets $ 1,012,870 $ 906,909 Interest on lease liabilities 267,729 435,593 Operating lease expense 77,284 80,590 Short-term lease expense 1,481,270 1,595,311 Total $ 2,839,153 $ 3,018,403 Other Information Cash paid for amounts included in the measurement of lease liabilities for finance leases - Operating cash flows $ 267,729 $ 435,593 Financing cash flows $ 1,861,650 $ 1,911,287 Cash paid for amounts included in the measurement of lease liabilities for operating leases - Operating cash flows $ 77,284 $ 80,590 Right-of-use assets obtained in exchange for lease liabilities - Financing leases $ - $ 612,124 Operating leases $ - $ 67,750 Weighted-average remaining lease term (in years) - Financing leases 2.0 3.0 Operating leases 2.1 2.8 Weighted-average discount rate - Financing leases 7.4 % 7.4 % Operating leases 5.3 % 5.2 % Future minimum lease payments under non-cancelable operating and financing leases as of May 31, 2021, are approximately: Operating Leases Financing Leases Year ended May 31, 2021 $ 61,881 $ 1,948,534 Year ended May 31, 2022 33,881 1,666,035 Year ended May 31, 2023 19,018 253,192 Year ended May 31, 2024 1,990 12,304 Total lease payments 116,770 3,880,065 Less: Imputed interest (7,757 ) (286,058 ) Present value of minimum lease payments $ 109,013 $ 3,594,007 |
Revenue
Revenue | 12 Months Ended |
May 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 6. REVENUE Greystone’s principal product is plastic pallets produced from recycled plastic resin. Sales are primarily to customers in the continental United States of America. International sales are made to customers in Canada and Mexico which totaled $594,745 and $2,323,650 in fiscal years 2021 and 2020, respectively. Greystone’s customers include stocking and non-stocking distributors and direct sales to end-user customers. Sales to the following categories of customers for the fiscal years 2021 and 2020, respectively, were as follows: Category 2021 2020 Major customers (end users) 83 % 87 % Distributors 17 % 13 % Advances from a customer pursuant to a contract for the sale of plastics pallets is recognized as deferred revenue. Revenue is recognized by Greystone as pallets are shipped to the customer. Customer advances totaled $8,334,755 and $5,980,920 in fiscal years 2021 and 2020, respectively. The unrecognized balance of deferred revenue as of May 31, 2021 and 2020, was $6,430,607 and $3,793,167, respectively. The Company recognized $5,697,315 and $4,388,820 into revenue during the years ended May 31, 2021 and 2020, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
May 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 7. RELATED PARTY TRANSACTIONS Transactions with Warren F. Kruger, Chairman 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 for manufacturing pallets. Greystone compensates Yorktown for the use of equipment as discussed below. Rental fees. Yorktown provides administrative office space for Greystone in Tulsa, Oklahoma under a five-year lease at a monthly rental of $4,000 per month. Total rent expense was $48,000 each in fiscal years 2021 and 2020. At May 31, 2021, future minimum payments under the non-cancelable operating lease are $28,000 in fiscal year 2022. Transactions with TriEnda Holdings, L.L.C. TriEnda Holdings, L.L.C. (“TriEnda”) is a manufacturer of plastic pallets, protective packaging and dunnage utilizing thermoform processing of which Warren F. Kruger, Greystone’s President and CEO, is the non-executive chairman of the board of directors of Kruger Family Holdings, LLC (“KFH”), which owns a majority interest in TriEnda. Greystone may purchase pallets from TriEnda for resale or sell Greystone pallets to TriEnda. During fiscal year 2021 and 2020, Greystone purchases from TriEnda totaled $143,589 and $9,620, respectively and sales to TriEnda totaled $123,166 and $6,758, respectively. As of May 31, 2021, TriEnda owed $38,035 to Greystone. Transactions with Green Plastic Pallets Green Plastic Pallets (“Green”) is an entity owned by James Kruger, a brother to Warren Kruger, Greystone’s President and CEO. Green purchased pallets from Greystone totaling $544,636 and $506,501 in fiscal years 2021 and 2020, respectively. As of May 31, 2021, Green owed $115,515 to Greystone. |
Income Taxes
Income Taxes | 12 Months Ended |
May 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8. INCOME TAXES Deferred taxes as of May 31, 2021 and 2020 are as follows: 2021 2020 Deferred tax asset: Net operating loss carryforward $ 2,487,650 $ 3,355,844 Accrued expenses - 35,445 Inventory 7,620 91,440 Total deferred tax asset 2,495,270 3,482,729 Deferred tax liability: Depreciation and amortization, tax reporting (3,274,778 ) (2,990,647 ) Valuation allowance (1,601,134 ) (1,601,134 ) Net deferred tax liability $ (2,380,642 ) $ (1,109,052 ) A deferred tax asset is recognized for tax-deductible temporary differences and operating losses using the applicable enacted tax rate. In assessing the realizability of deferred tax assets, management considers the likelihood of whether it is more likely than not the net deferred tax asset will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which net operating losses and the reversal of timing differences may offset taxable income. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Future realization of deferred tax assets ultimately depends on the existence of sufficient taxable income of the appropriate character in carryforward periods under the tax law. Based on this evaluation, management has determined that Greystone will not be able to realize the full effect of the deferred tax assets and a valuation allowance of $1,601,134 has been recorded as of May 31, 2021 and 2020. The NOLs that are anticipated to be utilized during the available years total $4,221,505. The net change in deferred taxes for the year ended May 31, 2021 and 2020 is as follows: 2021 2020 Valuation allowance $ - $ 1,377,377 Net operating loss carryforward (868,195 ) (1,451,772 ) Depreciation and amortization, tax reporting in excess of financial (284,131 ) (113,074 ) Accrued expenses (35,445 ) (52,853 ) Inventory (83,820 ) 57,912 Net change $ (1,271,591 ) $ (182,410 ) The provision for income taxes as of May 31, 2021 and 2020 consists of the following: 2021 2020 Current income tax - state $ 208,999 $ 26,590 Deferred income taxes 1,271,591 182,410 Provision for income taxes $ 1,480,590 $ 209,000 Greystone’s provision for income taxes for the years ended May 31, 2021 and 2020 differs from the federal statutory rate as follows: 2021 2020 Tax provision using statutory rates 21 % 21 % State income taxes 9 10 Change in valuation allowance - (26 ) VIE income passed to members (1 ) (1 ) Tax provision per financial statements 29 % 4 % As of May 31, 2021, Greystone had net operating losses (NOLs) for Federal income tax purposes totaling $11,845,952, as follows: NOL Carryforward Year Expiring Year ended May 31, 2003 3,526,144 2023 Year ended May 31, 2004 1,632,774 2024 Year ended May 31, 2005 4,215,217 2025 Year ended May 31, 2006 275 294 2026 Year ended May 31, 2007 67,667 2027 Year ended May 31, 2011 746,484 2031 Year ended May 31, 2015 321,625 2035 Year ended May 31, 2016 1,060,747 2036 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
May 31, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Note 9. STOCKHOLDERS’ EQUITY Convertible Preferred Stock In September 2003, Greystone issued 50,000 shares of Series 2003, cumulative, convertible preferred stock, par value $0.0001, for a total purchase price of $5,000,000. Each share of the preferred stock has a stated value of $100 and a dividend rate equal to the prime rate of interest plus 3.25% (6.5% at May 31, 2021) and may be converted into common stock at the conversion rate of $1.50 per share or an aggregate of 3,333,333 shares of common stock. The holder of the preferred stock has been granted certain voting rights so that such holder has the right to elect a majority of the Board of Directors of Greystone. Preferred stock dividends must be fully paid before a dividend on the common stock may be paid. Warrants to Purchase Common Stock 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 of Directors, as compensation for providing guarantees on Greystone’s debt with IBC. The warrants are vested and expire January 10, 2027. |
Stock Options
Stock Options | 12 Months Ended |
May 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock Options | Note 10. STOCK OPTIONS Greystone has a stock option plan that provides for the granting of options to key employees and non-employee directors. The options are to purchase common stock at not less than fair market value at the date of the grant. Stock options generally expire in ten years from the date of grant or upon termination of employment and are generally exercisable one year from date of grant in cumulative annual installments of 25%. There was no option activity during the two years ended May 31, 2021. Outstanding options are as follows: Number Weighted Average Exercise Price Remaining Intrinsic Value Total outstanding May 31, 2019 200,000 $ 0.12 Total outstanding May 31, 2020 200,000 $ 0.12 Total outstanding May 31, 2021 200,000 $ 0.12 1.0 Exercisable as of May 31, 2021 200,000 $ 0.12 1.0 $ 228,000 Non-vested as of May 31, 2021 -0- |
Retirement Plan
Retirement Plan | 12 Months Ended |
May 31, 2021 | |
Retirement Benefits [Abstract] | |
Retirement Plan | Note 11. RETIREMENT PLAN Greystone implemented a defined contribution and profit-sharing plan effective January 1, 2019. The defined contribution plan is a IRC Section 401(K) plan. Greystone matches employee contributions up to 6% of employee contributions with a maximum employer contribution of 4% based on 100% of the first 3% and 50% of the next 2%. The employee is 100% vested for employer contributions to the 401(K) plan. Greystone’s contributions to the 401(K) plan totaled $330,682 and $275,677 in the fiscal years ended May 31, 2021 and 2020, respectively. The profit-sharing plan is an employer nonelective plan. Greystone’s contributions are discretionary. Vesting is earned ratably over a five-year period. Greystone has not authorized or made any discretionary contributions since inception. |
Financial Instruments
Financial Instruments | 12 Months Ended |
May 31, 2021 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | Note 12. FINANCIAL INSTRUMENTS The following methods and assumptions are used in estimating the fair-value disclosures for financial instruments: Cash, Accounts Receivable and Accounts Payable: The carrying amounts reported in the balance sheet for cash, accounts receivable and accounts payable approximate fair value due to the short-term maturity of these instruments. Long-Term 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 for comparable loans. As of May 31, 2021 and 2020, the carrying amounts reported in the consolidated balance sheet approximate fair value for the variable and fixed rate loans. |
Supplemental Information of Cas
Supplemental Information of Cash Flows | 12 Months Ended |
May 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Information of Cash Flows | Note 13. SUPPLEMENTAL INFORMATION OF CASH FLOWS Supplemental information of cash flows for the years ended May 31, 2021 and 2020: 2021 2020 Non-cash investing and financing activities: Acquisition of equipment through financing leases $ - $ 612,124 Acquisition of equipment in accounts payable $ 15,656 $ 295,108 Equipment reclassified from inventory $ 26,750 $ - Preferred dividend accrual $ - $ 84,110 Supplemental information: Interest paid $ 1,176,412 $ 1,696,444 Income taxes paid $ 178,280 $ - |
Concentrations, Risks and Uncer
Concentrations, Risks and Uncertainties | 12 Months Ended |
May 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Concentrations, Risks and Uncertainties | Note 14. CONCENTRATIONS, RISKS AND UNCERTAINTIES For the fiscal years 2021 and 2020, Greystone had four customers that accounted for approximately 83% and 87% of total sales, respectively. Greystone purchases damaged pallets from its customers at a price based on the value of the raw material content of the pallet. A majority of these purchases is from one of Greystone’s major customers which totaled approximately $753,000 and $1,768,000 in fiscal years 2021 and 2020, respectively. COVID-19 Risks Greystone is subject to litigation, claims and other commitments and contingencies arising in the ordinary course of business. Although the asserted value of these matters may be significant, the company currently does not expect that the ultimate resolution of any open matters will have a material adverse effect on its consolidated financial position or results of operations. Legal Proceeding On February 1, 2021, iGPS Logistics, LLC (“iGPS”), filed a Demand for Arbitration (the “Demand”) with the International Centre for Dispute Resolution of the American Arbitration Association (the “AAA”) against Greystone Manufacturing, LLC (“GSM”). iGPS alleges breaches by GSM under that certain manufacturing supply agreement dated as of December 16, 2015, by and between iGPS and GSM (the “MSA”) and the implied covenant of good faith and fair dealing, including, among other things, with respect to (1) improperly terminating the MSA, (2) improperly seeking to revoke its warranty of workmanship and materials, (3) failing to utilize a lower-priced and higher-quality PiRod, (4) making knowing false representations about compliance with UL certification requirements, and (5) refusing to permit an audit. iGPS seeks, among other things, (a) a declaratory judgment that iGPS is entitled to an audit of GSM’s material costs, (b) damages in excess of $500,000, including pre-judgment and post-judgment interest, (c) indemnification pursuant to MSA, (d) a preliminary and permanent injunction preventing GSM from taking any actions that are contrary to the exclusivity and non-competition provisions of the MSA, and (e) fees, costs, and expenses of bringing the arbitration. GSM denies the allegations set forth in the Demand and intends to vigorously defend itself. On March 1, 2021, GSM filed an Answer to the Demand with the AAA (the “Answer”). In its Answer, GSM states, among other things, (i) within the first year of the MSA, and repeatedly thereafter, iGPS made substantial and material reconfigurations of the original mold design, routinely demanding that GSM alone bear virtually all the increasing costs and provide warranties for the experimental redesigns iGPS demanded, (ii) the iGPS-GSM relationship changed dramatically in 2019 after a leadership change, (iii) the new iGPS leadership began disclaiming the understandings reached between iGPS and GSM in the earlier years, (iv) although GSM terminated the MSA on March 17, 2020, it has not missed a run on any of the pallets sold to iGPS even to today, over a year after termination, and (v) GSM has not breached the exclusivity and non-competition provisions of the MSA. GSM seeks, among other things, (A) certain declaratory awards, (B) damages, including pre-judgment and post-judgment interest, and (C) attorney’s fees, costs, and expenses associated with the arbitration. Greystone continues to manufacture and sell plastic pallets to iGPS. |
Variable Interest Entities (VIE
Variable Interest Entities (VIE) | 12 Months Ended |
May 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities (VIE) | Note 15. VARIABLE INTEREST ENTITIES (VIE) Greystone Real Estate, L.L.C. GRE is owned by Warren Kruger, President and CEO, and Robert Rosene, a member of the Board of Directors. GRE was created solely to own and lease two buildings that GSM occupies in Bettendorf, Iowa. The buildings, having a carrying value of $2,664,805 and $2,780,677 at May 31, 2021 and 2020, respectively, serve as collateral for GRE’s debt and Greystone’s debt under the Loan Agreement between Greystone and IBC. The debt had a carrying value of $2,049,941 and $2,261,425 as of May 31, 2021 and 2020, respectively. |
Commitments
Commitments | 12 Months Ended |
May 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Note 16. COMMITMENTS As of May 31, 2021, Greystone had outstanding commitments totaling $516,092 for the acquisition of equipment. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
May 31, 2021 | |
Accounting Policies [Abstract] | |
Organization | Organization Greystone Logistics, Inc. (“Greystone”), through its two wholly-owned subsidiaries, Greystone Manufacturing, LLC (“GSM”) and Plastic Pallet Production, Inc. (“PPP”), is engaged in the manufacturing and marketing of plastic pallets and pelletized recycled plastic resin. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Greystone, its subsidiaries and entities required to be consolidated by the accounting guidance for variable interest entities (“VIE”). All material intercompany accounts and transactions have been eliminated. Greystone consolidates its VIE, Greystone Real Estate, L.L.C. (“GRE”), which owns the manufacturing facilities which are occupied by Greystone. GRE is owned by Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., a member of Greystone’s Board of Directors. |
Use of Estimates | Use of Estimates The preparation of Greystone’s consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires Greystone’s management to make estimates and assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. |
Credit Losses on Financial Instruments | Credit Losses on Financial Instruments Effective June 1, 2020, Greystone adopted ASU 2016-13, Financial Instruments-Credit Losses |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Uncollectible Accounts Greystone records its accounts receivable at their face value less an allowance for credit losses in an amount sufficient to absorb losses inherent in its accounts receivable portfolio based on projected expected credit losses. Greystone evaluates its accounts receivable and establishes an allowance for uncollectible accounts based on a combination of specific customer circumstances, credit conditions and history of collections. |
Inventory | Inventory Inventory consists of finished pallets and raw materials which are stated at the lower of average cost or net realizable value. |
Property, Plant and Equipment | Property, Plant and Equipment Greystone’s property, plant and equipment is stated at cost. Depreciation expense is computed using the straight-line method over the estimated useful lives, as follows: Plant buildings 39 years Production machinery and equipment 5-12 years Leasehold improvements 5-7 years Furniture & fixtures 3-5 years Upon sale, retirement or other disposal, the related costs and accumulated depreciation of items of property, plant or equipment are removed from the related accounts and any gain or loss is recognized. When events or changes in circumstances indicate that long-lived assets may be impaired, an evaluation is performed comparing the estimated future undiscounted cash flows associated with the asset to the asset’s carrying amount. If the asset’s carrying amount exceeds the cash flows, a write-down to fair value is required. |
Leases | Leases Greystone recognizes right-of-use assets and lease liabilities on the balance sheet and disclosure of key information about leasing arrangements. Greystone has operating and finance leases for facilities, office space and plant equipment. Operating leases are included in right-of-use (“ROU”) operating lease assets and finance lease ROU assets are included in property, plant and equipment, net in the consolidated balance sheet. The lease liabilities are included in operating leases and financing leases (current and non-current) in the consolidated balance sheet. The lease liability is initially measured at the present value of the lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the incremental borrowing rate. The incremental borrowing rate is defined as the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. For finance leases, lease expenses are the sum of interest on the lease obligations and amortization of the ROU assets. Finance lease ROU assets are amortized based on the lesser of the lease term and the useful life of the leased asset according to the capital asset accounting policy. If ownership of the ROU assets transfers to the Greystone at the end of the lease term or if Greystone is reasonably certain to exercise a purchase option, amortization is calculated using the estimated useful life of the leased asset. For operating leases, the lease expenses are generally recognized on a straight-line basis over the lease term and recorded to general and administrative expenses in the consolidated statements of income. In accordance with Accounting Standards Codification 842, Greystone has made accounting policy elections (1) to not recognize right-of-use assets and lease liabilities for lease arrangements with a term of twelve months or less and (2) to combine lease and non-lease components. The non-lease components are not material and do not result in significant timing differences in the recognition of lease expense. Short-term leases include real estate and vehicles and are not significant in comparison to the Greystone’s overall lease portfolio. For these leases, the Company recognizes the leases as an operating expense on a straight-line basis over the term of the lease. |
Debt Issuance Costs | Debt Issuance Costs The Company capitalizes debt issuance costs as incurred and amortizes such costs on a straight-line basis across the term of the debt. Debt issuance costs are fully amortized when the debt is repaid or refinanced. |
Stock Options | Stock Options The grant-date fair value of stock options and other equity-based compensation issued to employees is amortized on the straight-line basis over the vesting period of the award as compensation cost. The fair value of new option grants is estimated using the Black-Scholes option pricing model. The Black-Scholes option pricing model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option pricing models require the input of highly subjective assumptions including the expected stock price volatility, dividend yields and expected holding periods. |
Recognition of Revenues | Recognition of Revenues Revenue is recognized at the point in time a good or service is transferred to a customer and the customer obtains control of that good or receives the service performed. Sales arrangements with customers are short-term in nature involving single performance obligations related to the delivery of goods and generally provide for transfer of control at the time of shipment. In limited circumstances, where acceptance of the goods is subject to approval by the customer, revenue is recognized upon approval by the customer unless, historically, there have been insignificant rejections of goods by the customer. Contract liabilities associated with sales arrangements primarily relate to deferred revenue on prepaid sales of goods. Greystone generally purchases damaged pallets from its customers which are reground and used in Greystone’s pallet production process; however, damaged pallet purchases are historically insignificant. |
Income Taxes | Income Taxes Greystone accounts for income taxes under the liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the consolidated financial statements and tax bases of assets and liabilities and tax loss carryforwards using enacted tax rates in effect for the year in which the differences are expected to reverse. |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing the earnings available to common stockholders by the weighted average number of common shares outstanding for the year. In arriving at income available to common stockholders, income attributable to non-controlling interest and preferred stock dividends are deducted from net income for the year. Basic and diluted earnings per share of common stock for the years ending May 31, are as follows: 2021 2020 Basic earnings per share of common stock: Numerator - Net income attributable to common stockholders $ 3,030,165 $ 4,301,585 Denominator - Weighted-average common shares outstanding 28,361,201 28,361,201 Income per share of common stock - Basic $ 0.11 $ 0.15 Diluted earnings per share of common stock: Numerator - Net income attributable to common stockholders $ 3,030,165 $ 4,301,585 Add: Preferred stock dividends due to assumed conversion 323,219 398,836 Net income allocated to common stockholders $ 3,353,384 $ 4,700,421 Denominator - Weighted-average common shares outstanding-basic 28,361,201 28,361,201 Incremental common shares from assumed conversion of warrants, options and preferred stock, as appropriate 4,003,741 3,982,456 Diluted weighted average common stock outstanding 32,364,942 32,343,657 Income per share of common stock - Diluted $ 0.10 $ 0.15 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
May 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Useful Life of Property, Plant and Equipment | Greystone’s property, plant and equipment is stated at cost. Depreciation expense is computed using the straight-line method over the estimated useful lives, as follows: Plant buildings 39 years Production machinery and equipment 5-12 years Leasehold improvements 5-7 years Furniture & fixtures 3-5 years |
Schedule of Basic and Diluted Earnings Per Share | Basic and diluted earnings per share of common stock for the years ending May 31, are as follows: 2021 2020 Basic earnings per share of common stock: Numerator - Net income attributable to common stockholders $ 3,030,165 $ 4,301,585 Denominator - Weighted-average common shares outstanding 28,361,201 28,361,201 Income per share of common stock - Basic $ 0.11 $ 0.15 Diluted earnings per share of common stock: Numerator - Net income attributable to common stockholders $ 3,030,165 $ 4,301,585 Add: Preferred stock dividends due to assumed conversion 323,219 398,836 Net income allocated to common stockholders $ 3,353,384 $ 4,700,421 Denominator - Weighted-average common shares outstanding-basic 28,361,201 28,361,201 Incremental common shares from assumed conversion of warrants, options and preferred stock, as appropriate 4,003,741 3,982,456 Diluted weighted average common stock outstanding 32,364,942 32,343,657 Income per share of common stock - Diluted $ 0.10 $ 0.15 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
May 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consists of the following as of May 31: 2021 2020 Raw materials $ 2,520,654 $ 1,953,957 Finished pallets 921,320 2,275,938 Total Inventory $ 3,441,974 $ 4,229,895 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
May 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | A summary of the property, plant and equipment for Greystone is as follows, as of May 31: 2021 2020 Production machinery and equipment $ 52,292,733 $ 51,637,883 Plant buildings and land 6,970,949 6,881,326 Leasehold improvements 1,487,398 1,323,535 Furniture and fixtures 550,337 601,586 Total property, plant and equipment 61,301,417 60,444,330 Less: Accumulated depreciation (30,302,429 ) (26,301,923 ) Net Property, Plant and Equipment $ 30,998,988 $ 34,142,407 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
May 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt consists of the following as of May 31, 2021 and 2020: 2021 2020 Term loan A payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing April 30, 2023 $ 1,623,572 $ 2,459,854 Term loan C payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing August 4, 2024 905,822 1,165,774 Term loan D payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing January 10, 2022 487,390 1,136,455 Term loan E payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing February 28, 2023 447,551 696,174 Term loan F payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing February 29, 2024 2,035,670 2,752,293 Term loan G payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing April 30, 2024 789,926 837,811 Revolving loan payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.50%, due January 31, 2023 - 2,540,000 Term loan payable by GRE to International Bank of Commerce, interest rate of 5.5%, monthly principal and interest payments of $27,688, due April 30, 2023 2,049,941 2,261,425 Term note payable to Great Western Bank, interest rate of 3.7%, monthly principal and interest payments of $27,593, due March 19, 2025, secured by certain equipment 1,180,470 1,461,726 Paycheck Protection Program note, principal and interest forgiven as of June 11, 2021 3,034,000 3,034,000 Note payable to Robert Rosene, 7.5% interest, due January 15, 2023 3,536,112 4,253,228 Other 147,914 183,156 Face value of long-term debt 16,238,368 22,781,896 Less: Debt issuance costs, net of amortization (30,726 ) (35,886 ) 16,207,642 22,746,010 Less: Current portion of long-term debt (3,236,113 ) (4,416,377 ) Long-term debt $ 12,971,529 $ 18,329,633 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
May 31, 2021 | |
Leases [Abstract] | |
Schedule of Financing Lease | Financing leases consist of the following as of May 31: 2021 2020 Non-cancelable financing leases $ 3,594,007 $ 5,455,656 Less: Current portion of financing leases (1,745,535 ) (1,838,251 ) Non-cancelable financing leases, net of current portion $ 1,848,472 $ 3,617,405 |
Schedule of Non-cancelable Financing Leases | The production equipment under the non-cancelable financing leases at May 31, 2021 and 2020 is as follows: 2021 2020 Production equipment under financing leases $ 8,473,357 $ 8,473,357 Less: Accumulated amortization (2,534,688 ) (1,521,818 ) Production equipment under financing leases, net $ 5,938,669 $ 6,951,539 |
Schedule of Operating Leases | The outstanding liability for right to use assets under operating leases as of May 31, 2021 and 2020 is as follows: 2021 2020 Liability under operating leases $ 109,013 $ 181,525 Less: Current portion (56,443 ) (74,024 ) Long-term portion of liability under operating leases $ 52,570 $ 107,051 |
Summary of Lease Activity | For the years ended May 31, 2021 and 2020, a summary of lease activity follows: 2021 2020 Lease Expense Financing lease expense - Amortization of right-of-use assets $ 1,012,870 $ 906,909 Interest on lease liabilities 267,729 435,593 Operating lease expense 77,284 80,590 Short-term lease expense 1,481,270 1,595,311 Total $ 2,839,153 $ 3,018,403 Other Information Cash paid for amounts included in the measurement of lease liabilities for finance leases - Operating cash flows $ 267,729 $ 435,593 Financing cash flows $ 1,861,650 $ 1,911,287 Cash paid for amounts included in the measurement of lease liabilities for operating leases - Operating cash flows $ 77,284 $ 80,590 Right-of-use assets obtained in exchange for lease liabilities - Financing leases $ - $ 612,124 Operating leases $ - $ 67,750 Weighted-average remaining lease term (in years) - Financing leases 2.0 3.0 Operating leases 2.1 2.8 Weighted-average discount rate - Financing leases 7.4 % 7.4 % Operating leases 5.3 % 5.2 % |
Schedule of Future Minimum Lease Payments | Future minimum lease payments under non-cancelable operating and financing leases as of May 31, 2021, are approximately: Operating Leases Financing Leases Year ended May 31, 2021 $ 61,881 $ 1,948,534 Year ended May 31, 2022 33,881 1,666,035 Year ended May 31, 2023 19,018 253,192 Year ended May 31, 2024 1,990 12,304 Total lease payments 116,770 3,880,065 Less: Imputed interest (7,757 ) (286,058 ) Present value of minimum lease payments $ 109,013 $ 3,594,007 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
May 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Sale of Revenues for Customer Categories | Sales to the following categories of customers for the fiscal years 2021 and 2020, respectively, were as follows: Category 2021 2020 Major customers (end users) 83 % 87 % Distributors 17 % 13 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
May 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Summary of Deferred Taxes | Deferred taxes as of May 31, 2021 and 2020 are as follows: 2021 2020 Deferred tax asset: Net operating loss carryforward $ 2,487,650 $ 3,355,844 Accrued expenses - 35,445 Inventory 7,620 91,440 Total deferred tax asset 2,495,270 3,482,729 Deferred tax liability: Depreciation and amortization, tax reporting (3,274,778 ) (2,990,647 ) Valuation allowance (1,601,134 ) (1,601,134 ) Net deferred tax liability $ (2,380,642 ) $ (1,109,052 ) |
Summary of Net Change in Deferred Taxes | The net change in deferred taxes for the year ended May 31, 2021 and 2020 is as follows: 2021 2020 Valuation allowance $ - $ 1,377,377 Net operating loss carryforward (868,195 ) (1,451,772 ) Depreciation and amortization, tax reporting in excess of financial (284,131 ) (113,074 ) Accrued expenses (35,445 ) (52,853 ) Inventory (83,820 ) 57,912 Net change $ (1,271,591 ) $ (182,410 ) |
Summary of Provision for Income Taxes | The provision for income taxes as of May 31, 2021 and 2020 consists of the following: 2021 2020 Current income tax - state $ 208,999 $ 26,590 Deferred income taxes 1,271,591 182,410 Provision for income taxes $ 1,480,590 $ 209,000 |
Summary of Provision for Income Taxes for Federal Statutory Rate | Greystone’s provision for income taxes for the years ended May 31, 2021 and 2020 differs from the federal statutory rate as follows: 2021 2020 Tax provision using statutory rates 21 % 21 % State income taxes 9 10 Change in valuation allowance - (26 ) VIE income passed to members (1 ) (1 ) Tax provision per financial statements 29 % 4 % |
Summary of Net Operating Loss for Federal Income Tax | As of May 31, 2021, Greystone had net operating losses (NOLs) for Federal income tax purposes totaling $11,845,952, as follows: NOL Carryforward Year Expiring Year ended May 31, 2003 3,526,144 2023 Year ended May 31, 2004 1,632,774 2024 Year ended May 31, 2005 4,215,217 2025 Year ended May 31, 2006 275 294 2026 Year ended May 31, 2007 67,667 2027 Year ended May 31, 2011 746,484 2031 Year ended May 31, 2015 321,625 2035 Year ended May 31, 2016 1,060,747 2036 |
Stock Options (Tables)
Stock Options (Tables) | 12 Months Ended |
May 31, 2021 | |
Schedule Of Compensation Related Costs Sharebased Payments Abstract | |
Schedule of Option Activity | Outstanding options are as follows: Number Weighted Average Exercise Price Remaining Intrinsic Value Total outstanding May 31, 2019 200,000 $ 0.12 Total outstanding May 31, 2020 200,000 $ 0.12 Total outstanding May 31, 2021 200,000 $ 0.12 1.0 Exercisable as of May 31, 2021 200,000 $ 0.12 1.0 $ 228,000 Non-vested as of May 31, 2021 -0- |
Supplemental Information of C_2
Supplemental Information of Cash Flows (Tables) | 12 Months Ended |
May 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Information of Cash Flows | Supplemental information of cash flows for the years ended May 31, 2021 and 2020: 2021 2020 Non-cash investing and financing activities: Acquisition of equipment through financing leases $ - $ 612,124 Acquisition of equipment in accounts payable $ 15,656 $ 295,108 Equipment reclassified from inventory $ 26,750 $ - Preferred dividend accrual $ - $ 84,110 Supplemental information: Interest paid $ 1,176,412 $ 1,696,444 Income taxes paid $ 178,280 $ - |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Schedule of Useful Life of Property, Plant and Equipment (Details) | 12 Months Ended |
May 31, 2021 | |
Plant Buildings [Member] | |
Estimated useful life of property plant and equipment | 39 years |
Production Machinery and Equipment [Member] | Minimum [Member] | |
Estimated useful life of property plant and equipment | 5 years |
Production Machinery and Equipment [Member] | Maximum [Member] | |
Estimated useful life of property plant and equipment | 12 years |
Leasehold Improvements [Member] | Minimum [Member] | |
Estimated useful life of property plant and equipment | 5 years |
Leasehold Improvements [Member] | Maximum [Member] | |
Estimated useful life of property plant and equipment | 7 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Estimated useful life of property plant and equipment | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Estimated useful life of property plant and equipment | 5 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Basic and Diluted Earnings Per Share (Details) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Accounting Policies [Abstract] | ||
Net income attributable to common stockholders | $ 3,030,165 | $ 4,301,585 |
Weighted-average common shares outstanding | 28,361,201 | 28,361,201 |
Income per share of common stock - Basic | $ 0.11 | $ 0.15 |
Net income attributable to common stockholders | $ 3,030,165 | $ 4,301,585 |
Add: Preferred stock dividends due to assumed conversion | 323,219 | 398,836 |
Net Income allocated to common stockholders | $ 3,353,384 | $ 4,700,421 |
Weighted-average shares outstanding - basic | 28,361,201 | 28,361,201 |
Incremental common shares from assumed conversion of warrants, options and preferred stock, as appropriate | 4,003,741 | 3,982,456 |
Diluted weighted average common stock outstanding | 32,364,942 | 32,343,657 |
Income per share - Diluted | $ 0.10 | $ 0.15 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 2,520,654 | $ 1,953,957 |
Finished goods | 921,320 | 2,275,938 |
Total Inventory | $ 3,441,974 | $ 4,229,895 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Carrying value of property, plant and equipment | $ 61,301,417 | $ 60,444,330 |
Depreciation expense | 5,796,357 | $ 5,275,872 |
Two Plant Buildings and Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Carrying value of property, plant and equipment | 2,664,805 | |
Service [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Machinery and equipment | $ 426,343 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 61,301,417 | $ 60,444,330 |
Less: Accumulated depreciation and amortization | (30,302,429) | (26,301,923) |
Net Property, Plant and Equipment | 30,998,988 | 34,142,407 |
Production Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 52,292,733 | 51,637,883 |
Plant Buildings and Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 6,970,949 | 6,881,326 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 1,487,398 | 1,323,535 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 550,337 | $ 601,586 |
Long-Term Debt (Details Narrati
Long-Term Debt (Details Narrative) - USD ($) | May 31, 2021 | Jun. 02, 2016 | Jan. 31, 2014 | May 31, 2021 | May 31, 2020 | Apr. 10, 2020 | Jan. 07, 2016 | Dec. 15, 2005 |
Preferred stock dividend amount | $ 323,219 | $ 398,836 | ||||||
Maturities long term debt year one | $ 3,236,113 | 3,236,113 | ||||||
Maturities long term debt year two | 7,761,154 | 7,761,154 | ||||||
Maturities long term debt year three | 1,842,044 | 1,842,044 | ||||||
Maturities long term debt year four | 365,057 | 365,057 | ||||||
Robert B. Rosene, Jr. [Member] | ||||||||
Debt instrument interest rate | 7.50% | |||||||
Note payable | $ 2,066,000 | |||||||
Robert B. Rosene, Jr. [Member] | Restated Note [Member] | ||||||||
Debt instrument interest rate | 7.50% | |||||||
Debt instrument principal amount | $ 4,541,690 | |||||||
Debt instrument, maturity date range, start | Jan. 15, 2019 | |||||||
Extended maturity date | Jan. 15, 2023 | |||||||
Paycheck Protection Program [Member] | ||||||||
Debt instrument principal amount | $ 3,034,000 | |||||||
Excluding PPP Loan [Member] | ||||||||
Debt instrument principal amount | $ 3,034,000 | $ 3,034,000 | ||||||
Revolving Loan [Member] | ||||||||
Debt instrument interest rate | 4.50% | 4.50% | ||||||
Line of credit maximum borrowing capacity | $ 4,000,000 | $ 4,000,000 | ||||||
IBC Loan Agreement [Member] | ||||||||
Amortization of debt issuance costs | 5,160 | |||||||
Debt monthly payment | $ 258,000 | |||||||
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 | |||||||
Capital expenditure on fixed assets | $ 1,500,000 | 1,500,000 | ||||||
Preferred stock dividend amount | 500,000 | |||||||
IBC Loan Agreement [Member] | Revolving Loan [Member] | ||||||||
Debt instrument principal amount | 4,000,000 | 4,000,000 | ||||||
Line of credit maximum borrowing capacity | $ 4,000,000 | $ 4,000,000 | ||||||
IBC Loan Agreement [Member] | Guaranty [Member] | ||||||||
Guarantees combined amount | $ 6,500,000 | $ 3,500,000 | ||||||
Revolving Loan [Member] | ||||||||
Debt instrument maturity date | Jan. 31, 2023 | |||||||
GRE and IBC [Member] | Mortgage Loan [Member] | ||||||||
Debt instrument interest rate | 5.50% | |||||||
Debt instrument principal amount | $ 3,412,500 | |||||||
Debt instrument maturity date | Apr. 30, 2023 | |||||||
Prime Rate [Member] | ||||||||
Debt instrument interest rate | 3.25% | 3.25% | ||||||
Prime Rate [Member] | Revolving Loan [Member] | ||||||||
Debt instrument interest rate | 0.50% | 0.50% |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Debt Instrument [Line Items] | ||
Total long-term debt | $ 16,238,368 | $ 22,781,896 |
Debt issuance costs, net of amortization | (30,726) | (35,886) |
Total debt, net of debt issuance costs | 16,207,642 | 22,746,010 |
Less: Current portion of long-term debt | (3,236,113) | (4,416,377) |
Long-term debt, net of current portion and debt issue costs | 12,971,529 | 18,329,633 |
Term Loan A Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 1,623,572 | 2,459,854 |
Term Loan C Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing August 4, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 905,822 | 1,165,774 |
Term Loan D Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 487,390 | 1,136,455 |
Term Loan E Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing February 28, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 447,551 | 696,174 |
Term Loan F Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing February 29, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 2,035,670 | 2,752,293 |
Term Loan G Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing April 30, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 789,926 | 837,811 |
Revolving Loan Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.50%, Due January 31, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 2,540,000 | |
Term Loan Payable by GRE to International Bank of Commerce, Interest Rate of 5.5%, Monthly Principal and Interest Payment of $27,688, Due April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 2,049,941 | 2,261,425 |
Term Note Payable to Great Western Bank, Interest Rate of 3.7%, Monthly Principal and Interest Payments of $27,593, due March 19, 2025, Secured by Certain Equipment [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 1,180,470 | 1,461,726 |
Paycheck Protection Program Note, Principal and Interest Forgiven as of June 11, 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 3,034,000 | 3,034,000 |
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 3,536,112 | 4,253,228 |
Other [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 147,914 | $ 183,156 |
Long-Term Debt - Schedule of _2
Long-Term Debt - Schedule of Long-Term Debt (Details) (Parenthetical) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Term Loan A Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Apr. 30, 2023 | Apr. 30, 2023 |
Term Loan A Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing April 30, 2023 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.00% | 4.00% |
Term Loan C Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing August 4, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Aug. 4, 2024 | Aug. 4, 2024 |
Term Loan C Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing August 4, 2024 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.00% | 4.00% |
Term Loan D Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 10, 2022 | Jan. 10, 2022 |
Term Loan D Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.75% | 4.75% |
Term Loan E Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing February 28, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Feb. 28, 2023 | Feb. 28, 2023 |
Term Loan E Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing February 28, 2023 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.75% | 4.75% |
Term Loan F Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing February 29, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Feb. 29, 2024 | Feb. 29, 2024 |
Term Loan F Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing February 29, 2024 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.25% | 5.25% |
Term Loan G Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing April 30, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Apr. 30, 2024 | Apr. 30, 2024 |
Term Loan G Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing April 30, 2024 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.25% | 5.25% |
Revolving Loan Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.50%, Due January 31, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 31, 2023 | Jan. 31, 2023 |
Revolving Loan Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.50%, Due January 31, 2023 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.50% | 4.50% |
Term Loan Payable by GRE to International Bank of Commerce, Interest Rate of 5.5%, Monthly Principal and Interest Payment of $27,688, Due April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.50% | 5.50% |
Debt instrument maturity date | Apr. 30, 2023 | Apr. 30, 2023 |
Debt instrument principal and interest amount | $ 27,688 | $ 27,688 |
Term Note Payable to Great Western Bank, Interest Rate of 3.7%, Monthly Principal and Interest Payments of $27,593, due March 19, 2025, Secured by Certain Equipment [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 3.70% | 3.70% |
Debt instrument maturity date | Mar. 19, 2025 | Mar. 19, 2025 |
Debt instrument principal and interest amount | $ 27,593 | $ 27,593 |
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 7.50% | 7.50% |
Debt instrument maturity date | Jan. 15, 2023 | Jan. 15, 2023 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Lessee, Lease, Description [Line Items] | ||
Finance lease cost | $ 2,839,153 | $ 3,018,403 |
Amortization of assets | $ 1,012,870 | 906,909 |
Equipment One [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease term | 52 months | |
Operating lease discount rate | 5.40% | |
Office Space [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Payments of monthly rental amount | $ 48,000 | $ 48,000 |
Operating lease term | 90 months | |
Operating lease discount rate | 5.00% | |
Sale and Leaseback Agreement [Member] | Yorktown Production Equipment [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Finance lease term | 4 years | |
Value of production equipment purchased | $ 968,168 | |
Lease maturity date | Dec. 27, 2022 | |
Bargain purchase option amount | $ 10,000 | |
Sale and Leaseback Agreement [Member] | Yorktown Production Equipment [Member] | Initial Thirty Nine Months [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Payments of monthly rental amount | 27,915 | |
Sale and Leaseback Agreement [Member] | Yorktown Production Equipment [Member] | Remaining Twelve Months [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Payments of monthly rental amount | $ 7,695 | |
Three Year Lease Agreements with Five Year Terms [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Finance lease term | 3 years | |
Lease interest rate | 7.40% | |
Finance lease cost | $ 6,900,000 | |
Lease payment per invoice rate | $ 3.32 | |
Payments of monthly rental amount | $ 142,000 |
Leases - Schedule of Financing
Leases - Schedule of Financing Lease (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Leases [Abstract] | ||
Non-cancellable financing leases | $ 3,594,007 | $ 5,455,656 |
Less: Current portion of financing leases | (1,745,535) | (1,838,251) |
Non-cancellable financing leases, net of current portion | $ 1,848,472 | $ 3,617,405 |
Leases - Schedule of Non-cancel
Leases - Schedule of Non-cancelable Financing Leases (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Leases [Abstract] | ||
Production equipment under financing leases | $ 8,473,357 | $ 8,473,357 |
Less: Accumulated amortization | (2,534,688) | (1,521,818) |
Production equipment under financing leases, net | $ 5,938,669 | $ 6,951,539 |
Leases - Schedule of Operating
Leases - Schedule of Operating Leases (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Leases [Abstract] | ||
Liability under operating leases | $ 109,013 | $ 181,525 |
Less: Current portion | (56,443) | (74,024) |
Long-term portion of liability under operating leases | $ 52,570 | $ 107,501 |
Leases - Summary of Lease Activ
Leases - Summary of Lease Activity (Details) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Leases [Abstract] | ||
Financing lease expense - Amortization of right-of-use assets | $ 1,012,870 | $ 906,909 |
Financing lease expense - Interest on lease liabilities | 267,729 | 435,593 |
Operating lease expense | 77,284 | 80,590 |
Short-term lease expense | 1,481,270 | 1,595,311 |
Total | 2,839,153 | 3,018,403 |
Cash paid for amounts included in the measurement of lease liabilities for finance leases - Operating cash flows | 267,729 | 435,593 |
Cash paid for amounts included in the measurement of lease liabilities for finance leases - Financing cash flows | 1,861,650 | 1,911,287 |
Cash paid for amounts included in the measurement of lease liabilities for operating leases - Operating cash flows | 77,284 | 80,590 |
Right-of-use assets obtained in exchange for lease liabilities - Financing leases | 612,124 | |
Right-of-use assets obtained in exchange for lease liabilities - Operating leases | $ 67,750 | |
Weighted-average remaining lease term (in years) - Financing leases | 2 years | 3 years |
Weighted-average remaining lease term (in years) - Operating leases | 2 years 1 month 6 days | 2 years 9 months 18 days |
Weighted-average discount rate - Financing leases | 7.40% | 7.40% |
Weighted-average discount rate - Operating leases | 5.30% | 5.20% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Leases [Abstract] | ||
Year ended May 31, 2021 | $ 61,881 | |
Year ended May 31, 2022 | 33,881 | |
Year ended May 31, 2023 | 19,018 | |
Year ended May 31, 2024 | 1,990 | |
Total lease payments | 116,770 | |
Less: Imputed interest | (7,757) | |
Present value of minimum lease payments | 109,013 | $ 181,525 |
Year ended May 31, 2021 | 1,948,534 | |
Year ended May 31, 2022 | 1,666,035 | |
Year ended May 31, 2023 | 253,192 | |
Year ended May 31, 2024 | 12,304 | |
Total lease payments | 3,880,065 | |
Less: Imputed interest | (286,058) | |
Present value of minimum lease payments | $ 3,594,007 | $ 5,455,656 |
Revenue (Details Narrative)
Revenue (Details Narrative) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Customer advances | $ 5,697,315 | $ 4,388,820 |
Unrecognized deferred revenue | 6,430,607 | 3,793,167 |
Pallets [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Customer advances | 8,334,755 | 5,980,920 |
Canada and Mexico [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Sales revenue | $ 594,745 | $ 2,323,650 |
Revenue - Schedule of Sale of R
Revenue - Schedule of Sale of Revenues for Customer Categories (Details) - Sales Revenue, Net [Member] - Customer Concentration Risk [Member] | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
End Users - Major Customers [Member] | ||
Concentration Risk [Line Items] | ||
Total | 83.00% | 87.00% |
Distributors [Member] | ||
Concentration Risk [Line Items] | ||
Total | 17.00% | 13.00% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Related Party Transaction [Line Items] | ||
Future minimum payments | $ 116,770 | |
Non-Cancelable Operating Lease [Member] | Fiscal Year 2022 [Member] | ||
Related Party Transaction [Line Items] | ||
Future minimum payments | 28,000 | |
Office Space [Member] | ||
Related Party Transaction [Line Items] | ||
Payments of rental fees | $ 48,000 | $ 48,000 |
Lease term | 90 months | |
Monthly [Member] | Office Space [Member] | ||
Related Party Transaction [Line Items] | ||
Payments of rental fees | $ 4,000 | |
Lease term | 5 years | |
Yorktown's Grinding and Pelletizing Equipment [Member] | ||
Related Party Transaction [Line Items] | ||
Payments of rental fees | $ 1,430,000 | 1,430,000 |
Yorktown's Grinding and Pelletizing Equipment [Member] | Weekly [Member] | ||
Related Party Transaction [Line Items] | ||
Payments of rental fees | 27,500 | |
TriEnda Holdings, L.L.C [Member] | ||
Related Party Transaction [Line Items] | ||
Related party transaction purchases | 143,589 | 9,620 |
Revenue from goods | 123,166 | 6,758 |
Account receivable | 38,035 | |
Green Plastic Pallets [Member] | ||
Related Party Transaction [Line Items] | ||
Revenue from goods | 544,636 | $ 506,501 |
Account receivable | $ 115,515 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | May 31, 2021 | May 31, 2020 |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets and valuation allowance | $ 1,601,134 | $ 1,601,134 |
Utilization of NOL's accumulated | 4,221,505 | |
NOL carryforward | $ 11,845,952 |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Taxes (Details) - USD ($) | May 31, 2021 | May 31, 2020 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforward | $ 2,487,650 | $ 3,355,844 |
Accrued expenses | 35,445 | |
Inventory | 7,620 | 91,440 |
Total deferred tax asset | 2,495,270 | 3,482,729 |
Depreciation and amortization, tax reporting in excess of financial | (3,274,778) | (2,990,647) |
Valuation allowance | (1,601,134) | (1,601,134) |
Net deferred tax liability | $ (2,380,642) | $ (1,109,052) |
Income Taxes - Summary of Net C
Income Taxes - Summary of Net Change in Deferred Taxes (Details) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Valuation allowance | $ 1,377,377 | |
Net operating loss carryforward | (868,195) | (1,451,772) |
Depreciation and amortization, tax reporting in excess of financial | (284,131) | (113,074) |
Accrued expenses | (35,445) | (52,853) |
Other | (83,820) | 57,912 |
Net change | $ (1,271,591) | $ (182,410) |
Income Taxes - Summary of Provi
Income Taxes - Summary of Provision for Income Taxes (Details) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Current income tax - state | $ 208,999 | $ 26,590 |
Deferred income tax | 1,271,591 | 182,410 |
Provision for income taxes | $ 1,480,590 | $ 209,000 |
Income Taxes - Summary of Pro_2
Income Taxes - Summary of Provision for Income Taxes for Federal Statutory Rate (Details) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Tax provision using statutory rates | 21.00% | 21.00% |
State income taxes | 9.00% | 10.00% |
Change in valuation allowance | (26.00%) | |
VIE income passed to members | (1.00%) | (1.00%) |
Tax provision per financial statements | 29.00% | 4.00% |
Income Taxes - Summary of Net O
Income Taxes - Summary of Net Operating Loss for Federal Income Tax (Details) | 12 Months Ended |
May 31, 2021USD ($) | |
NOL Carryforward | $ 11,845,952 |
Year Ended May 31, 2003 [Member] | |
NOL Carryforward | $ 3,526,144 |
Year Expiring | 2023 |
Year Ended May 31, 2004 [Member] | |
NOL Carryforward | $ 1,632,774 |
Year Expiring | 2024 |
Year Ended May 31, 2005 [Member] | |
NOL Carryforward | $ 4,215,217 |
Year Expiring | 2025 |
Year Ended May 31, 2006 [Member] | |
NOL Carryforward | $ 275,294 |
Year Expiring | 2026 |
Year Ended May 31, 2007 [Member] | |
NOL Carryforward | $ 67,667 |
Year Expiring | 2027 |
Year Ended May 31, 2011 [Member] | |
NOL Carryforward | $ 746,484 |
Year Expiring | 2031 |
Year Ended May 31, 2015 [Member] | |
NOL Carryforward | $ 321,625 |
Year Expiring | 2035 |
Year Ended May 31, 2016 [Member] | |
NOL Carryforward | $ 1,060,747 |
Year Expiring | 2036 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Sep. 30, 2003 | May 31, 2021 | May 31, 2020 | Sep. 01, 2016 | |
Preferred stock par value | $ 0.0001 | $ 0.0001 | ||
Warren F. Kruger [Member] | ||||
Issuance of warrants to purchase shares of common stock | 250,000 | |||
Warrants exercise price per share | $ 0.01 | |||
Warrants expiration date | Jan. 10, 2027 | |||
Robert B. Rosene, Jr. [Member] | ||||
Issuance of warrants to purchase shares of common stock | 250,000 | |||
Warrants exercise price per share | $ 0.01 | |||
Warrants expiration date | Jan. 10, 2027 | |||
Convertible Preferred Stock [Member] | ||||
Number of shares issued | 50,000 | |||
Preferred stock par value | $ 0.0001 | |||
Number of shares issued, value | $ 5,000,000 | |||
Preferred stock stated value | $ 100 | |||
Preferred stock dividend rate | 3.25% | 6.50% | ||
Debt conversion price | $ 1.50 | |||
Number of common stock issued upon conversion | 3,333,333 |
Stock Options (Details Narrativ
Stock Options (Details Narrative) | 12 Months Ended |
May 31, 2021 | |
Stock Options - Schedule Of Option Activity | |
Stock option expiration year | 10 years |
Stock option annual installment percentage | 25.00% |
Stock Options - Schedule of Opt
Stock Options - Schedule of Option Activity (Details) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Stock Options - Schedule Of Option Activity | ||
Number of Options Outstanding, Beginning Balance | 200,000 | 200,000 |
Number of Options Outstanding, Exercised | ||
Number of Options Outstanding, Ending Balance | 200,000 | 200,000 |
Number of Options Exercisable, Ending Balance | 200,000 | |
Number of Options Non-vested, Ending Balance | 0 | |
Weighted Average Exercise Price Outstanding, Beginning Balance | $ 0.12 | $ 0.12 |
Weighted Average Exercise Price Outstanding, Exercised | ||
Weighted Average Exercise Price Outstanding, Ending Balance | 0.12 | $ 0.12 |
Weighted Average Exercise Price, Exercisable | $ 0.12 | |
Remaining Contractual Life (years), Outstanding | 1 year | |
Remaining Contractual Life (years), Exercisable | 1 year | |
Intrinsic Value, Options Exercisable, Ending Balance | $ 228,000 |
Retirement Plan (Details Narrat
Retirement Plan (Details Narrative) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Retirement Benefits [Abstract] | ||
Employers contribution percentage, description | The defined contribution plan is a IRC Section 401(K) plan. Greystone matches employee contributions up to 6% of employee contributions with a maximum employer contribution of 4% based on 100% of the first 3% and 50% of the next 2%. The employee is 100% vested for employer contributions to the 401(K) plan. | |
Employer discretionary contribution amount | $ 330,682 | $ 275,677 |
Maximum annual contributions per employee, percent | 6.00% |
Supplemental Information of C_3
Supplemental Information of Cash Flows - Schedule of Supplemental Information of Cash Flows (Details) - USD ($) | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | ||
Acquisition of equipment through financing leases | $ 612,124 | |
Acquisition of equipment in accounts payable | 15,656 | 295,108 |
Equipment reclassified from inventory | 26,750 | |
Preferred dividend accrual | 84,110 | |
Interest paid | 1,176,412 | 1,696,444 |
Income taxes paid | $ 178,280 |
Concentrations, Risks and Unc_2
Concentrations, Risks and Uncertainties (Details Narrative) - USD ($) | Feb. 01, 2021 | May 31, 2021 | May 31, 2020 |
Concentration Risk [Line Items] | |||
Excess damages | $ 500,000 | ||
Fiscal Year 2021 [Member] | |||
Concentration Risk [Line Items] | |||
Customer purchases amount | $ 753,000 | ||
Fiscal Year 2020 [Member] | |||
Concentration Risk [Line Items] | |||
Customer purchases amount | $ 1,768,000 | ||
Sales Revenue, Net [Member] | Four Customers [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 83.00% | 87.00% |
Variable Interest Entities (V_2
Variable Interest Entities (VIE) (Details Narrative) - USD ($) | May 31, 2021 | May 31, 2020 |
Debt [Member] | ||
Carrying value of liabilities | $ 2,049,941 | $ 2,261,425 |
Plant Buildings [Member] | ||
Carrying value of assets | $ 2,664,805 | $ 2,780,677 |
Commitments (Details Narrative)
Commitments (Details Narrative) | May 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Purchase of production equipment | $ 516,092 |