We prepared the following discussion and analysis to help you better understand our financial condition, changes in our financial condition, and results of operations for the three-month and nine-month periods ended July 31, 2009. This discussion should be read in conjunction with the financial statements and notes and the information contained in our annual report on Form 10-K for the fiscal year ended October 31, 2008.
This report contains forward-looking statements that involve future events, our future performance and our expected future operations and actions. In some cases you can identify forward-looking statements by the use of words such as “may,” “will,” “should,” “anticipate,” “believe,” “expect,” “plan,” “future,” “intend,” “could,” “estimate,” “predict,” “hope,” “potential,” “continue,” or the negative of these terms or other similar expressions. These forward-looking statements are only our predictions and involve numerous assumptions, risks and uncertainties, including, but not limited to, those business risks and factors described elsewhere in this report, in our other Securities and Exchange Commission filings, as well as those listed below.
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| • | Overcapacity within the biodiesel industry; |
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| • | Our ability to obtain member approval and regulatory consent required to acquire substantially all of Freedom Fuels’ assets; |
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| • | Our ability to obtain debt financing to modify Freedom Fuels’ existing biodiesel plant so that it can process corn oil; |
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| • | Our ability to close the transaction to acquire substantially all of Freedom Fuels’ assets; |
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| • | Availability and costs of feedstock, particularly soy oil, animal fats and corn oil; |
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| • | Changes in the price and market for biodiesel and glycerin; |
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| • | Changes in our business strategy, capital improvements or development plans; |
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| • | Changes in or elimination of governmental laws, tariffs, trade or other controls or enforcement practices such as national, state or local energy policy; federal biodiesel tax incentives; or environmental laws and regulations that apply to the plant operations of any company we may invest in or merge with and their enforcement; |
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| • | Changes in general economic conditions impacting the availability and price of vegetable oils and animal fats; |
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| • | Total U.S. consumption of diesel; |
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| • | Continuing decrease in the demand for biodiesel; |
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| • | Changes in soy-based biodiesel’s qualification under the Renewable Fuels Standard as a result of the Environmental Protection Agency’s preliminary tests indicating soy-based biodiesel’s failure to satisfy the required reduction of greenhouse gas emissions; |
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| • | Weather changes, strikes, transportation or production problems causing supply interruptions or shortages affecting the availability and price of feedstock; |
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| • | Changes in interest rates or the availability of credit; |
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| • | Our ability to generate free cash flow to invest in our business; |
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| • | Our potential liability resulting from future litigation; |
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| • | General economic conditions; |
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| • | Existence of and changes and advances in biodiesel production technology allowing us to profitably process corn oil by attaching a module to Freedom Fuels’ plant; |
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| • | Continued imposition of tariffs; |
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| • | Competition from other alternative fuels; and |
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| • | Other factors described elsewhere in this report. |
We undertake no duty to update these forward looking statements, even though our situation may change in the future. Furthermore, we cannot guarantee future results, events, levels of activity, performance or achievements. We caution you not to put undue reliance on any forward-looking statements which speak only as of the date of this report. You should read this report completely and with the understanding that our actual future results may be materially different from what we currently expect. We qualify all of our forward looking statements by these cautionary statements.
Table of Contents
Overview
Soy Energy, LLC was organized as an Iowa limited liability company by filing articles of organization with the Iowa Secretary of State on December 15, 2005. We anticipated constructing a biodiesel plant with a production capacity of 15 million gallons per year using technology provided by Best Energies, Inc. (“Best Energies”) in Marcus, Iowa. However, given the current downturn in economic and market conditions, combined with Best Energies’ inability to make a $5,000,000 equity contribution, Management determined in October 2008 that obtaining the financing to construct our plant would not likely be feasible. Consequently, Management began exploring its options to acquire, invest in or merge with a company that owns a constructed biodiesel plant and decided to purchase certain assets of Freedom Fuels, LLC, an Iowa limited liability company currently in Chapter 11 bankruptcy. Currently, our principal place of business is located at P.O. Box 663, 222 N. Main St., Marcus, Iowa 51035.
Because we no longer plan to construct our plant, any funds we have expended in our construction and plant development efforts were deemed a loss. From our inception to July 31, 2009, we have incurred accumulated losses of approximately $7,509,000. Since we have not commenced any operations, we do not yet have comparable income, production or sales data.
On July 29, 2009, we entered into an Asset Purchase Agreement (“APA”) with Freedom Fuels, LLC, an Iowa limited liability company and debtor in possession (“Freedom Fuels”) pursuant to which we will acquire substantially all of Freedom Fuels’ assets free and clear of all liens, claims and interests and thereafter operate the biodiesel production facility currently owned by Freedom Fuels in exchange for $9,000,000 in cash, an assignment agreement assigning to Freedom Fuels all of our right, title and interest in the debtor in possession loans and an assignment agreement assigning to Freedom Fuels all of the our right, title and interest in the dividend cash flow note of $2 million issued by New Equity, LLC to us (the “Transaction”). The key agreements governing the Transaction are described in further detail below.
Asset Purchase Agreement
Pursuant to the APA, we will acquire substantially all the assets of Freedom Fuels, including without limitation, all inventory and tangible personal property used in Freedom Fuels’ business, all intellectual property, deposits and all rights of Freedom Fuels under its contracts that we assume. We will not be assuming any liabilities arising out of or relating to any aspect of Freedom Fuels’ business on or before the closing date of the Transaction, which shall be no later than 3 business days following satisfaction of the various conditions to closing.
Among other conditions, the closing of the Transaction is conditioned upon the receipt of certain regulatory approvals and approval and confirmation from the Bankruptcy Court of Freedom Fuels’ plan of reorganization, which will include the Transaction. Our obligation to close the Transaction is also conditioned on us obtaining a small business loan in the amount of $4 million and obtaining a $10 million USDA loan guarantee and a loan in the approximate amount of $7 million to construct and operate a corn oil pretreatment facility that will enable Freedom Fuels’ plant to process and refine feedstocks other than soy oil, such as crude corn oil. Further, unless a majority of our unit holders approve the APA and the transactions contemplated therein, we are not obligated to consummate the Transaction.
According to the APA, pending closing of the Transaction, Freedom Fuels shall conduct its business only in the ordinary course and it shall use commercially reasonable efforts to preserve its present business operations. Freedom Fuels shall also use its best efforts to obtain approval of the APA by the Bankruptcy Court. Freedom Fuels’ plan of reorganization was filed with the Bankruptcy Court for the Northern District of Iowa on September 11, 2009 providing for the Transaction shortly. We can terminate the APA if there has been a material adverse effect to the business of Freedom Fuels or if Freedom Fuels has breached or failed to perform any of its representations or warranties as set forth in the APA and such breach or failure to perform are not timely cured. Finally, either party may terminate the APA if the Transaction does not close by December 31, 2009. This termination date may be extended by either party for a maximum of 90 days, as long as the sole reason for closing not having occurred is that required governmental approvals have not been approved. The parties may also mutually agree to extend the closing date.
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Unit Purchase Agreement
On July 29, 2009 we entered into a Unit Purchase Agreement with New Equity, LLC, an Iowa limited liability company (the “UPA”) pursuant to which we will issue 8,254 of our membership units to New Equity, representing a 20% ownership interest in Soy Energy, LLC. New Equity, LLC is comprised of 19 members of Freedom Fuels.
New Equity has been designated as the Freedom Fuels Debtor In Possession Lender in the plan of reorganization of Freedom Fuels to be filed with the Bankruptcy Court. New Equity and Freedom Fuels have entered into a loan agreement and promissory note for New Equity to make advances to Freedom Fuels up to $1,000,000 (the “Debtor In Possession Loan”). Pursuant to this loan agreement, New Equity will pay to BANKFIRST, Freedom Fuels’ senior lender, cash in an amount equal to $1,000,000, less all advances actually made to Freedom Fuels by New Equity.
As consideration for the units issued under the UPA, New Equity will: assign to us all of its interest in the Debtor In Possession Loan and provide us with a promissory note for $2,000,000 (the “Dividend Cash Flow Note”). The Debtor In Possession Loan and the Dividend Cash Flow Note will be assigned to Freedom Fuels as a part of the APA. The UPA anticipates the units will be issued through a private placement and we will prepare an offering document to be presented to New Equity no less than two weeks prior to closing of the UPA. Closing of the UPA is conditioned upon New Equity’s review of the offering documents, and upon the Bankruptcy Court’s approval of the APA.
Both parties have made customary representations, warranties and covenants in the UPA. The closing of the UPA is conditioned upon us obtaining our members’ approval of amendments to our Operating Agreement to provide for New Equity to appoint four directors to our board of directors and to issue our units to New Equity. The closing of the UPA is also conditioned upon closing of the APA and if the closing on the UPA has not occurred by March 15, 2010, either party may terminate the UPA.
Liquidity and Capital Resources
Plan of Operations
We expect to spend the next 12 months focused primarily on obtaining government and member approval, filing the necessary reports with the Securities and Exchange Commission, obtaining the requisite debt financing, and closing on an acquisition of substantially all the assets of Freedom Fuels, LLC, and modifying the biodiesel facility to incorporate corn oil as a feedstock. There can be no assurance that we will obtain the necessary member or regulatory approval or debt financing required to close the Transaction.
Of the $30,668,000 we raised in equity during our offering registered with the State of Iowa, we have total assets remaining of approximately $23,692,000 as of July 31, 2009, consisting primarily of approximately $20,115,000 of cash and equivalents and assets held for sale of approximately $3,557,000. We are currently working to sell the assets held for sale, which include two boilers and three centrifuges, which were acquired in our earlier efforts to construct a biodiesel plant.
Sources and Uses of Funds
Below is a table showing our sources of funds and our estimated use of proceeds assuming we are able to successfully close the Transaction, although we have not obtained member or regulatory approval in this regard.
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ESTIMATED USE OF PROCEEDS
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Use of Proceeds | | Amount | |
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Equity Proceeds Raised | | $ | 31,782,000 | (1) |
Estimated Proceeds Used in Development and Partial Construction of a Biodiesel Facility in Marcus, Iowa and Continuing Administrative Costs | | | 11,859,000 | (2) |
Proceeds required to purchase substantially all of Freedom Fuels’ assets | | $ | 9,000,000 | (3) |
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Estimated proceeds remaining for start-up of Freedom Fuels’ plant and related expenditures | | $ | 10,923,000 | (4) |
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(1) This amount is our total equity proceeds less the redemption agreement for 750 units we executed with Bratney and our offering costs of approximately $186,000. The primary costs we incurred in raising capital included legal fees, accounting fees, printing and distribution costs, and meeting costs.
(2) We believe these amounts represent a reasonable estimate of the proceeds we used as of July 31, 2009 on construction, building and facilities, purchase of machinery and equipment and purchases of real estate related to our attempt to construct a biodiesel facility in Marcus, Iowa plus ongoing administrative costs we have associated with operating our business until an acquisition, investment or merger with another company is closed.
(3) This amount assumes that the Transaction closes and we obtain the numerous approvals required.
(4) This number is our current cash and equivalents, less our accounts payable. If we sell some of the assets we have held for sale, then this will increase the proceeds remaining to invest in or merge with another company. Additionally, this figure does not include the debt financing that we intend to obtain.
Site Acquisition and Development
We purchased approximately 35 acres for our plant site near Marcus, Iowa in Cherokee County. In August 2007, we commenced construction of our biodiesel plant. In November 2007, we suspended all construction related activities on our plant while we sought the debt financing we needed to complete construction of the plant. Upon completing approximately 10% of the construction of our biodiesel plant in October 2008, Management determined that it would not likely be feasible to complete construction of the biodiesel plant due to current economic conditions and our lack of financing. We may be unable to sell the site and the construction completed at a profit, or at all. Due to the significant changes we made to our project, we recorded an impairment charge during our year ended October 31, 2008 in the value of constructed and construction in process assets of approximately $6,923,000, a portion of which is from the site we purchased.
Freedom Fuels’ biodiesel plant is located in Mason City, Iowa and has a capacity of 30 million gallons per year. The plant site is subject to two mortgages held by BankFirst both of which will be released pursuant to the plan of reorganization to be filed by Freedom Fuels. Thus, it is expected that we will obtain Freedom Fuels’ plant site free and clear of all liens.
Plant Construction and Start-Up of Plant Operations
Plant Construction Activity
Construction of the plant in Marcus, Iowa was approximately 10% complete when Management determined completion of the construction was no longer feasible. In October 2008 we terminated our agreement with Best Energies because it notified us it was no longer able to commit a $5,000,000 equity contribution to the project. As a result of this and the current economic downturn, Management determined that obtaining financing to complete construction was not likely feasible and began exploring its options to acquire, invest in, or merge with a company that owns a constructed biodiesel plant. Consequently, we recently executed an Asset Purchase Agreement with Freedom Fuels, LLC for its biodiesel plant in Mason City, Iowa. Freedom Fuels’ plant was operational and produced approximately 20 million gallons of biodiesel before Freedom Fuels filed for bankruptcy.
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Permitting and Costs and Effects of Compliance with Environmental Laws
We anticipate that all the permits of Freedom Fuels’ current biodiesel plant will be transferred to us. We may need to obtain additional permits for the module we intend to attach to the plant to enable us to process corn oil; however, we are yet to apply for any such permits at this time and we can provide no assurance or guarantees that we will obtain such permits.
Feedstock Procurement and Sale of Biodiesel
We anticipate obtaining corn oil for processing at the biodiesel plant we intend to acquire from ethanol plants situated nearby. We have had preliminary discussions with numerous ethanol plants but have only reached non-binding and informal understandings in this regard. We are yet to enter into any contracts with any entity to supply us with corn oil.
We anticipate entering into an agreement with a biodiesel marketer to sell the biodiesel produced at the plant we intend to acquire. We are currently discussing marketing arrangements with several different marketers, but are yet to enter into any definitive agreements in this regard. We anticipate that any biodiesel marketing contract we may enter into will require that we will be paid for the biodiesel upon shipment from the plant, thus limiting our risk. However, we have not entered into an agreement with any biodiesel marketer, and we may not be able to enter into such an agreement on favorable terms or at all.
Freedom Fuels’ biodiesel plant
Freedom Fuels’ plant is designed to run on soybean oil. Since the plant was not profitable processing soybean oil, we intend to attach a module on the front end of the plant to enable the plant to also process corn oil. This corn oil module is expected to cost approximately $7 million dollars and we intend to obtain debt financing for this project. We are in the process of applying for a USDA loan guarantee in connection with obtaining this debt financing; however, we may be unable to obtain the debt financing or the loan guarantee and this may hinder our ability to purchase the necessary equipment. It is expected that construction and installation of the corn oil module shall take between six to eight months. We are yet to definitively decide which design-builder will construct the corn oil module.
Trends and Uncertainties Impacting the Biodiesel Industry and Our Future Operations
Freedom Fuels was not profitable and it therefore filed for bankruptcy protection. While we anticipate that the corn oil module will improve profit margins of the plant that we intend to acquire, given the numerous industry-wide factors that affect the operation of biodiesel plants and their financial performance, we cannot provide any assurances that the plant will become profitable under our management. We expect to require debt financing in the approximate amount of $7 million for construction and installation of the corn oil module; however, given our lack of operational history and adverse industry conditions, we cannot provide any guarantee or assurances that we will obtain this debt financing. These factors include, but are not limited to, the available supply and cost of feedstock from which the biodiesel and glycerin will be processed; dependence on a biodiesel marketer and glycerin marketer to market and distribute our products; the competitive nature of the biodiesel industry; possible legislation at the federal, state and/or local level; changes in federal tax incentives; the cost of complying with extensive environmental laws that regulate the biodiesel industry; the risk of decreased demand from European markets; and the biodiesel industry’s lack of market share and instability in the renewable fuels industry as a whole. If we are unable to obtain the requisite debt financing, we will not be obligated to close the Transaction.
We anticipate our revenues from the biodiesel plant that we intend to acquire will consist of sales of biodiesel and glycerin. We expect biodiesel sales to constitute the bulk of our revenues. Although the price of diesel fuel has increased over the last several years, diesel fuel prices per gallon remain at levels below or equal to the price of biodiesel. In addition, other more cost-efficient domestic alternative fuels may be developed and displace biodiesel as an environmentally-friendly alternative. If diesel prices do not continue to increase or a new fuel is developed to compete with biodiesel, it may be difficult to market biodiesel, which could result in the loss of some or all of the value of our units. Further, if the supply of biodiesel increases from new biodiesel plants scheduled to begin production or from current plants beginning to operate at larger percentages of their capacities, then we do not expect current biodiesel prices to be sustainable in the long term and the industry will need to continue to grow demand to offset the increased supply brought to the market place by additional production.
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Management believes that the current U.S. economic recession, the global economic downturn and the recent financial crisis that led to a collapse of a variety of major U.S. financial institutions and the federal government’s passage of bailout plans may also place downward pressure on the demand for fuel, including biodiesel. These factors have caused significant upheaval in the financial markets and economy of the United States, as well as abroad. Credit markets have tightened and lending requirements have become more stringent. The U.S. economy is in the midst of a recession, with increasing unemployment rates and decreasing retail sales. Commodity markets tumbled as a result of the economic turmoil, causing oil and other commodity prices to drop significantly. Management expects that these conditions may lead to a decline in biodiesel demand and it is uncertain for how long and to what extent these financial troubles may negatively affect biodiesel demand in the future.
In addition, demand could be depressed as a result of anti-dumping and anti-subsidy tariffs imposed by the European Commission on all biodiesel produced in the United States. On March 12, 2009 the European Commission applied temporary tariffs on imports of biodiesel from the United States, while it continues to investigate the evidence of unfair subsidies and dumping of United States biodiesel imports into the European Union. These tariffs went into effect March 13, 2009. In July 2009, the European Commission decided to extend these tariffs beyond their initial July 2009 expiration date until 2014. Our product will likely face increased competition for sales of its biodiesel and international demand for its product will likely decrease as a result of these tariffs. If demand for biodiesel continues to decline, this could have a negative effect on the ability of Freedom Fuels’ plant we intend to acquire to operate profitably.
We expect that our results of operations if the Transaction is consummated will benefit from federal and state biodiesel supports and tax incentives. Biodiesel has generally been more expensive to produce than petroleum-based diesel and, as a result, the biodiesel industry depends on such incentives to be competitive. Changes to these supports or incentives could significantly impact demand for biodiesel. The most significant of these are the Volumetric Ethanol Excise Tax Credit (“VEETC”), and the RFS, as amended by the Energy Independence and Security Act of 2007 (the “Energy Independence Act”). The VEETC creates a tax credit of $1.00 per gallon of biodiesel blended with petroleum diesel, but is set to expire on December 31, 2009. The amended RFS requires the use of 9 billion gallons of renewable fuel in 2008, increasing to 36 billion gallons of renewable fuel by 2022. The RFS further requires at least 500 million gallons of biodiesel and biomass-based diesel fuel be blended into the national diesel pool in 2009, increasing to 1 billion gallons by 2012. We anticipate that the RFS may increase demand for biodiesel in the long-term, as it sets a minimum usage requirement for biodiesel and other types of biomass-based diesel. However, the EPA recently issued preliminary findings that soy-based biodiesel fails to meet targets for reducing greenhouse emissions, as required under the RFS. The RFS requires that biodiesel reduce greenhouse gas emissions by 40 to 50% when compared to conventional diesel in order to count towards the RFS mandate. The EPA found soy-based biodiesel to reduce greenhouse gas emissions by only 22%. Biodiesel produced from animal fats were found to meet this greenhouse gas emissions reduction requirement. Thus, Management anticipates there may be increased demand for biodiesel produced from animal fats in order to contribute to the RFS mandate. There can be no assurance, however, that demand for biodiesel will be increased by the RFS, as amended by the Energy Independence Act. It is already estimated that national biodiesel production capacity far exceeds the 2012 biodiesel and biomass-based diesel use RFS mandate. Accordingly, there is no assurance that additional production of biodiesel and biomass-based diesel will not continually outstrip any additional demand for biodiesel that might be created by the RFS. We also anticipate that the majority of the renewable fuels utilized to satisfy the RFS will be primarily satisfied by corn-based ethanol and other types of ethanol, including cellulose-based ethanol.
Quarterly Financial Results
At July 31, 2009, we had total assets of approximately $23,692,000 consisting primarily of cash and equivalents and assets held for sale. At July 31, 2009, we had current liabilities of approximately $170,000 consisting of our accounts payable and other accrued expenses. Total members’ equity at July 31, 2009, was approximately $23,522,000. Since our inception, we have generated no revenue from operations. For the three months ended July 31, 2009, we had a net loss of approximately $235,000.
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Sources of Funds
In December 2005, we sold a total of 1,500 units to our founding members at a price of $333.33 per unit and received aggregate proceeds of $500,000. In addition, in April 2006 we issued 1,600 units to our seed capital members at a price of $500 per unit and received aggregate proceeds of $800,000. We sold 30,668 units at a price of $1,000 per unit in our Iowa registered offering and received aggregate proceeds of $30,668,000. We broke escrow on our Iowa registered offering in June 2007. We incurred costs of raising capital of approximately $186,000 related to the equity proceeds raised. These costs primarily consisted of legal fees, professional fees and printing costs. In July 2008, we executed a redemption agreement with Bratney pursuant to which Bratney agreed to return its 750 membership units.
We determined the offering price for our founding members, seed capital and general offering units based upon the capitalization requirements necessary to fund our development, organization and financing activities as a development-stage company with plans to construct and operate a biodiesel plant. We did not rely upon any independent valuation, book value or other valuation criteria in determining the founding member, seed capital and general offering sales price per unit.
Debt Financing
In October 2008, Management determined it would not likely be feasible to obtain the necessary debt financing to complete construction of our biodiesel plant. We therefore entered into the APA with Freedom Fuels to purchase substantially all its assets including its biodiesel plant in Mason City, Iowa. Closing of the Transaction is conditioned on us obtaining debt financing to allow us to attach a module on the front end of the plant to enable the plant to run on corn oil.
Grants and Government Programs
Currently, there are limited numbers of grants, loans and forgivable loan programs available to biodiesel producers. We intend to apply for a USDA loan guarantee to assist us in obtaining the debt financing necessary to construct and install a corn oil module on Freedom Fuels’ plant that we intend to acquire. We can offer no assurances or guarantees that we will obtain the loan guarantee or that it will be of the amount that we desire.
Critical Accounting Estimates
Management uses estimates and assumptions in preparing our financial statements in accordance with Generally Accepted Accounting Principles. Those estimates and assumptions affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and reported revenues and expenses. Significant estimates include long-lived asset and assets held for sale impairment analysis.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
The Company is not required to provide the information required by this item because it is a smaller reporting company.
Item 4T. Controls and Procedures
Our management, including our Chief Executive Officer (the principal executive officer) Charles Sand, along with our Chief Financial Officer (the principal financial officer) Dallas Thompson, have reviewed and evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) as of July 31, 2009. Based upon this review and evaluation, these officers have concluded that our disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting discussed below.
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Due to the current operations and size of the Company, there is a lack of segregation of duties in certain functions. The Company is in the process of strengthening internal controls including enhancing our internal control systems and procedures to assure that this weakness is corrected and remediated. Accordingly, our executive officers and management believe that the financial statements included in this report present fairly in all material respects our financial condition, results of operations and cash flows for the periods presented.
Changes in Internal Control Over Financial Reporting
Our management, including our principal executive officer and principal financial officer, have reviewed and evaluated any changes in our internal control over financial reporting that occurred during the period ended July 31, 2009 and there has been no change that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
From time to time in the ordinary course of business, we may be named as a defendant in legal proceedings related to various issues, including without limitation, workers’ compensation claims, tort claims, or contractual disputes. We are not currently subject to any material legal proceeding or claims. Management does not believe that there are currently any material unasserted claims against us.
Item 1A. Risk Factors.
The Company is not required to provide the information required by this item because it is a smaller reporting company.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
We did not sell any membership units during the three months ended July 31, 2009. None of our membership units were purchased by or on behalf of the Company or any affiliated purchaser (as defined in Rule 10b-18(a)(3) of the Exchange Act) of the Company during the three months ended July 31, 2009. The following table sets forth our approximate use of proceeds until the present time:
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Net Proceeds | | $ | 31,782,000 | (1) |
Capital Expenditures and Construction Related Costs | | | (11,259,000 | ) |
Project Development Costs | | | (1,923,000 | )(2) |
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Balance | | $ | 18,600,000 | |
(1)This amount is our total equity proceeds less the redemption agreement for 750 units we executed with Bratney and our offering costs of approximately $186,000. The primary costs we incurred in raising capital included legal fees, accounting fees, printing and distribution costs, and meeting costs.
(2)This amount only reflects the funds we have expended as of July 31, 2009 on project development costs and does not include the approximately $1,323,000 we have received from interest on cash and equivalents and investments. The amount we have received from interest has offset the amount we expended, as reflected on our statement of cash flows and in the table “Estimated Use of Proceeds” above.
Item 3. Defaults Upon Senior Securities
None.
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Item 4. Submission of Matters to a Vote of Security Holders |
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None. |
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Item 5. Other Information |
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None. |
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Item 6. Exhibits |
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(a) | The following exhibits are filed as part of this report. Exhibits previously filed are incorporated by reference, as noted. |
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| | Exhibit No. | | Exhibit |
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| | 31.1 | | Certificate Pursuant to 17 CFR 240.13a-14(a). |
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| | 31.2 | | Certificate Pursuant to 17 CFR 240.13a-14(a). |
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| | 32.1 | | Certificate Pursuant to 18 U.S.C. § 1350. |
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| | 32.2 | | Certificate Pursuant to 18 U.S.C. § 1350. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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| | | SOY ENERGY, LLC |
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Date: | September 14, 2009 | | /s/ Charles Sand |
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| | | Charles Sand |
| | | President and Chief Executive Officer |
| | | (Principal Executive Officer) |
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Date: | September 14, 2009 | | /s/ Dallas Thompson |
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| | | Dallas Thompson |
| | | Treasurer and Chief Financial Officer |
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